PLACEMENT AGREEMENT

 

                                                                   Exhibit 10.15

 

                                   $5,000,000

                                    MMCapSSM

                        CENTER BANCORP STATUTORY TRUST II

                                PLACEMENT AGREEMENT

 

 

                                                              New York, New York

                                                              December 12, 2003

 

SANDLER O'NEILL & PARTNERS, L.P.

919 Third Avenue

6th Floor

 

New York, New York 10022

 

Ladies and Gentlemen:

 

      Center   Bancorp   Statutory   Trust   II (the   "Trust"),   a   statutory   trust

organized   under the Delaware   Statutory   Trust Act, 12 Del. C. ss. 3801 et seq.

(the "Delaware   Act"), and Center Bancorp,   Inc., a New Jersey   corporation (the

"Company" and together with the Trust, the "Offerors"),   confirm their agreement

(the   "Agreement")   with   Sandler   O'Neill   &   Partners,   L.P.,   as agent of the

Offerors   (the   "Placement   Agent"),   with   respect to the issue and sale by the

Trust and the placement by the Placement   Agent of 5,000   MMCapSSM   (liquidation

amount of $1,000 per   security)   of the Trust (the   "Capital   Securities").   The

Capital   Securities   will be guaranteed by the Company to the extent provided in

the   Guarantee   Agreement,   to be dated as of the   Closing   Date (as   defined in

Section 2(a)   hereof)   (the   "Guarantee   Agreement"),   between the   Company,   as

guarantor,   and Wilmington Trust Company,   as guarantee   trustee (the "Guarantee

Trustee"),    with   respect   to   distributions   and   payments   upon   liquidation,

redemption and otherwise.

 

      The   entire   proceeds   from the   sale of the   Capital   Securities   will be

combined   with the entire   proceeds from the sale by the Trust to the Company of

its common securities (the "Common   Securities"),   and will be used by the Trust

to   purchase   $5,155,000   aggregate   principal   amount of   Floating   Rate Junior

Subordinated   Debt   Securities   due 2034 (the   "Subordinated   Debt   Securities")

issued by the Company.   The Capital Securities and the Common Securities will be

issued pursuant to the Amended and Restated Declaration of Trust, to be dated as

of the Closing   Date (the   "Declaration"),   among the Company,   as sponsor,   the

Administrators named therein (the   "Administrators"),   Wilmington Trust Company,

as   institutional   trustee   (the   "Institutional   Trustee"),    Wilmington   Trust

Company,   as Delaware trustee (the "Delaware   Trustee"),   and the holders,   from

time to time, of undivided   beneficial interests in the assets of the Trust. The

Subordinated   Debt Securities   will be issued   pursuant to the Indenture,   to be

dated   as of the   Closing   Date   (the   "Indenture"),   between   the   Company   and

Wilmington Trust Company,   as indenture trustee (the "Indenture   Trustee").   The

Indenture,   the Guarantee   Agreement,   the   Declaration,   this Agreement and the

Subscription   Agreement   (as defined in Section   2(a)   hereof)   are   hereinafter

referred to collectively as the "Operative Documents."

 

<PAGE>

 

 

      SECTION 1. Representations and Warranties.

 

      (a) The   Trust and the   Company,   jointly   and   severally,   represent   and

warrant to the   Placement   Agent and the   Purchaser   (as defined in Section 2(a)

hereof) of Capital   Securities as of the date hereof and as of the Closing Date,

and agree with the Placement Agent and the Purchaser, as follows:

 

            (i) Similar Offerings. Within a period of six months before or after

the date hereof,   the Offerors have not,   directly or indirectly,   solicited any

offer to buy or offered to sell, and will not,   directly or indirectly,   solicit

any offer to buy or offer to sell,   in the United States or to any United States

citizen or resident,   any security which is or would be integrated with the sale

of the Capital   Securities   (including   any   securities of the same or a similar

class as the   Capital   Securities)   in a manner   that would   require the Capital

Securities to be registered   under the   Securities   Act of 1933, as amended (the

"1933 Act").

