EXECUTION COPY
5,000,000 NON-CUMULATIVE PERPETUAL PREFERRED SHARES
SCOTTISH RE GROUP LIMITED
UNDERWRITING AGREEMENT
June 28, 2005
XXXXXX BROTHERS INC.
As Representative of the
several underwriters named in Schedule I hereto
c/x XXXXXX BROTHERS INC.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
Scottish Re Group Limited, an exempted company limited by shares
organized and existing under the laws of the Cayman Islands (the "Company"),
proposes to issue and sell to you and the other underwriters named in Schedule I
hereto (the "Underwriters"), for whom you are acting as representative (the
"Representative"), of the Company's Non-Cumulative Perpetual Preferred Shares,
par value $0.01 per share to be issued on the terms set out in the Certificate
of Designations as authorized by the resolutions of Pricing Committee of the
Company dated June 28, 2005 and the resolutions of the Board of Directors dated
June 16, 2005 (the "Perpetual Preferred Shares"), the number of Perpetual
Preferred Shares identified in Schedule I hereto (the "Firm Stock"). In
addition, the Company proposes to grant to the Underwriters an option to
purchase up to an additional 750,000 Perpetual Preferred Shares on the terms and
for the purposes set forth in Section 2(b) (the "Option Stock"). The Firm Stock
and the Option Stock, if purchased, are hereinafter collectively called the
"Preferred Stock". This is to confirm the agreement concerning the purchase of
the Preferred Stock from the Company by the Underwriters named in Schedule I
hereto.
SECTION 1. Representations and Warranties. The Company represents and
warrants to each Underwriter that:
(a) The Company meets the requirements for the use of Form S-3 under
the Securities Act of 1933, as amended (the "Securities Act"), and the rules and
regulations promulgated thereunder (the "Rules"), and has prepared and filed
with the Securities and Exchange Commission (the "Commission") a registration
statement on Form S-3 (file number 333-113030), for the registration of the
Preferred Stock under the Securities Act, which Registration Statement (as
defined below) has become effective and no stop order suspending the
effectiveness of the Registration Statement has been issued under the Securities
Act and no proceedings for that purpose have been instituted or are pending or,
to its knowledge, are threatened by the Commission, and any request by the
Commission
for additional information has been complied with. The Registration
Statement meets the requirements set forth in Rule 415(a)(1)(x) under the
Securities Act and complies in all other material respects with such rule. The
Company proposes to file with the Commission pursuant to Rule 424 under the
Securities Act ("Rule 424") a supplement to the form of prospectus included in
the registration statement relating to the initial offering of the Preferred
Stock and the plan of distribution thereof and has previously advised you of all
further information (financial and other) with respect to the Company to be set
forth therein. The term "Registration Statement" means the registration
statement, as amended at the date of this Agreement, including the exhibits
thereto, financial statements, and all documents incorporated therein by
reference pursuant to Form S-3 (the "Incorporated Documents"), and such
prospectus as then amended, including the Incorporated Documents, is hereinafter
referred to as the "Basic Prospectus"; such supplemented form of prospectus with
respect to the offering of the Preferred Stock, in the form in which it shall be
filed with the Commission pursuant to Rule 424 (including the Basic Prospectus
as so supplemented), is hereinafter called the "Final Prospectus". Any
preliminary form of the Final Prospectus which has heretofore been filed
pursuant to Rule 424 is hereinafter called an "Interim Prospectus". Any
reference herein to the Registration Statement, the Basic Prospectus, any
Interim Prospectus or the Final Prospectus shall be deemed to refer to and
include the Incorporated Documents which were filed under the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Commission promulgated thereunder (the "Exchange Act"), on or before the date of
this Agreement or the issue date of the Basic Prospectus, any Interim Prospectus
or the Final Prospectus, as the case may be; and any reference herein to the
terms "amend", "amendment" or "supplement" with respect to the Registration
Statement, the Basic Prospectus, any Interim Prospectus or the Final Prospectus
shall be deemed to refer to and include the filing of any Incorporated Documents
under the Exchange Act after the date of this Agreement or the issue date of the
Basic Prospectus, any Interim Prospectus or the Final Prospectus, as the case
may be, and deemed to be incorporated therein by reference. Copies of the
Registration Statement and each of the amendments thereto have been delivered by
the Company to you as Representative of the Underwriters. If the Company has
filed an abbreviated registration statement to register additional shares of
Preferred Stock pursuant to Rule 462(b) under the Securities Act (the "Rule 462
Registration Statement"), then any reference herein to the term "Registration
Statement" shall be deemed to include such Rule 462 Registration Statement. The
Commission has not issued any order preventing or suspending the use of any
Interim Prospectus.
(b) As of the date hereof, when the Final Prospectus is first filed
with the Commission pursuant to Rule 424, when, before the Delivery Date
(hereinafter defined), any amendment to the Registration Statement becomes
effective, when, before the Delivery Date, any Incorporated Document is filed
with the Commission, when any supplement to the Final Prospectus is filed with
the Commission and at the Delivery Date, the Registration Statement, the Final
Prospectus and any such amendment or supplement will comply in all material
respects with the applicable requirements of the Securities Act and the Rules,
and the Incorporated Documents will comply in all material respects with the
requirements of the Exchange Act, or the Securities Act and the Rules,
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as applicable, and on the date it became effective, the Registration Statement
did not, and, on the date that any post-effective amendment to the Registration
Statement becomes effective, the Registration Statement as amended by such
post-effective amendment did not or will not, as the case may be, contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading; on
the date the Final Prospectus is filed with the Commission pursuant to Rule 424
and on the Delivery Date, the Final Prospectus, as it may be amended or
supplemented, will not include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they are made, not misleading; and on
said dates, the Incorporated Documents will comply in all material respects with
the applicable provisions of the Exchange Act, and, when read together with the
Final Prospectus, or the Final Prospectus as it may be then amended or
supplemented, will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading; provided that the foregoing representations and warranties in this
paragraph (b) shall not apply to statements or omissions made in reliance upon
and in conformity with written information furnished to the Company by or
through the Representative on behalf of any Underwriter specifically for use in
connection with the preparation of the Registration Statement, any Interim
Prospectus or the Final Prospectus, as they may be amended or supplemented.
(c) The only subsidiaries (as defined in Rule 405 of the Securities
Act) of the Company (each, a "Subsidiary") are those listed on Schedule II
attached hereto. Each of the Company and the Subsidiaries has been duly
organized and is validly existing as a corporation or a company limited by
shares in good standing under the laws of its jurisdiction of incorporation.
Each of the Company and the Subsidiaries is duly qualified to do business and is
in good standing as a foreign corporation in each jurisdiction in which the
character or location of its properties (owned, leased or licensed) or the
nature or conduct of its business makes such qualification necessary, except for
those failures to be so qualified or in good standing which will not in the
aggregate have a material adverse effect on the condition (financial or
otherwise), results of operations, business, properties or prospects of the
Company and the Subsidiaries taken as a whole (a "Material Adverse Effect").
Each of the Company and the Subsidiaries has all requisite power and authority,
and all necessary consents, approvals, authorizations, orders, registrations,
qualifications, licenses and permits (collectively, the "Consents") of and from
all public, regulatory or governmental agencies and bodies, to own, lease and
operate its properties and conduct its business as now being conducted and as
described in the Registration Statement and Final Prospectus, with such
exceptions as would not have, individually or in the aggregate, a Material
Adverse Effect. No Consent contains a materially burdensome restriction on the
operations of the Company or its Subsidiaries not adequately disclosed in the
Registration Statement and Final Prospectus.
(d) Each of the Company and the Subsidiaries which is engaged in the
business of insurance or reinsurance (each, an "Insurance Subsidiary" and
together, the
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"Insurance Subsidiaries") holds such insurance license, certificates and permits
from governmental authorities (including, without limitation, from the insurance
regulatory agencies of the various jurisdictions where it conducts business)
(the "Insurance Licenses") as are necessary to the conduct of its business as
described in the Final Prospectus; the Company and each Insurance Subsidiary
have fulfilled and performed all obligations necessary to maintain the Insurance
Licenses; there is no pending or, to the knowledge of the Company, threatened
action, suit, proceeding or investigation that could reasonably be expected to
result in the revocation, termination, suspension or limitation of any Insurance
License or otherwise impose any limitation on the conduct of any Insurance
Subsidiary; and no insurance regulatory agency or body has issued or commenced
any proceeding for the issuance of, any order or decree impairing, restricting
or prohibiting the payment of dividends or the making of any loan by any
Subsidiary to its parent. Except as otherwise described in the Final Prospectus,
none of the Insurance Subsidiaries has received any notification from any
applicable regulatory authority to the effect that any additional Insurance
Licenses from such regulatory authority are needed to be obtained by such
Insurance Subsidiary in any case where it could be reasonably expected that (i)
any Insurance Subsidiary would in fact be required either to obtain any such
additional Insurance Licenses or cease or otherwise limit engaging in certain
business and (ii) the failure to have such Insurance Licenses or limiting such
business would have, individually or in the aggregate, a Material Adverse
Effect. Each of the Company and its Insurance Subsidiaries is in compliance with
all applicable insurance laws, rules, regulations, orders, bylaws and similar
requirements which are applicable to it, and has filed all notices, reports,
documents or other information required to be filed thereunder, in each case
with such exceptions as would not have, individually or in the aggregate, a
Material Adverse Effect.
