EXHIBIT 1(A)
===============================================================================
MERRILL LYNCH & CO., INC.
(a Delaware corporation)
UNDERWRITING AGREEMENT
----------------------
Dated: __________, 1996
===============================================================================
TABLE OF CONTENTS
Page
----
SECTION 1. Representations and Warranties........................... 4
------------------------------
(a) Representations and Warranties by the Company...... 4
(i) Compliance with Registration Requirements..... 4
(ii) Incorporated Documents....................... 5
(iii) Independent Accountants..................... 5
(iv) Financial Statements......................... 6
(v) No Material Adverse Change in Business........ 6
(vi) Good Standing of the Company................. 6
(vii) Good Standing of Subsidiaries............... 6
(viii) Authorization of Agreement................. 7
(ix) Authorization of the Indenture............... 7
(x) Authorization of the Securities............... 7
(xi) Authorization of the Stock Agreement......... 7
(xii) Description of Securities, Indenture and
Stock Agreement............................. 8
(xiii) Absence of Defaults and Conflicts.......... 8
(xiv) Absence of Labor Dispute.................... 9
(xv) Absence of Proceedings....................... 9
(xvi) Exhibits.................................... 9
(xvii) Possession of Intellectual Property........ 9
(xviii) Absence of Further Requirements........... 9
(xix) Possession of Licenses and Permits......... 10
(xx) Title to Property........................... 10
(xxi) Compliance with Cuba Act................... 10
(b) Officer's Certificates............................ 10
SECTION 2. Sale and Delivery to Underwriter; Closing............... 11
-----------------------------------------
(a) Initial Securities................................ 11
(b) Option Securities................................. 11
(c) Payment........................................... 11
(d) Denominations; Registration....................... 11
SECTION 3. Covenants of the Company with the Underwriter........... 12
---------------------------------------------
(a) Compliance with Securities Regulations and Commission
Requests.......................................... 12
(b) Filing of Amendments.............................. 12
(c) Delivery of ML&Co. Registration Statements........ 12
(d) Delivery of ML&Co. Prospectuses................... 12
(e) Continued Compliance with Securities Laws......... 13
(f) Blue Sky Qualifications........................... 13
(g) Rule 158.......................................... 13
(h) Use of Proceeds................................... 13
(i) Listing........................................... 14
(j) Reporting Requirements............................ 14
SECTION 4. Payment of Expenses..................................... 14
-------------------
i
(a) Expenses Payable by the Company....................... 14
(b) Termination of Agreement.............................. 14
SECTION 5. Conditions............................................ 14
----------
(a) Conditions of Underwriter's Obligations............... 14
(1) Effectiveness of ML&Co. Registration Statement... 15
(2) Effectiveness of SunAmerica Registration
Statement........................................ 15
(3) Opinion of Counsel for the Company............... 15
(4) Opinion of Counsel for the Underwriter........... 15
(5) Opinion of Maryland Counsel for SunAmerica....... 15
(6) Opinion of General Counsel for SunAmerica........ 15
(7) Opinion of Special Counsel for SunAmerica and
Counsel for the Selling Stockholder.............. 16
(8) Company Officers' Certificate.................... 16
(9) SunAmerica Officer's Certificate................. 16
(10) The Selling Stockholder's Certificate............ 16
(11) Company Accountant's Comfort Letter.............. 17
(12) SunAmerica Accountant's Comfort Letters.......... 17
(13) Company Bring-down Comfort Letter................ 17
(14) SunAmerica Bring-down Comfort Letter............. 17
(15) Maintenance of Rating............................ 17
(16) Approval of Listing.............................. 17
(17) No Objection..................................... 17
(18) Conditions to Purchase of Option Securities...... 17
(19) Additional Documents............................. 19
(b) Conditions of the Company's Obligations............... 19
(1) Effectiveness of SunAmerica Registration
Statement........................................ 19
(2) Opinion of Counsel for the Company............... 19
(3) Opinion of Counsel for the Underwriter........... 20
(4) Opinion of Maryland Counsel for SunAmerica....... 20
(5) Opinion of General Counsel for SunAmerica........ 20
(6) Opinion of Special Counsel for SunAmerica and
Counsel for the Selling Stockholder.............. 20
(7) SunAmerica Officer's Certificate................. 20
(8) The Selling Stockholder's Certificate............ 20
(9) SunAmerica Accountant's Comfort Letters.......... 20
(10) SunAmerica Bring-down Comfort Letter............. 20
(11) Conditions to Sale of Option Securities.......... 21
(c) Termination of Agreement.............................. 22
SECTION 6. Indemnification............................................. 22
---------------
(a) Indemnification of the Underwriter by the Company..... 22
(b) Indemnification of the Company, Directors and
Officers.............................................. 23
(c) Actions against Parties; Notification................. 24
(d) Settlement without Consent if Failure to Reimburse.... 24
SECTION 7. Contribution................................................ 24
------------
SECTION 8. Representations, Warranties and Agreements to Survive
-----------------------------------------------------
Delivery.................................................... 25
-----------
SECTION 9. Termination of Agreement.................................... 26
------------------------
ii
(a) Termination; General................................ 26
(b) Liabilities......................................... 26
SECTION 10. Notices.................................................. 26
-------
SECTION 11. Parties.................................................. 26
-------
SECTION 12. GOVERNING LAW AND TIME................................... 27
----------------------
SECTION 13. Effect of Headings....................................... 27
------------------
SECTION 14. Counterparts............................................. 27
------------
iii
MERRILL LYNCH & CO., INC.
(a Delaware corporation)
____% STRYPES/SM/ DUE ____, 1999
Payable with Shares of Common Stock of SunAmerica Inc.
UNDERWRITING AGREEMENT
----------------------
_____________, 1996
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Ladies and Gentlemen:
Merrill Lynch & Co., Inc., a Delaware corporation (the "Company"), confirms
its agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated (the "Underwriter") with respect to the issue and sale by the
Company and the purchase by the Underwriter of an aggregate of 3,000,000 of the
Company's Structured Yield Product Exchangeable for Stock(SM), ____% STRYPES(SM)
Due ____, 1999 (each, a "STRYPES") and with respect to the grant by the Company
to the Underwriter of the option described in Section 2(b) hereof to purchase
all or any part of 450,000 additional STRYPES to cover over-allotments, if any.
The aforesaid 3,000,000 STRYPES (the "Initial Securities") to be purchased by
the Underwriter and all or any part of the 450,000 STRYPES subject to the option
described in Section 2(b) hereof (the "Option Securities") are hereinafter
called, collectively, the "Securities." The Securities are to be issued
pursuant to an indenture, dated as of April 1, 1983 and restated as of April 1,
1987, as amended and supplemented as of __________, 1996 (the "Indenture"),
between the Company and Chemical Bank (successor by merger to Manufacturers
Hanover Trust Company), as trustee (the "Trustee").
__________________________
(SM) Service mark of Merrill Lynch & Co., Inc.