 

            (ii) Incorporated Documents. The documents of the Company filed with

the Securities and Exchange Commission (the "Commission") in accordance with the

Securities Exchange Act of 1934, as amended (the "1934 Act"), from and including

the   commencement of the fiscal year covered by the Company's most recent Annual

Report on Form 10-K, at the time they were or hereafter are filed by the Company

with the Commission   (collectively,   the "1934 Act Reports"),   complied and will

comply in all material   respects with the   requirements   of the 1934 Act and the

rules and regulations of the Commission thereunder (the "1934 Act Regulations"),

and, at the date of this   Agreement and on the Closing Date, do not and will not

include 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

the light of the circumstances   under which they were made, not misleading;   and

other than such   instruments,   agreements,   contracts and other documents as are

filed as exhibits to the Company's Annual Report on Form 10-K, Quarterly Reports

on   Form   10-Q or   Current   Reports   on   Form   8-K,   there   are no   instruments,

agreements,   contracts   or   documents   of a character   described   in Item 601 of

Regulation S-K   promulgated by the Commission to which the Company or any of its

subsidiaries is a party.

 

            (iii)   Independent   Accountants.   The accountants of the Company who

certified   the   financial   statements   included   in the   1934 Act   Reports   (the

"Independent Accountants") are independent public accountants of the Company and

its   subsidiaries   within   the   meaning   of the   1933   Act   and   the   rules   and

regulations of the Commission thereunder (the "1933 Act Regulations").

 

            (iv)   Financial    Statements   and    Information.    The   consolidated

historical   financial   statements   of the   Company,   together   with the   related

schedules and notes,   included in the 1934 Act Reports   present   fairly,   in all

material   respects,   the   respective   consolidated   financial   positions   of the

Company and its consolidated subsidiaries at the respective dates indicated, and

the consolidated   statements of income, changes in stockholders' equity and cash

flows   of the   Company   and its   consolidated   subsidiaries   for the   respective

periods   specified;   said financial   statements have been prepared in conformity

with generally accepted accounting   principles in the United States applied on a

consistent   basis   throughout the periods   involved,   except as disclosed in the

notes to such financial statements;   the supporting schedules,   if any, included

in   the   1934   Act   Reports   present   fairly,   in   all   material   respects,   the

information   required   to   be   stated   therein;   and   any   pro   forma   financial

statements   and the   related   notes   thereto   included   in the 1934 Act   Reports

present fairly the information   shown therein,   have been prepared in accordance

with the   Commission's   rules and guidelines with respect to pro forma financial

statements and have been properly compiled on the bases described   therein,   and

the   assumptions   used   in   the   preparation   thereof   are   reasonable   and   the

adjustments   used therein are appropriate to give effect to the transactions and

circumstances referred to therein.

 

 

 

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<PAGE>

 

            (v) No Material   Adverse   Change.   Since the respective   dates as of

which   information is given in the 1934 Act Reports,   there has not been (A) any

material adverse change in the condition, financial, regulatory or otherwise, or

in the earnings,   business affairs or business   prospects of the Trust or of the

Company   and its   subsidiaries   considered   as one   enterprise,   whether   or not

arising in the ordinary course of business (a "Material   Adverse Effect") or (B)

any dividend or distribution   of any kind declared,   paid or made by the Company

on any class of its capital stock other than regular quarterly   dividends on the

Company's common stock declared and paid consistent with past practice.

 

            (vi)   Internal   Accounting   Controls.   Each of the   Company   and its

subsidiaries   maintain a system of internal   accounting   controls   sufficient to

provide   reasonable   assurance that (i)   transactions are executed in accordance

with the management's general or 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 the

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.