(e) All reinsurance treaties and arrangements to which the Company or
any Subsidiary is a party as a cedant are in full force and effect; neither the
Company nor any Subsidiary is in material violation of or in material default in
the performance, observance or fulfillment of any obligation, agreement,
covenant or condition contained therein; neither the Company nor any Subsidiary
has received any notice from any other party to such treaties or arrangements
that such other party intends not to perform such treaty; and, to the best
knowledge of the Company and the Subsidiaries, the Company and the Subsidiaries
have no reason to believe that any other party to such treaties or arrangements
will be unable to perform such treaty or arrangement except to the extent
adequately and properly reserved for in the consolidated financial statements of
the Company included in the Final Prospectus.
(f) The Company has the authorized capital as set forth in the Final
Prospectus. All of the issued shares of capital stock of the Company have been
duly and validly authorized and issued, are fully paid and non-assessable and
have not been issued in violation of or subject to any preemptive or similar
rights that entitle or will entitle any person to acquire any such share capital
or any security convertible, exchangeable or exercisable into such share capital
from the Company upon issuance or sale by the Company of Preferred Stock in the
Offering, except for such rights as may have been
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fully satisfied or waived prior to the effectiveness of the Registration
Statement. All of the issued share capital of each Subsidiary has been duly and
validly authorized and issued and is fully paid and non-assessable and, except
for 5% of the outstanding capital stock of Scottish Re Life Corporation
(formerly ERC Life Reinsurance Corporation), is owned directly or indirectly by
the Company, free and clear of all liens, encumbrances, equities or claims.
(g) The shares of Preferred Stock have been duly and validly authorized
and, when delivered by the Company in accordance with this Agreement, will be
duly and validly issued, fully paid as to their stated price of $25 per share,
and non-assessable and will not have been issued in violation of or subject to
any preemptive or similar rights that entitle or will entitle any person to
acquire any shares of Preferred Stock to be issued in connection therewith from
the Company upon issuance thereof by the Company. The Preferred Stock conforms
to the descriptions thereof contained in the Final Prospectus. Upon payment for
the shares of Preferred Stock to be sold by the Company on the Delivery Date
pursuant to this Agreement, and the crediting of such shares of Preferred Stock
on the records of the Depository Trust Company ("DTC") to securities accounts in
the name of the Underwriters, (A) DTC shall be a "protected purchaser" (within
the meaning of Section 8-303 of the Uniform Commercial Code as in effect in the
State of New York (the "Code")), (B) the Underwriters will acquire a valid
"security entitlement" (within the meaning of Section 8-501 of the Code) in
respect of such Preferred Stock and (C) no action based on any "adverse claim"
(within the meaning of Section 8-102 of the Code) to such Preferred Stock may be
asserted against the Underwriters with respect to such security entitlement (it
being assumed that for the purposes of this representation and warranty that
when such payment, delivery and crediting occur, (x) such shares of Preferred
Stock will have been registered in the name of Cede & Co. or another nominee
designated by DTC, in each case on the Company's share registry in accordance
with its certificate of incorporation, by-laws and applicable law, (y) DTC will
be registered as a "clearing corporation" within the meaning of Section 8-102 of
the Code and (z) appropriate entries to the account(s) of the Underwriters on
the records of DTC will have been made pursuant to the Code).
(h) Each of this Agreement and the Remarketing Agreement, to be dated
as of the Delivery Date, between the Company and Xxxxxx Brothers Inc., as
Remarketing Agent (the "Remarketing Agreement") has been duly authorized,
executed and delivered by the Company.
(i) The issue and sale of the shares of Preferred Stock being delivered
on the Delivery Date by the Company pursuant to this Agreement and the
execution, delivery and performance of this Agreement and the Remarketing
Agreement by the Company and the consummation of the transactions contemplated
hereby will not (i) conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default (or an event which with
notice or lapse of time, or both, would constitute a default) under, or result
in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any Subsidiary pursuant to any indenture,
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mortgage, deed of trust, loan agreement or other agreement, instrument,
franchise, license or permit to which the Company or any Subsidiary is a party
or by which the Company or any Subsidiary or their respective properties or
assets may be bound or to which any of the property or assets of the Company or
any Subsidiary is subject or give the holder of any of the notes, debentures, or
other evidence of indebtedness of the Company or any Subsidiary the right to
require repurchase, redemption or repayment of all or a portion of such
indebtedness by the Company or any Subsidiary, or result in the creation or
imposition of any lien, charge or encumbrance upon any of the assets, properties
or operations of the Company or any Subsidiary or (ii) violate or conflict with
any provision of the memorandum of association, articles of association,
certificate or articles of incorporation, charter, by-laws or other
organizational documents of the Company or any Subsidiary or any judgment,
decree, order, statute, rule or regulation of any court or any public,
governmental or regulatory agency or body having jurisdiction over the Company
or any Subsidiary or any of their respective properties, operations or assets.
No consent, approval, authorization, order, registration, filing, qualification,
license or permit of or with any court or any public, governmental or regulatory
agency or body having jurisdiction over the Company or any Subsidiary or any of
their respective properties or assets is required to be made or obtained by the
Company for the execution, delivery and performance of this Agreement or the
Remarketing Agreement or the consummation of the transactions contemplated
hereby or thereby, by the Registration Statement and by the Final Prospectus,
including the issuance, sale and delivery of the Preferred Stock to be issued,
sold and delivered by the Company hereunder, except (A) the registration of the
Preferred Stock under the Securities Act and the Exchange Act, and (B) such
consents, approvals, authorizations, orders, registrations, filings,
qualifications, licenses and permits as may be required under the Exchange Act,
applicable state securities, Blue Sky or insurance securities laws or the rules
of the National Association of Securities Dealers, Inc. (the "NASD") in
connection with the purchase and distribution of the Preferred Stock by the
Underwriters.
(j) Neither the Company nor any Subsidiary has sustained, since the
date of the latest audited financial statements included in the Final
Prospectus, any loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise than as set
forth or contemplated in the Final Prospectus, except for such losses or
interferences as would not have, individually or in the aggregate, a Material
Adverse Effect; and, subsequent to the respective dates as of which information
is given in the Registration Statement and Final Prospectus, except as set forth
in the Registration Statement and Final Prospectus, there has been no material
adverse change or any development involving a prospective material adverse
change in (i) the general affairs, business, management, prospects, properties,
operations, condition (financial or other), surplus, reserves, stockholders'
equity or results of operations (in each case considered either on a statutory
or U.S. generally accepted accounting principles ("GAAP") basis, as applicable)
of the Company and its Subsidiaries, taken as a whole, otherwise than as set
forth or contemplated in the Final Prospectus; (ii) the share capital or
long-term debt of the Company; or (iii) the offering or the delivery of the
Preferred
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Stock being delivered on the Delivery Date on the terms and in the manner
contemplated in the Final Prospectus, whether or not arising from transactions
in the ordinary course of business, and since the date of the latest balance
sheet presented in the Registration Statement and Final Prospectus, neither the
Company nor any Subsidiary has incurred or undertaken any liabilities or
obligations, direct or contingent, or entered into any transactions which are
material to the Company and the Subsidiaries taken as a whole, except for
liabilities or obligations which are reflected in the Registration Statement and
Final Prospectus.
(k) The financial statements of the Company, including the notes
thereto, and supporting schedules included in the Registration Statement and the
Final Prospectus present fairly in all material respects the financial position
of the Company and its consolidated subsidiaries and the other entities for
which financial statements are included in the Registration Statement and Final
Prospectus as of the dates indicated and condition and results of operations for
the periods specified; except as otherwise stated in the Registration Statement,
said financial statements have been prepared in conformity with GAAP in all
material respects applied on a consistent basis throughout the periods involved,
and the supporting schedules included in the Registration Statement present
fairly in all material respects the information required to be stated therein.
No other financial statements or supporting schedules are required to be
included in the Registration Statement or Final Prospectus. The other financial
and statistical information and data relating to the Company and its
consolidated subsidiaries included in the Registration Statement and Final
Prospectus present fairly in all material respects the information included
therein and have been prepared on a basis consistent with that of the financial
statements included in the Registration Statement and Final Prospectus and the
books and records of the respective entities presented therein.