The STRYPES will be payable at maturity or upon redemption by delivery of
shares of Common Stock, par value $1.00 per share (the "SunAmerica Common
Stock"), of SunAmerica Inc., a Maryland corporation ("SunAmerica") subject to
the Company's option to deliver at maturity, in lieu of shares of SunAmerica
Common Stock, an amount in cash. The Company, SunAmerica, Mr. Eli Broad (the
"Selling Stockholder") and the Underwriter are concurrently entering into an
agreement dated the date hereof (the "Registration Agreement") relating to the
registration of shares of SunAmerica Common Stock deliverable by the Company
pursuant to the STRYPES.
The Company understands that the Underwriter proposes to make a public
offering of the Securities as soon as the Underwriter deems advisable after this
Agreement has been executed and delivered.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 33-65135) for the
registration of debt securities, including the Securities, under the Securities
Act of 1933, as amended (the "1933 Act"), and the offering thereof from time to
time in accordance with Rule 415 of the rules and regulations of the Commission
under the 1933 Act (the "1933 Act Regulations"), and the Company has filed post-
effective amendment no. 2 thereto, including a preliminary prospectus and
preliminary prospectus supplement relating to the offering of the Securities.
Promptly after execution and delivery of this Agreement, the Company will either
(i) prepare and file a prospectus and prospectus supplement in accordance with
the provisions of Rule 430A ("Rule 430A") of the 1933 Act Regulations and
paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or (ii) if
the Company has elected to rely upon Rule 434 ("Rule 434") of the 1933 Act
Regulations, prepare and file a term sheet (an "ML&Co. Term Sheet") in
accordance with the provisions of Rule 434 and Rule 424(b). The information
included in such prospectus and prospectus supplement or in such ML&Co. Term
Sheet, as the case may be, that was omitted from such registration statement (as
so amended) at the time it became effective but that is deemed to be part of
such registration statement (as so amended) at the time it became effective (i)
pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A Information"
or (ii) pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434
Information." Any prospectus and prospectus supplement relating to the offering
of the Securities used before such registration statement (as so amended) became
effective, and any prospectus and prospectus supplement relating to the offering
of the Securities that omitted, as applicable, the Rule 430A Information or the
Rule 434 Information, that was used after such effectiveness and prior to the
execution and delivery of this Agreement, in each case excluding any SunAmerica
preliminary prospectus (as defined below) accompanying such prospectus and
prospectus supplement, as the case may be, are herein called, collectively, an
"ML&Co. preliminary prospectus." Such registration statement (as so amended),
including the exhibits thereto, the schedules thereto, if any, and the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 under the 1933
Act, at the time it became effective and including the Rule 430A Information and
the Rule 434 Information, as applicable, is herein called the "ML&Co.
Registration Statement." Any registration statement filed by the Company
pursuant to Rule 462(b) of the 1933 Act Regulations is herein referred to as the
"ML&Co. Rule 462(b) Registration Statement," and after such filing the term
"ML&Co. Registration Statement" shall include the ML&Co. Rule 462(b)
Registration Statement. The final prospectus and final prospectus supplement
relating to the offering of the Securities, including
2
the documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act, but excluding any SunAmerica Prospectus (as defined below)
accompanying such final prospectus or prospectus supplement, as the case may be,
in the form first furnished to the Underwriter for use in connection with the
offering of the Securities are collectively referred to herein as the "ML&Co.
Prospectus." If Rule 434 is relied on, the term "ML&Co. Prospectus" shall refer
to the ML&Co. preliminary prospectus dated May ____, 1996 together with the
ML&Co. Term Sheet and all references in this Agreement to the date of the ML&Co.
Prospectus shall mean the date of the ML&Co. Term Sheet. For purposes of this
Agreement, all references to the ML&Co. Registration Statement, any ML&Co.
preliminary prospectus, the ML&Co. Prospectus or any ML&Co. Term Sheet or any
amendment or supplement to any of the foregoing shall be deemed to include the
copy filed with the Commission pursuant to its Electronic Data Gathering,
Analysis and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the ML&Co.
Registration Statement, any ML&Co. preliminary prospectus or the ML&Co.
Prospectus (or other references of like import) shall be deemed to mean and
include all such financial statements and schedules and other information which
is incorporated by reference in the ML&Co. Registration Statement, any ML&Co.
preliminary prospectus or the ML&Co. Prospectus, as the case may be, and shall
be deemed to exclude all financial statements and schedules and other
information which is included or incorporated by reference in any SunAmerica
preliminary prospectus or the SunAmerica Prospectus which shall accompany any
ML&Co. preliminary prospectus or the ML&Co. Prospectus; and all references in
this Agreement to amendments or supplements to the ML&Co. Registration
Statement, any ML&Co. preliminary prospectus or the ML&Co. Prospectus shall be
deemed to mean and include the filing of any document under the Securities
Exchange Act of 1934, as amended (the "1934 Act"), which is incorporated by
reference in the ML&Co. Registration Statement, such ML&Co. preliminary
prospectus or the ML&Co. Prospectus, as the case may be.
SunAmerica has filed with the Commission a registration statement on Form
S-3 (No. 333-411) covering the registration of 3,450,000 shares of SunAmerica
Common Stock that may be delivered at maturity or upon redemption of the
Securities under the 1933 Act, including the related preliminary prospectus or
prospectuses. Each prospectus used before such registration statement became
effective is herein called a "SunAmerica preliminary prospectus." Such
registration statement, including the exhibits thereto, the schedules thereto,
if any, and the documents incorporated by reference therein pursuant to Item 12
of Form S-3 under the 1933 Act, at the time it became effective, is herein
called the "SunAmerica Registration Statement." Any registration statement filed
by SunAmerica pursuant to Rule 462(b) of the 1933 Act Regulations is herein
referred to as the "SunAmerica Rule 462(b) Registration Statement," and after
such filing the term "SunAmerica Registration Statement" shall include the
SunAmerica Rule 462(b) Registration Statement. The final prospectus, including
the documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act, in the form first furnished to the Underwriter for use in
connection with the offering of the Securities is herein called the "SunAmerica
Prospectus." For purposes of this Agreement, all references to the SunAmerica
Registration Statement, any SunAmerica preliminary prospectus, the SunAmerica
Prospectus or
3
any amendment or supplement to any of the foregoing shall be deemed to include
the copy filed with the Commission pursuant to EDGAR.
All references in this Agreement to financial statements and schedules and
other information which is "contained," "included" or "stated" in the SunAmerica
Registration Statement, any SunAmerica preliminary prospectus or the SunAmerica
Prospectus (or other references of like import) shall be deemed to mean and
include all such financial statements and schedules and other information which
is incorporated by reference in the SunAmerica Registration Statement, any
SunAmerica preliminary prospectus or the SunAmerica Prospectus, as the case may
be; and all references in this Agreement to amendments or supplements to the
SunAmerica Registration Statement, any SunAmerica preliminary prospectus or the
SunAmerica Prospectus shall be deemed to mean and include the filing of any
document under the 1934 Act which is incorporated by reference in the SunAmerica
Registration Statement, such SunAmerica preliminary prospectus or the SunAmerica
Prospectus, as the case may be.
Prior to the closing under this Agreement, the Company, Merrill Lynch
Capital Services, Inc., a wholly-owned subsidiary of the Company (the "ML&Co.