 

            (vii) Disclosure Controls. The Company has established and maintains

disclosure   controls and   procedures   (as such term is defined in Rule 13a-15(e)

and 15d-15(e) under the 1934 Act);   such disclosure   controls and procedures (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 1934 Act   Reports   are

being prepared,   (ii) have been evaluated for effectiveness as of the end of the

annual or quarterly period reported to the Commission and (iii) are effective to

perform the functions for which they were   established;   the Company's   auditors

and the Audit   Committee of the Board of Directors have been advised of: (A) any

significant   deficiencies in the design or operation of internal   controls which

could adversely affect the Company's ability to record, process,   summarize, and

report financial data and (B) any fraud, whether or not material,   that involves

management   or   other   employees   who   have a role   in   the   Company's   internal

controls;   any material weaknesses in internal controls have been identified for

the Company's auditors; and since the date of the most recent evaluation of such

disclosure   controls and procedures,   there have been no significant   changes in

internal controls or in other factors that could   significantly   affect internal

controls,    including   any    corrective    actions   with   regard   to   significant

deficiencies and material weaknesses.

 

            (viii)   Regulatory   Matters.   Neither   the   Company   nor   any of its

subsidiaries   is   subject or is party to, or has   received   any notice or advice

that any of them may become subject or party to any   investigation   with respect

to, any corrective,   suspension or cease-and-desist   order,   agreement,   consent

agreement,   memorandum of understanding or other regulatory   enforcement action,

proceeding   or order   with or by,   or is a party   to any   commitment   letter   or

similar   undertaking   to,   or is   subject   to any   directive   by,   or has been a

recipient of any supervisory   letter from, or has adopted any board   resolutions

at the   request of, any   Regulatory   Agency (as   defined   below) that   currently

relates to or restricts in any material respect the conduct of their business or

that   in   any   manner   relates   to   their   capital   adequacy,   credit   policies,

management or business (each, a "Regulatory Agreement"),   nor has the Company or

any of its   subsidiaries   been   advised   by any   Regulatory   Agency   that   it is

considering   issuing or requesting any such   Regulatory   Agreement;   there is no

unresolved   violation,   criticism   or exception   by any   Regulatory   Agency with

respect to any report or statement   relating to any   examinations of the Company

or any of its subsidiaries   which, in the reasonable judgment of the Company, is

expected   to result in a   Material   Adverse   Effect.   As used   herein,   the term

"Regulatory   Agency"   means   any   federal   or   state   agency   charged   with   the

supervision   or regulation of depositary   institutions   or holding   companies of

depositary   institutions,   or engaged in the insurance of depositary institution

deposits,    or   any   court,    administrative    agency   or   commission   or   other

governmental   agency,    authority   or   instrumentality    having   supervisory   or

regulatory authority with respect to the Company or any of its subsidiaries.

 

 

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<PAGE>

 

            (ix) No Undisclosed Liabilities.   Neither the Company nor any of its

subsidiaries   has any   material   liability,   whether   known or unknown,   whether

asserted or   unasserted,   whether   absolute or   contingent,   whether   accrued or

unaccrued, whether liquidated or unliquidated, and whether due or to become due,

including   any   liability   for   taxes   (and   there is no past or   present   fact,

situation,   circumstance,   condition   or other   basis for any   present or future

action, suit, proceeding,   hearing, charge,   complaint,   claim or demand against

the Company or its subsidiaries   giving rise to any such liability),   except (i)

for   liabilities   set forth in the financial   statements   referred to in Section

1(a)(iv)   above and (ii) normal   fluctuations   in the amount of the   liabilities

referred to in clause (i) above   occurring in the ordinary course of business of

the   Company   and all of its   subsidiaries   since   the date of the   most   recent

balance sheet included in such financial statements.

 

            (x)   Good   Standing   of the   Company.   The   Company   has   been   duly

organized and is validly   existing as a corporation   in good standing   under the

laws of the State of New Jersey and has full power and authority under such laws

to own, lease and operate its   properties and to conduct its business,   to enter

into and perform its obligations under each of the Operative   Documents to which

it is a party, and to issue the Subordinated Debt Securities; and the Company is

duly   registered as a bank holding company under the Bank Holding Company Act of

1956, as amended.

