EXHIBIT 99.3
EXCHANGE AGENCY AGREEMENT
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March __, 0000
Xxxxx Xxxxx Xxxxxxxx Xxxx
xx Xxxxx Xxxxxxxx
000 Xxxxx Xxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxx, XX 00000-0000
Ladies and Gentlemen:
Integon Corporation, a Delaware Corporation (the "Company"), and Integon
Capital I, a Delaware statutory business trust (the "Trust"), propose to make an
offer (the "Exchange Offer") to exchange 10 3/4% Capital Securities, Series B of
the Trust, having a Liquidation Amount of $1,000 per security (the "Exchange
Capital Securities"), which have been registered under the Securities Act of
1933, as amended (the "Securities Act"), for a like aggregate Liquidation Amount
of outstanding 10 3/4% Capital Securities, Series A of the Trust, having a
Liquidation Amount of $1,000 per security (the "Outstanding Capital
Securities"). The terms and conditions of the Exchange Offer as currently
contemplated are set forth in a prospectus, dated ____________________, 1997
(the "Prospectus"), and in the related Letter of Transmittal, proposed to be
distributed to all record holders of Outstanding Capital Securities. The
Outstanding Capital Securities and the Exchange Capital Securities are
collectively referred to herein as the "Capital Securities."
The Company and the Trust hereby appoint First Union National Bank of
North Carolina ("First Union") to act as exchange agent (the "Exchange Agent")
in connection with the Exchange Offer. References hereinafter to "you" shall
refer to First Union.
The Exchange Offer is expected to be commenced by the Company and the
Trust on or about ___________________, 1997. The Letter of Transmittal
accompanying the Prospectus is to be used by the holders of Outstanding Capital
Securities to accept the Exchange Offer, and contains instructions with respect
to the delivery of certificates representing Outstanding Capital Securities
tendered in connection therewith.
The Exchange Offer shall expire at 5:00 P.M., New York City time, on
____________________, 1997 or on such later date or time to which the Company
and the Trust may extend the Exchange Offer (the "Expiration Date"). Subject to
the terms and conditions set forth in the Prospectus, the Company and the Trust
expressly reserve the right to extend the Exchange Offer from time to time and
may extend the Exchange Offer by giving oral (confirmed in writing) or written
notice to you before
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9:00 A.M., New York City time, on the business day following the previously
scheduled Expiration Date.
The Company and the Trust expressly reserve the right to amend or
terminate the Exchange Offer, and not to accept for exchange any Outstanding
Capital Securities not theretofore accepted for exchange, upon the occurrence of
any of the conditions of the Exchange Offer specified in the Prospectus under
the caption "Exchange Offer--Conditions to the Exchange Offer." The Company
and the Trust will give oral (confirmed in writing) or written notice of any
amendment, termination or nonacceptance to you as promptly as practicable.
In carrying out your duties as Exchange Agent, you are to act in
accordance with the following instructions:
1. You will perform such duties and only such duties as are
specifically set forth in the section of the Prospectus captioned "Exchange
Offer" or as specifically set forth herein; provided, however, that in no way
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will your general duty to act in good faith be discharged by the foregoing.
