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EXHIBIT 4.20
FIRST BANKS, INC.
10,000 Capital Securities
Floating Rate Capital Securities
(Liquidation Amount $1,000.00 per Capital Security)
PLACEMENT AGREEMENT
---------------
September 27, 2007
FTN Financial Capital Markets
845 Crossover Lane, Suite 150
Memphis, Tennessee 38117
Keefe, Bruyette & Woods, Inc.
787 7th Avenue
4th Floor
New York, New York 10019
Ladies and Gentlemen:
First Banks, Inc., a Missouri corporation (the "Company"), and
its
financing subsidiary, First Bank Statutory Trust XI, a Delaware
statutory trust
(the "Trust," and hereinafter together with the Company, the
"Offerors"), hereby
confirm their agreement (this "Agreement") with you as placement
agents (the
"Placement Agents"), as follows:
Section 1. Issuance and Sale of Securities.
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1.1. Introduction. The Offerors propose to issue and sell at
the
------------
Closing (as defined in Section 2.3.1 hereof) 10,000 of the
Trust's Floating Rate
Capital Securities, with a liquidation amount of $1,000.00 per
capital security
(the "Capital Securities"), to First Tennessee Bank National
Association (the
"Purchaser") pursuant to the terms of a Subscription Agreement
entered into, or
to be entered into on or prior to the Closing Date (as defined
in Section 2.3.1
hereof), between the Offerors and the Purchaser (the
"Subscription Agreement"),
the form of which is attached hereto as Exhibit A and
incorporated herein by
---------
this reference.
1.2. Operative Agreements. The Capital Securities shall be
fully
---------------------
and unconditionally guaranteed on a subordinated basis by the
Company with
respect to distributions and amounts payable upon liquidation,
redemption or
repayment (the "Guarantee") pursuant and subject to the
Guarantee Agreement (the
"Guarantee Agreement"), to be dated as of the Closing Date and
executed and
delivered by the Company and Wilmington Trust Company ("WTC"),
as trustee (the
"Guarantee Trustee"), for the benefit from time to time of the
holders of the
Capital Securities. The entire proceeds from the sale by the
Trust to the
holders of the Capital Securities shall be combined with the
entire proceeds
from the sale by the Trust to the Company of its common
securities (the "Common
Securities"), and shall be used by the Trust to purchase
$10,310,000.00 in
principal amount of the Floating Rate Junior Subordinated
Deferrable Interest
Debentures (the "Debentures") of the Company. The Capital
Securities and the
Common Securities for the Trust shall be issued pursuant to an
Amended and
Restated Declaration of Trust among WTC, as Delaware trustee
(the "Delaware
Trustee"), WTC, as institutional trustee (the "Institutional
Trustee"), the
Administrators named therein, and the Company, to be dated as of
the Closing
Date and in substantially the form heretofore delivered to the
Placement Agents
(the "Trust Agreement"). The Debentures shall be issued pursuant
to an Indenture
(the "Indenture"), to be dated as of the Closing Date, between
the Company and
WTC, as indenture trustee (the "Indenture Trustee"). The
documents identified in
this Section 1.2 and in Section 1.1 are referred to herein as
the "Operative
Documents."
1.3. Rights of Purchaser. The Capital Securities shall be
offered
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and sold by the Trust directly to the Purchaser without
registration of any of
the Capital Securities, the Debentures or the Guarantee under
the Securities Act
of 1933, as amended (the "Securities Act"), or any other
applicable securities
laws in reliance upon exemptions from the registration
requirements of the
Securities Act and other applicable securities laws. The
Offerors agree that
this Agreement shall be incorporated by reference into the
Subscription
Agreement and the Purchaser shall be entitled to each of the
benefits of the
<PAGE>
Placement Agents and the Purchaser under this Agreement and
shall be entitled to
enforce obligations of the Offerors under this Agreement as
fully as if the
Purchaser were a party to this Agreement. The Offerors and the
Placement Agents
have entered into this Agreement to set forth their
understanding as to their
relationship and their respective rights, duties and
obligations.
1.4. Legends. Upon original issuance thereof, and until such
time
-------
as the same is no longer required under the applicable
requirements of the
Securities Act, the Capital Securities and Debentures
certificates shall each
contain a legend as required pursuant to any of the Operative
Documents.
Section 2. Purchase of Capital Securities.
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2.1. Exclusive Rights; Purchase Price. From the date hereof
until
---------------------------------
the Closing Date (which date may be extended by mutual agreement
of the Offerors
and the Placement Agents), the Offerors hereby grant to the
Placement Agents the
exclusive right to arrange for the sale of the Capital
Securities to the
Purchaser at a purchase price of $1,000.00 per Capital
Security.
2.2. Subscription Agreement. The Offerors hereby agree to
evidence
-----------------------
their acceptance of the subscription by countersigning a copy of
the
Subscription Agreement and returning the same to the Placement
Agents.
2.3. Closing and Delivery of Payment.
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2.3.1. Closing; Closing Date. The sale and purchase of the
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CapitalSecurities by the Offerors to the Purchaser shall take
place at a closing
(the"Closing") at the offices of Lewis, Rice & Fingersh,
L.C., at 10:00 a.m.(St.
Louis time) on September 28, 2007, or such other business day as
may be agreed
upon by the Offerors and the Placement Agents (the "Closing
Date"); provided,
--------
however, that in no event shall the Closing Date occur later
than October 5,
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2007 unless consented to by the Purchaser. Payment by the
Purchaser shall be
payable in the manner set forth in the Subscription Agreement
and shall be made
prior to or on the Closing Date.
2.3.2. Delivery. The certificate for the Capital Securities
--------
shall be in definitive form, registered in the name of the
Purchaser, or the
Purchaser's designee, and in the aggregate amount of the Capital
Securities
purchased by the Purchaser.
