documents incorporated by reference in each prospectus contained therein that are available through the Commission’s Electronic Data Gathering and Retrieval System) have been delivered by the Company or are otherwise available to the Representative; and no other document with respect to such registration statement or any such document incorporated by reference therein has heretofore been filed or transmitted for filing with the Commission.  For purposes of this Agreement, the following terms have the specified meanings:

 

“ Applicable Time ” means 7:30 a.m. (New York City time) on May 12, 2009;

 

“ Base Prospectus ” means the base prospectus filed as part of the Registration Statement, in the form in which it has most recently been amended on or prior to the date hereof, relating to the Securities;

 

“ Disclosure Package ” means, as of the Applicable Time, the most recent Preliminary Prospectus, together with the information set forth on Schedule III hereto and each other Issuer Free Writing Prospectus, if any, filed or used by the Company on or before the Applicable Time and identified on Schedule II(a) hereto;

 

“ Effective Date ” means any date as of which any part of the Registration Statement or any post-effective amendment thereto relating to the Securities became, or is deemed to have become, effective under the Securities Act in accordance with the Rules (including pursuant to Rule 430B of the Rules);

 

“ Final Prospectus ” means the final prospectus relating to the Securities, including the Base Prospectus and the final prospectus supplement thereto relating to the Securities prepared pursuant to Section 5(a) hereof, as filed with the Commission pursuant to Rule 424(b) of the Rules and provided to the Representative for use by the Underwriters;

 

“ Issuer Free Writing Prospectus ” means each “free writing prospectus” (as defined in Rule 405 of the Rules) prepared by or on behalf of the Company or used or referred to by the Company in connection with the offering of the Securities and identified on Schedule II(b) hereto;

 

“ Preliminary Prospectus ” means any preliminary prospectus relating to the Securities, including the Base Prospectus and any preliminary prospectus supplement thereto relating to the Securities, included in the Registration Statement or as filed with the Commission pursuant to Rule 424(b) of the Rules and provided to the Representative for use by the Underwriters; and

 

“ Registration Statement ” means, collectively, the various parts of the above-referenced registration statement, each as amended as of the Effective Date for such part, including any Preliminary Prospectus or the Final Prospectus and all exhibits to such registration statement.

 

Any reference to the “most recent Preliminary Prospectus” will be deemed to refer to the latest Preliminary Prospectus included in the Registration Statement or filed pursuant to Rule 424(b) of the Rules prior to or on the date hereof (including, for purposes of this Agreement, any documents incorporated by reference therein prior to or on the date of this Agreement).  Any

 

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reference to any Preliminary Prospectus or the Final Prospectus will be deemed to refer to and include any documents incorporated by reference therein as of the date of such Preliminary Prospectus or the Final Prospectus, as the case may be.  Any reference to any amendment or supplement to any Preliminary Prospectus or the Final Prospectus will be deemed to refer to and include any document filed under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), after the date of such Preliminary Prospectus or the Final Prospectus, as the case may be, and incorporated by reference in such Preliminary Prospectus or the Final Prospectus, as the case may be; and any reference to any amendment to the Registration Statement will be deemed to include any annual report of the Company on Form 10-K filed with the Commission pursuant to Section 13(a) or 15(d) of the Exchange Act after the Effective Date that is incorporated by reference in the Registration Statement.

 

(b)            The Commission has not issued any order preventing or suspending the effectiveness of the Registration Statement or preventing or suspending the use of any Preliminary Prospectus, any Issuer Free Writing Prospectus or the Final Prospectus; and no proceeding for any such purpose or pursuant to Section 8A of the Securities Act against the Company or related to the offering has been instituted or, to the knowledge of the Company, threatened by the Commission.  The Commission has not issued any order directed to any document incorporated by reference in the most recent Preliminary Prospectus or the Final Prospectus, and no proceeding has been instituted or, to the knowledge of the Company, threatened by the Commission with respect to any document incorporated by reference in the most recent Preliminary Prospectus or the Final Prospectus.  The Commission has not notified the Company of any objection to the use of the form of the Registration Statement.

 

(c)            The Company has been, and continues to be, a “well-known seasoned issuer” (as defined in Rule 405 of the Rules) and has not been, and continues not to be, an “ineligible issuer” (as defined in Rule 405 of the Rules), in each case at all times relevant under the Securities Act in connection with the offering of the Securities.