Subsidiary"), and the Selling Stockholder have entered into an agreement (the
"Stock Agreement") pursuant to which the Selling Stockholder is obligated to
deliver to the ML&Co. Subsidiary, on ___________, 1999, and on any date of
redemption of his obligations under the Stock Agreement, a specified number of
shares of SunAmerica stock, subject to the Selling Stockholder's option,
exercisable in its sole discretion, to satisfy his obligations under the Stock
Agreement by delivering immediately prior to the maturity or redemption a
specified amount of cash in lieu of such shares. Under the Indenture, the
Company has agreed to pay and discharge the STRYPES by delivering to the holders
thereof at maturity or on any redemption date the form of consideration that the
ML&Co. Subsidiary receives from the Selling Stockholder.
SECTION 1. Representations and Warranties.
------------------------------
(a) Representations and Warranties by the Company. The Company represents
and warrants to the Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(c) hereof, and as of each Date of Delivery (if any)
referred to in Section 2(b) hereof, and agrees with the Underwriter, as follows:
(i) Compliance with Registration Requirements. The Company meets the
-----------------------------------------
requirements for use of Form S-3 under the 1933 Act. Each of the ML&Co.
Registration Statement and any ML&Co. Rule 462(b) Registration Statement
has become effective under the 1933 Act and no stop order suspending the
effectiveness of the ML&Co. Registration Statement or any ML&Co. Rule
462(b) Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has been
complied with.
At the respective times the ML&Co. Registration Statement, any ML&Co.
Rule 462(b) Registration Statement and any post-effective amendments
thereto became effective and at the Closing Time (and, if any Option
Securities are purchased, at the Date of
4
Delivery), the ML&Co. Registration Statement, the ML&Co. Rule 462(b)
Registration Statement and any amendments and supplements thereto complied
and will comply in all material respects with the requirements of the 1933
Act and the 1933 Act Regulations and the Trust Indenture Act of 1939, as
amended (the "1939 Act"), and the rules and regulations of the Commission
under the 1939 Act (the "1939 Act Regulations"), and did not and will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading. Neither the ML&Co. Prospectus nor any amendments
or supplements thereto, at the time the ML&Co. Prospectus or any such
amendment or supplement was issued and at the Closing Time (and, if any
Option Securities are purchased, at the Date of Delivery), included or will
include an untrue statement of a material fact or omitted or will omit to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
If Rule 434 is used, the Company will comply with the requirements of Rule
434. The representations and warranties in this subsection shall not apply
to (A) statements in or omissions from the ML&Co. Registration Statement or
ML&Co. Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by the Underwriter expressly for use in
the ML&Co. Registration Statement or ML&Co. Prospectus or (B) that part of
the ML&Co. Registration Statement that constitutes the Statement of
Eligibility on Form T-1 (the "Form T-1") under the 1939 Act of the Trustee.
Each ML&Co. preliminary prospectus and the prospectus relating to the
offering of the Securities filed as part of the ML&Co. Registration
Statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the 1933 Act, complied when so filed in all
material respects with the 1933 Act Regulations and, if applicable, each
ML&Co. preliminary prospectus and the ML&Co. Prospectus delivered to the
Underwriter for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(ii) Incorporated Documents. The documents incorporated or deemed to
----------------------
be incorporated by reference in the ML&Co. Registration Statement and the
ML&Co. Prospectus, when they became effective or at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1933 Act and the 1933 Act
Regulations or the 1934 Act and the rules and regulations of the Commission
thereunder (the "1934 Act Regulations"), as applicable, and, when read
together with the other information in the ML&Co. Prospectus, at the time
the ML&Co. Registration Statement became effective, at the time the ML&Co.
Prospectus was issued and at the Closing Time (and, if any Option
Securities are purchased, at the Date of Delivery), did not and will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading.
(iii) Independent Accountants. The accountants who certified the
-----------------------
financial statements and supporting schedules included in the ML&Co.
Registration Statement are independent public accountants as required by
the 1933 Act and the 1933 Act Regulations.
5
(iv) Financial Statements. The financial statements included in the
--------------------
ML&Co. Registration Statement and the ML&Co. Prospectus, together with the
related schedules and notes, present fairly the financial position of the
Company and its consolidated subsidiaries at the dates indicated and the
statement of operations, stockholders' equity and cash flows of the Company
and its consolidated subsidiaries for the periods specified; said financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules, if any, included in the ML&Co.
Registration Statement present fairly in accordance with GAAP the
information required to be stated therein. The selected financial data and
the summary financial information included in the ML&Co. Prospectus present
fairly the information shown therein and have been compiled on a basis
consistent with that of the audited financial statements included in the
ML&Co. Registration Statement.
(v) No Material Adverse Change in Business. Since the respective
--------------------------------------
dates as of which information is given in the ML&Co. Registration Statement
and the ML&Co. Prospectus, except as otherwise stated therein, (A) 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 (a "Material Adverse
Effect"), (B) 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 (C) except for regular
quarterly dividends on its outstanding common stock and regular dividends
on its outstanding preferred stock in amounts per share that are consistent
with past practice, there has been no dividend or distribution of any kind
declared, paid or made by the Company on any class of its capital stock.
(vi) Good Standing of the Company. The Company has been duly
----------------------------
organized and is validly existing as a corporation in good standing under
the laws of the State of Delaware and has corporate power and authority to
own, lease and operate its properties and to conduct its business as
described in the ML&Co. Prospectus and to enter into and perform its
obligations under this Agreement and the Indenture; and the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each subsidiary of the Company
-----------------------------
which is a "significant subsidiary" as defined in Rule 1-02 of Regulation
S-X under the 1933 Act (each a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly organized and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the ML&Co.
Prospectus and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
6
property or the conduct of business, except where the failure so to qualify
or to be in good standing would not result in a Material Adverse Effect;
except as otherwise disclosed in the ML&Co. Registration Statement, all of
the issued and outstanding capital stock of each such Subsidiary has been
duly authorized and validly issued and is fully paid and non-assessable and
is owned by the Company, directly or through subsidiaries, free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; and none of the outstanding shares of capital stock of any
Subsidiary was issued in violation of the preemptive or similar rights of
any securityholder of such Subsidiary. The only subsidiaries of the
Company are (A) the subsidiaries listed in Exhibit 21 to the Annual Report
on Form 10-K of the Company filed with the Commission under Section 13 of
the 1934 Act for the fiscal year ended December 29, 1995 and (B) certain
other subsidiaries which, considered in the aggregate as a single
subsidiary, do not constitute a "significant subsidiary" as defined in Rule
1-02 of Regulation S-X under the 1933 Act.
(viii) Authorization of Agreement. This Agreement has been duly
--------------------------
authorized, executed and delivered by the Company.
(ix) Authorization of the Indenture. The Indenture has been duly
------------------------------
authorized by the Company, duly qualified under the 1939 Act and duly
executed and delivered by the Company and (assuming the due authorization,
execution and delivery by the Trustee) will constitute a valid and binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law).
(x) Authorization of the Securities. The Securities have been duly
-------------------------------
authorized by the Company for issuance and sale to the Underwriter pursuant
to this Agreement and, at the Closing Time, will have been duly executed by
the Company and, when authenticated by the Trustee in the manner provided
for in the Indenture and delivered against payment of the purchase price
therefor as provided in this Agreement, will constitute valid and binding
obligations of the Company, enforceable against the Company in accordance
with their terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law), and will be
in the form contemplated by, and entitled to the benefits of, the
Indenture.