 

            (xi)   Good    Standing   of   the    Subsidiaries.    Each    "significant

subsidiary"   (as   defined   in Rule 1-02 of   Regulation   S-X) of the   Company   (a

"Significant   Subsidiary") has been duly organized and is validly existing as an

entity   in good   standing   under   the   laws of the   jurisdiction   in which it is

chartered   and has full power and   authority   under such laws to own,   lease and

operate its properties and to conduct its current and contemplated business; and

the deposit accounts of each of the Company's subsidiary banks are insured up to

the   applicable   limits   by the   Bank   Insurance   Fund   of the   Federal   Deposit

Insurance   Corporation   (the "FDIC") to the fullest extent   permitted by law and

the rules and   regulations   of the FDIC, and no proceeding for the revocation or

termination   of such   insurance is pending or, to the   knowledge of the Company,

threatened.

 

 

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<PAGE>

 

 

            (xii)    Foreign    Qualifications.    Each   of   the   Company   and   its

subsidiaries   is duly   qualified as a foreign entity to transact   business,   and

each is in good standing in each   jurisdiction   in which such   qualification   is

required,   whether by reason of the   ownership   or leasing   of   property   or the

conduct of   business,   except   where the   failure to be so   qualified   would not

singularly,   or in the aggregate,   in the reasonable judgment of the Company, be

expected to result in a Material Adverse Effect.

 

            (xiii) Capital Stock Duly Authorized and Validly Issued.   All of the

issued and outstanding capital stock of the Company has been duly authorized and

validly   issued   and is fully   paid and   nonassessable;   all of the   issued   and

outstanding   capital   stock of each   subsidiary   of the   Company   has been   duly

authorized and validly issued,   is fully paid and   nonassessable and is owned by

the Company,   directly or through   subsidiaries,   free and clear of any security

interest,   mortgage,   pledge, lien,   encumbrance,   claim or equitable right; and

none   of   the   issued   and   outstanding   capital   stock   of the   Company   or its

Significant   Subsidiaries   was issued in violation of any   preemptive or similar

rights   arising   by   operation   of law,   under the   charter,   by-laws or code of

regulations of the Company or any of its   Significant   Subsidiaries or under any

agreement   to which the   Company   or any of its   Significant   Subsidiaries   is a

party.

 

            (xiv) Good   Standing of the Trust.   The Trust has been duly   created

and is validly existing in good standing as a statutory trust under the Delaware

Act with the power and   authority to own property and to conduct its business as

provided in the Declaration, to enter into and perform its obligations under the

Operative   Documents to which it is a party, and to issue the Capital Securities

and the Common Securities; the Trust is not a party to or otherwise bound by any

agreement   other than the   Operative   Documents to which it is a party;   and the

Trust is, and will be, under current law,   classified   for United States federal

income tax purposes as a grantor   trust and not as an   association   taxable as a

corporation.

 

            (xv)   Authorization of Common   Securities.   On the Closing Date, the

Common   Securities   will have been duly   authorized   for   issuance   by the Trust

pursuant to the   Declaration   and,   when duly issued and executed in   accordance

with the   Declaration   and delivered by the Trust to the Company against payment

therefor in accordance with the subscription agreement therefor, will be validly

issued and fully paid and nonassessable   undivided common   beneficial   ownership

interests in the assets of the Trust;   the issuance of the Common   Securities is

not subject to preemptive or other similar rights;   and on the Closing Date, all

of the   issued   and   outstanding   Common   Securities   of the Trust will be owned

directly by the   Company,   free and clear of any   security   interest,   mortgage,

pledge, lien, encumbrance, claim or equitable right.

 

            (xvi) Authorization of Capital Securities.   On the Closing Date, the

Capital   Securities   will have been duly   authorized   for   issuance by the Trust

pursuant to the Declaration and, when duly issued, executed and authenticated in

accordance   with the   Declaration   and   delivered by the Trust   against   payment

therefor as provided herein and in the Subscription   Agreement,   will be validly

issued and fully paid and nonassessable undivided preferred beneficial ownership

interests   in the assets of the Trust;   the   issuance of the Capital   Securities

will not be subject to   preemptive   or other   similar   rights;   and the   Capital

Securities will be in the form contemplated by, and entitled to the benefits of,

the Declaration.

 

 

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<PAGE>

 

 

             (xvii) Authorization of this Agreement. This Agreement has been duly

authorized, executed and delivered by each of the Offerors.