 

(d)            (i)  The Registration Statement conformed on the Effective Date and conforms on the date hereof, and any amendment to the Registration Statement filed after the date hereof will conform, in all material respects to the requirements of the Securities Act and the Rules.  The most recent Preliminary Prospectus conforms on the date hereof, and the Final Prospectus, and any amendment or supplement thereto, will conform as of its date and as of each Time of Delivery (as defined in Section 4 hereof), in all material respects to the requirements of the Securities Act and the Rules.  The documents incorporated by reference in the most recent Preliminary Prospectus or the Final Prospectus, when they became effective or were filed with the Commission, as the case may be, conformed in all material respects, to the requirements of the Securities Act or the Exchange Act, as applicable, and the Rules, and any further documents so filed and incorporated by reference in the Final Prospectus or any further amendment or supplement thereto, when such documents become effective or are filed with the Commission, as the case may be, will conform, in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and the Rules; and no such documents have been filed with the Commission since the close of business of the Commission on the business day immediately prior to the date hereof.

 

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(ii)            The Registration Statement did not, as of the Effective Date, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; provided , however , that no representation or warranty is made as to information contained in or omitted from the Registration Statement in reliance upon and in conformity with written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein.

 

(iii)           The Disclosure Package did not, as of the Applicable Time, contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided , however , that no representation or warranty is made as to information contained in or omitted from the Disclosure Package in reliance upon and in conformity with written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein.

 

(iv)           The Final Prospectus, and any amendment or supplement thereto, will not, as of its date and as of each Time of Delivery, contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided , however , that no representation or warranty is made as to information contained in or omitted from the Final Prospectus in reliance upon and in conformity with written information furnished to the Company through the Representative by or on behalf of any Underwriter specifically for inclusion therein.

 

(v)            The documents incorporated by reference in the most recent Preliminary Prospectus or the Final Prospectus, when they became effective or were first filed with the Commission, did not, and any further documents incorporated by reference therein, when they become effective or are first filed with the Commission, will not, contain any untrue statement of a material fact or omit to state any 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.

 

(e)            Each of Principal Financial Services, Inc., an Iowa business corporation (“ Principal Financial ”), Principal Life Insurance Company, an Iowa insurance company (“ PLIC ”), and Principal Global Investors LLC, a Delaware limited liability company (“ Principal Investors ,” and together with Principal Financial and PLIC, the “ Significant Subsidiaries ”), is a “significant subsidiary,” as such term is defined in Rule 405 of the Rules, and the Company has no other subsidiary that is a “significant subsidiary” within the meaning of such Rule.

 

(f)             Each of the Company and the Significant Subsidiaries has been duly incorporated and is validly existing as a corporation or limited liability company, as applicable, and is in good standing under the laws of its jurisdiction, with power and authority (corporate and other) to own its properties and conduct its business as described in the Final Prospectus; the Company is duly qualified to do business as a foreign corporation and is in good standing under the laws of each

 

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other jurisdiction in which its ownership or lease of property or the conduct of its business requires such qualification, or is subject to no material liability or disability by reason of the failure to be so qualified and in good standing in any such jurisdiction; and each Significant Subsidiary of the Company is duly qualified to do business as a foreign corporation, partnership or limited partnership, as applicable, and is in good standing under the laws of each other jurisdiction in which its ownership or lease of property or the conduct of its business requires such qualification and good standing, except where the failure to be so qualified or in good standing would not have a material adverse effect on the condition, financial or otherwise, or on the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a “ Material Adverse Effect ”).

 