(xi) Authorization of the Stock Agreement. The Stock Agreement has
------------------------------------
been duly authorized by the Company and the ML&Co. Subsidiary and, at the
Closing Time, will have been duly executed and delivered by the Company and
the ML&Co. Subsidiary and (assuming the due authorization, execution and
delivery by the Selling Stockholder) will constitute a valid and binding
agreement of the Company and the ML&Co. Subsidiary,
7
enforceable against the Company and the ML&Co. Subsidiary in accordance
with its terms, except as the enforcement thereof may be limited by
bankruptcy, insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law).
(xii) Description of Securities, Indenture and Stock Agreement. The
--------------------------------------------------------
Securities, the Indenture and the Stock Agreement will conform in all
material respects to the respective statements relating thereto contained
in the ML&Co. Prospectus and will be in substantially the respective forms
filed or incorporated by reference, as the case may be, as exhibits to the
ML&Co. Registration Statement.
(xiii) Absence of Defaults and Conflicts. Neither the Company nor
---------------------------------
any of its subsidiaries is in violation of its charter or by-laws or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, deed
of trust, loan or credit agreement, note, lease or other agreement or
instrument to which 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 subsidiary is subject (collectively,
"Agreements and Instruments") except for such defaults that would not
result in a Material Adverse Effect; and (A) the execution, delivery and
performance by the Company of this Agreement, the Indenture and the
Securities and the consummation of the transactions contemplated herein,
therein and in the ML&Co. Registration Statement (including the issuance
and sale of the Securities and the delivery of shares of SunAmerica Common
Stock pursuant thereto and the use of the proceeds from the sale of the
Securities as described in the ML&Co. Prospectus under the caption "Use of
Proceeds") and compliance by the Company with its obligations hereunder and
under the Indenture and the Securities and (B) the execution, delivery and
performance by the ML&Co. Subsidiary of the Stock Agreement and the
consummation of the transactions contemplated therein and compliance by the
ML&Co. Subsidiary with its obligations under the Stock Agreement have been
duly authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or passage of time or both,
conflict with or constitute a breach of, or default or Repayment Event (as
defined below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any
subsidiary pursuant to, the Agreements and Instruments (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action result
in any violation of the provisions of the charter or by-laws of the Company
or any subsidiary or, to the best of the Company's knowledge, any
applicable law, statute, rule, regulation, judgment, order, writ or decree
of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any subsidiary or any of
their assets, properties or operations. As used herein, a "Repayment
Event" means any event or condition which gives the holder of any note,
debenture or other evidence of indebtedness (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Company or any
subsidiary.
8
(xiv) Absence of Labor Dispute. No labor dispute with the employees
------------------------
of the Company or any subsidiary exists or, to the knowledge of the
Company, is imminent which may reasonably be expected to result in a
Material Adverse Effect.
(xv) Absence of Proceedings. There is no action, suit, proceeding,
----------------------
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or, to the knowledge of
the Company, threatened, against or affecting the Company or any
subsidiary, which is required to be disclosed in the ML&Co. Registration
Statement (other than as disclosed therein), or which, individually or in
the aggregate, might reasonably be expected to result in a Material Adverse
Effect, or which, individually or in the aggregate, might reasonably be
expected to materially and adversely affect the properties or assets
thereof or the consummation of the transactions contemplated in this
Agreement, the Indenture or the Stock Agreement (including the issuance and
sale of the Securities and the delivery of shares of SunAmerica Common
Stock pursuant thereto) or the performance by the Company of its
obligations hereunder or thereunder or the performance by the ML&Co.
Subsidiary of its obligations under the Stock Agreement; the aggregate of
all pending legal or governmental proceedings to which the Company or any
subsidiary is a party or of which any of their respective property or
assets is the subject which are not described in the ML&Co. Registration
Statement, including ordinary routine litigation incidental to the
business, could not reasonably be expected to result in a Material Adverse
Effect.
(xvi) Exhibits. There are no contracts or documents which are of a
--------
character required to be described in the ML&Co. Registration Statement,
the ML&Co. Prospectus or the documents incorporated by reference therein or
to be filed as exhibits thereto which have not been so described or filed
as required.
(xvii) Possession of Intellectual Property. The Company and its
-----------------------------------
subsidiaries own or possess, or can acquire on reasonable terms, adequate
trademarks, service marks, trade names and other intellectual property
(collectively, "Intellectual Property") necessary to carry on the business
now operated by them, and neither the Company nor any of its subsidiaries
has received any notice or is otherwise aware of any infringement of or
conflict with asserted rights of others with respect to any Intellectual
Property or of any facts or circumstances which would render any
Intellectual Property invalid or inadequate to protect the interest of the
Company or any of its subsidiaries therein, and which infringement or
conflict (if the subject of any unfavorable decision, ruling or finding) or
invalidity or inadequacy, singly or in the aggregate, would result in a
Material Adverse Effect.
(xviii) Absence of Further Requirements. No filing with, or
-------------------------------
authorization, approval, consent, license, order, registration,
qualification or decree of, any court or governmental authority or agency
is necessary or required (A) for the performance by the Company of its
obligations under this Agreement or the Stock Agreement or the consummation
by the Company of the transactions contemplated herein or therein
(including the issuance and sale of the Securities and the delivery of
shares of SunAmerica Common Stock pursuant thereto) or for the due
execution, delivery or performance of the Indenture by the Company or (B)
for the performance by the ML&Co.
9
Subsidiary of its obligations under the Stock Agreement or the consummation
by the ML&Co. Subsidiary of the transactions contemplated therein, except,
in each case, such as have been already obtained or as may be required
under the 1933 Act or the 1933 Act Regulations or state securities laws and
except for the qualification of the Indenture under the 1939 Act.
(xix) Possession of Licenses and Permits. The Company and its
----------------------------------
subsidiaries own or possess such permits, licenses, approvals, consents and
other authorizations (collectively, "Governmental Licenses") issued by the
appropriate federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; the Company and its
subsidiaries are in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure so to comply would not,
singly or in the aggregate, have a Material Adverse Effect; all of the
Governmental Licenses are valid and in full force and effect, except when
the invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not 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 Governmental Licenses which, singly
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xx) Title to Property. The Company and its subsidiaries have good
-----------------
and marketable title to all real property owned by the Company and its
subsidiaries and good title to all other properties owned by them, in each
case, free and clear of all mortgages, pledges, liens, security interests,
claims, restrictions or encumbrances of any kind except such as (A) are
described in the ML&Co. Prospectus or (B) do not, singly or in the
aggregate, materially affect the value of such property and do not
interfere with the use made and proposed to be made of such property by the
Company or any of its subsidiaries; and all of the leases and subleases
material to the business of the Company and its subsidiaries, considered as
one enterprise, and under which the Company or any of its subsidiaries
holds properties described in the ML&Co. Prospectus, are in full force and
effect, and neither the Company nor any subsidiary has any notice of any
material claim of any sort that has been asserted by anyone adverse to the
rights of the Company or any subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company or such subsidiary to the continued possession of the leased or
subleased premises under any such lease or sublease.