(l) The statutory annual and quarterly statements of each of the
Insurance Subsidiaries required to prepare such statements and the statutory
balance sheets and income statements included in such statutory annual and
quarterly statements, most recently filed in their domiciliary jurisdictions,
together with related schedules and notes, have been prepared, in all material
respects, in conformity with statutory accounting principles or practices
required or permitted by the appropriate insurance department of the
jurisdiction of domicile of each such Insurance Subsidiary, and such statutory
accounting practices have been applied on a consistent basis throughout the
periods involved, except as may otherwise be indicated therein or in the notes
thereto, and present fairly, in all material respects, the statutory financial
position of each such Insurance Subsidiary as of the dates thereof, and the
statutory basis results of operations of each such Insurance Subsidiary for the
periods covered thereby.
(m) Ernst & Young LLP, who have certified certain of the financial
statements of the Company and management's assessment of the effectiveness of
internal control over financial reporting as of December 31, 2004, whose reports
appear in the Final Prospectus and who have delivered the letters referred to in
paragraphs (g) and (h) of
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Section 7, are independent public accountants as required by the Securities Act,
the Exchange Act and the Rules.
(n) Any real property and buildings held under lease or sublease by the
Company and any Subsidiary are held by them under valid, subsisting and
enforceable leases, with such exceptions as would not have, individually or in
the aggregate, a Material Adverse Effect and do not interfere with the use made
and proposed to be made of such property and buildings by the Company and any
Subsidiary. Neither the Company nor any Subsidiary has received any notice of
any claim adverse to their ownership of any real or personal property or of any
claim against the continued possession of any real property, whether owned or
held under lease or sublease by the Company or any Subsidiary.
(o) Each of the Company and the Subsidiaries owns or possesses adequate
rights to use all patents, patent applications, trademarks, service marks, trade
names, trademark registrations, service xxxx registrations, copyrights,
licenses, formulae, customer lists, and know-how and other intellectual property
(including trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) necessary for the conduct of
their respective businesses as being conducted and as described in the
Registration Statement and Final Prospectus and have no reason to believe that
the conduct of their respective businesses will conflict with, and have not
received any notice of any claim of conflict with, any such right of others,
which claim, if the subject of an unfavorable decision, ruling or finding, could
reasonably be expected to result in a Material Adverse Effect. To the best of
the Company's knowledge, all material technical information developed by and
belonging to the Company which has not been patented has been kept confidential.
Neither the Company nor any Subsidiary has granted or assigned to any other
person or entity any right to manufacture, have manufactured, assemble or sell
the current products and services of the Company or those products and services
described in the Registration Statement and Final Prospectus.
(p) Except as described in the Registration Statement and Final
Prospectus, there is no judicial, regulatory, arbitral or other legal or
governmental proceeding or other litigation, or arbitration, including routine
litigation, to which the Company or any Subsidiary is a party or of which any
property or assets of the Company or any Subsidiary is the subject which, if
determined adversely to the Company or any Subsidiary, would, individually or in
the aggregate, have a Material Adverse Effect, and to the knowledge of the
Company, no such proceeding is threatened or contemplated by governmental
authorities or threatened or contemplated by others.
(q) There are no contracts or other documents which are required to be
described in the Final Prospectus or filed as exhibits to the Registration
Statement by the Securities Act or by the Rules which have not been described in
the Final Prospectus or filed as exhibits to the Registration Statement.
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(r) Neither the Company nor any Subsidiary (i) is in violation of its
memorandum or articles of association, certificate or articles of incorporation,
charter or by-laws or similar organizational documents, (ii) is in default (and
no event has occurred which, with notice or lapse of time or both, would
constitute such a default) under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of the Company or any
Subsidiary pursuant to, any indenture, mortgage, deed of trust, loan agreement,
lease or other agreement or instrument to which it is a party or by which it is
bound or to which any of its property or assets is subject or (iii) is in
violation in any respect of any statute or any judgment, decree, order, rule or
regulation of any court or governmental or regulatory agency or body having
jurisdiction over the Company or any Subsidiary or any of their properties or
assets, except in the case of (ii) or (iii), any violation or default that would
not have a Material Adverse Effect.
(s) Neither of the Company nor any Subsidiary is, nor as of the
Delivery Date will be, an "investment company" as defined in the Investment
Company Act of 1940, as amended (the "Investment Company Act").
(t) The Company has established and maintains disclosure controls and
procedures (as such term is defined in Rule 13a-15 and 15d-15 under the Exchange
Act) that (i) are designed to ensure that material information relating to the
Company, including its consolidated subsidiaries, is made known to the Company's
Chief Executive Officer and its Chief Financial Officer by others within those
entities, particularly during the periods in which the filings made by the
Company with the Commission which it may make under Section 13(a), 13(c), 14 or
15(d) of the Exchange Act are being prepared, (ii) have been evaluated for
effectiveness as of the end of the Company's most recent fiscal quarter and
(iii) are effective to perform the functions for which they were established.
(u) The Company (x) maintains systems of internal controls and
processes sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general and specific authorizations;
(ii) transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain asset accountability; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences; and (y) except as disclosed in the Registration Statement and Final
Prospectus, there has been no material weakness in internal controls since
December 31, 2004 and there have been no significant changes in internal
controls or other factors that could materially affect internal controls
subsequent to December 31, 2004, except for corrective actions with respect to
(i) any such material weaknesses so disclosed, or (ii) any significant
deficiencies identified by the Company prior to the date of this Agreement that
would not have a Material Adverse Effect.
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(v) The Company is not aware of any threatened or pending downgrading
of any Insurance Subsidiary's financial strength rating from A.M. Best Company,
Inc., Standard & Poor's Rating Services, Inc., Xxxxx'x Investor Services or
Fitch Ratings.
(w) The Company has filed or will file with the Bermuda Registrar of
Companies, as promptly as practicable after the date hereof, the Final
Prospectus, executed as required by and in accordance with all other
requirements for such filing under the Bermuda Companies Act of 1981.
(x) Except as disclosed in the Registration Statement and Final
Prospectus, no holder of securities of the Company has any rights to the
registration of securities of the Company because of the filing of the
Registration Statement or otherwise in connection with the sale of the Preferred
Stock contemplated hereby, and any such rights so disclosed have been
effectively waived by the holders thereof.
SECTION 2. Purchase of the Preferred Stock by the Underwriters;
Over-Allotment Option.
(a) On the basis of the representations and warranties contained in,
and subject to the terms and conditions of, this Agreement, the Company agrees
to sell 5,000,000 shares of the Firm Stock to the several Underwriters and each
of the Underwriters, severally and not jointly, agrees to purchase the number of
shares of the Firm Stock set forth opposite that Underwriter's name in Schedule
I hereto. The respective purchase obligations of the Underwriters with respect
to the Firm Stock shall be rounded among the Underwriters to avoid fractional
shares, as the Representative may determine.
(b) In addition, the Company grants to the Underwriters an option to
purchase up to 750,000 shares of Option Stock. Such option is granted for the
purpose of covering over-allotments in the sale of Firm Stock and is exercisable
as provided in Section 4 hereof. Shares of Option Stock shall be purchased
severally for the account of the Underwriters in proportion to the number of
shares of Firm Stock set forth opposite the name of such Underwriters in
Schedule I hereto. The respective purchase obligation of each Underwriter with
respect to the Option Stock shall be adjusted by the Representative so that no
Underwriter shall be obligated to purchase Option Stock other than in 100 share
amounts.
(c) The price of both the Firm Stock and any Option Stock shall be
$24.2125 per share, except that the price of both the Firm Stock and any Option
Stock shall be $24.5 per share when sold by the Underwriters to certain
institutions as agreed by the Company and the Representative.
SECTION 3. Offering of Preferred Stock by the Underwriters. Upon
authorization by the Representative of the release of the Firm Stock, the
several Underwriters propose to offer the Firm Stock for sale upon the terms and
conditions set forth in the Final Prospectus and in Annex I.
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SECTION 4. Delivery of and Payment for the Preferred Stock.
(a) The Preferred Stock to be purchased by each of the Underwriters
hereunder will be represented by one or more definitive global certificates in
book-entry form which will be deposited by or on behalf of the Company with The
Depository Trust Company ("DTC") or its designated custodian. The Company will
deliver the Preferred Stock to Xxxxxx Brothers Inc., for the account of each
Underwriter, against payment by or on behalf of such Underwriter of the purchase
price therefor by wire transfer in immediately available funds, by causing DTC
to credit the Preferred Stock to the account of Xxxxxx Brothers Inc. at DTC.