2. You will arrange with The Depository Trust Company (the "Book-Entry
Transfer Facility") for the establishment of an account or other procedures with
respect to the Outstanding Capital Securities at The Book-Entry Transfer
Facility for purposes of the Exchange Offer within two business days after the
date of the Prospectus, and any financial institution that is a participant in
the Book-Entry Transfer Facility's systems may make book-entry delivery of the
Outstanding Capital Securities by causing the Book-Entry Transfer Facility to
transfer such Outstanding Capital Securities into your account in accordance
with the Book-Entry Transfer Facility's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and
certificates representing Outstanding Capital Securities (or confirmation of
book-entry transfer into your account at the Book-Entry Transfer Facility) and
any other documents delivered or mailed to you by or for holders of Outstanding
Capital Securities and any book-entry confirmations received by you with respect
to Outstanding Capital Securities, to ascertain whether: (i) the Letters of
Transmittal and any such other documents are duly executed and properly
completed in accordance with the instructions set forth therein and that such
book-entry confirmations are in due and proper form and contain the information
required to be set forth therein, (ii) Outstanding Capital Securities have
otherwise been properly tendered, (iii) Outstanding Capital Securities are
tendered in aggregate liquidation amounts of $100,000 (100 Outstanding Capital
Securities) or any integral multiple of $1,000 in excess thereof and if any
Outstanding Capital Securities are tendered for exchange in part, the untendered
aggregate liquidation amount thereof is $100,000 (100 Outstanding Capital
Securities) or any integral multiple of $1,000 in excess thereof and (iv)
holders have provided their correct Tax Identification Number or
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required certification. Determination of all questions as to validity, form,
eligibility and acceptance for exchange of any Outstanding Capital Securities
shall be made by the Company or the Trust, whose determination shall be final
and binding. In each case where the Letter of Transmittal or any other document
has been improperly completed or executed or any of the certificates
representing Outstanding Capital Securities are not in proper form for transfer
or some other irregularity in connection with the acceptance of the Exchange
Offer exists, you will endeavor promptly to inform the presenters of the need
for fulfillment of all requirements and promptly to take any other action as may
be necessary or advisable to cause such irregularity to be corrected, and you
will promptly notify the Company and the Trust thereof.
4. With the approval of any of the Chairman, the Chief Executive
Officer, the President, any Vice President or the Secretary of the Company
(each, a "Designated Officer") or an Administrative Trustee of the Trust, or of
counsel to the Company or the Trust (such approval, if given orally, to be
confirmed in writing) or any other party designated by such a Designated Officer
or Administrative Trustee, you are authorized to waive any irregularities in
connection with any tender of Outstanding Capital Securities pursuant to the
Exchange Offer.
5. Tenders of Outstanding Capital Securities may be made only as set
forth in the Letter of Transmittal and in the section of the Prospectus
captioned "Exchange Offer--Procedures for Tendering Outstanding Capital
Securities," and Outstanding Capital Securities shall be considered properly
tendered to you only when tendered in accordance with the procedures set forth
therein.
Notwithstanding the provisions of this paragraph 5, Outstanding Capital
Securities that a Designated Officer or an Administrative Trustee of the Trust
shall approve as having been properly tendered shall be considered to be
properly tendered (such approval, if given orally, shall be confirmed in
writing).
6. You shall advise the Company and the Trust with respect to any
Outstanding Capital Securities received as soon as possible after 5:00 p.m. New
York City time on the Expiration Date and accept their instructions with respect
to disposition of such Outstanding Capital Securities.
7. You shall accept tenders:
(a) in cases where Outstanding Capital Securities are registered in
two or more names only if signed by all named holders;
(b) in cases where the signing person (as indicated on the Letter of
Transmittal) is acting in a fiduciary or a representative capacity only when
proper evidence of his or her authority so to act is submitted; and
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(c) from persons other than the registered holder of Outstanding
Capital Securities provided that customary transfer requirements, including
payment of any applicable transfer taxes, have been satisfied.
You shall accept partial tenders of Outstanding Capital Securities where
so indicated and as permitted in the Letter of Transmittal and deliver
certificates representing Outstanding Capital Securities to the transfer agent
for split-up and return any untendered Outstanding Capital Securities to the
holder (or such other person as may be designated in the Letter of Transmittal)
as promptly as practicable after expiration or termination of the Exchange
offer.
8. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Company or the Trust will notify you (such notice if given orally, to
be confirmed in writing) of its acceptance, promptly after the Expiration date,
of all Outstanding Capital Securities properly tendered and you, on behalf of
the Company and the Trust, will exchange such Outstanding Capital Securities for
Exchange Capital Securities and cause such Outstanding Capital Securities to be
canceled. Delivery of Exchange Capital Securities will be made on behalf of the
Trust by you at the rate of $1,000 aggregate liquidation amount of Exchange
Capital Securities for each $1,000 aggregate liquidation amount of Outstanding
Capital Securities tendered as soon as practicable after notice (such notice if
given orally, to be confirmed in writing) of acceptance of said Outstanding
Capital Securities by the Company and the Trust; provided, however, that in all
cases, Outstanding Capital Securities tendered pursuant to the Exchange Offer
will be exchanged only after timely receipt by you of certificates representing
such Outstanding Capital Securities (or confirmation of book-entry transfer into
your account at the Book-Entry Transfer Facility), a properly completed and duly
executed Letter of Transmittal (or facsimile thereof) with any required
signature guarantees and any other required documents. Unless otherwise
instructed by the Company and the Trust, you shall issue Exchange Capital
Securities only in denominations of $100,000 (100 Exchange Capital Securities)
or any integral multiple $1,000 in excess thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and upon the conditions set forth in the Prospectus and the
Letter of Transmittal, Outstanding Capital Securities tendered pursuant to the
Exchange Offer may be withdrawn at any time prior to the Expiration Date.
10. The Company and the Trust shall not be required to exchange any
Outstanding Capital Securities tendered if any of the conditions set forth in
the Exchange Offer are not met. Notice of any decision by the Company and the
Trust not to exchange any Outstanding Capital Securities tendered shall be given
(such notice if given orally, to be confirmed in writing) by the Company or the
Trust to you.
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11. If, pursuant to the Exchange Offer, the Company or the Trust do not
accept for exchange all or part of the Outstanding Capital Securities tendered
because of an invalid tender, the occurrence of certain other events set forth
in the Prospectus under the caption "Exchange Offer--Certain Conditions to the
Exchange Offer" or otherwise, you shall as soon as practicable after the
expiration or termination of the Exchange Offer return those certificates
representing unaccepted Outstanding Capital Securities (or effect appropriate
book-entry transfer), together with any related required documents and the
Letters of Transmittal relating thereto that are in your possession, to the
persons who deposited them.
12. All certificates representing reissued Outstanding Capital
Securities, unaccepted Outstanding Capital Securities or Exchange Capital
Securities shall be forwarded by (a) first-class certified mail, return receipt
requested under a blanket surety bond protecting you, the Company and the Trust
from loss or liability arising out of the non-receipt or non-delivery of such
certificates or (b) by registered mail insured separately for the replacement
value of each of such certificates.
13. You are not authorized to pay or offer to pay any concessions,
commissions or solicitation fees to any broker, dealer, bank or other persons or
to engage or utilize any person to solicit tenders.
14. As Exchange Agent hereunder you:
(a) shall have no duties or obligations other than those specifically
set forth herein or as may be subsequently agreed to in writing by you, the
Company and the Trust;
(b) will be regarded as making no representations and having no
responsibilities as to the validity, sufficiency, value or genuineness of any of
the certificates or the Outstanding Capital Securities represented thereby
deposited with you pursuant to the Exchange Offer, and will not be required to
and will make no representation as to the validity, value or genuineness of the
Exchange Offer; provided, however, that in no way will your general duty to act
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in good faith be discharged by the foregoing;
(c) shall not be obligated to take any legal action hereunder which
might in your reasonable judgment involve any expense or liability, unless you
shall have been furnished with reasonable indemnity;
(d) may reasonably rely on and shall be protected in acting in
reliance upon any certificate, instrument, opinion, notice, letter, telegram or
other document or security delivered to you and reasonably believed by you to be
genuine and to have been signed by the proper party or parties;
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(e) may reasonably act upon any tender, statement, request, comment,
agreement or other instrument whatsoever not only as to its due execution and
validity and effectiveness of its provisions, but also as to the truth and
accuracy of any information contained therein, which you shall in good faith
believe to be genuine or to have been signed or represented by a proper person
or persons;
(f) may rely on and shall be protected in acting upon written or oral
instructions from any Designated Officer or Administrative Trustee of the Trust;
(g) may consult with your counsel with respect to any questions
relating to your duties and responsibilities and the written opinion of such
independent counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted to be taken by you hereunder in
good faith and in accordance with the written opinion of such counsel; and
(h) shall not advise any person tendering Outstanding Capital
Securities pursuant to the Exchange Offer as to the wisdom of making such tender
or as to the market value or decline or appreciation in market value of any
Outstanding Capital Securities.