(g)            Each of the Company and its subsidiaries that are required to be organized and licensed or registered as an insurance or an insurance holding company (collectively, the “ Insurance Entities ”) is duly organized and licensed or registered as an insurance or insurance holding company, as the case may be, in its jurisdiction of incorporation, and, in the case of an insurance company, is duly licensed or authorized in each other jurisdiction where it is required to be so licensed or authorized to conduct its business and all such licenses or authorizations are in full force and effect with such exceptions as would not have, individually or in the aggregate, a Material Adverse Effect; provided , however , that in the case of PLIC’s insurance license in the State of Iowa and the Company’s insurance holding company registration in the State of Iowa, such license and such registration are in full force and effect in all respects.  Except as otherwise described in the most recent Preliminary Prospectus and the Final Prospectus, each of the Insurance Entities has all other approvals, orders, consents, authorizations, licenses, certificates, permits, registrations and qualifications (collectively, the “ Approvals ”) of and from all insurance and regulatory authorities, as the case may be, to conduct its business, with such exceptions as would not have, individually or in the aggregate, a Material Adverse Effect, and all such Approvals are in full force and effect except where the failure of such Approvals to be in full force and effect would not have, individually or in the aggregate, a Material Adverse Effect.  There is no pending or, to the knowledge of the Company after due inquiry, threatened action, suit, proceeding or investigation that could reasonably be expected to lead to the revocation, termination, suspension or limitation of any such Approval or otherwise impose any limitation on the conduct of business of any Insurance Entity, the revocation, termination or suspension of which would have, individually or in the aggregate, a Material Adverse Effect, and, to the knowledge of the Company after due inquiry, no insurance regulatory agency or body has issued any order or decree impairing, restricting or prohibiting the payment of dividends by any Insurance Entity.  Except as otherwise described in the most recent Preliminary Prospectus and the Final Prospectus, none of the Insurance Entities has received any notification from any applicable regulatory authority to the effect that any additional Approvals from such regulatory authority are needed to be obtained by such Insurance Entity in any case where it could be reasonably expected that (i) any of the Insurance Entities would in fact be required either to obtain any such additional Approvals or cease or otherwise limit engaging in certain business and (ii) the failure to have such Approvals or limiting such business would have, individually or in the aggregate, a Material Adverse Effect.  Each of the Company and its Insurance Entities is in compliance with all applicable insurance laws, rules, regulations, orders, bylaws and similar

 

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requirements which are applicable to it, and has filed all notices, reports, documents or other information required to be filed thereunder, in each case with such exceptions as would not have, individually or in the aggregate, a Material Adverse Effect.

 

(h)            Each of the Company and its subsidiaries that is engaged in the business of acting as a bank, broker-dealer or an investment advisor (respectively, a “ Bank Subsidiary ,” a “ Broker-Dealer Subsidiary ” and “ Investment Advisor Subsidiary ”) is duly licensed or registered as a bank, broker-dealer or investment advisor, as the case may be, in each jurisdiction where it is required to be so licensed or registered to conduct its business, in each case with such exceptions as would not have, individually or in the aggregate, a Material Adverse Effect.  Each Bank Subsidiary, Broker-Dealer Subsidiary and Investment Advisor Subsidiary has all other necessary Approvals of and from all applicable regulatory authorities, including any self-regulatory organization, to conduct its businesses, in each case with such exceptions as would not have, individually or in the aggregate, a Material Adverse Effect.  There is no pending or, to the knowledge of the Company after due inquiry, threatened action, suit, proceeding or investigation that could reasonably be expected to lead to the revocation, termination, suspension or limitation of any such Approval or otherwise impose any limitation on the conduct of business of any Bank Subsidiary, Broker-Dealer Subsidiary or Investment Advisor Subsidiary, the revocation, termination or suspension of which would have, individually or in the aggregate, a Material Adverse Effect.  Except as otherwise described in the most recent Preliminary Prospectus and the Final Prospectus, none of the Bank Subsidiaries, Broker-Dealer Subsidiaries or Investment Advisor Subsidiaries has received any notification from any applicable regulatory authority to the effect that any additional Approvals from such regulatory authority are needed to be obtained by such Bank Subsidiary, Broker-Dealer Subsidiary or Investment Advisor Subsidiary in any case where it could be reasonably expected that (i) any of the Bank Subsidiaries, Broker-Dealer Subsidiaries or Investment Advisor Subsidiaries would in fact be required either to obtain any such additional Approvals or cease or otherwise limit engaging in certain business and (ii) the failure to have such Approvals or limiting such business would have, individually or in the aggregate, a Material Adverse Effect; and each Bank Subsidiary, Broker-Dealer Subsidiary and Investment Advisor Subsidiary is in compliance with the requirements of the banking, broker-dealer and investment advisor laws and regulations of each jurisdiction which are applicable to such subsidiary, and has filed all notices, reports, documents or other information required to be filed thereunder, in each case with such exceptions as would not have, individually or in the aggregate, a Material Adverse Effect.