2.3.3. Transfer Agent. The Offerors shall deposit the
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certificatere presenting the Capital Securities with the
Institutional Trustee
or other appropriate party prior to the Closing Date.
2.4. Costs and Expenses. Whether or not this Agreement is
terminated
------------------
or the sale of the Capital Securities is consummated, the
Company hereby
covenants and agrees that it shall pay or cause to be paid
(directly or by
reimbursement) all reasonable costs and expenses incident to the
performance of
the obligations of the Offerors under this Agreement, including
all fees,
expenses and disbursements of counsel and accountants for the
Offerors; all
reasonable expenses incurred by the Offerors incident to the
preparation,
execution and delivery of the Trust Agreement, the Indenture,
and the Guarantee;
and all other reasonable costs and expenses incident to the
performance of the
obligations of the Company hereunder and under the Trust
Agreement.
2.5. Failure to Close. If any of the conditions to the
Closing
----------------
specified in this Agreement shall not have been fulfilled to the
satisfaction of
the Placement Agents or if the Closing shall not have occurred
on or before
10:00 a.m. (St. Louis time) on October 5, 2007, then each party
hereto,
notwithstanding anything to the contrary in this Agreement,
shall be relieved of
all further obligations under this Agreement without thereby
waiving any rights
it may have by reason of such nonfulfillment or failure;
provided, however, that
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the obligations of the parties under Sections 2.4, 7.5 and 9
shall not be so
relieved and shall continue in full force and effect.
<PAGE>
Section 3. Closing Conditions. The obligations of the Purchaser
and the
------------------
Placement Agents on the Closing Date shall be subject to the
accuracy, at and as
of the Closing Date, of the representations and warranties of
the Offerors
contained in this Agreement, to the accuracy, at and as of the
Closing Date, of
the statements of the Offerors made in any certificates pursuant
to this
Agreement, to the performance by the Offerors of their
respective obligations
under this Agreement, to compliance, at and as of the Closing
Date, by the
Offerors with their respective agreements herein contained, and
to the following
further conditions:
3.1. Opinions of Counsel. On the Closing Date, the Placement
Agents
-------------------
shall have received the following favorable opinions, each dated
as of the
Closing Date: (a) from Stinson Morrison Hecker LLP, counsel for
the Offerors and
addressed to the Purchaser, the Placement Agents and WTC in
substantially the
form set forth on Exhibit B-1 attached hereto and incorporated
herein by this
-----------
reference, (b) from Richards, Layton & Finger, P.A., special
Delaware counsel to
the Offerors and addressed to the Purchaser, the Placement
Agents and the
Offerors, in substantially the form set forth on Exhibit B-2
attached hereto and
-----------
incorporated herein by this reference and (c) from Lewis, Rice
& Fingersh, L.C.,
special tax counsel to the Offerors, and addressed to the
Placement Agents and
the Offerors, addressing the items set forth on Exhibit B-3
attached hereto and
-----------
incorporated herein by this reference, subject to the receipt by
Lewis, Rice &
Fingersh, L.C. of a representation letter from the Company in
the form set forth
in Exhibit B-3 completed in a manner reasonably satisfactory to
Lewis, Rice &
-----------
Fingersh, L.C. (collectively, the "Offerors' Counsel Opinions").
In rendering
the Offerors' Counsel Opinions, counsel to the Offerors may rely
as to factual
matters upon certificates or other documents furnished by
officers, directors
and trustees of the Offerors (copies of which shall be delivered
to the
Placement Agents and the Purchaser) and by government officials,
and upon such
other documents as counsel to the Offerors may, in their
reasonable opinion,
deem appropriate as a basis for the Offerors' Counsel Opinions.
Counsel to the
Offerors may specify the jurisdictions in which they are
admitted to practice
and that they are not admitted to practice in any other
jurisdiction and are not
experts in the law of any other jurisdiction. If the Offerors'
counsel is not
admitted to practice in the State of New York, the opinion of
Offerors' counsel
may assume, for purposes of the opinion, that the laws of the
State of New York
are substantively identical, in all respects material to the
opinion, to the
internal laws of the state in which such counsel is admitted to
practice. Such
Offerors' Counsel Opinions shall not state that they are to be
governed or
qualified by, or that they are otherwise subject to, any
treatise, written
policy or other document relating to legal opinions, including,
without
limitation, the Legal Opinion Accord of the ABA Section of
Business Law (1991).
3.2. Officer's Certificate. At the Closing Date, the Purchaser
and
---------------------
the Placement Agents shall have received certificates from an
authorized officer
of the Company, dated as of the Closing Date, stating that (i)
the
representations and warranties of the Offerors set forth in
Section 5 hereof are
true and correct as of the Closing Date and that the Offerors
have complied with
all agreements and satisfied all conditions on their part to be
performed or
satisfied at or prior to the Closing Date, (ii) since the date
of this Agreement
the Offerors have not incurred any liability or obligation,
direct or
contingent, or entered into any material transactions, other
than in the
ordinary course of business, which is material to the Offerors,
and (iii)
covering such other matters as the Placement Agents may
reasonably request.
3.3. Administrator's Certificate. At the Closing Date, the
Purchaser
---------------------------
and the Placement Agents shall have received a certificate of
one or more
Administrators of the Trust, dated as of the Closing Date,
stating that the
representations and warranties of the Trust set forth in Section
5 are true and
correct as of the Closing Date and that the Trust has complied
with all
agreements and satisfied all conditions on its part to be
performed or satisfied
at or prior to the Closing Date.
3.4. Purchase Permitted by Applicable Laws; Legal Investment.
The
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purchase of and payment for the Capital Securities as described
in this
Agreement and pursuant to the Subscription Agreement shall (a)
not be prohibited
by any applicable law or governmental regulation, (b) not
subject the Purchaser
or the Placement Agents to any penalty or, in the reasonable
judgment of the
Purchaser and the Placement Agents, other onerous conditions
under or pursuant
to any applicable law or governmental regulation, and (c) be
permitted by the
laws and regulations of the jurisdictions to which the Purchaser
and the
Placement Agents are subject.