(xxi) Compliance with Cuba Act. The Company has complied with, and
------------------------
is and will be in compliance with, the provisions of that certain Florida
act relating to disclosure of doing business with Cuba, codified as Section
517.075 of the Florida statutes, and the rules and regulation thereunder
(collectively, the "Cuba Act") or is exempt therefrom.
(b) Officer's Certificates. Any certificate signed by any officer of the
Company or any of its subsidiaries delivered to the Underwriter shall be deemed
a representation and warranty by the Company to the Underwriter as to the
matters covered thereby.
10
SECTION 2. Sale and Delivery to Underwriter; Closing.
-----------------------------------------
(a) Initial Securities. On the basis of the representations and
warranties herein contained and subject to the terms and conditions herein set
forth, the Company agrees to sell to the Underwriter, and the Underwriter agrees
to purchase from the Company, at the price per STRYPES set forth in Schedule A,
the Initial Securities.
(b) Option Securities. In addition, on the basis of the representations
and warranties herein contained and subject to the terms and conditions herein
set forth, the Company hereby grants an option to the Underwriter to purchase up
to an additional 450,000 STRYPES at the price per STRYPES set forth in Schedule
A. The option hereby granted will expire 30 days after the date hereof and may
be exercised in whole or in part from time to time only for the purpose of
covering over-allotments which may be made in connection with the offering and
distribution of the Initial Securities upon notice by the Underwriter to the
Company setting forth the number of Option Securities as to which the
Underwriter is then exercising the option and the time and date of payment and
delivery for such Option Securities. Any such time and date of delivery (a
"Date of Delivery") shall be determined by the Underwriter, but shall not be
later than seven full business days after the exercise of said option, nor in
any event prior to the Closing Time, as hereinafter defined.
(c) Payment. Payment of the purchase price for, and delivery of
certificates for, the Initial Securities shall be made at the offices of Brown &
Wood, One World Trade Center, New York, New York 10048, or at such other place
as shall be agreed upon by the Underwriter and the Company, at 10:00 A.M.
(Eastern time) on the third (fourth, if the pricing occurs after 4:30 P.M.
(Eastern time) on any given day) business day after the date hereof, or such
other time not later than ten business days after such date as shall be agreed
upon by the Underwriter and the Company (such time and date of payment and
delivery being herein called "Closing Time"). In addition, in the event that
any or all of the Option Securities are purchased by the Underwriter, payment of
the purchase price for, and delivery of certificates for, such Option Securities
shall be made at the above-mentioned offices, or at such other place as shall be
agreed upon by the Underwriter and the Company, on each Date of Delivery as
specified in the notice from the Underwriter to the Company.
Payment shall be made to the Company by wire transfer of immediately
available funds to a bank account designated by the Company, against delivery to
the Underwriter of certificates for the Securities to be purchased by it.
(d) Denominations; Registration. Certificates for the Initial Securities
and the Option Securities, if any, shall be in such denominations and registered
in such names as the Underwriter may request in writing at least one full
business day before the Closing Time or the relevant Date of Delivery, as the
case may be. The certificates for the Initial Securities and the Option
Securities, if any, will be made available for examination and packaging by the
Underwriter in The City of New York not later than 10:00 A.M. (Eastern time) on
the business day prior to the Closing Time or the relevant Date of Delivery, as
the case may be.
11
SECTION 3. Covenants of the Company with the Underwriter.
---------------------------------------------
(a) Compliance with Securities Regulations and Commission Requests. The
Company, subject to Section 3(a)(ii) hereof, will comply with the requirements
of Rule 430A or Rule 434, as applicable, and will notify the Underwriter
immediately, and confirm the notice in writing, (A) when any post-effective
amendment to the ML&Co. Registration Statement shall become effective, or any
supplement to the ML&Co. Prospectus or any amended ML&Co. Prospectus shall have
been filed, (B) of the receipt of any comments from the Commission, (C) of any
request by the Commission for any amendment to the ML&Co. Registration Statement
or any amendment or supplement to the ML&Co. Prospectus or for additional
information, and (D) of the issuance by the Commission of any stop order
suspending the effectiveness of the ML&Co. Registration Statement or of any
order preventing or suspending the use of any ML&Co. preliminary prospectus, or
of the suspension of the qualification of the Securities for offering or sale in
any jurisdiction, or of the initiation or threatening of any proceedings for any
of such purposes. The Company will promptly effect the filings necessary
pursuant to Rule 424(b) and will take such steps as it deems necessary to
ascertain promptly whether the form of prospectus transmitted for filing under
Rule 424(b) was received for filing by the Commission and, in the event that it
was not, it will promptly file such prospectus. The Company will use its best
efforts to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Company will give the Underwriter notice
of its intention to file or prepare any amendment to the ML&Co. Registration
Statement (including any filing under Rule 462(b)), any ML&Co. Term Sheet or any
amendment, supplement or revision to either the prospectus relating to the
offering of the Securities included in the ML&Co. Registration Statement at the
time it became effective or to the ML&Co. Prospectus, whether pursuant to the
1933 Act, the 1934 Act or otherwise, will furnish the Underwriter with copies of
any such documents a reasonable amount of time prior to such proposed filing or
use, as the case may be, and will not file or use any such document to which the
Underwriter or counsel for the Underwriter shall reasonably object.
(c) Delivery of ML&Co. Registration Statements. The Company has furnished
or will deliver to the Underwriter, without charge, and to the Selling
Stockholder and counsel for the Selling Stockholder signed copies of the ML&Co.
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference therein) and
signed copies of all consents and certificates of experts. If applicable, the
copies of the ML&Co. Registration Statement and each amendment thereto furnished
to the Underwriter and the Selling Stockholder will be identical to the
electronically transmitted copies thereof filed with the Commission pursuant to
EDGAR, except to the extent permitted by Regulation S-T.
(d) Delivery of ML&Co. Prospectuses. The Company has delivered to the
Underwriter, without charge, as many copies of each ML&Co. preliminary
prospectus as the Underwriter reasonably requested, and the Company hereby
consents to the use of such copies for purposes permitted by the 1933 Act. The
Company will furnish to the Underwriter, without charge, during the period when
the ML&Co. Prospectus is required to be delivered under the
12
1933 Act or the 1934 Act, such number of copies of the ML&Co. Prospectus (as
amended or supplemented) as the Underwriter may reasonably request. If
applicable, the ML&Co. Prospectus and any amendments or supplements thereto
furnished to the Underwriter will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to EDGAR, except to the extent
permitted by Regulation S-T.
(e) Continued Compliance with Securities Laws. The Company will comply
with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act
Regulations so as to permit the completion of the distribution of the Securities
as contemplated in this Agreement and in the ML&Co. Prospectus. If at any time
when a prospectus is required by the 1933 Act to be delivered in connection with
sales of the Securities, any event shall occur or condition shall exist as a
result of which it is necessary, in the reasonable opinion of counsel for the
Underwriter or for the Company, to amend the ML&Co. Registration Statement or
amend or supplement the ML&Co. Prospectus in order that the ML&Co. Prospectus
will not include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not misleading
in the light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the reasonable opinion of either such
counsel, at any such time to amend the ML&Co. Registration Statement or amend or
supplement the ML&Co. Prospectus in order to comply with the requirements of the
1933 Act or the 1933 Act Regulations, the Company will promptly prepare and file
with the Commission, subject to Section 3(a)(ii) hereof, such amendment or
supplement as may be necessary to correct such statement or omission or to make
the ML&Co. Registration Statement or the ML&Co. Prospectus comply with such
requirements, and the Company will furnish to the Underwriter such number of
copies of such amendment or supplement as the Underwriter may reasonably
request.