 

(i)             The Company has an authorized capitalization as set forth in the most recent Preliminary Prospectus and the Final Prospectus.  All of the issued and outstanding shares of capital stock of the Company have been duly authorized and validly issued, and are fully paid and non-assessable and conform to the description thereof contained in the most recent Preliminary Prospectus and the Final Prospectus.  None of the outstanding shares of the Company’s capital stock was issued in violation of preemptive or other similar rights of any of its security holders.  All of the Company’s outstanding options, warrants and other rights to purchase or exchange any securities for shares of the Company’s capital stock have been duly authorized and validly issued and conform to the description thereof contained in the most recent Preliminary Prospectus and the Final Prospectus.  None of the Company’s outstanding options,

 

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warrants, or other rights to purchase or exchange any securities for shares of its capital stock was issued in violation of preemptive or other similar rights of any of its security holders.  All of the issued shares of capital stock of each Significant Subsidiary of the Company have been duly authorized and validly issued and are fully paid and non-assessable and are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims.

 

(j)             This Agreement has been duly authorized, executed and delivered by the Company.

 

(k)            The Securities have been duly authorized by the Company and, when issued by the Company in accordance with the terms of this Agreement against payment therefor, will be validly issued, fully paid and nonassessable; the Securities are not subject to pre-emptive rights in favor of the Company’s shareholders or any other person; and the Securities will conform in all material respects to the descriptions thereof contained in the Disclosure Package and the Final Prospectus.

 

(l)             The Company has all corporate power and authority necessary to execute and deliver this Agreement, to issue and deliver the Securities and to perform its obligations hereunder and thereunder; the issuance and delivery of the Securities being delivered on each Time of Delivery by the Company pursuant to this Agreement and the execution, delivery and performance of this Agreement by the Company and the consummation of the transactions contemplated hereby will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or its subsidiaries is a party or by which the Company or its subsidiaries is bound or to which any of the property or assets of the Company or its subsidiaries is subject or give the holder of any of the notes, debentures, or other evidence of indebtedness of the Company or its subsidiaries the right to require repurchase, redemption or repayment of all or a portion of such indebtedness by any of the Company or its subsidiaries, or result in the creation or imposition of any lien, charge or encumbrance upon any of the assets, properties or operations of any of the Company or its subsidiaries, nor will such actions result in any violation of the provisions of the certificate of incorporation or by-laws or similar organizational documents of the Company or its subsidiaries or the plan of conversion of Principal Mutual Holding Company adopted on March 31, 2001 (the “ Demutualization Plan ”), or any statute or any order, rule or regulation of any court or insurance or other regulatory agency or governmental agency or body having jurisdiction over the Company or its subsidiaries or any of their respective properties or assets, in each case the effect of which (other than any violation of the provisions of the certificate of incorporation or by-laws or similar organizational documents of the Company or any of its subsidiaries), individually or in the aggregate, would be either to affect the validity of the Securities or affect adversely the consummation of the transactions contemplated hereby, or to have a Material Adverse Effect; and no notice, consent, approval, authorization, order, registration or qualification of or with or to any court or governmental agency or body is required for the execution and delivery of the Securities, including without limitation pursuant to the Demutualization Plan, except such as may have been previously obtained or as may be required under applicable state securities or “blue sky” laws.

 

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(m)           There are no contracts, agreements or understandings between the Company and any person granting such person the right to require the Company to file a registration statement under the Securities Act with respect to any securities of the Company owned or to be owned by such person or to require the Company to include such securities in the securities registered pursuant to the Registration Statement or in any securities being registered pursuant to any other registration statement filed by the Company under the Securities Act.

 

(n)            Since the respective dates as of which information is given in the Registration Statement, the Disclosure Package or the Final Prospectus, except as otherwise stated therein, (i) there has been no material adverse change in the condition, financial or otherwise, or in the earnings, business affairs or business prospects of the Company and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business, (ii) there have been no transactions entered into by the Company or any of its subsidiaries, other than those in the ordinary course of business, which are material with respect to the Company and its subsidiaries considered as one enterprise, and (iii) there has been no dividend or distribution of any kind declared, paid or made by the Company on any class of its capital stock.