<PAGE>
3.5. Consents and Permits. The Company and the Trust shall
have
---------------------
received all consents, permits and other authorizations, and
made all such
filings and declarations, as may be required from any person or
entity pursuant
to any law, statute, regulation or rule (federal, state, local
and foreign), or
pursuant to any agreement, order or decree to which the Company
or the Trust is
a party or to which either is subject, in connection with the
transactions
contemplated by this Agreement.
3.6. Information. Prior to or on the Closing Date, the
Offerors
-----------
shall have furnished to the Placement Agents such further
information,
certificates, opinions and documents addressed to the Purchaser
and the
Placement Agents, which the Placement Agents may reasonably
request, including,
without limitation, a complete set of the Operative Documents or
any other
documents or certificates required by this Section 3; and all
proceedings taken
by the Offerors in connection with the issuance, offer and sale
of the Capital
Securities as herein contemplated shall be reasonably
satisfactory in form and
substance to the Placement Agents.
If any condition specified in this Section 3 shall not have
been
fulfilled when and as required in this Agreement, or if any of
the opinions or
certificates mentioned above or elsewhere in this Agreement
shall not be
reasonably satisfactory in form and substance to the Placement
Agents, this
Agreement may be terminated by the Placement Agents by notice to
the Offerors at
any time at or prior to the Closing Date. Notice of such
termination shall be
given to the Offerors in writing or by telephone or facsimile
confirmed in
writing.
Section 4. Conditions to the Offerors' Obligations. The
obligations of the
---------------------------------------
Offerors to sell the Capital Securities to the Purchaser and
consummate the
transactions contemplated by this Agreement shall be subject to
the accuracy, at
and as of the Closing Date, of the representations and
warranties of the
Placement Agents contained in this Agreement and to the
following further
conditions:
4.1. Executed Agreement. The Offerors shall have received from
the
------------------
Placement Agents an executed copy of this Agreement.
4.2. Fulfillment of Other Obligations. The Placement Agents
shall
--------------------------------
have fulfilled all of their other obligations and duties
required to be
fulfilled under this Agreement prior to or at the Closing.
Section 5. Representations and Warranties of the Offerors.
Except as set
------------------------------------------------
forth on the Disclosure Schedule (as defined in Section 11.1)
attached hereto,
if any, the Offerors jointly and severally represent and warrant
to the
Placement Agents and the Purchaser as of the date hereof and as
of the Closing
Date as follows:
5.1. Securities Law Matters.
----------------------
(a) Neither the Company nor the Trust, nor any of their
"Affiliates" (as defined in Rule 501(b) of Regulation D under
the Securities Act
("Regulation D")), nor any person acting on any of their behalf
has, directly or
indirectly, made offers or sales of any security, or solicited
offers to buy any
security, under circumstances that would require the
registration under the
Securities Act of any of the Capital Securities, the Guarantee
or the Debentures
(collectively, the "Securities") or any other securities to be
issued, or which
may be issued, by the Purchaser.
(b) Neither the Company nor the Trust, nor any of their
Affiliates, nor any person acting on its or their behalf has (i)
other than the
Placement Agents, offered for sale or solicited offers to
purchase the
Securities, or (ii) engaged in any form of offering, general
solicitation or
general advertising (within the meaning of Regulation D) in
connection with any
offer or sale of any of the Securities.
(c) The Securities satisfy the eligibility requirements of
Rule
144A(d)(3) under the Securities Act.
(d) Neither the Company nor the Trust is or, after giving
effect to the offering and sale of the Capital Securities and
the consummation
of the transactions described in this Agreement, 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
"Investment Company Act"), without regard to Section 3(c) of the
Investment
Company Act.
<PAGE>
(e) Neither the Company nor the Trust has paid or agreed to
pay to any person or entity (other than the Placement Agents)
any compensation
for soliciting another to purchase any of the Securities.
5.2. Organization, Standing and Qualification of the Trust.
The
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Trust has been duly created and is validly existing in good
standing as a
statutory trust under the Delaware Statutory Trust Act (the
"Statutory Trust
Act") with the power and authority to own property and to
conduct the business
it transacts and proposes to transact and to enter into and
perform its
obligations under the Operative Documents. The Trust is duly
qualified to
transact business as a foreign entity and is in good standing in
each
jurisdiction in which such qualification is necessary, except
where the failure
to so qualify or be in good standing would not have a material
adverse effect on
the Trust. The Trust is not a party to or otherwise bound by any
agreement other
than the Operative Documents. The Trust is and will, under
current law, be
classified for federal income tax purposes as a grantor trust
and not as an
association taxable as a corporation.
5.3. Trust Agreement. The Trust Agreement 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 of the Trust,
and, assuming due
authorization, execution and delivery by the Delaware Trustee
and the
Institutional Trustee, will be a valid and binding obligation of
the Company and
such Administrators, enforceable against them in accordance with
its terms,
subject to (a) applicable bankruptcy, insolvency, moratorium,
receivership,
reorganization, liquidation and other laws relating to or
affecting creditors'
rights generally, and (b) general principles of equity
(regardless of whether
considered and applied in a proceeding in equity or at law)
("Bankruptcy and
Equity"). Each of the Administrators of the Trust is an employee
or a director
of the Company or of a financial institution subsidiary of the
Company and has
been duly authorized by the Company to execute and deliver the
Trust Agreement.
5.4. Guarantee Agreement and the Indenture. Each of the
Guarantee
--------------------------------------
and 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 by the Guarantee
Trustee, in the case
of the Guarantee, and by the Indenture Trustee, in the case of
the Indenture,
will be a valid and binding obligation of the Company
enforceable against it in
accordance with its terms, subject to Bankruptcy and Equity.