(f) Blue Sky Qualifications. The Company will use its best efforts, in
cooperation with the Underwriter, to qualify the Securities for offering and
sale under the applicable securities laws of such states and other jurisdictions
of the United States as the Underwriter may designate and to maintain such
qualifications in effect for a period of not less than one year from the later
of the effective date of the ML&Co. Registration Statement and any ML&Co. Rule
462(b) Registration Statement; provided, however, that the Company shall not be
obligated to file any general consent to service of process or to qualify as a
foreign corporation or as a dealer in securities in any jurisdiction in which it
is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each
jurisdiction in which the Securities have been so qualified, the Company will
file such statements and reports as may be required by the laws of such
jurisdiction to continue such qualification in effect for a period of not less
than one year from the effective date of the ML&Co. Registration Statement and
any ML&Co. Rule 462(b) Registration Statement.
(g) Rule 158. The Company will timely file such reports pursuant to the
1934 Act as are necessary in order to make generally available to its
securityholders as soon as practicable an earnings statement for the purposes
of, and to provide the benefits contemplated by, the last paragraph of Section
11(a) of the 1933 Act.
(h) Use of Proceeds. The Company will use the net proceeds received by it
from the sale of the Securities in the manner specified in the ML&Co. Prospectus
under "Use of Proceeds."
13
(i) Listing. The Company will use its best efforts to effect the listing
of the Securities on the New York Stock Exchange.
(j) Reporting Requirements. The Company, during the period when the
ML&Co. Prospectus is required to be delivered under the 1933 Act or the 1934
Act, will file all documents required to be filed with the Commission pursuant
to the 1934 Act within the time periods required by the 1934 Act and the 1934
Act Regulations.
SECTION 4. Payment of Expenses.
-------------------
(a) Expenses Payable by the Company. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including
(i) the preparation, printing and filing of the ML&Co. Registration Statement
(including financial statements and exhibits) as originally filed and of each
amendment thereto, (ii) the preparation, printing and delivery to the
Underwriter of this Agreement, the Indenture, the Stock Agreement and such other
documents as may be required in connection with the offering, purchase, sale,
issuance or delivery of the Securities, (iii) the preparation, issuance and
delivery of the certificates for the Securities to the Underwriter, (iv) the
fees and disbursements of the Company's counsel, accountants and other advisors,
(v) the qualification of the Securities under securities laws in accordance with
the provisions of Section 3(a)(vi) hereof, including filing fees and the
reasonable fees and disbursements of the Company's counsel in connection
therewith and in connection with the preparation of the Blue Sky Survey and any
supplement thereto, (vi) the printing and delivery to the Underwriter of copies
of each ML&Co. preliminary prospectus, any ML&Co. Term Sheets and of the ML&Co.
Prospectus and any amendments or supplements thereto, (vii) the preparation,
printing and delivery to the Underwriter of copies of the Blue Sky Survey and
any supplement thereto, (viii) the fees and expenses of the Trustee, including
the fees and disbursements of counsel for the Trustee in connection with the
Indenture and the Securities, (ix) any fees payable in connection with the
rating of the Securities, (x) the filing fees incident to, and the reasonable
fees and disbursements of counsel to the Underwriter in connection with, the
review by the National Association of Securities Dealers, Inc. (the "NASD") of
the terms of the sale of the Securities and (xi) the fees and expenses incurred
in connection with the listing of the Securities on the New York Stock Exchange.
(b) Termination of Agreement. If this Agreement is terminated by the
Underwriter in accordance with the provisions of Section 5 or Section 9(a)(i)
hereof, the Company shall reimburse the Underwriter for all of its out-of-pocket
expenses, including the reasonable fees and disbursements of counsel for the
Underwriter.
SECTION 5. Conditions.
----------
(a) Conditions of Underwriter's Obligations. The obligations of the
Underwriter hereunder are subject to the accuracy of the representations and
warranties of the Company contained in Section 1(a) hereof, to the accuracy of
the representations and warranties of SunAmerica and the Selling Stockholder
contained in Sections 1(A) and 1(B), respectively, in the Registration
Agreement, to the accuracy of the statements in certificates of any officer of
the Company, SunAmerica or the Selling Stockholder delivered pursuant to the
provisions hereof,
14
to the performance by the Company of its covenants and other obligations
hereunder, to the performance by SunAmerica and the Selling Stockholder of its
and his covenants and other obligations under the Registration Agreement, and to
the following further conditions:
(1) Effectiveness of ML&Co. Registration Statement. The ML&Co.
Registration Statement, including any ML&Co. Rule 462(b) Registration
Statement, has become effective and at Closing Time no stop order
suspending the effectiveness of the ML&Co. Registration Statement shall
have been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, and any request on the part of the Commission
for additional information shall have been complied with to the reasonable
satisfaction of counsel to the Underwriter. A prospectus containing the
Rule 430A Information shall have been filed with the Commission in
accordance with Rule 424(b) (or a post-effective amendment providing such
information shall have been filed and declared effective in accordance with
the requirements of Rule 430A) or, if the Company has elected to rely upon
Rule 434, an ML&Co. Term Sheet shall have been filed with the Commission in
accordance with Rule 424(b).
(2) Effectiveness of SunAmerica Registration Statement. The
SunAmerica Registration Statement, including any SunAmerica Rule 462(b)
Registration Statement, has become effective and at Closing Time no stop
order suspending the effectiveness of the SunAmerica Registration Statement
shall have been issued under the 1933 Act or proceedings therefor initiated
or threatened by the Commission.
(3) Opinion of Counsel for the Company. At Closing Time, the
Underwriter shall have received the favorable opinion, dated as of Closing
Time, of Brown & Wood, counsel for the Company, in form and substance
satisfactory to the Underwriter, to the effect set forth in Exhibit A
hereto and to such further effect as the Underwriter may reasonably
request.
(4) Opinion of Counsel for the Underwriter. At Closing Time, the
Underwriter shall have received the favorable opinion, dated as of Closing
Time, of Skadden, Arps, Slate, Meagher & Flom, counsel for the Underwriter,
in form and substance satisfactory to the Underwriter, to the effect set
forth in Exhibit B hereto and to such further effect as the Underwriter may
reasonably request.
(5) Opinion of Maryland Counsel for SunAmerica. At Closing Time, the
Underwriter shall have received the favorable opinion, dated as of Closing
Time, of Piper & Marbury L.L.P., Maryland counsel for SunAmerica, in form
and substance satisfactory to the Underwriter, to the effect set forth in
Exhibit C hereto.
(6) Opinion of General Counsel for SunAmerica. At Closing Time, the
Underwriter shall have received the favorable opinion, dated as of Closing
Time, of Susan L. Harris, Senior Vice President, General Counsel--Corporate
Affairs and Secretary of SunAmerica, in form and substance satisfactory to
the Underwriter, to the effect set forth in Exhibit D hereto.