 

            (xviii)   Authorization of Subscription   Agreement.   The Subscription

Agreement   has been   duly   authorized,   executed   and   delivered   by each of the

Offerors,   and   assuming   due   authorization,   execution   and   delivery   of   the

Subscription   Agreement   by   the   Purchaser,   the   Subscription   Agreement   will

constitute   a   valid,   legal   and   binding   agreement   of each of the   Offerors,

enforceable against each of the Offerors in accordance with its terms, except to

the extent that   enforceability   may be limited by (a)   bankruptcy,   insolvency,

reorganization,   moratorium,   fraudulent conveyance or other similar laws now or

hereafter in effect   relating to   creditors'   rights   generally   and (b) general

principles of equity   (regardless of whether   enforceability   is considered in a

proceeding at law or in equity) (collectively, the "Enforceability Exceptions").

 

            (xix)   Authorization   of Declaration.   The Declaration has been duly

authorized by the Company and, on the Closing Date, will have been duly executed

and   delivered   by   the   Company   and   the   Administrators,    and   assuming   due

authorization,   execution and delivery of the   Declaration by the   Institutional

Trustee and the Delaware Trustee, the Declaration will constitute a valid, legal

and   binding   agreement   of the   Company,   enforceable   against   the   Company in

accordance   with its terms,   except to the   extent   that   enforceability   may be

limited by the Enforceability Exceptions.

 

            (xx) Authorization of Guarantee   Agreement.   The Guarantee Agreement

has been duly authorized by the Company and, on the Closing Date, will have been

duly   executed and   delivered by the   Company,   and assuming due   authorization,

execution and delivery of the Guarantee Agreement by the Guarantee Trustee,   the

Guarantee   Agreement will constitute a valid, legal and binding agreement of the

Company, enforceable against the Company in accordance with its terms, except to

the extent that enforceability may be limited by the Enforceability Exceptions.

 

            (xxi)   Authorization   of   Indenture.   The   Indenture   has been   duly

authorized by the Company and, on the Closing Date, will have been duly executed

and   delivered by the Company,   and assuming due   authorization,   execution   and

delivery   of   the   Indenture   by   the   Indenture   Trustee,   the   Indenture   will

constitute a valid,   legal and binding   agreement   of the   Company,   enforceable

against   the   Company in   accordance   with its terms,   except to the extent that

enforceability may be limited by the Enforceability Exceptions.

 

            (xxii)    Authorization    of   Subordinated    Debt    Securities.    The

Subordinated   Debt Securities   have been duly authorized by the Company;   on the

Closing Date, the   Subordinated   Debt Securities will have been duly executed by

the Company and, when   authenticated in the manner provided for in the Indenture

and   delivered   by   the   Company   to   the   Trust   against   payment   therefor   as

contemplated in the   subscription   agreement   therefor,   will constitute   valid,

legal and binding obligations of the Company, enforceable against the Company in

accordance   with their terms,   except to the extent that   enforceability   may be

limited by the Enforceability   Exceptions; the Subordinated Debt Securities will

be in the form   contemplated by, and entitled to the benefits of, the Indenture;

and the   Company   has no   present   intention   to   exercise   its   option to defer

payments of   interest on the   Subordinated   Debt   Securities   as provided in the

Indenture.

 

 

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<PAGE>

 

 

            (xxiii) Authorization of Administrators.   Each of the Administrators

of the   Trust is an   officer   or   employee   of the   Company   and has   been   duly

authorized by the Company to execute and deliver the Declaration.

 

            (xxiv) Not an Investment Company.   Neither the Trust nor the Company

is, and   immediately   following   consummation of the   transactions   contemplated

hereby and the application of the net proceeds   therefrom   neither the Trust nor

the Company will be, an   "investment   company" or an entity   "controlled"   by an

"investment   company",   in each case within the   meaning of Section   3(a) of the

Investment   Company Act of 1940, as amended (the "1940 Act"),   without regard to

Section 3(c) of the 1940 Act.