5.5. Capital Securities and Common Securities. The Capital
-----------------------------------------------
Securities and the Common Securities have been duly authorized
by the Trust
Agreement and, when issued and delivered against payment
therefor on the Closing
Date to the Purchaser, in the case of the Capital Securities,
and to the
Company, in the case of the Common Securities, will be validly
issued and
represent undivided beneficial interests in the assets of the
Trust. None of the
Capital Securities or the Common Securities is subject to
preemptive or other
similar rights. On the Closing Date, all of the issued and
outstanding Common
Securities will be directly owned by the Company free and clear
of any pledge,
security interest, claim, lien or other encumbrance.
5.6. Debentures. The Debentures have been duly authorized by
the
----------
Company and, at the Closing Date, will have been duly executed
and delivered to
the Indenture Trustee for authentication in accordance with the
Indenture, and,
when authenticated in the manner provided for in the Indenture
and delivered
against payment therefor by the Trust, will constitute valid and
binding
obligations of the Company entitled to the benefits of the
Indenture enforceable
against the Company in accordance with their terms, subject to
Bankruptcy and
Equity.
5.7. Power and Authority. This Agreement has been duly
authorized,
--------------------
executed and delivered by the Company and the Trust and
constitutes the valid
and binding obligation of the Company and the Trust, enforceable
against the
Company and the Trust in accordance with its terms, subject to
Bankruptcy and
Equity.
5.8. No Defaults. The Trust is not in violation of the Trust
------------
Agreement or, to the knowledge of the Administrators, any
provision of the
Statutory Trust Act. The execution, delivery and performance by
the Company or
the Trust of this Agreement or the Operative Documents to which
it is a party,
and the consummation of the transactions contemplated herein or
therein and the
use of the proceeds therefrom, will not conflict with or
constitute a breach of,
or a default under, or result in the creation or imposition of
any lien, charge
or other encumbrance upon any property or assets of the Trust,
the Company or
any of the Company's Subsidiaries (as defined in Section 5.11
hereof) pursuant
to any contract, indenture, mortgage, loan agreement, note,
lease or other
instrument to which the Trust, the Company or any of its
Subsidiaries is a party
<PAGE>
or by which it or any of them may be bound, or to which any of
the property or
assets of any of them is subject, except for a conflict, breach,
default, lien,
charge or encumbrance which could not, singly or in the
aggregate, reasonably be
expected to have a Material Adverse Effect nor will such action
result in any
violation of the Trust Agreement or the Statutory Trust Act or
require the
consent, approval, authorization or order of any court or
governmental agency or
body. As used herein, the term "Material Adverse Effect" means
any one or more
effects that individually or in the aggregate are material and
adverse to the
Offerors' ability to consummate the transactions contemplated
herein or in the
Operative Documents or any one or more effects that individually
or in the
aggregate are material and adverse to the condition (financial
or otherwise),
earnings, affairs, business, prospects or results of operations
of the Company
and its Subsidiaries taken as whole, whether or not occurring in
the ordinary
course of business.
5.9. Organization, Standing and Qualification of the Company.
The
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Company has been duly incorporated and is validly existing as a
corporation in
good standing under the laws of Missouri, with all requisite
corporate power and
authority to own its properties and conduct the business it
transacts and
proposes to transact, and is duly qualified to transact business
and is in good
standing as a foreign corporation in each jurisdiction where the
nature of its
activities requires such qualification, except where the failure
of the Company
to be so qualified would not, singly or in the aggregate, have a
Material
Adverse Effect.
5.10. Subsidiaries of the Company. Each of the Company's
significant
---------------------------
subsidiaries (as defined in Section 1-02(w) of Regulation S-X to
the Securities
Act (the "Significant Subsidiaries")) is listed in Exhibit C
attached hereto and
---------
incorporated herein by this reference. Each Significant
Subsidiary has been duly
organized and is validly existing and in good standing under the
laws of the
jurisdiction in which it is chartered or organized, with all
requisite power and
authority to own its properties and conduct the business it
transacts and
proposes to transact, and is duly qualified to transact business
and is in good
standing as a foreign entity in each jurisdiction where the
nature of its
activities requires such qualification, except where the failure
of any such
Significant Subsidiary to be so qualified would not, singly or
in the aggregate,
have a Material Adverse Effect. All of the issued and
outstanding shares of
capital stock of the Significant Subsidiaries (a) have been duly
authorized and
are validly issued, (b) are fully paid and nonassessable, and
(c) are wholly
owned, directly or indirectly, by the Company free and clear of
any security
interest, mortgage, pledge, lien, encumbrance, restriction upon
voting or
transfer, preemptive rights, claim, equity or other defect.
5.11. Permits. The Company and each of its subsidiaries (as
defined
in Section 1-02(x) of Regulation S-X to the Securities Act) (the
"Subsidiaries")
have all requisite power and authority, and all necessary
authorizations,
approvals, orders, licenses, certificates and permits of and
from regulatory or
governmental officials, bodies and tribunals, to own or lease
their respective
properties and to conduct their respective businesses as now
being conducted,
except such authorizations, approvals, orders, licenses,
certificates and
permits which, if not obtained and maintained, would not, singly
or in the
aggregate, have a Material Adverse Effect, and neither the
Company nor any of
its Subsidiaries has received any notice of proceedings relating
to the
revocation or modification of any such authorizations,
approvals, orders,
licenses, certificates or permits which, singly or in the
aggregate, if the
failure to be so licensed or approved is the subject of an
unfavorable decision,
ruling or finding, would, singly or in the aggregate, have a
Material Adverse
Effect; and the Company and its Subsidiaries are in compliance
with all
applicable laws, rules, regulations and orders and consents, the
violation of
which would, singly or in the aggregate, have a Material Adverse
Effect.