(b) Delivery of the Firm Stock shall be made at the offices of Xxxxxxxx
& Xxxxxxxx LLP, 000 Xxxxx Xxxxxx, at 10:00 A.M., New York City time, on the
fifth full business day following the date of this Agreement or at such other
date or place as shall be determined by agreement between the Representative and
the Company. This date and time are sometimes referred to as the "First Delivery
Date." On the First Delivery Date, the Company shall deliver or cause to be
delivered certificates representing the Firm Stock to the Representative for the
account of each Underwriter against payment to or upon the order of the Company
of the purchase price by wire transfer in immediately available funds. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Firm Stock shall be registered in such names and
in such denominations as the Representative shall request in writing not less
than two full business days prior to the First Delivery Date. For the purpose of
expediting the checking and packaging of the certificates for the Firm Stock,
the Company shall make the certificates representing the Firm Stock available
for inspection by the Representative in New York, New York, not later than 2:00
P.M., New York City time, on the business day prior to the First Delivery Date.
The option granted in Section 2 will expire 30 days after the date of this
Agreement and may be exercised in whole or in part from time to time by written
notice being given to the Company by the Representative. Such notice shall set
forth the aggregate number of shares of Option Stock as to which the option is
being exercised, the names in which the shares of Option Stock are to be
registered, the denominations in which the shares of Option Stock are to be
issued and the date and time, as determined by the Representative, when the
shares of Option Stock are to be delivered; provided, however, that this date
and time shall not be earlier than the First Delivery Date nor earlier than the
third business day after the date on which the option shall have been exercised
nor later than the fifth business day after the date on which the option shall
have been exercised. The date and time the shares of Option Stock are delivered
are sometimes referred to as a "Second Delivery Date" and the Delivery Date and
any Second Delivery Date are sometimes each referred to as a "Delivery Date".
(c) Delivery of and payment for the Option Stock shall be made at the
place specified in the first sentence of the first paragraph of this Section 4
(or at such other place as shall be determined by agreement between the
Representative and the Company) at 10:00 A.M., New York City time, on such
Second Delivery Date. On such Second
11
Delivery Date, the Company shall deliver or cause to be delivered the
certificates representing the Option Stock to the Representative for the account
of each Underwriter against payment to or upon the order of the Company of the
purchase price by wire transfer in immediately available funds. Time shall be of
the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Option Stock shall be registered in such names and
in such denominations as the Representative shall request in the aforesaid
written notice. For the purpose of expediting the checking and packaging of the
certificates for the Option Stock, the Company shall make the certificates
representing the Option Stock available for inspection by the Representative in
New York, New York, not later than 2:00 P.M., New York City time, on the
business day prior to such Second Delivery Date.
SECTION 5. Further Agreements of the Company. The Company covenants and
agrees:
(a) To prepare the Final Prospectus in a form approved by the
Representative and to file the Final Prospectus pursuant to Rule 424(b) under
the Securities Act not later than the Commission's close of business on the
second business day following the execution and delivery of this Agreement or,
if applicable, such earlier time as may be required by Rule 430A(a)(3) under the
Securities Act; to make no further amendment or any supplement to the
Registration Statement or to the Final Prospectus except as permitted herein; to
advise the Representative, promptly after it receives notice thereof, of the
time when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Final Prospectus or any amended Final
Prospectus has been filed and to furnish the Representative with copies thereof;
to advise the Representative, promptly after it receives notice thereof, of the
issuance by the Commission of any stop order or of any order preventing or
suspending the use of any Interim Prospectus or the Final Prospectus, of the
suspension of the qualification of the Preferred Stock for offering or sale in
any jurisdiction, of the initiation or threatening of any proceeding for any
such purpose, or of any request by the Commission for the amending or
supplementing of the Registration Statement or Final Prospectus or for
additional information; and, in the event of the issuance of any stop order or
of any order preventing or suspending the use of any Basic Prospectus, Interim
Prospectus or the Final Prospectus or suspending any such qualification, to use
promptly its best efforts to obtain its withdrawal;
(b) To furnish promptly to each of the Representative and to counsel
for the Underwriters a signed copy of the Registration Statement as originally
filed with the Commission, and each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith;
(c) To deliver promptly to the Representative such number of the
following documents as the Representative shall reasonably request: (i)
conformed copies of the Registration Statement as originally filed with the
Commission and each amendment
12
thereto (in each case excluding exhibits) and (ii) each Interim Prospectus, the
Final Prospectus and any amended or supplemented Final Prospectus; and, if the
delivery of a prospectus is required at any time after the Effective Time in
connection with the offering or sale of the Preferred Stock or any other
securities relating thereto and if at such time any events shall have occurred
as a result of which the Final Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made when the Final Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary to amend or
supplement the Final Prospectus in order to comply with the Securities Act, to
notify the Representative and, upon their request, to file such document and to
prepare and furnish without charge to each Underwriter and to any dealer in
securities as many copies as the Representative may from time to time reasonably
request of such amended or supplemented Final Prospectus which will correct such
statement or omission or effect such compliance;
(d) To file promptly with the Commission any amendment to the
Registration Statement or Final Prospectus or any supplement to the Final
Prospectus that may, in the judgment of the Company or the Representative, be
required by the Securities Act or requested by the Commission;
(e) Prior to filing with the Commission any amendment to the
Registration Statement or supplement to the Final Prospectus or any prospectus
pursuant to Rule 424 of the Rules, to furnish a copy thereof to the
Representative and counsel for the Underwriters and obtain the consent of the
Representative to the filing such consent, which consent shall not be
unreasonably withheld;
(f) As soon as practicable after the date of the Final Prospectus, to
make generally available to the Company's security holders and to deliver to the
Representative an earnings statement of the Company and its Subsidiaries (which
need not be audited) complying with Section 11(a) of the Securities Act and the
Rules (including, at the option of the Company, Rule 158);
(g) For a period of five years following the date of the Final
Prospectus, upon request by the Representative, to furnish to the Representative
copies of all materials furnished by the Company to its shareholders and all
public reports and all reports and financial statements furnished by the Company
to the Commission pursuant to the Exchange Act;
(h) Promptly from time to time to take such action as the
Representative may reasonably request to qualify the Preferred Stock for
offering and sale under the securities laws of such jurisdictions as the
Representative may request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions for as long as
may be necessary to complete the distribution of the Preferred Stock; provided
that in connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in any
jurisdiction;
13
(i) For a period of 90 days from the date of the Final Prospectus, not
to, directly or indirectly, (1) offer for sale, sell, pledge or otherwise
dispose of (or enter into any transaction or device which is designed to, or
could be expected to, result in the disposition by any person at any time in the
future of) any shares of preferred stock or securities convertible into or
exchangeable for preferred stock of the Company (other than the Preferred Stock
and shares issued pursuant to employee benefit plans, qualified stock option
plans or other employee compensation plans existing on the date hereof or
pursuant to currently outstanding options, warrants or rights), or sell or grant
options, rights or warrants with respect to any shares of Preferred Stock or
securities convertible into or exchangeable for Preferred Stock (other than the
grant of options pursuant to option plans existing on the date hereof), (2)
enter into any swap or other derivatives transaction that transfers to another,
in whole or in part, any of the economic benefits or risks of ownership of such
shares of Preferred Stock, whether any such transaction described in clause (1)
or (2) above is to be settled by delivery of Preferred Stock or other
securities, in cash or otherwise, or (3) file or cause to be filed a
registration statement on Form S-3 or other similar form with respect to any
shares of Preferred Stock or securities convertible, exercisable or exchangeable
into Preferred Stock or any other securities of the Company, in each case
without the prior written consent of Xxxxxx Brothers Inc. on behalf of the
Underwriters; and
(j) To apply the net proceeds from the sale of the Preferred Stock as
set forth in the Final Prospectus.
SECTION 6. Expenses. The Company agrees to pay (a) the costs incident to
the authorization, issuance, sale and delivery of the Preferred Stock and any
taxes payable in that connection; (b) the costs incident to the preparation,
printing and filing under the Securities Act of the Registration Statement and
any amendments and exhibits thereto; (c) the costs of distributing the
Registration Statement as originally filed and each amendment thereto and any
post-effective amendments thereof (including, in each case, exhibits), any
Interim Prospectus, the Final Prospectus and any amendment or supplement to the
Final Prospectus, all as provided in this Agreement; (d) the costs of producing
this Agreement, any supplemental agreement among the Underwriters and any other
related documents in connection with the offering, purchase, sale and delivery
of the Preferred Stock; (e) any applicable listing or other fees; (f) the fees
and expenses of qualifying the Preferred Stock under the securities laws of the
several jurisdictions as provided in Section 5(h) and of preparing, printing and
distributing a Blue Sky Memorandum (including related fees and expenses of
counsel to the Underwriters not to exceed $10,000); (g) the costs and expenses
of the Company relating to investor presentations on any "road show" undertaken
in connection with the marketing or the offering of the Preferred Stock,
including, without limitation, expenses associated with the production of road
show slides and graphics, fees and expenses of any consultants engaged in
connection with the road show presentations with the prior approval of the
Company, and travel and lodging expenses of the Representative and officers of
the Company and any such consultants; and (h) all other costs and expenses
incident to the performance of the obligations of the Company under this
Agreement; provided that,
14
except as provided in this Section 6 and in Section 11 the Underwriters shall
pay their own costs and expenses, including the costs and expenses of their
counsel, any transfer taxes on the Preferred Stock which they may sell and the
expenses of advertising any offering of the Preferred Stock made by the
Underwriters.