15
(7) Opinion of Special Counsel for SunAmerica and Counsel for the
Selling Stockholder. At Closing Time, the Underwriter shall have received
the favorable opinion, dated as of Closing Time, of Davis Polk & Wardwell,
special counsel for SunAmerica and counsel for the Selling Stockholder, in
form and substance satisfactory to the Underwriter, to the effect set forth
in Exhibit E hereto.
(8) Company Officers' Certificate. At Closing Time, there shall not
have been, since the date hereof or since the respective dates as of which
information is given in the ML&Co. Prospectus, any 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, and the Underwriter shall have received a certificate of the
President or a Vice President of the Company and of the chief financial or
chief accounting officer of the Company, dated as of Closing Time, to the
effect that (i) there has been no such material adverse change, (ii) the
representations and warranties in Section 1(a) hereof are true and correct
with the same force and effect as though expressly made at and as of
Closing Time, (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or
prior to Closing Time, and (iv) no stop order suspending the effectiveness
of the ML&Co. Registration Statement has been issued and no proceedings for
that purpose have been instituted or are pending or are contemplated by the
Commission.
(9) SunAmerica Officer's Certificate. At Closing Time, the
Underwriter shall have received a certificate, signed by an executive
officer of SunAmerica and dated as of Closing Time, to the effect that (a)
no stop order suspending the effectiveness of the SunAmerica Registration
Statement is in effect, and no proceedings for such purpose are pending
before or threatened by the Commission, (b) subsequent to the execution and
delivery of this Agreement and prior to Closing Time, there shall not have
occurred any material adverse change, or any development involving a
prospective material adverse change, in the condition, financial or
otherwise, or in the earnings, business or operations, of SunAmerica and
its subsidiaries, taken as a whole, from that set forth in the SunAmerica
Prospectus, and (c) the representations and warranties of SunAmerica
contained in the Registration Agreement are true and correct as of Closing
Time and that SunAmerica has complied with all of the agreements and
satisfied all of the obligations on its part to be performed or satisfied
on or before Closing Time pursuant to the Registration Agreement. The
officer signing and delivering such certificate may rely upon the best of
his or her knowledge as to proceedings threatened.
(10) The Selling Stockholder's Certificate. At Closing Time, the
Underwriter shall have received a certificate of the Selling Stockholder,
dated as of Closing Time, in which the Selling Stockholder shall state that
(i) the representations and warranties of the Selling Stockholder contained
in Section 1(b) hereof are true and correct with the same force and effect
as though expressly made at and as of Closing Time and (ii) the Selling
Stockholder has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied at or prior to Closing Time.
16
(11) Company Accountant's Comfort Letter. At the time of the
execution of this Agreement, the Underwriter shall have received from
Deloitte & Touche LLP a letter dated such date, in form and substance
satisfactory to the Underwriter, containing statements and information of
the type ordinarily included in accountants' "comfort letters" to
underwriters in accordance with the American Institute of Certified Public
Accountants standards with respect to the financial statements and certain
financial information contained in or incorporated by reference into the
ML&Co. Registration Statement and the ML&Co. Prospectus.
(12) SunAmerica Accountant's Comfort Letters. At the time of the
execution of this Agreement, the Underwriter shall have received from
SunAmerica's independent public accountants a letter dated such date, in
form and substance satisfactory to the Underwriter, containing statements
and information of the type ordinarily included in accountants' "comfort
letters" to underwriters in accordance with the American Institute of
Certified Public Accountants standards, with respect to the financial
statements and certain financial information contained in or incorporated
by reference into the SunAmerica Registration Statement and the SunAmerica
Prospectus.
(13) Company Bring-down Comfort Letter. At Closing Time, the
Underwriter shall have received from Deloitte & Touche LLP a letter, dated
as of Closing Time, to the effect that they reaffirm the statements made in
the letter furnished by them pursuant to Section 5(a)(11) hereof, except
that the "specified date" referred to shall be a date not more than three
business days prior to Closing Time.
(14) SunAmerica Bring-down Comfort Letter. At Closing Time, the
Underwriter shall have received from SunAmerica's independent public
accounts a letter, dated as of Closing Time, to the effect that they
reaffirm the statements made in the letter furnished by them pursuant to
Section 5(a)(12) hereof, except that the "specified date" referred to shall
be a date not more than three business days prior to Closing Time.
(15) Maintenance of Rating. Since the date of this Agreement, there
shall not have occurred a downgrading in the rating assigned to any of the
Company's securities by any "nationally recognized statistical rating
agency", as that term is defined by the Commission for purposes of Rule
436(g)(2) under the 1933 Act, and no such organization shall have publicly
announced that it has under surveillance or review its rating of any of the
Company's securities.
(16) Approval of Listing. At Closing Time, the Securities shall have
been approved for listing on the New York Stock Exchange, subject only to
official notice of issuance.
(17) No Objection. The NASD shall not have raised any objection with
respect to the fairness and reasonableness of the underwriting terms and
arrangements.
(18) Conditions to Purchase of Option Securities. In the event that
the Underwriter exercises its option provided in Section 2(b) hereof to
purchase all or any
17
portion of the Option Securities, the representations and warranties of the
Company contained herein, the representations and warranties of SunAmerica
and the Selling Stockholder contained in the Registration Agreement and the
statements in any certificates furnished by the Company, SunAmerica or the
Selling Stockholder hereunder shall be true and correct as of each Date of
Delivery and, at the relevant Date of Delivery, the Underwriter shall have
received:
(A) Company Officers' Certificate. A certificate, dated such
-----------------------------
Date of Delivery, of the President or a Vice President of the Company
and of the chief financial or chief accounting officer of the Company
confirming that the certificate delivered at Closing Time pursuant to
Section 5(a)(8) hereof is true and correct as of such Date of
Delivery.
(B) SunAmerica Officer's Certificate. A certificate, dated such
--------------------------------
Date of Delivery, of an executive officer of SunAmerica confirming
that the certificate delivered at Closing Time pursuant to Section
5(a)(9) hereof is true and correct as of such Date of Delivery.
(C) The Selling Stockholder's Certificate. A certificate, dated
-------------------------------------
such Date of Delivery, of the Selling Stockholder confirming that the
certificate delivered at Closing Time pursuant to Section 5(a)(10)
hereof is true and correct as of such Date of Delivery.
(D) Opinion of Counsel for the Company. The favorable opinion
----------------------------------
of Brown & Wood, counsel for the Company, in form and substance
reasonably satisfactory to the Underwriter, dated such Date of
Delivery, relating to the Option Securities to be purchased on such
Date of Delivery and otherwise to the same effect as the opinion
required by Section 5(a)(3) hereof.
(E) Opinion of Counsel for the Underwriter. The favorable
--------------------------------------
opinion of Skadden, Arps, Slate, Meagher & Flom, counsel for the
Underwriter, in form and substance satisfactory to the Underwriter,
dated such Date of Delivery, relating to the Option Securities to be
purchased on such Date of Delivery and otherwise to the same effect as
the opinion required by Section 5(a)(4) hereof.