5.12. Conflicts, Authorizations and Approvals. Neither the
Company
----------------------------------------
nor any of its Subsidiaries is in violation of its respective
articles or
certificate of incorporation, charter or by-laws or similar
organizational
documents or in default in the performance or observance of any
obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage,
loan agreement, note, lease or other agreement or instrument to
which either the
Company or any of its Subsidiaries is a party, or by which it or
any of them may
be bound or to which any of the property or assets of the
Company or any of its
Subsidiaries is subject, the effect of which violation or
default in performance
or observance would have, singly or in the aggregate, a Material
Adverse Effect.
5.13. Holding Company Registration and Deposit Insurance.
The
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Company is duly registered (i) as a bank holding company or
financial holding
company under the Bank Holding Company Act of 1956, as amended,
and the
regulations of the Board of Governors of the Federal Reserve
System (the
"Federal Reserve") or (ii) as a savings and loan holding company
under the Home
Owners' Loan Act of 1933, as amended, and the regulations of the
Office of
Thrift Supervision (the "OTS"), and the deposit accounts of the
Company's
Subsidiary depository institutions are insured by the Federal
Deposit Insurance
Corporation ("FDIC") to the fullest extent permitted by law and
the rules and
regulations of the FDIC, and no proceedings for the termination
of such
insurance are pending or threatened.
5.14. Financial Statements.
--------------------
(a) The consolidated balance sheets of the Company and all
of
its Subsidiaries as of December 31, 2006 and December 31, 2005
and related
consolidated income statements and statements of changes in
shareholders' equity
for the three years ended December 31, 2006 together with the
notes thereto, and
the consolidated balance sheets of the Company and all of its
Subsidiaries as of
June 30, 2007 and the related consolidated income statements and
statements of
changes in shareholders' equity for the six months then ended,
copies of each of
which have been provided to the Placement Agents (together, the
"Financial
Statements"), have been prepared in accordance with generally
accepted
accounting principles applied on a consistent basis (except as
may be disclosed
therein) and fairly present in all material respects the
financial position and
the results of operations and changes in shareholders' equity of
the Company and
all of its Subsidiaries as of the dates and for the periods
indicated (subject,
in the case of interim financial statements, to normal recurring
year-end
adjustments, none of which shall be material). The books and
records of the
Company and all of its Subsidiaries have been, and are being,
maintained in all
material respects in accordance with generally accepted
accounting principles
and any other applicable legal and accounting requirements and
reflect only
actual transactions.
(b) The information in the Company's most recently filed (i)
FR
Y-9C filed with the Federal Reserve if the Company is a bank
holding company,
(ii) FR Y-9SP filed with the Federal Reserve if the Company is a
small bank
holding company or (iii) H-(b)11 filed with the OTS if the
Company is a savings
and loan holding company (the "Regulatory Report"), previously
provided to the
Placement Agents fairly presents in all material respects the
financial position
of the Company and, where applicable, all of its Subsidiaries as
of the end of
the period represented by such Regulatory Report.
(c) Since the respective dates of the Financial Statements
and
the Regulatory Report, there has been no material adverse change
or development
with respect to the financial condition or earnings of the
Company and all of
its Subsidiaries, taken as a whole.
(d) The accountants of the Company who certified the
year-end
Financial Statements are independent public accountants of the
Company and its
Subsidiaries within the meaning of the Securities Act and the
rules and
regulations thereunder.
5.15. Exchange Act Reporting. The reports filed with the
Securities
----------------------
and Exchange Commission (the "Commission") by the Company under
the Securities
Exchange Act of 1934, as amended (the "1934 Act") and the
regulations thereunder
at the time they were filed with the Commission complied as to
form in all
material respects with the requirements of the 1934 Act and such
reports did 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 in which they were made, not
misleading (except to
the extent superseded by a subsequent report filed by the
Company with the
Commission).
5.16. Regulatory Enforcement 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 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 since January 1, 2004,
a recipient of
any supervisory letter from, or since January 1, 2004, has
adopted any board
resolutions at the request of, any Regulatory Agency (as defined
below) that
currently restricts in any material respect the conduct of their
business or
that in any material manner relates to their capital adequacy,
their credit
policies, their ability or authority to pay dividends or make
distributions to
their shareholders or make payments of principal or interest on
their debt
obligations, their management or their business (each, a
"Regulatory
Agreement"), nor has the Company or any of its Subsidiaries been
advised since
January 1, 2004, by any Regulatory Agency that it is considering
issuing or
requesting any such Regulatory Agreement. There is no material
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. As used herein, the term "Regulatory Agency" means
any federal or
state agency charged with the supervision or regulation of
depository
institutions, bank, financial or savings and loan holding
companies, or engaged
in the insurance of depository 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. Neither the Company nor any
of the
Subsidiaries is currently unable to pay dividends or make
distributions to its
shareholders with respect to any class of its equity securities,
or prohibited
from paying principal or interest on its debt obligations, due
to a restriction
or limitation, whether by statute, contract or otherwise, and,
in the reasonable
judgment of the Company's management, neither the Company nor
any of the
Subsidiaries will be unable in the foreseeable future to pay
dividends or make
distributions with respect to any class of equity securities, or
be prohibited
from paying principal or interest on its debt obligations, due
to a restriction
or limitation, whether by statute, contract or otherwise.
<PAGE>
5.17. No Material Change. Since December 31, 2006, there has
been no
------------------
material adverse change or development with respect to the
condition (financial
or otherwise), earnings, affairs, business, prospects or results
of operations
of the Company or its Subsidiaries on a consolidated basis,
whether or not
arising in the ordinary course of business.
5.18. 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 and (ii)
normal
fluctuation 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 the
Financial Statements.
5.19. Litigation. No charge, investigation, action, suit or
----------
proceeding is pending or, to the knowledge of the Offerors,
threatened against
or affecting the Company or its Subsidiaries or any of their
respective
properties before or by any courts or any regulatory,
administrative or
governmental official, commission, board, agency or other
authority or body, or
any arbitrator, wherein an unfavorable decision, ruling or
finding could have,
singly or in the aggregate, a Material Adverse Effect.