 

(o)            The audited consolidated financial statements (including the related notes and supporting schedules) filed as part of the Registration Statement or included or incorporated by reference in the most recent Preliminary Prospectus and the Final Prospectus present fairly in all material respects on a consolidated basis the financial condition, the results of operations, changes in common stock and other shareholders’ equity and cash flows of the entities purported to be shown thereby, at the dates and for the periods indicated, and have been prepared in conformity with U.S. generally accepted accounting principles applied on a consistent basis (except as noted with respect to the adoption of new accounting standards) throughout the periods involved.  The unaudited consolidated financial statements included in the most recent Preliminary Prospectus, the Final Prospectus and the Registration Statement and the related notes are true, complete and correct, subject to normally recurring changes resulting from year-end audit adjustments, and have been prepared in accordance with the instructions to Form 10-Q.

 

(p)            The statutory annual and quarterly statements of PLIC and the statutory balance sheets and income statements included in such statutory annual and quarterly statements, most recently filed in its domiciliary jurisdictions have been prepared in conformity with required or permitted or prescribed statutory accounting principles or practices applied on a consistent basis, except as may otherwise be indicated in the notes thereto and any normal year-end adjustments, and present fairly in all material respects the financial position of PLIC (on a statutory basis) for the period covered thereby.

 

(q)            Ernst & Young LLP, which has audited certain of the financial statements of the Company, whose report is incorporated by reference in the most recent Preliminary Prospectus and in the Final Prospectus and who have delivered the letters referred to in paragraphs (f) and (g) of Section 8 hereof, are an independent registered public accounting firm as required by the Securities Act and the Rules.

 

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(r)             Other than as set forth in the most recent Preliminary Prospectus and the Final Prospectus, there are no legal or governmental proceedings pending to which the Company or any of its subsidiaries is a party or of which any property or assets of the Company or any of its subsidiaries is the subject which, if determined adversely to the Company or any of its subsidiaries, would, individually or in the aggregate, have a Material Adverse Effect; and to the knowledge of the Company after due inquiry, no such proceedings are threatened or contemplated by governmental authorities.

 

(s)            The statements set forth in the Base Prospectus under the caption “Description of Capital Stock of Principal Financial Group, Inc.,” insofar as they purport to constitute a summary of the terms of the Common Stock, are accurate in all material respects.

 

(t)             There are no contracts or other documents which are required to be described in the most recent Preliminary Prospectus or the Final Prospectus or filed as exhibits to the Registration Statement by the Securities Act or by the Rules which have not been described in the most recent Preliminary Prospectus and the Final Prospectus or filed as exhibits to the Registration Statement.

 

(u)            None of the Company or any of its subsidiaries is in violation of its certificate of incorporation or by-laws or similar organizational documents; and none of the Company or any of its subsidiaries is in default in the performance or observance of any obligation, agreement, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which it is a party or by which it or any of its properties may be bound or any judgment, order or decree of any governmental body, agency or court having jurisdiction over the Company or any of its subsidiaries, which violation or default would have, individually or in the aggregate, a Material Adverse Effect.

 

(v)            The Company is not required to be registered as, and as of each Time of Delivery after giving effect to the offering of the Securities and the application of the proceeds therefrom in the manner contemplated in each of the most recent Preliminary Prospectus and the Final Prospectus will not be required to be registered as, an “ investment company ” as defined in the Investment Company Act of 1940, as amended (the “ Investment Company Act ”), it being understood that certain separate accounts of PLIC are registered as investment companies under the Investment Company Act in the ordinary course of PLIC’s business.

 

(w)           To the knowledge of the Company, no insurance regulatory agency or body has issued any order or decree impairing, restricting or prohibiting the payment of dividends by any Significant Subsidiary that is required to be organized or licensed as an insurance company in its jurisdiction of incorporation to its parent which would have, individually or in the aggregate, a Material Adverse Effect, except as described in or contemplated by the Disclosure Package and the Final Prospectus.

 

(x)             Neither the Company nor any affiliate of the Company has taken, nor will the Company or any affiliate take, directly or indirectly, any action which is designed to or which has constituted or which would be expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities.