 

            (xxv)   Absence   of   Defaults   and   Conflicts.   The   Trust   is not in

violation of the trust certificate of the Trust filed with the State of Delaware

(the "Trust Certificate") or the Declaration, and neither the Company nor any of

its subsidiaries is in violation of its charter, by-laws or code of regulations;

none of the Trust, the Company or any subsidiary of the Company is in default in

the   performance   or   observance   of   any   obligation,   agreement,   covenant   or

condition contained in any contract, indenture, mortgage, deed of trust, loan or

credit agreement,   note, lease or other agreement or instrument to which it is a

party   or by   which   it or any of   them   may be   bound   or to   which   any of its

properties or assets is subject   (collectively,   "Agreements and   Instruments"),

except   for   such   defaults   under   Agreements   and   Instruments   that,   in   the

reasonable   judgment of the   Company,   are not   expected to result in a Material

Adverse   Effect;   and the execution,   delivery and   performance of the Operative

Documents by the Trust or the Company,   as the case may be, the   issuance,   sale

and delivery of the Capital Securities and the Subordinated Debt Securities, the

consummation of the transactions   contemplated by the Operative   Documents,   and

compliance   by the   Trust   and the   Company   with   the   terms   of the   Operative

Documents to which they are a party have been duly   authorized   by all necessary

corporate   action on the part of the Company and, on the Closing Date, will have

been duly authorized by all necessary action on the part of the Trust and do not

and will not, whether with or without the giving of notice or passage of time or

both, violate,   conflict with or constitute a breach of, or default or Repayment

Event (as defined below) under,   or result in the creation or imposition of any,

security   interest,   mortgage,   pledge,   lien,   charge,   encumbrance,   claim   or

equitable right upon any properties or assets of the Trust or the Company or any

of its subsidiaries pursuant to any of the Agreements and Instruments,   nor will

such action result in any violation of the provisions of the charter, by-laws or

code of regulations of the Company or any of its subsidiaries or the Declaration

or the Trust Certificate, or violation by the Company or any of its subsidiaries

of any applicable law,   statute,   rule,   regulation,   judgment,   order,   writ or

decree of any   government,   government   authority,   agency   (including,   without

limitation,   each applicable   Regulatory   Agency) or   instrumentality   or court,

domestic or foreign, having jurisdiction over the Trust or the Company or any of

its   subsidiaries   or   their   respective   properties   or   assets   (collectively,

"Governmental Entities"). As used herein, a "Repayment Event" means any event or

condition   which gives the holder of any note,   debenture   or other   evidence of

indebtedness (or any person acting on such holder's behalf) the right to require

the repurchase, redemption or repayment of all or a portion of such indebtedness

by the Trust or the Company or any of its   subsidiaries   prior to its   scheduled

maturity.

 

 

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<PAGE>

 

 

            (xxvi) Absence of Labor Dispute. No labor dispute with the employees

of the Company or any of its   subsidiaries   exists or, to the   knowledge   of the

executive   officers   of the   Company,   is   imminent,   which,   in the   reasonable

judgment of the Company, is expected to result in a Material Adverse Effect.

 

            (xxvii)    Absence   of   Proceedings.    There   is   no   action,    suit,

proceeding,   inquiry or   investigation   before or   brought   by any   Governmental

Entity,   now   pending,   or,   to the   knowledge   of   the   Trust   or the   Company,

threatened,   against   or   affecting   the   Trust   or   the   Company   or any of its

subsidiaries,   which, in the reasonable   judgment of the Trust or the Company is

expected to result in a Material   Adverse   Effect or   materially   and   adversely

affect   the   consummation   of the   transactions   contemplated   by the   Operative

Documents   or the   performance   by the Trust or the   Company of its   obligations

hereunder or thereunder;   and the aggregate of all pending legal or governmental

proceedings   to which the Trust or the Company or any of its   subsidiaries   is a

party or of which any of their   respective   properties or assets is the subject,

including   ordinary routine litigation   incidental to the business,   are not, in

the   reasonable   judgment of the   Company or the Trust,   expected to result in a

Material Adverse Effect.