5.20. Deferral of Interest Payments on Debentures. The Company
has no
-------------------------------------------
present intention to exercise its option to defer payments of
interest on the
Debentures as provided in the Indenture. The Company believes
that the
likelihood that it would exercise its right to defer payments of
interest on the
Debentures as provided in the Indenture at any time during which
the Debentures
are outstanding is remote because of the restrictions that would
be imposed on
the Company's ability to declare or pay dividends or
distributions on, or to
redeem, purchase, acquire or make a liquidation payment with
respect to, any of
the Company's capital stock and on the Company's ability to make
any payments of
principal, interest or premium on, or repay, repurchase or
redeem, any of its
debt securities that rank pari passu in all respects with, or
junior in interest
to, the Debentures.
Section 6. Representations and Warranties of the Placement
Agents. Each
---------------------------------------------------------
Placement Agent represents and warrants to the Offerors as to
itself (but not as
to the other Placement Agent) as follows:
6.1. Organization, Standing and Qualification.
----------------------------------------
(a) FTN Financial Capital Markets is a division of First
Tennessee Bank National Association, a national banking
association duly
organized, validly existing and in good standing under the laws
of the United
States, with full power and authority to own, lease and operate
its properties
and conduct its business as currently being conducted. FTN
Financial Capital
Markets is duly qualified to transact business as a foreign
corporation and is
in good standing in each other jurisdiction in which it owns or
leases property
or conducts its business so as to require such qualification and
in which the
failure to so qualify would, individually or in the aggregate,
have a material
adverse effect on the condition (financial or otherwise),
earnings, business,
prospects or results of operations of FTN Financial Capital
Markets.
(b) Keefe, Bruyette & Woods, Inc. is a corporation duly
organized, validly existing and in good standing under the laws
of the State of
New York, with full power and authority to own, lease and
operate its properties
and conduct its business as currently being conducted. Keefe,
Bruyette & Woods,
Inc. is duly qualified to transact business as a foreign
corporation and is in
good standing in each other jurisdiction in which it owns or
leases property or
conducts its business so as to require such qualification and in
which the
failure to so qualify would, individually or in the aggregate,
have a material
adverse effect on the condition (financial or otherwise),
earnings, business,
prospects or results of operations of Keefe, Bruyette &
Woods, Inc.
6.2. Power and Authority. The Placement Agent has all
requisite
-------------------
power and authority to enter into this Agreement, and this
Agreement has been
duly and validly authorized, executed and delivered by the
Placement Agent and
constitutes the legal, valid and binding agreement of the
Placement Agent,
enforceable against the Placement Agent in accordance with its
terms, subject to
Bankruptcy and Equity and except as any indemnification or
contribution
provisions thereof may be limited under applicable securities
laws.
<PAGE>
6.3. General Solicitation. In the case of the offer and sale
of
---------------------
the Capital Securities, no form of general solicitation or
general advertising
was used by the Placement Agent or its representatives
including, but not
limited to, advertisements, articles, notices or other
communications published
in any newspaper, magazine or similar medium or broadcast over
television or
radio or any seminar or meeting whose attendees have been
invited by any general
solicitation or general advertising.
6.4. Purchaser. The Placement Agent has made such reasonable
inquiry
---------
as is necessary to determine that the Purchaser is acquiring the
Capital
Securities for its own account, except as contemplated in
Section 7.8 hereto,
and that the Purchaser does not intend to distribute the Capital
Securities in
contravention of the Securities Act or any other applicable
securities laws.
6.5. Qualified Purchasers. The Placement Agent has not offered
or
--------------------
sold and will not arrange for the offer or sale of the Capital
Securities except
(i) to those the Placement Agent reasonably believes are
"accredited investors"
(as defined in Rule 501 of Regulation D), or (ii) in any other
manner that does
not require registration of the Capital Securities under the
Securities Act. In
connection with each such sale, the Placement Agent has taken or
will take
reasonable steps to ensure that the Purchaser is aware that (a)
such sale is
being made in reliance on an exemption under the Securities Act
and (b) future
transfers of the Capital Securities will not be made except in
compliance with
applicable securities laws.
6.6. Offering Circulars. Neither the Placement Agent nor its
-------------------
representatives will include any non-public information about
the Company, the
Trust or any of their Affiliates in any registration statement,
prospectus,
offering circular or private placement memorandum used in
connection with any
purchase of Capital Securities without the prior written consent
of the Trust
and the Company.
Section 7. Covenants of the Offerors. The Offerors covenant and
agree with
-------------------------
the Placement Agents and the Purchaser as follows:
7.1. Compliance with Representations and Warranties. During
the
-------------------------------------------------
period from the date of this Agreement to the Closing Date, the
Offerors shall
use their best efforts and take all action necessary or
appropriate to cause
their representations and warranties contained in Section 5
hereof to be true as
of the Closing Date, after giving effect to the transactions
contemplated by
this Agreement, as if made on and as of the Closing Date.
7.2. Sale and Registration of Securities. The Offerors and
their
------------------------------------
Affiliates shall not nor shall any of them permit any person
acting on their
behalf (other than the Placement Agents), to directly or
indirectly (i) sell,
offer for sale or solicit offers to buy or otherwise negotiate
in respect of any
security (as defined in the Securities Act) that would or could
be integrated
with the sale of the Capital Securities in a manner that would
require the
registration under the Securities Act of the Securities or (ii)
make offers or
sales of any such Security, or solicit offers to buy any such
Security, under
circumstances that would require the registration of any of such
Securities
under the Securities Act.
7.3. Use of Proceeds. The Trust shall use the proceeds from the
sale
---------------
of the Capital Securities and the Common Securities to purchase
the Debentures
from the Company.
7.4. Investment Company. The Offerors shall not engage, or
permit
-------------------
any Subsidiary to engage, in any activity which would cause it
or any Subsidiary
to be an "investment company" under the provisions of the
Investment Company
Act.