15. You shall take such action as may from time to time be requested by
the Company or the Trust or their respective counsel (and such other action as
you may reasonably deem appropriate) to furnish copies of the Prospectus, Letter
of Transmittal and the Notice of Guaranteed Delivery or such other forms as may
be approved from time to time by the Company or the Trust, to all persons
requesting such documents and to accept and comply with telephone requests for
information relating to the Exchange Offer, provided that such information shall
relate only to the procedures for accepting (or withdrawing from) the Exchange
Offer. The Company or the Trust will furnish you with copies of such documents
at your request.
16. You shall advise by cable, facsimile transmission or telephone, and
promptly thereafter confirm in writing to the Company and the Trust and such
other person or persons as they may request, daily (and more frequently during
the week immediately preceding the Expiration Date and if otherwise requested)
up to and including the Expiration Date, as to the number of Outstanding Capital
Securities that have been tendered pursuant to the Exchange Offer and the items
received by you pursuant to this Agreement, separately reporting and giving
cumulative totals as to items properly received and items improperly received.
In addition, you will also inform, and cooperate in making available to, the
Company, the Trust or any such other person or persons upon oral request made
from time to time prior to the Expiration Date such other information as it or
he or she reasonably requests. Such cooperation shall include, without
limitation, the granting by you to the Company and the Trust and such person as
the Company or the Trust may request of access to those
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persons on your staff who are responsible for receiving tenders, in order to
ensure that immediately prior to the Expiration Date the Company and the Trust
shall have received information in sufficient detail to enable them to decide
whether to extend the Exchange Offer. You shall prepare a final list of all
persons whose tenders were accepted, the aggregate liquidation amount of
Outstanding Capital Securities tendered and the aggregate liquidation amount of
Outstanding Capital Securities accepted and you shall deliver said list to the
Company and the Trust.
17. Letters of Transmittal, book-entry confirmations and Notices of
Guaranteed Delivery shall be stamped by you as to the date and the time of
receipt thereof and shall be preserved by you for a period of time at least
equal to the period of time you preserve other records pertaining to the
transfer of securities, or one year, whichever is longer, and thereafter shall
be delivered by you to the Company and the Trust. You shall dispose of unused
Letters of Transmittal and other surplus materials by returning them to the
Company or the Trust.
18. You hereby expressly waive any lien, encumbrance or right of set-off
whatsoever that you may have with respect to funds deposited with you for the
payment of transfer taxes by reasons of amounts, if any, borrowed by the Company
or the Trust, or any of their subsidiaries or affiliates pursuant to any loan or
credit agreement with you or for compensation owed to you hereunder or for any
other matter.
19. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation as set forth on Schedule 1 attached hereto.
20. You hereby acknowledge receipt of the Prospectus and the Letter of
Transmittal and further acknowledge that you have examined each of them. Any
inconsistency between this Agreement, on the one hand, and the Prospectus and
the Letter of Transmittal (as they may be amended from time to time), on the
other hand, shall be resolved in favor of the latter two documents, except with
respect to the duties, liabilities and indemnification of you as Exchange Agent
which shall be controlled by this Agreement.