 

            (xxviii)   Absence   of   Further   Requirements.   No   filing   with,   or

authorization, approval, consent, license, order, registration, qualification or

decree   of,   any   Governmental   Entity,   other than those that have been made or

obtained, is necessary or required for the authorization, execution, delivery or

performance by the Trust or the Company of their   respective   obligations   under

the   Operative   Documents,   the   Subordinated   Debt   Securities   or the   Capital

Securities,   as applicable,   or the   consummation by the Trust or the Company of

the transactions contemplated by the Operative Documents.

 

            (xxix)   Possession of Licenses and Permits.   Each of the Trust,   the

Company and the   subsidiaries   of the Company   possesses   such permits,   orders,

certificates,    licenses,    approvals,    consents    and    other    authorizations

(collectively,   "Governmental   Licenses") issued by the appropriate Governmental

Entities   necessary   to conduct the business now operated by it that is material

to the Trust or the Company and its   subsidiaries   considered as one enterprise;

each of the   Trust,   the   Company   and the   subsidiaries   of the   Company   is in

compliance   with the terms and conditions of all of its   Governmental   Licenses,

except   where the   failure   so to   comply,   in the   reasonable   judgment   of the

Company,   is not expected to,   singularly or in the   aggregate,   have a Material

Adverse Effect; all of the Governmental Licenses are valid and in full force and

effect,   except when the invalidity of such Governmental Licenses or the failure

of such Governmental   Licenses to be in full force and effect, in the reasonable

judgment of the Company,   is not expected to have a Material Adverse Effect; and

none of the Trust,   the Company or any   subsidiary   of the Company has   received

notice of any proceeding,   and to the knowledge of the Trust, the Company or any

subsidiary of the Company, there has been no threatened proceeding,   relating to

the revocation, termination, suspension or modification of any such Governmental

Licenses which,   singularly or in the aggregate,   in the reasonable   judgment of

the Company or the Trust, is expected to result in a Material Adverse Effect.

 

 

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            (xxx)   Title to   Property.   Each of the Trust,   the   Company and the

subsidiaries   of   the   Company   has   good   and   marketable   title   to all of its

respective   real and   personal   properties,   in each   case free and clear of all

liens,   encumbrances and defects,   except such as, in the reasonable judgment of

the Trust or the Company,   singularly or in the   aggregate,   are not expected to

result in a Material   Adverse Effect;   and all of the leases and subleases under

which the Trust,   the Company or any subsidiary of the Company holds   properties

are in full   force and   effect,   except   when the   failure   of such   leases   and

subleases   to be in full force and   effect,   in the   reasonable   judgment of the

Company,   singularly   or in the   aggregate,   is not   expected to have a Material

Adverse   Effect,   and none of the Trust,   the Company or any   subsidiary   of the

Company has any notice of any claim of any sort that has been asserted by anyone

adverse to the rights of the Trust, the Company or any subsidiary of the Company

under any of the leases or subleases   under which the Trust,   the Company or any

subsidiary   of the Company holds   properties,   or affecting or   questioning   the

rights of such entity to the   continued   possession   of the leased or   subleased

premises   under any such   lease or   sublease,   except   when such   claim,   in the

reasonable   judgment of the   Company,   singularly   or in the   aggregate,   is not

expected to have a Material Adverse Effect.

 

            (xxxi)   Stabilization.   The Company has not taken and will not take,

directly or   indirectly,   any action   designed   to, or that might be   reasonably

expected to, cause or result in   stabilization   or   manipulation of the price of

the Capital Securities.

 

            (xxxii) No General   Solicitation.   Neither   the Trust or the Company

nor any of their   Affiliates   (as defined in Rule 501(b)   under the 1933 Act) or

any person acting on its or any of their behalf (other than the Placement Agent,

as to whom the Offerors make no   representation)   has engaged or will engage, in

connection with the offering of the Capital   Securities,   in any form of general

solicitation or general   advertising within the meaning of Rule 502(c) under the

1933 Act.

 

            (xxxiii)   No   Directed   Selling   Efforts.   Neither   the Trust or the

Company nor any of their   Affiliates or any person acting on its or any of their

behalf   (other   than   the   Placement   Agent,   as to whom   the   Offerors   make no

representation)   has   engaged or will   engage in any   directed   selling   efforts

within the   meaning of   Regulation   S under the 1933 Act   ("Regulation   S") with

respect to the offering of the Capital Securities.