7.5. Reimbursement of Expenses. If the sale of the Capital
-------------------------
Securities provided for herein is not consummated (i) because
any condition set
forth in Section 3 hereof is not satisfied, or (ii) because of
any refusal,
inability or failure on the part of the Company or the Trust to
perform any
agreement herein or comply with any provision hereof other than
by reason of a
breach by the Placement Agents, the Company shall reimburse the
Placement Agents
upon demand for all of their pro rata share of out-of-pocket
expenses (including
reasonable fees and disbursements of counsel) in an amount not
to exceed
$50,000.00 that shall have been incurred by them in connection
with the proposed
purchase and sale of the Capital Securities. Notwithstanding the
foregoing, the
Company shall have no obligation to reimburse the Placement
Agents for their
out-of-pocket expenses if the sale of the Capital Securities
fails to occur
because the Placement Agents fail to fulfill a condition set
forth in Section 4
or the Purchaser fails to purchase the Capital Securities.
<PAGE>
7.6. Solicitation and Advertising. In connection with any offer
or
----------------------------
sale of any of the Securities, the Offerors shall not, nor shall
either of them
permit any of their Affiliates or any person acting on their
behalf, other than
the Placement Agents, to engage in any form of general
solicitation or general
advertising (as defined in Regulation D).
7.7. Compliance with Rule 144A(d)(4) under the Securities Act.
So
-----------------------------------------------------------
long as any of the Securities are outstanding and are
"restricted securities"
within the meaning of Rule 144(a)(3) under the Securities Act,
the Offerors
will, during any period in which they are not subject to and in
compliance with
Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended (the
"Exchange Act"), or the Offerors are not exempt from such
reporting requirements
pursuant to and in compliance with Rule 12g3-2(b) under the
Exchange Act,
provide to each holder of such restricted securities and to each
prospective
purchaser (as designated by such holder) of such restricted
securities, upon the
request of such holder or prospective purchaser in connection
with any proposed
transfer, any information required to be provided by Rule
144A(d)(4) under the
Securities Act, if applicable. This covenant is intended to be
for the benefit
of the holders, and the prospective purchasers designated by
such holders, from
time to time of such restricted securities. The information
provided by the
Offerors pursuant to this Section 7.7 will not, at the date
thereof, contain any
untrue statement of a material fact or omit to state any
material fact necessary
to make the statements therein, in light of the circumstances
under which they
were made, not misleading.
7.8. Transfer Notice. The Offerors acknowledge that the
Purchaser
---------------
may transfer the Capital Securities, in whole or in part, at any
time and from
time to time following the Closing Date by delivering the notice
(the "Transfer
Notice") attached as Exhibit B to the Master Custodian
Agreement, dated May 27,
---------
2004, as amended, and attached as Exhibit A to the Subscription
Agreement. In
---------
order to facilitate such transfer, the Company shall execute in
blank five
additional Capital Securities certificates, to be delivered at
Closing, such
certificates to be completed with the name of the transferee(s)
to which the
Capital Securities, in whole or in part, will be transferred
upon the receipt of
a Transfer Notice and authenticated by the Institutional Trustee
at the time of
each such transfer.
Section 8. Covenants of the Placement Agents. The Placement
Agents
------------------------------------
covenant and agree with the Offerors that, during the period
from the date of
this Agreement to the Closing Date, the Placement Agents shall
use their best
efforts and take all action necessary or appropriate to cause
their
representations and warranties contained in Section 6 to be true
as of the
Closing Date, after giving effect to the transactions
contemplated by this
Agreement, as if made on and as of the Closing Date. The
Placement Agents
further covenant and agree not to engage in hedging transactions
with respect to
the Capital Securities unless such transactions are conducted in
compliance with
the Securities Act.
Section 9. Indemnification.
---------------
9.1. Indemnification Obligation. The Offerors shall jointly
and
---------------------------
severally indemnify and hold harmless the Placement Agents and
the Purchaser and
each of their respective agents, employees, officers and
directors and each
person that controls either of the Placement Agents or the
Purchaser within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act,
and agents, employees, officers and directors or any such
controlling person of
either of the Placement Agents or the Purchaser (each such
person or entity, an
"Indemnified Party") from and against any and all losses,
claims, damages,
judgments, liabilities or expenses, joint or several, to which
such Indemnified
Party may become subject under the Securities Act, the Exchange
Act or other
federal or state statutory law or regulation, or at common law
or otherwise
(including in settlement of any litigation, if such settlement
is effected with
the written consent of the Offerors), insofar as such losses,
claims, damages,
judgments, liabilities or expenses (or actions in respect
thereof) arise out of,
or are based upon, or relate to, in whole or in part, (a) any
untrue statement
or alleged untrue statement of a material fact contained in any
information
(whether written or oral) or documents executed in favor of,
furnished or made
available to the Placement Agents or the Purchaser by the
Offerors, or (b) any
omission or alleged omission to state in any information
(whether written or
oral) or documents executed in favor of, furnished or made
available to the
Placement Agents or the Purchaser by the Offerors a material
fact required to be
stated therein or necessary to make the statements therein not
misleading, and
shall reimburse each Indemnified Party for any legal and other
expenses as such
expenses are reasonably incurred by such Indemnified Party in
connection with
investigating, defending, settling, compromising or paying any
such loss, claim,
damage, judgments, liability, expense or action described in
this Section 9.1.