SECTION 7. Conditions of Underwriters' Obligations. The respective
obligations of the Underwriters hereunder are subject to the accuracy, when made
and on each Delivery Date, of the representations and warranties of the Company
contained herein, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) The Final Prospectus shall have been timely filed with the
Commission in accordance with Section 5(a); no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or Final Prospectus or
otherwise shall have been complied with.
(b) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Preferred Stock, the
Registration Statement and Final Prospectus, and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
reasonably satisfactory in all material respects to the Representative in
consultation with counsel for the Underwriters, and the Company shall have
furnished to such counsel all documents and information that they may reasonably
request.
(c) LeBoeuf, Lamb, Xxxxxx & XxxXxx LLP shall have furnished to the
Representative their written opinion, as counsel to the Company, addressed to
the Underwriters and dated such Delivery Date, in form and substance
satisfactory to the Representative, to the effect that:
(i) Scottish Re (U.S.), Inc., a Delaware corporation, is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation with all requisite corporate power to own
its properties and conduct its business as described in the Final
Prospectus.
(ii) the Preferred Stock to be sold under this Agreement to the
Underwriters has been approved for listing on the New York Stock
Exchange, subject to notice of issuance.
(iii) The Registration Statement is effective under the Securities
Act and, to our actual knowledge, no stop order suspending the
effectiveness of the Registration Statement or any post-effective
amendment thereof has been issued, and no proceedings therefor have
been initiated or threatened by the Commission. All filings required by
Rule 424(b) of the Rules with respect to the Registration Statement
have been made.
15
(iv) The Registration Statement and the Final Prospectus and any
amendments thereof or supplements thereto (other than the financial
statements and the notes thereto and the schedules and other financial
or statistical data included or incorporated by reference therein or
omitted therefrom, as to which we express no opinion) appear on their
face to be appropriately responsive in all material respects with the
requirements of the Securities Act and the Rules. To such counsel's
actual knowledge, without due inquiry other than of the attorneys at
such counsel's firm who have been involved in the preparation of the
Registration Statement, all documents required by the Rules to be filed
in connection with, incorporated by reference, or described in the
Registration Statement have been so filed, incorporated by reference or
described. The Incorporated Documents (other than the financial
statements and the notes thereto and the schedules and other financial
and statistical data included or incorporated by reference therein or
omitted therefrom, as to which we express no opinion) when they were
filed with the Commission (or at the time they were amended, if
applicable) appeared on their face to be appropriately responsive in
all material respects to the requirements of the Exchange Act.
(v) The statements contained in the Final Prospectus under the
captions "Summary--The Offering" and "Description of the Perpetual
Preferred Shares," in the Final Prospectus, insofar as they purport to
constitute summaries of certain terms of documents referred to therein,
fairly summarize such terms in all material respects.
(vi) The statements in the Final Prospectus under the captions
"Summary--The Offering--Tax Consequences," "Risk Factors--Changes in
U.S. Federal Income Tax Law Could Materially Adversely Affect an
Investment in our Perpetual Preferred Shares," "Risk Factors--If
Scottish Re or any of its non-U.S. subsidiaries is treated as a
controlled foreign corporation or a passive foreign investment company
or if any of our non-U.S. insurance subsidiaries generate more than a
permissible amount of related person insurance income, U.S. persons who
own our perpetual preferred shares may be subject to U.S. federal
income taxation on our undistributed earnings and may recognize
ordinary income upon disposition of our perpetual preferred shares,"
"Risk Factors--If we are a controlled foreign corporation or if any of
our non-U.S. insurance subsidiaries generate related person insurance
income, U.S. tax-exempt organizations that own our perpetual preferred
shares may recognize unrelated business taxable income," "Certain Tax
Considerations--General," "Certain Tax Considerations--Taxation of
Scottish Re and its Subsidiaries--United States" and "Certain Tax
Considerations--Taxation of Holders of Perpetual Preferred
Shares--United States--Taxation of U.S. Holders," insofar as they
purport to constitute summaries of matters of United States federal tax
law and regulations or legal conclusions with respect thereto, fairly
summarize such matters and conclusions in all material respects.
16
(vii) The issuance and sale of the Preferred Stock by the Company,
the execution, delivery and performance of this Agreement and the
Remarketing Agreement, compliance by the Company with all provisions of
this Agreement and the Remarketing Agreement and the consummation by
the Company of the transactions contemplated thereby, do not and will
not conflict with or result in a breach of (A) any of the terms or
provisions of, or constitute a default (or an event which with notice
or lapse of time, or both, would constitute a default) under, or result
in the creation or imposition of any lien, charge or encumbrance upon
any property or assets of the Company or any of the Subsidiaries
pursuant to, any agreement or instrument that is expressed to be
governed by New York law and filed (or incorporated by reference) as an
exhibit to the Registration Statement, or (B) any New York or Federal
statute or any rule or regulation of any New York or Federal
governmental agency or body having jurisdiction over the Company or any
Subsidiary or any of their properties.
(viii) No consent, approval, authorization, order, registration,
filing, qualification, license or permit pursuant to U.S. federal law,
New York law, the Delaware General Corporation Law or the Delaware
Insurance Code with any U.S. federal, New York or Delaware court or any
U.S. federal, New York or Delaware public, governmental, or regulatory
agency or body having jurisdiction over the Company or any of the
Subsidiaries or any of their respective properties or assets is
required for the issuance, sale and delivery of the Preferred Stock,
the execution, delivery and performance of this Agreement and the
Remarketing Agreement or the consummation by the Company of the
transactions contemplated thereby, except for (1) such as may be
required under applicable state securities or Blue Sky or insurance
securities laws in connection with the purchase and distribution of the
Preferred Stock by the Underwriters (as to which we express no
opinion), (2) such as have been made or obtained under the Securities
Act and Exchange Act and (3) such as are required by the NASD (as to
which we express no opinion).
(ix) Neither the Company nor any Subsidiary is an investment
company as defined in the Investment Company Act.
(x) This Agreement and the Remarketing Agreement have been duly
executed and delivered by the Company to the extent the laws of the
State of New York apply.
(xi) Under the laws of the State of New York relating to submission
to jurisdiction, the Company has validly (a) submitted to the
jurisdiction of any court of the State of New York or any United States
federal court, in each case, sitting in the Borough of Manhattan, City
and State of New York, for the purpose of any suit, action, or other
proceeding arising out of this Agreement or the Remarketing Agreement,
or the transaction contemplated by the Final Prospectus (each, a
"Proceeding"), (b) waived any objection to the venue of any
Proceeding in any
17
such court, and (c) appointed CT Corporation Systems for purposes of
Section 17(b) of this Agreement and Section 15(b) of the Remarketing
Agreement, assuming (i) the validity of such submission, waiver or
appointment under the law of the Company's jurisdiction of
incorporation, and (ii) due authorization of this Agreement and the
Remarketing Agreement by the Company.
Such counsel shall also state that in the course of
the preparation by the Company of the Registration Statement and the
Final Prospectus, it has participated in conferences with certain
officers and employees of the Company, with representatives of Ernst &
Young LLP, independent public accountants for the Company, with the
Underwriters and with counsel for the Underwriters, at which
conferences the contents of the Registration Statement and the Final
Prospectus and related matters were discussed, that such counsel has
not undertaken to determine independently, do not express an opinion as
to, and do not assume any responsibility for, the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Final Prospectus except to the extent
stated expressly in clauses (v) and (vi) above, and that based upon
such counsel's examination of the Registration Statement and the Final
Prospectus and upon the above-described procedures, no facts have come
to the attention of such counsel that have caused them to believe that
the Registration Statement (it being understood that such counsel has
not been requested to comment and do not express any comment with
respect to the financial statements and the notes thereto and the
related statements, supporting schedules and other financial and
statistical information included or incorporated by reference therein
or omitted therefrom), at the time the Registration Statement became
effective, contained or incorporated by reference any untrue statement
of a material fact or omitted to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, or that the Final Prospectus (it being understood that such
counsel has not been requested to comment and do not express any
comment with respect to the financial statements and the notes thereto
and the related statements, supporting schedules and other financial
and statistical information included or incorporated by reference
therein or omitted therefrom), as of its date contained, or, on such
Delivery Date, contains, any untrue statement of a material fact or
omitted, or, on such Delivery Date, omits, to state any material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(d) Xxxxxx & Xxxxxx shall have furnished to the Representative their
written opinion, as Cayman Islands counsel to the Company, addressed to the
Underwriters and dated such Delivery Date, in form and substance satisfactory to
the Representative, as set forth in Exhibit A.