 

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(y)            The Company has established and maintains disclosure controls and procedures (as such term is defined in Rule 13a-15 and 15d-15 under the Exchange Act) that (i) are designed to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to the Company’s Chief Executive Officer and its Chief Financial Officer by others within those entities, particularly during the periods in which the filings made by the Company with the Commission which it may make under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act are being prepared, (ii) have been evaluated for effectiveness as of the end of the Company’s most recent fiscal quarter and (iii) are effective to perform the functions for which they were established and comply with the requirements of the Exchange Act.

 

(z)             Not later than the date of the filing with the Commission of the Company’s most recent Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, each of the Company’s independent registered public accounting firm and the Audit Committee of the Board of Directors of the Company had been advised of (i) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information and (ii) any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal controls over financial reporting.

 

(aa)          Neither the Company nor, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is aware of or has taken any action, directly or indirectly, that would result in a violation by such persons of the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder (the “FCPA”), including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA and the Company and, to the knowledge of the Company, its affiliates have conducted their businesses in compliance with the FCPA and have instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.

 

(bb)          The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with (i) all applicable financial recordkeeping requirements in all material respects, (ii) all applicable reporting requirements in all material respects and (iii) the money laundering statutes and the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “ Money Laundering Laws ”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.

 

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(cc)          Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently subject to any sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“ OFAC ”); and the Company will not directly or indirectly use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

 

SECTION 2.            Purchase of the Securities by the Underwriters .  (a)  On the basis of the representations and warranties contained in, and subject to the terms and conditions of, this Agreement, (i) the Company agrees to sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Company, at the purchase price of $19.0588 per Firm Share, the number of Firm Shares set forth opposite such Underwriter’s name in Schedule I hereto and (ii) if and to the extent that the Representative exercises the election to purchase Optional Shares as provided in Section 2(b) hereof, the Company agrees to issue and sell to each Underwriter, and each Underwriter agrees, severally and not jointly, to purchase from the Company, at the same purchase price, that portion of the number of the Optional Shares as to which such election shall have been exercised (to be adjusted by the Representative, if necessary, so as to eliminate fractions of shares of Common Stock) determined by multiplying the number of such Optional Shares by a fraction, the numerator of which is the maximum number of Firm Shares which such Underwriter is entitled to purchase as set forth opposite the name of such Underwriter in Schedule I hereto and the denominator of which is the maximum number of Firm Shares that all of the Underwriters are entitled to purchase hereunder.

 

(b)            The Company hereby grants to the Underwriters an option to purchase at the election of the Representative up to 7,597,500 Optional Shares, at the purchase price of $19.0588 per Optional Share. Any such election to purchase Optional Shares may be exercised in whole or in part from time to time by written notice from the Representative to the Company, with a copy to Debevoise & Plimpton LLP, given within a period of 30 days after the date of this Agreement, only for the purpose of covering overallotments, setting forth the aggregate number of Optional Shares to be purchased and the date on which such Optional Shares are to be delivered, as determined by the Representative, which shall in no event be earlier than the First Time of Delivery (as defined in Section 4 hereof) or, unless the Representative and the Company otherwise agree in writing, earlier than three or later than ten business days after the date of such notice.

 

SECTION 3.            Offering of the Securities by the Underwriters .  Upon authorization by the Representative of the release of the Securities, the several Underwriters propose to offer the Securities for sale upon the terms and conditions set forth in the Final Prospectus.

 

SECTION 4.            Delivery of and Payment for the Securities .  The Company will deliver, or cause to be delivered, the Securities to the Representative for the account of each Underwriter, against payment by or on behalf of such Underwriter of the purchase price therefor by wire transfer of Federal (same-day) funds to the account specified by the Company to the Representative at least

 

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twenty-four hours in advance, by causing Computershare Investor Services, LLC, as registrar, to register the Securities in the name of Cede & Co., or such other nominee as DTC may designate, and shall cause DTC to credit the Securities to the account of the Representative at DTC.  The time and date of such delivery and payment, with respect to the Firm Shares, shall be 10:00 a.m., New York City time, on May 15, 2009 or such other time and date as the Representative and the Company may agree upon in writing, and, with respect to the Optional Shares shall be 10:00 a.m., New York City time, on the date specified by the Representative in the written notice given by the Representative of the Underwriters’ election to purchase the Optional Shares pursuant to Section 2(b) hereof, or at such other time and date as the Representative and the Company may agree upon in writing.  Such time and date for delivery of the Firm Shares is herein called the “ First Time of Delivery ,” such time and date for delivery of the Optional Shares, if not the First Time of Delivery, is herein called an “ Optional Time of Delivery ,” and each such time and date for delivery is herein called a “ Time of Delivery .”