<PAGE>
In addition to their other obligations under this Section 9, the
Offerors hereby
agree that, as an interim measure during the pendency of any
claim, action,
investigation, inquiry or other proceeding arising out of, or
based upon, or
related to the matters described above in this Section 9.1, they
shall reimburse
each Indemnified Party on a quarterly basis for all reasonable
legal or other
expenses incurred in connection with investigating or defending
any such claim,
action, investigation, inquiry or other proceeding,
notwithstanding the absence
of a judicial determination as to the propriety and
enforceability of the
possibility that such payments might later be held to have been
improper by a
court of competent jurisdiction. To the extent that any such
interim
reimbursement payment is so held to have been improper, each
Indemnified Party
shall promptly return such amounts to the Offerors together with
interest,
determined on the basis of the prime rate (or other commercial
lending rate for
borrowers of the highest credit standing) announced from time to
time by First
Tennessee Bank National Association (the "Prime Rate"). Any such
interim
reimbursement payments which are not made to an Indemnified
Party within 30 days
of a request for reimbursement shall bear interest at the Prime
Rate from the
date of such request.
9.2. Conduct of Indemnification Proceedings. Promptly after
receipt
--------------------------------------
by an Indemnified Party under this Section 9 of notice of the
commencement of
any action, such Indemnified Party shall, if a claim in respect
thereof is to be
made against the Offerors under this Section 9, notify the
Offerors in writing
of the commencement thereof; but, subject to Section 9.4, the
omission to so
notify the Offerors shall not relieve them from any liability
pursuant to
Section 9.1 which the Offerors may have to any Indemnified Party
unless and to
the extent that the Offerors did not otherwise learn of such
action and such
failure by the Indemnified Party results in the forfeiture by
the Offerors of
substantial rights and defenses. In case any such action is
brought against any
Indemnified Party and such Indemnified Party seeks or intends to
seek indemnity
from the Offerors, the Offerors shall be entitled to participate
in, and, to the
extent that they may wish, to assume the defense thereof with
counsel reasonably
satisfactory to such Indemnified Party; provided, however, if
the defendants in
-------- -------
any such action include both the Indemnified Party and the
Offerors and the
Indemnified Party shall have reasonably concluded that there may
be a conflict
between the positions of the Offerors and the Indemnified Party
in conducting
the defense of any such action or that there may be legal
defenses available to
it and/or other Indemnified Parties which are different from or
additional to
those available to the Offerors, the Indemnified Party shall
have the right to
select separate counsel to assume such legal defenses and to
otherwise
participate in the defense of such action on behalf of such
Indemnified Party.
Upon receipt of notice from the Offerors to such Indemnified
Party of their
election to so assume the defense of such action and approval by
the Indemnified
Party of counsel, the Offerors shall not be liable to such
Indemnified Party
under this Section 9 for any legal or other expenses
subsequently incurred by
such Indemnified Party in connection with the defense thereof
unless (i) the
Indemnified Party shall have employed such counsel in connection
with the
assumption of legal defenses in accordance with the proviso in
the preceding
sentence (it being understood, however, that the Offerors shall
not be liable
for the expenses of more than one separate counsel representing
the Indemnified
Parties who are parties to such action), or (ii) the Offerors
shall not have
employed counsel reasonably satisfactory to the Indemnified
Party to represent
the Indemnified Party within a reasonable time after notice of
commencement of
the action, in each of which cases the fees and expenses of
counsel of such
Indemnified Party shall be at the expense of the Offerors.
9.3. Contribution. If the indemnification provided for in
this
------------
Section 9 is required by its terms, but is for any reason held
to be unavailable
to or otherwise insufficient to hold harmless an Indemnified
Party under Section
9.1 in respect of any losses, claims, damages, liabilities or
expenses referred
to herein or therein, then the Offerors shall contribute to the
amount paid or
payable by such Indemnified Party as a result of any losses,
claims, damages,
judgments, liabilities or expenses referred to herein (i) in
such proportion as
is appropriate to reflect the relative benefits received by the
Offerors, on the
one hand, and the Indemnified Party, on the other hand, from the
offering of
such Capital Securities, 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 Offerors, on the one hand, and the
Placement Agents,
on the other hand, in connection with the statements or
omissions or
inaccuracies in the representations and warranties herein or
other breaches
which resulted in such losses, claims, damages, judgments,
liabilities or
expenses, as well as any other relevant equitable
considerations. The respective
relative benefits received by the Offerors, on the one hand, and
the Placement
Agents, on the other hand, shall be deemed to be in the same
proportion, in the
case of the Offerors, as the total price paid to the Offerors
for the Capital
Securities sold by the Offerors to the Purchaser (net of the
compensation paid
to the Placement Agents hereunder, but before deducting
expenses), and in the
case of the Placement Agents, as the compensation received by
them, bears to the
total of such amounts paid to the Offerors and received by the
Placement Agents
as compensation. The relative fault of the Offerors and the
Placement Agents
shall be determined by reference to, among other things, whether
the untrue
<PAGE>
statement or alleged untrue statement of a material fact or the
omission or
alleged omission of a material fact or the inaccurate or the
alleged inaccurate
representation and/or warranty relates to information supplied
by the Offerors
or the Placement Agents and the parties' relative intent,
knowledge, access to
information and opportunity to correct or prevent such statement
or omission.
The provisions set forth in Section 9.2 with respect to notice
of commencement
of any action shall apply if a claim for contribution is made
under this Section
9.3; provided, however, that no additional notice shall be
required with respect
-------- -------
to any action for which notice has been given under Section 9.2
for purposes of
indemnification. The Offerors and the Placement Agents agree
that it would not
be just and equitable if contribution pursuant to this Section
9.3 were
determined by pro rata allocation or by any other method of
allocation that does
not take account of the equitable considerations referred to in
this Section
9.3. The amount paid or payable by an Indemnified Party as a
result of the
losses, claims, damages, judgments, liabilities or expenses
referred to in this
Section 9.3 shall be deemed to include, subject to the
limitations set forth
above, any legal or other expenses reasonably incurred by such
Indemnified Party
in connection with investigating or defending any such action or
claim. In no
event shall the liability of the Placement Agents hereunder be
greater in amount
than the dollar amount of the compensation (net of payment of
all expenses)
received by the Placement Agents upon the sale of the Cap
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