(e) Xxxx Xxxxxxx, General Counsel to the Company, shall have furnished
to the Representative his written opinion, as counsel to the Company, addressed
to the
18
Underwriters and dated such Delivery Date, in form and substance satisfactory to
the Representative, to the effect that:
(i) Each of the subsidiaries of the Company set forth on Schedule
III hererto (each a "U.S. Subsidiary") has been duly organized and is
validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation with all requisite corporate power
and other necessary authority to own its properties and conduct its
business as described in the Final Prospectus.
(ii) All of the issued share capital of each U.S. Subsidiary has
been duly and validly authorized and issued, is fully paid and
non-assessable and, except for 5% of the outstanding stock of Scottish
Re Life Corporation, is owned directly or indirectly by the Company
free and clear of all liens, encumbrances, equities or claims.
(iii) To the best of such counsel's knowledge, and other than as
described in the Registration Statement and Final Prospectus, there is
no judicial, regulatory, arbitral or other legal or governmental
proceeding or other litigation, or arbitration, including routine
litigation, to which the Company or any Subsidiary is a party or of
which any property of the Company or any Subsidiary is the subject
which, individually or in the aggregate, if determined adversely to the
Company or any Subsidiary, would have a Material Adverse Effect, and to
the best of such counsel's knowledge, no such proceeding is threatened
or contemplated by governmental authorities or threatened or
contemplated by others.
(iv) To the best of such counsel's knowledge, there are no
contracts or other documents which are required to be described in the
Final Prospectus or filed as exhibits to the Registration Statement by
the Securities Act or by the Rules which have not been so described or
filed as exhibits to the Registration Statement.
(v) Each of this Agreement and the Remarketing Agreement has been
duly authorized, executed and delivered by the Company.
(vi) The issuance and sale of the Preferred Stock by the Company
and the execution, delivery and performance of this Agreement and the
Remarketing Agreement by the Company and the consummation of the
transactions contemplated hereby will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute
a default (or an event which with notice or lapse of time, or both,
would constitute a default) under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any Subsidiary pursuant to any indenture,
mortgage, deed of trust, loan agreement or other agreement, instrument,
franchise, license or permit known to such counsel to which the Company
or any Subsidiary is a party or by which the Company or any Subsidiary
or their respective properties or
19
assets may be bound or to which any of the property or assets of the
Company or any Subsidiary is subject or give the holder of any of the
notes, debentures, or other evidence of indebtedness of the Company or
any Subsidiary the right to require repurchase, redemption or repayment
of all or a portion of such indebtedness by the Company or any
Subsidiary, or result in the creation or imposition of any lien, charge
or encumbrance upon any of the assets, properties or operations of the
Company or any Subsidiary or violate or conflict with any judgment,
decree, order, statute, rule or regulation of any court or any public,
governmental or regulatory agency or body having jurisdiction over the
Company or any Subsidiary or any of their respective properties,
operations or assets.
(vii) No consent, approval, authorization, order, registration,
filing, qualification, license or permit of or with any court or any
public, governmental or regulatory agency or body having jurisdiction
over the Company or any Subsidiary or any of their respective
properties or assets is required to be made or obtained by the Company
for the execution, delivery and performance of this Agreement or the
Remarketing Agreement or the consummation of the transactions
contemplated hereby or thereby, by the Registration Statement and by
the Final Prospectus, including the issuance, sale and delivery of the
Preferred Stock to be issued, sold and delivered by the Company
hereunder, except (A) the registration under the Securities Act of the
Preferred Stock, and (B) such consents, approvals, authorizations,
orders, registrations, filings, qualifications, licenses and permits as
may be required under the Exchange Act, applicable state securities,
Blue Sky or insurance securities laws or the rules of the NASD in
connection with the purchase and distribution of the Preferred Stock by
the Underwriters.
(viii) The Company and each of the U.S. Subsidiaries that are
engaged in the business of insurance or reinsurance (the "U.S.
Insurance Subsidiaries") holds such Insurance Licenses as are necessary
to the conduct of its business as described in the Final Prospectus;
the Company and each U.S. Insurance Subsidiary have fulfilled and
performed all obligations necessary to maintain the Insurance Licenses;
there is no pending or, to the knowledge of such counsel, threatened
action, suit, proceeding or investigation that could reasonably be
expected to result in the revocation, termination, suspension or
limitation of any Insurance License or otherwise impose any limitation
on the conduct of any U.S. Insurance Subsidiary; and no insurance
regulatory agency or body has issued, or to such counsel's knowledge,
commenced any proceeding for the issuance of, any order or decree
impairing, restricting or prohibiting the payment of dividends or the
making of any loan by any U.S. Insurance Subsidiary to its parent.
Such counsel shall also state that he has participated in conferences
with representatives of the Company and with representatives of their
independent accountants and counsel at which conferences the contents of the
Registration Statement and Final Prospectus and related matters were discussed,
and, although he assumes no
20
responsibility for the accuracy, completeness or fairness of the Registration
Statement and Final Prospectus (except as expressly provided above), nothing has
come to his attention to cause him to believe that the Registration Statement or
Final Prospectus, as of its date or such Delivery Date, contained or contains
any untrue statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading (other than the financial statements
and other financial information contained or incorporated by reference therein,
as to which such counsel expresses no belief).
(f) The Representative shall have received from Xxxxxxxx & Xxxxxxxx
LLP, counsel for the Underwriters, such opinion or opinions, dated such Delivery
Date, with respect to the issuance and sale of the Preferred Stock, the
Registration Statement, the Final Prospectus and other related matters as the
Representative may reasonably require, and the Company shall have furnished to
such counsel such documents as they reasonably request for the purpose of
enabling them to pass upon such matters.
(g) At the time of execution of this Agreement, the Representative
shall have received from Ernst & Young LLP a letter or letters, in form and
substance satisfactory to the Representative, addressed to the Underwriters and
dated the date hereof (i) confirming that they are independent public
accountants within the meaning of the Securities Act and are in compliance with
the applicable requirements relating to the qualification of accountants under
Rule 2-01 of Regulation S-X of the Commission and (ii) stating, as of the date
hereof (or, with respect to matters involving changes or developments since the
respective dates as of which specified financial information is given in the
Final Prospectus, as of a date not more than five days prior to the date
hereof), the conclusions and findings of such firm with respect to the financial
information and other matters ordinarily covered by accountants' "comfort
letters" to underwriters in connection with registered public offerings.
(h) With respect to the letter or letters of Ernst & Young LLP referred
to in the preceding paragraph and delivered to the Representative concurrently
with the execution of this Agreement (the "initial letters"), the Company shall
have furnished to the Representative a letter (the "bring-down letter") of such
accountants, addressed to the Underwriters and dated such Delivery Date (i)
confirming that they are independent public accountants within the meaning of
the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the Commission, (ii) stating, as of the date of the bring-down letter (or,
with respect to matters involving changes or developments since the respective
dates as of which specified financial information is given in the Final
Prospectus, as of a date not more than five days prior to the date of the
bring-down letter), the conclusions and findings of such firm with respect to
the financial information and other matters covered by the initial letters and
(iii) confirming in all material respects the conclusions and findings set forth
in the initial letters.
21
(i) The Company shall have furnished to the Representative a
certificate, dated such Delivery Date, of the Chief Executive Officer and Chief
Financial Officer of the Company, stating that:
(i) The representations, warranties and agreements of the Company
in Section 1 are true and correct as of such Delivery Date; the Company
has complied with all its agreements contained herein; and the
conditions set forth in paragraph (a) of this Section 7 have been
fulfilled; and
(ii) They have carefully examined the Registration Statement and
Final Prospectus and, in their opinion (A) as of the date of the Final
Prospectus, the Registration Statement and Final Prospectus did not
include any untrue statement of a material fact and did not omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and (B) since the date of
the Final Prospectus, no event has occurred which should have been set
forth in a supplement or amendment to the Registration Statement or
Final Prospectus which has not been so set forth.
(j) Since the execution and delivery of this Agreement or, if earlier,
the dates as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Final Prospectus (exclusive of any
supplement thereto), there shall not have been any change in the share capital,
ordinary shares, preferred shares, or long-term debt of the Company or any of
the Subsidiaries or any other change (whether or not arising from transactions
in the ordinary course of business), or any development involving a prospective
change, in or affecting the condition (financial or otherwise) results of
operations, business, properties or prospects of the Subsidiaries or the Company
taken as a whole, including, without limitation, the occurrence of a fire,
flood, explosion or other calamity at any of the properties owned or leased by
the Company or any of its Subsidiaries, the effect of which, in any such case
described above, is, in the judgment of the Underwriters, so material and
adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Preferred Stock on the terms and in the manner
contemplated in the Final Prospectus (exclusive of any supplement).