 

SECTION 5.            Further Agreements of the Company .   The Company covenants and agrees:

 

(a)            To prepare the Final Prospectus in a form approved by the Representative and to file the Final Prospectus pursuant to Rule 424(b) of the Rules not later than the Commission’s close of business on the second business day following the execution and delivery of this Agreement or, if applicable, such earlier time as may be required by Rule 430A(a)(3) of the Rules; for so long as the delivery of a prospectus is required in connection with the offering and sale of the Securities (or in lieu thereof, the notice referred to in Rule 173(a) of the Rules):  (i) to make no further amendment or any supplement to the Registration Statement or to the Final Prospectus unless the Company has furnished to you a copy for your review prior to filing or transmission for filing of the same with or to the Commission, (ii) to advise you, promptly after it receives notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any amendment or supplement to the Prospectus has been filed and to furnish you with copies thereof, (iii) to file promptly all material required to be filed in connection with the offering of the Securities by the Company with the Commission pursuant to Rule 433(d) of the Rules, and (iv) to file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Final Prospectus; to advise the Representative, promptly after it receives notice thereof, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any Preliminary Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus, of the suspension of the qualification of the Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement, the Final Prospectus or any Issuer Free Writing Prospectus or for additional information; and, in the event of the issuance of any stop order or of any order preventing or suspending the use of any Base Prospectus, any Preliminary Prospectus, the Final Prospectus or any Issuer Free Writing Prospectus or suspending any such qualification, to use promptly its best efforts to obtain its withdrawal;

 

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(b)            To furnish promptly to the Representative and to counsel for the Underwriters a signed copy of the Registration Statement as originally filed with the Commission, and each amendment thereto filed with the Commission, including all consents and exhibits filed therewith;

 

(c)            To deliver promptly to the Representative such number of the following documents as the Representative shall reasonably request: (i) conformed copies of the Registration Statement as originally filed with the Commission and each amendment thereto (in each case excluding exhibits and documents incorporated by reference therein that are available through the Commission’s Electronic Data Gathering and Retrieval System) and (ii) each Preliminary Prospectus, the Final Prospectus, any amended or supplemented Final Prospectus, and any Issuer Free Writing Prospectus; and, if the delivery of a prospectus is required at any time after the Applicable Time in connection with the offering or sale of the Securities and if at such time any events shall have occurred as a result of which the Disclosure Package or the Final Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when the Disclosure Package or the Final Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary to amend or supplement the Disclosure Package or the Final Prospectus in order to comply with the Securities Act, to notify the Representative and, upon their request, to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representative may from time to time reasonably request of such amended or supplemented Disclosure Package or Final Prospectus which will correct such statement or omission or effect such compliance;

 

(d)            To file promptly with the Commission any amendment to the Registration Statement or the Final Prospectus or any supplement to the Final Prospectus that may, in the judgment of the Company or the Representative, be required by the Securities Act or requested by the Commission;

 

(e)            Prior to filing with the Commission any amendment to the Registration Statement or supplement to the Final Prospectus or any prospectus pursuant to Rule 424(b) of the Rules, to furnish a copy thereof to the Representative and counsel for the Underwriters and obtain the consent of the Representative to the filing thereof, which consent shall not be unreasonably withheld;

 

(f)             As soon as practicable after the date of the Final Prospectus, to make generally available to the Company’s security holders and to deliver to the Representative an earnings statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Securities Act and the Rules (including, at the option of the Company, Rule 158 of the Rules);

 

(g)            For a period of five years following the date of the Final Prospectus, upon request by the Representative, to furnish to the Representative copies of all materials furnished by the Company to its shareholders and all public reports and all reports and financial statements

 

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furnished by the Company to the Commission pursuant to the Exchange Act or any rule or regulation of the Commission thereunder, unless such materials, reports or financial statements are available on EDGAR;

 

(h)            Promptly from time to time to take such action as the Representative may reasonably request to qualify the Securities for offering and sale under the securities laws of such jurisdictions as the Representative may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of the Securities; provided that in connection therewith the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction;

 