21. The Company and the Trust covenant and agree to indemnify and hold
you in your capacity as Exchange Agent hereunder harmless against any loss,
liability, cost or expense, including reasonable attorneys' fees arising out of
or in connection with any act, omission, delay or refusal made by you in
reasonable reliance upon any signature, endorsement, assignment, certificate,
order, request, notice, instruction or other instrument or document reasonably
believed by you to be valid, genuine and sufficient and in accepting any tender
or effecting any transfer of Outstanding Capital Securities reasonably believed
by you in good faith to be authorized, and in delaying or refusing in good faith
to accept any tenders or effect any transfer of Outstanding Capital Securities;
provided, however, that the Company and the Trust shall not be liable for
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indemnification or otherwise for any loss, liabil-
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ity, cost or expense to the extent arising out of your gross negligence, willful
misconduct or bad faith. In no case shall the Company or the Trust be liable
under this indemnity with respect to any claim against you unless the Company
and the Trust shall be notified by you, by letter or cable or by facsimile
confirmed by letter, of the written assertion of a claim against you or of any
other action commenced against you, promptly after you shall have received any
such written assertion or shall have been served with a summons in connection
therewith. In addition, the Company and the Trust shall not be liable for any
loss, liability, cost or expense resulting from a settlement entered into
without their consent. The Company and the Trust shall be entitled to
participate at their own expense in the defense of any such claim or other
action, and, if the Company or the Trust so elect, the Company and/or the Trust
shall assume the defense of any suit brought to enforce any such claim. In the
event that the Company and/or the Trust shall assume the defense of any such
suit, the Company and the Trust shall not be liable for the fees and expenses of
any additional counsel thereafter retained by you, so long as the Company and
the Trust shall retain counsel reasonably satisfactory to you to defend such
suit.
22. You shall arrange to comply with all requirements under the tax laws
of the United States, including those relating to missing Tax Identification
Numbers, and shall file any appropriate reports with the Internal Revenue
Service. The Company and the Trust understand that you are required to deduct
31% on payments to holders who have not supplied their correct Taxpayer
Identification Number or required certification. Such funds will be turned over
to the Internal Revenue Service in accordance with applicable regulations.
23. You shall deliver or cause to be delivered, in a timely manner to
each governmental authority to which any transfer taxes are payable in respect
of the exchange of Outstanding Capital Securities, your check in the amount of
all transfer taxes so payable, and the Company and the Trust shall reimburse you
for the amount of any and all transfer taxes payable in respect of the exchange
of Outstanding Capital Securities; provided, however, that you shall reimburse
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the Company or the Trust for amounts refunded to you in respect of your payment
of any such transfer taxes, at such time as such refund is received by you.
24. This Agreement and your appointment as Exchange Agent hereunder
shall be construed and enforced in accordance with the laws of the State of New
York applicable to agreements made and to be performed entirely within such
state, and shall inure to the benefit of, and the obligations created hereby
shall be binding upon, the successors and assigns of each of the parties hereto.
25. This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
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26. In case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
27. This Agreement shall not be deemed or construed to be modified,
amended, rescinded, canceled or waived, in whole or in part, except by a written
instrument signed by a duly authorized representative of the party to be
charged. This Agreement may not be modified orally.
28. Unless otherwise provided herein, all notices, requests and other
communications to any party hereunder shall be in writing (including telecopy or
similar writing) and shall be given to such party, addressed to it, at its
address or telecopy number set forth below:
If to the Trust:
c/o Integon Corporation
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx-Xxxxx, Xxxxx Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
If to the Company:
Integon Corporation
000 Xxxx Xxxxx Xxxxxx
Xxxxxxx-Xxxxx, Xxxxx Xxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: General Counsel
If to the Exchange Agent:
First Union National Bank of North Carolina
000 Xxxxx Xxxxx Xxxxxx
0xx Xxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxx
29. Unless terminated earlier by the parties hereto, this Agreement
shall terminate 90 days following the Expiration Date. Notwithstanding the
foregoing, Paragraphs 19, 21 and 23 shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall promptly deliver to
the Company or the Trust any certificates, funds or property then held by you as
Exchange Agent under this Agreement.
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30. This Agreement shall be binding and effective as of the date hereof.
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Please acknowledge receipt of this Agreement and confirm the arrangements
herein provided by signing and returning the enclosed copy.
INTEGON CAPITAL I
By:_________________________________
Name:
Title: Administrative Trustee
INTEGON CORPORATION
By:_________________________________
Name:
Title:
Accepted as of the date
first above written.
FIRST UNION NATIONAL BANK
OF NORTH CAROLINA
By:______________________________
Name:
Title:
Attested By:
_________________________________
Name:
Title:
Schedule 1
FEE SCHEDULE
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Pursuant to Paragraph NINETEEN of the Exchange Agency Agreement, the fee for
the Exchange Agent is $2,000 plus out-of-pocket expenses.