(k) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading of any securities of
or guaranteed by the Company shall have been suspended on any exchange or in any
over-the-counter market, (ii) trading in securities on the New York Stock
Exchange, the American Stock Exchange, and the National Association of
Securities Dealers, Inc., shall have been generally suspended, or there shall
have been a material disruption in settlement of securities generally, (iii)
minimum or maximum ranges for prices shall have been generally established on
the New York Stock Exchange by the Commission or by the New York Stock Exchange,
(iv) a general banking moratorium shall have been declared by federal or New
York State authorities, (v) any major disruption of settlements of securities or
clearance services in the United States, or (vi) any outbreak or escalation of
major hostilities in which the United States is involved, any declaration of war
by the
22
United States Congress or any other substantial national or international
calamity, crisis or emergency (including, without limitation, acts of terrorism)
affecting the United States, in any such case provided for in clauses (i)
through (vi), as to make it, in the judgment of the Representative,
impracticable or inadvisable to proceed with the public offering or delivery of
the Preferred Stock being delivered on such Delivery Date on the terms and in
the manner contemplated in the Final Prospectus.
(l) On or after the date of this Agreement, (i) no downgrading shall
have occurred in the rating accorded the Company's debt securities or the debt
securities of any Subsidiary or any Subsidiary's claims paying ability or
financial strength by any "nationally recognized statistical rating
organization", as such term is defined in Rule 436(g)(2) of the Rules, (ii) no
such organization shall have publicly announced that it has under surveillance
or review, with possible negative implications, its rating of any of the
Company's debt securities or preferred stock or the debt securities of any
Subsidiary or any Subsidiary's claims paying ability or financial strength and
(iii) the Preferred Stock shall continue to be rated not lower than BB- by
Standard & Poor's and Ba1 by Xxxxx'x.
(m) No Underwriter shall have discovered and disclosed to the Company
on or prior to such Delivery Date that the Registration Statement or Final
Prospectus or any amendment or supplement thereto contains an untrue statement
of a fact which, in the reasonable opinion of counsel to the Underwriters, is
material or omits to state a fact which, in the reasonable opinion of such
counsel, is material and is required to be stated therein or is necessary to
make the statements therein not misleading.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to the Representative after consultation with counsel for the Underwriters.
SECTION 8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Underwriter, its
directors, officers and employees and each person, if any, who controls any
Underwriter within the meaning of the Securities Act, from and against any loss,
claim, damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of Preferred Stock), to which that Underwriter,
director, officer, employee or controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, any
Interim Prospectus or the Final Prospectus or in any amendment or supplement
thereto or the omission or alleged omission to state in the Registration
Statement, any Interim Prospectus or the Final Prospectus, or in any amendment
or supplement thereto, any material fact required to be stated therein or
necessary to make the statements therein not misleading, and shall reimburse
each Underwriter and each such director, officer,
23
employee or controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, director, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement,
any Interim Prospectus or the Final Prospectus, or in any such amendment or
supplement, in reliance upon and in conformity with written information
concerning such Underwriter furnished to the Company through the Representative
by or on behalf of any Underwriter specifically for inclusion therein which
information consists solely of the information specified in Section 8(e),
provided, further, that the foregoing indemnity agreement with respect to any
Interim Prospectus shall not inure to the benefit of any Underwriter who failed
to deliver a Final Prospectus (as then amended or supplemented, provided by the
Company to the several Underwriters in the requisite quantity and on a timely
basis to permit proper delivery on or prior to the Delivery Date) to the person
asserting any losses, claims, damages and liabilities and judgments caused by
any untrue statement or alleged untrue statement of a material fact contained in
any Interim Prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they are made,
not misleading, if such material misstatement or omission or alleged material
misstatement or omission was cured, as determined by a court of competent
jurisdiction in a decision not subject to further appeal, in such Final
Prospectus and such Final Prospectus was required by law to be delivered at or
prior to the written confirmation of sale to such person. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any Underwriter or to any director, officer, employee or
controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its officers and employees, each of its directors,
and each person, if any, who controls the Company within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which the Company or any such
director, officer or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, any
Interim Prospectus or the Final Prospectus or in any amendment or supplement
thereto, or (ii) the omission or alleged omission to state in the Registration
Statement, any Interim Prospectus or the Final Prospectus, or in any amendment
or supplement thereto, any material fact required to be stated therein or
necessary to make the statements therein not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information concerning such Underwriter furnished to the Company through the
Representative by or on behalf of that Underwriter specifically for inclusion
therein,
24
which information is limited to the information set forth in Section
8(e), and shall reimburse the Company and any such director, officer or
controlling person for any legal or other expenses reasonably incurred by the
Company or any such director, officer or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which any Underwriter may
otherwise have to the Company or any such director, officer, employee or
controlling person.
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 8(a) or (b) except to the extent it has been
materially prejudiced by such failure, and provided further, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have to an indemnified party otherwise than under this Section 8(a) or (b).
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel reasonably satisfactory to the indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party). After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 8 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation. No
indemnifying party shall without the prior written consent of the indemnified
parties (which consent shall not be unreasonably withheld), settle or compromise
or consent to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which indemnification
or contribution may be sought hereunder (whether or not the indemnified parties
are actual or potential parties to such claim or action) unless such settlement,
compromise or consent (i) includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding,
and (ii) does not include a statement as to, or an admission of, fault,
culpability or a failure to act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the Company
25
on the one hand and the Underwriters on the other from the offering of the
Preferred Stock or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the Underwriters on the other with
respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other with respect to such offering shall
be deemed to be in the same proportion as the total net proceeds from the
offering of the Preferred Stock purchased under this Agreement (before deducting
expenses) received by the Company, on the one hand, and the total underwriting
discounts and commissions received by the Underwriters with respect to the
shares of Preferred Stock purchased under this Agreement, on the other hand,
bear to the total gross proceeds from the offering of the shares of Preferred
Stock under this Agreement, in each case as set forth in the table on the cover
page of the Final Prospectus. The relative fault shall be determined by
reference to whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this Section were to be
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability, or action in respect thereof, referred to above in this Section
shall be deemed to include, for purposes of this Section 8(d), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(d), no Underwriter shall be required to contribute
any amount in excess of the amount by which the total price at which the shares
of Preferred Stock underwritten by it and distributed to the public were offered
to the public exceeds the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to contribute as
provided in this Section 8(d) are several in proportion to their respective
underwriting obligations and not joint.
(e) The Underwriters severally confirm and the Company acknowledges
that the statements with respect to the public offering of the Preferred Stock
by the Underwriters set forth on the cover page of and the paragraphs on
discounts and commissions, concessions, reallowance figures and underwriter
stabilization appearing under the caption "Underwriting" in the Final Prospectus
are correct and constitute the only information concerning such Underwriters
furnished in writing to the Company by
26
or on behalf of the Underwriters specifically for inclusion in the Registration
Statement and Final Prospectus.
SECTION 9. Defaulting Underwriters.
If, on either Delivery Date, any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters shall be obligated to purchase the Preferred Stock
which the defaulting Underwriter agreed but failed to purchase on such Delivery
Date in the respective proportions which the number of shares of Firm Stock set
opposite the name of each remaining non-defaulting Underwriter in Schedule I
hereto bears to the total number of shares of Firm Stock set opposite the names
of all the remaining non-defaulting Underwriters in Schedule I hereto; provided,
however, that the remaining non-defaulting Underwriters shall not be obligated
to purchase any of the Preferred Stock on such Delivery Date if the total number
of shares of Preferred Stock which the defaulting Underwriter or Underwriters
agreed but failed to purchase on such date exceeds 9.09% of the total number of
shares of Preferred Stock to be purchased on such Delivery Date, and any
remaining non-defaulting Underwriter shall not be obligated to purchase more
than 110% of the number of shares of Preferred Stock which it agreed to purchase
on such Delivery Date pursuant to the terms of Section 2. If the foregoing
maximums are exceeded, the remaining non-defaulting Underwriters, or those other
underwriters satisfactory to the Representative who so agree, shall have the
right, but shall not be obligated, to purchase, in such proportion as may be
agreed upon among them, all the Preferred Stock to be purchased on such Delivery
Date. If the remaining Underwriters or other underwriters satisfactory to the
Representative do not elect to purchase the shares which the defaulting
Underwriter or Underwriters agreed but failed to purchase on such Delivery Date,
this Agreement (or, with respect to the Second Delivery Date, the obligation of
the Underwriters to purchase, and of the Company to sell, the Option Stock)
shall terminate without liability on the part of any non-defaulting Underwriter
or the Company, except that the Company will continue to be liable for the
payment of expenses to the extent set forth in Sections 6 and 11. As used in
this Agreement, the term "Underwriter" includes, for all purposes of this
Agreement unless the context requires otherwise, any party not listed in
Schedule I hereto who, pursuant to this Section 9, purchases Firm Stock which a
defaulting Underwriter agreed but failed to purchase.