 

            (xxxiv) No   Registration.   Subject to   compliance   by the   Placement

Agent with the relevant   provisions of Section 6 hereof,   it is not necessary in

connection   with the offer,   sale and delivery of the Capital   Securities by the

Trust in the manner   contemplated   by this   Agreement   to   register   the Capital

Securities,   the   guarantee   as   described   in the   Guarantee   Agreement   or the

Subordinated   Debt Securities   under the 1933 Act or to qualify the Declaration,

the Guarantee   Agreement or the Indenture under the Trust Indenture Act of 1939,

as amended.

 

      (b) Any   certificate   signed   by any   Trustee   of the   Trust   or any   duly

authorized   officer of the Company or any of its   subsidiaries   and delivered to

the   Placement   Agent or to counsel   for the   Placement   Agent shall be deemed a

representation and warranty by the Trust or the Company,   as the case may be, to

the Placement Agent as to the matters covered thereby.

 

 

                                       9

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      SECTION 2. Sale and Delivery through Placement Agent; Closing.

 

      (a) The   Offerors   propose   to issue and sell the   Capital   Securities   on

December 19, 2003 (or such other date mutually agreed to by the Offerors and the

Placement   Agent) (the "Closing Date") to ALESCO   Preferred   Funding II, Ltd., a

newly formed company with limited liability   incorporated   under the laws of the

Cayman   Islands   (the   "Purchaser"),   pursuant   to   the   terms   of   the   Capital

Securities   Subscription   Agreement,   entered   into   on   the   date   hereof   (the

"Subscription Agreement"),   between the Offerors and the Purchaser. In addition,

the Offerors   agree that the Purchaser   shall be entitled to the benefit of, and

to rely on, the   provisions   of this   Agreement   to the extent   such   provisions

address or relate to the Purchaser or the Capital   Securities to be purchased by

the Purchaser.

 

      (b) The Offerors   hereby grant to the Placement   Agent the exclusive right

to arrange the placement of the Capital   Securities   with the Purchaser on their

behalf.   The   Placement   Agent   accepts   such   right and   agrees to use its best

efforts, on and prior to the Closing Date, to effect such placement.

 

      (c) Deliveries of certificates for the Capital Securities shall be made by

the Trust to or on behalf of the Purchaser at the offices of Sidley Austin Brown

& Wood LLP in The City of New York,   and payment of the   purchase   price for the

Capital   Securities shall be made by the Purchaser to the Trust by wire transfer

of    immediately    available    funds   to   a   bank    designated   by   the   Company

contemporaneous with closing on the Closing Date.

 

            Certificates for the Capital Securities in the aggregate liquidation

amount thereof shall be registered in the name of the Purchaser.

 

      (d) As   compensation   to the   Placement   Agent   for its   placement   of the

Capital   Securities and in view of the fact that the proceeds of the sale of the

Capital   Securities will be used to purchase the Subordinated Debt Securities of

the   Company,   the   Company   hereby   agrees   to pay on the   Closing   Date to the

Placement   Agent in   immediately   available   funds a   commission   of $25.00   per

Capital Security to be delivered by the Trust hereunder on the Closing Date.

 

      (e) In performing   its duties under this   Agreement,   the Placement   Agent

shall be   entitled   to rely upon any   notice,   signature   or   writing   which the

Placement   Agent   shall in good faith   believe to be genuine and to be signed or

presented by a proper party or parties.   The   Placement   Agent may rely upon any

opinions or certificates   or other documents   delivered by the Offerors or their

counsel or designees either to it or the Purchaser.   In addition,   in connection

with the   performance of its duties under this   Agreement,   the Placement   Agent

shall not be liable for any error of judgment or any action   taken or omitted to

be taken   unless it was grossly   negligent or engaged in willful   misconduct   in

connection   with such   performance   or   non-performance.   No   provision   of this

Agreement   shall require the Placement   Agent to expend or risk its own funds or

otherwise incur any financial liability on behalf of the Purchaser in connection

with the performance of any of its duties   hereunder.   The Placement Agent shall

be under no   obligation   to exercis