(i)             During a period of 90 days from the date hereof, the Company will not, without the prior written consent of the Representative, (i) directly or indirectly, offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of any share of Common Stock or any securities convertible into or exercisable or exchangeable for Common Stock or file any registration statement under the Securities Act with respect to any of the foregoing or (ii) enter into any swap or any other agreement or any transaction that transfers, in whole or in part, directly or indirectly, the economic consequence of ownership of the Common Stock, whether any such swap or transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or such other securities, in cash or otherwise.  The foregoing sentence shall not apply to (A) the Securities to be sold hereunder, (B) any shares of Common Stock issued by the Company upon the exercise of an option or warrant or the conversion of a security outstanding on the date hereof and referred to in the Final Prospectus, (C) any shares of Common Stock issued or options to purchase Common Stock granted pursuant to existing employee benefit plans of the Company referred to in the Final Prospectus, (D) any shares of Common Stock issued pursuant to any non-employee director stock plan or dividend reinvestment plan, (E) issuances by the Company of shares of Common Stock in connection with the acquisition of another corporation or entity or the acquisition of the assets or properties of any such corporation or entity, so long as the aggregate amount of such issuances does not exceed 10% of the total number of outstanding shares of Common Stock following the issuance of the Firm Shares and, if applicable, the Optional Shares or (F) issuances by the Company of shares of Common Stock in connection with the acquisition by another corporation or entity of the Common Stock, so long as the aggregate amount of such issuances does not exceed 10% of the total number of outstanding shares of Common Stock following the issuance of the Firm Shares and, if applicable, the Optional Shares;

 

(j)             To pay the required Commission filing fees relating to the Securities within the time required by Rule 456(b)(1) of the Rules without regard to the proviso therein and otherwise in accordance with Rule 457(r) of the Rules; and

 

(k)            To apply the net proceeds from the sale of the Securities as set forth in the Final Prospectus.

 

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SECTION 6.            Expenses .  The Company agrees to pay (a) the costs incident to the authorization, issuance, sale and delivery of the Securities and any taxes payable in that connection; (b) the costs incident to the preparation, printing and filing under the Securities Act of the Registration Statement and any amendments and exhibits thereto; (c) the costs of distributing the Registration Statement as originally filed and each amendment thereto and any post-effective amendments thereof (including, in each case, exhibits), any Preliminary Prospectus, any Issuer Free Writing Prospectus, the Final Prospectus and any amendment or supplement to the Final Prospectus, all as provided in this Agreement; (d) the costs of producing this Agreement, any supplemental agreement among the Underwriters and any other related documents in connection with the offering, purchase, sale and delivery of the Securities, which costs, for the avoidance of doubt, shall not include any costs and expenses of counsel to the Underwriters; (e) any applicable listing or other fees; (f) the fees and expenses of qualifying the Securities under the securities laws of the several jurisdictions as provided in Section 5(i) and of preparing, printing and distributing a Blue Sky Memorandum (including related fees and expenses of counsel to the Underwriters); (g) the costs and expenses of the Company relating to investor presentations on any “road show” undertaken in connection with the marketing or the offering of the Securities, including, without limitation, expenses associated with the production of road show slides and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of the Company, travel and lodging expenses of the Representative and officers of the Company and any such consultants, and the cost of any aircraft chartered in connection with the road show; and (h) all other costs and expenses incident to the performance of the obligations of the Company under this Agreement; provided that, except as provided in this Section 6 and in Section 12 hereof the Underwriters shall pay their own costs and expenses, including the costs and expenses of their counsel, any transfer taxes on the Securities which they may sell and the expenses of advertising any offering of the Securities made by the Underwriters.

 

SECTION 7.            Free Writing Prospectuses.

 

(a)            The Company represents and warrants to, and agrees with, each Underwriter that (i) other than any Issuer Free Writing Prospectus identified on Schedule II(b) hereto, the Company has not made, and will not make, any offer relating to the Securities that would constitute an Issuer Free Writing Prospectus without the prior consent of the Representative (which consent shall not be unreasonably withheld); (ii) each Issuer Free Writing Prospectus conformed or will conform in all material respects to the requirements of the Securities Act and the Rules on the date of first use, and the Company has complied with any filing requirements applicable to such Issuer Free Writing Prospectus pursuant to Rule 433 of the Rules; (iii) each Issuer Free Writing Prospectus will not, as