Nothing contained herein shall relieve a defaulting Underwriter of any
liability it may have to the Company for damages caused by its default. If other
Underwriters are obligated or agree to purchase the Preferred Stock of a
defaulting or withdrawing Underwriter, either the Representative or the Company
may postpone the Delivery Date for up to seven full business days in order to
effect any changes that in the opinion of counsel for the Company or counsel for
the Underwriters may be necessary in the Registration Statement, the Final
Prospectus or in any other document or arrangement.
SECTION 10. Termination. The obligations of the Underwriters hereunder may
be terminated by the Representative by notice given to and received by the
Company prior
27
to delivery of and payment for the Firm Stock if, prior to that time, any of the
events described in Sections 7(j), 7(k) or 7(l), shall have occurred or if the
Underwriters shall decline to purchase the Preferred Stock for any reason
permitted under this Agreement.
SECTION 11. Reimbursement of Underwriters' Expenses. If the Company shall
fail to tender the Preferred Stock for delivery to the Underwriters by reason of
any failure, refusal or inability on the part of the Company to perform any
agreement on its part to be performed, or because any other condition of the
Underwriters' obligations hereunder required to be fulfilled by the Company is
not fulfilled, the Company will reimburse the Underwriters for all reasonable
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
incurred by the Underwriters in connection with this Agreement and the proposed
purchase of the Preferred Stock, and upon demand the Company shall pay the full
amount thereof to the Representative. If this Agreement is terminated pursuant
to Section 9 by reason of the default of one or more Underwriters, the Company
shall not be obligated to reimburse any defaulting Underwriter on account of
those expenses.
SECTION 12. Notices, Etc. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to Xxxxxx Brothers Inc., 000 Xxxxxxx Xxxxxx, Xxx Xxxx,
XX 00000, Attention: Syndicate Registration Department, Fax (000) 000-0000, with
a copy, in the case of any notice pursuant to Section 8(c), to the Director of
Litigation, Office of the General Counsel, Xxxxxx Brothers Inc., 000 Xxxx
Xxxxxx, 00xx Xxxxx, Xxx Xxxx, XX 00000;
(b) if to the Company, shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Company set forth in the
Registration Statement, Attention: General Counsel (Fax: (000) 000-0000);
provided, however, that any notice to an Underwriter pursuant to Section 8(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representative, which address will be supplied to any other party hereto by the
Representative upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Company shall
be entitled to act and rely upon any request, consent, notice or agreement given
or made on behalf of the Underwriters by Xxxxxx Brothers Inc. on behalf of the
Representative.
SECTION 13. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the Underwriters, the Company, and
their respective successors. This Agreement and the terms and provisions hereof
are for the sole benefit of only those persons, except that (A) the
representations, warranties, indemnities and agreements of the Company contained
in this Agreement shall also be deemed to be for the benefit of the directors,
officers and the person or persons, if any, who control any Underwriter within
the meaning of Section 15 of the Securities Act and (B) the indemnity
28
agreement of the Underwriters contained in Section 8(b) of this Agreement shall
be deemed to be for the benefit of directors of the Company, officers of the
Company who have signed the Registration Statement and any person controlling
the Company within the meaning of Section 15 of the Securities Act. Nothing in
this Agreement is intended or shall be construed to give any person, other than
the persons referred to in this Section 13, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision contained
herein.
SECTION 14. Survival. The respective indemnities, representations,
warranties and agreements of the Company and the Underwriters contained in this
Agreement or made by or on behalf on them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Preferred Stock and
shall remain in full force and effect, regardless of any investigation made by
or on behalf of any of them or any person controlling any of them.
SECTION 15. Definition of the Term "Business Day". For purposes of this
Agreement, "business day" means each Monday, Tuesday, Wednesday, Thursday or
Friday which is not a day on which banking institutions in New York are
generally authorized or obligated by law or executive order to close.
SECTION 16. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of New York.
SECTION 17. Submission to Jurisdiction, Service of Process.
(a) The Company irrevocably (a) submits to the jurisdiction of any
court of the State of New York or any United States federal court, in each case,
sitting in the Borough of Manhattan, City and State of New York, for the purpose
of any Proceeding, (b) agrees that all claims in respect of any Proceeding may
be heard and determined in any such court, (c) waives, to the fullest extent
permitted by law, any immunity from jurisdiction of any such court or from any
legal process therein, (d) agrees not to commence any Proceeding other than in
such courts, and (e) waives, to the fullest extent permitted by law, any claim
that such Proceeding is brought in an inconvenient forum.
(b) The Company agrees that service of all writs, process and summonses
in any Proceeding against the Company may be made upon CT Corporation System at
000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, whom the Company irrevocably
appoints as its authorized agent for service of process. The Company represents
and warrants that CT Corporation System has agreed to act as the Company's agent
for service of process. The Company agrees that such appointment shall be
irrevocable until the irrevocable appointment by the Company of a successor in
The City of New York as its authorized agent for such purpose and the acceptance
of such appointment by such successor. The Company further agrees to take any
and all action, including the filing of any and all documents and instruments
that may be necessary to continue such appointment in full force and effect as
aforesaid. If CT Corporation System shall cease to act as the agent for
29
service of process for the Company, the Company shall appoint without delay,
another such agent and provide prompt written notice to the Representative of
such appointment.
SECTION 18. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION 19. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
30
If the foregoing correctly sets forth the agreement between the Company
and the Underwriters, please indicate your acceptance in the space provided for
that purpose below.
Very truly yours,
SCOTTISH RE GROUP LIMITED
By: /s/ X. Xxxxxx
-----------------------------
Name: XXXXXXXXX XXXXXX
Title: CHIEF FINANCIAL OFFICER
Accepted:
XXXXXX BROTHERS INC.
For themselves and as Representative
of the several Underwriters named
in Schedule I hereto
By XXXXXX BROTHERS INC.
By /s/ Xxxxxxx Xxxxxxxx
---------------------------------
Authorized Representative
ANNEX I
(1) Each Underwriter represents and agrees that: (i) it has not offered
or sold and, prior to the expiry of a period six months from the date of
issuance of the Preferred Stock, will not offer or sell any Preferred Stock to
any persons in the United Kingdom, except to persons whose ordinary activities
involved them in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purpose of their businesses or otherwise in
circumstances which have not resulted and will not result in an offer to the
public in the United Kingdom within the meaning of the Public Offers of
Securities Regulations 1995 (as amended); (ii) it has only communicated or
caused to be communicated, and will only communicate or cause to be
communicated, any invitation or inducement to engage in investment activity
(within the meaning of Section 21 of the Financial Services and Markets Act 2000
("FSMA")) received by it in connection with the issue or sale of any Preferred
Stock in circumstances in which Section 21(1) of the FSMA does not apply to the
Company; and (iii) it has complied, and will comply with, all applicable
provisions of the FSMA with respect to anything done by it in relation to the
Preferred Stock in, from or otherwise involving the United Kingdom.
32
SCHEDULE I
<TABLE>
Underwriter Number of Perpetual Preferred Shares to be purchased
Xxxxxx Brothers Inc. 2,900,000
Banc of America Securities LLC 500,000
Bear, Xxxxxxx & Co. Inc. 500,000
Xxxxx Xxxxxxxx & Xxxxx 500,000
Advest, Inc. 150,000
Xxxxxxxxxxx & Co. Inc. 150,000
RBC Xxxx Xxxxxxxx Inc. 150,000
Xxxxxx, Xxxxxxxx & Company, Incorporated 150,000
</TABLE>
SCHEDULE II
List of Subsidiaries
--------------------
Orkney Holdings, LLC
Orkney Re, Inc.
Scottish Annuity & Life Holdings (Bermuda) Limited
Scottish Annuity & Life Insurance Company (Bermuda) Limited
Scottish Annuity & Life Insurance Company (Cayman) Ltd.
Scottish Annuity & Life International Insurance Company (Bermuda) Limited
Scottish Financial (Luxembourg) S.a.r.l.
Scottish Holdings (Barbados) Ltd.
Scottish Holdings, Inc.
Scottish Re (Dublin) Limited
Scottish Re (U.S.), Inc.
Scottish Re Capital Markets, Inc.
Scottish Re Holdings Limited
Scottish Re Life (Bermuda) Limited
Scottish Re Life Corporation
Scottish Re Limited
Scottish Re PCC Limited (Guernsey)
Scottish Reinsurance Intermediaries (Canada) Inc.
Scottish Solutions, LLC
SRGL Vermogensverwaltungs GmbH (Germany)
Tartan Financial (U.K.)
Tartan Holdings (U.K.) Limited
The Scottish Annuity Company (Cayman), Ltd.
World-Wide Life Assurance S.A. (in liquidation)
SCHEDULE III
Scottish Holdings, Inc.
Scottish Re (U.S.), Inc.
Scottish Re Life Corporation
Exhibit A
[Form of Opinion of Xxxxxx and Xxxxxx]