(F) Opinion of Maryland Counsel for SunAmerica. The favorable
------------------------------------------
opinion of Piper & Marbury L.L.P., Maryland counsel for SunAmerica, in
form and substance satisfactory to the Underwriter, dated such Date of
Delivery, to the same effect as the opinion required by Section
5(a)(5) hereof.
(G) Opinion of General Counsel for SunAmerica. The favorable
-----------------------------------------
opinion of Susan L. Harris, Senior Vice President, General Counsel--
Corporate Affairs and Secretary of SunAmerica, in form and substance
satisfactory to the Underwriter, dated such Date of Delivery, to the
same effect as the opinion required by Section 5(a)(6) hereof.
18
(H) Opinion of Special Counsel for SunAmerica and Counsel for
---------------------------------------------------------
the Selling Stockholder. The favorable opinion of Davis Polk &
-----------------------
Wardwell, special counsel for SunAmerica and counsel for the Selling
Stockholder, in form and substance satisfactory to the Underwriter,
dated such Date of Delivery, to the same effect as the opinion
required by Section 5(a)(7) hereof.
(I) Company Bring-down Comfort Letter. A letter from Deloitte &
---------------------------------
Touche LLP, in form and substance satisfactory to the Underwriter and
dated such Date of Delivery, substantially the same in form and
substance as the letter furnished to the Underwriter pursuant to
Section 5(a)(13) hereof, except that the "specified date" in the
letter furnished pursuant to this paragraph shall be a date not more
than five days prior to such Date of Delivery.
(J) SunAmerica Bring-down Comfort Letter. A letter from
------------------------------------
SunAmerica's independent public accountants, in form and substance
satisfactory to the Underwriter and dated such Date of Delivery, to
the effect that they reaffirm the statements made in the letter
furnished to the Underwriter pursuant to Section 5(a)(14) hereof,
except that the "specified date" in the letter furnished pursuant to
this paragraph shall be a date not more than five days prior to such
Date of Delivery.
(19) Additional Documents. At Closing Time and at each Date of
Delivery, counsel for the Underwriter shall have been furnished with such
documents and opinions as they may require for the purpose of enabling them
to pass upon the issuance and sale of the Securities as herein
contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
contained herein or in the Registration Agreement; and all proceedings
taken by the Company in connection with the issuance and sale of the
Securities as herein contemplated shall be satisfactory in form and
substance to the Underwriter and counsel for the Underwriter.
(b) Conditions of the Company's Obligations. The obligations of the
Company hereunder are subject to the accuracy of the representations and
warranties of SunAmerica and the Selling Stockholder contained in the
Registration Agreement, to the accuracy of the statements in certificates of any
officer of SunAmerica or the Selling Stockholder delivered pursuant to the
provisions hereof, to the performance by SunAmerica and the Selling Stockholder
of its and his covenants and other obligations under the Registration Agreement,
and to the following further conditions:
(1) Effectiveness of SunAmerica Registration Statement. The
SunAmerica Registration Statement, including any SunAmerica Rule 462(b)
Registration Statement, has become effective and at Closing Time no stop
order suspending the effectiveness of the SunAmerica Registration Statement
shall have been issued under the 1933 Act or proceedings therefor initiated
or threatened by the Commission.
(2) Opinion of Counsel for the Company. At Closing Time, the Company
shall have received the favorable opinion, dated as of Closing Time, of
Brown & Wood,
19
counsel for the Company, to the same effect as the opinion required by
Section 5(a)(3) hereof.
(3) Opinion of Counsel for the Underwriter. At Closing Time, the
Underwriter shall have received the favorable opinion, dated as of Closing
Time, of Skadden, Arps, Slate, Meagher & Flom, counsel for the Underwriter,
to the same effect as the opinion required by Section 5(a)(4) hereof.
(4) Opinion of Maryland Counsel for SunAmerica. At Closing Time, the
Company shall have received the favorable opinion, dated as of Closing
Time, of Piper & Marbury L.L.P., Maryland counsel for SunAmerica, to the
same effect as the opinion required by Section 5(a)(5) hereof.
(5) Opinion of General Counsel for SunAmerica. At Closing Time, the
Company shall have received the favorable opinion, dated as of Closing
Time, of Susan L. Harris, Senior Vice President, General Counsel--Corporate
Affairs and Secretary of SunAmerica, to the same effect as the opinion
required by Section 5(a)(6) hereof.
(6) Opinion of Special Counsel for SunAmerica and Counsel for the
Selling Stockholder. At Closing Time, the Company shall have received the
favorable opinion, dated as of Closing Time, of Davis Polk & Wardwell,
special counsel for SunAmerica and counsel for the Selling Stockholder, to
the same effect as the opinion required by Section 5(a)(7) hereof.
(7) SunAmerica Officer's Certificate. At Closing Time, the Company
shall have received a certificate of an executive officer of SunAmerica,
dated as of Closing Time, to the same effect as the certificate delivered
to the Underwriter pursuant to Section 5(a)(9) hereof.
(8) The Selling Stockholder's Certificate. At Closing Time, the
Company shall have received a certificate of the Selling Stockholder, dated
as of Closing Time, to the same effect as the certificate delivered to the
Underwriter pursuant to Section 5(a)(10) hereof.
(9) SunAmerica Accountant's Comfort Letters. At the time of the
execution of this Agreement, the Company shall have received from
SunAmerica's independent public accountants a letter dated such date, in
form and substance satisfactory to the Company, substantially the same in
form and substance as the letter delivered to the Underwriter pursuant to
Section 5(a)(12) hereof.
(10) SunAmerica Bring-down Comfort Letter. At Closing Time, the
Company shall have received from SunAmerica's independent public
accountants a letter, dated as of Closing Time, in form and substance
satisfactory to the Company, and to the effect that they reaffirm the
statements made in the letter delivered to the Underwriter pursuant to
Section 5(a)(14) hereof.
20
(11) Conditions to Sale of Option Securities. In the event that the
Underwriter exercises its option provided in Section 2(b) hereof to
purchase all or any portion of the Option Securities, the representations
and warranties of SunAmerica and the Selling Stockholder contained in the
Registration Agreement and the statements in any certificates furnished by
SunAmerica or the Selling Stockholder hereunder shall be true and correct
as of each Date of Delivery and, at the relevant Date of Delivery, the
Company shall have received:
(A) SunAmerica Officer's Certificate. A certificate, dated such
--------------------------------
Date of Delivery, of an executive officer of SunAmerica confirming
that the certificate delivered at Closing Time pursuant to Section
5(b)(7) hereof is true and correct as of such Date of Delivery.
(B) The Selling Stockholder's Certificate. A certificate, dated
-------------------------------------
such Date of Delivery, of the Selling Stockholder confirming that the
certificate delivered at Closing Time pursuant to Section 5(b)(8)
hereof is true and correct as of such Date of Delivery.
(C) Opinion of Counsel for the Company. The favorable opinion,
----------------------------------
dated such Date of Delivery, of Brown & Wood, counsel for the Company,
to the same effect as the opinion required by Section 5(a)(18)(D)
hereof.
(D) Opinion of Counsel for the Underwriter. The favorable
--------------------------------------
opinion, dated such Date of Delivery, of Skadden, Arps, Slate, Meagher
& Flom, counsel for the Underwriter, to the same effect as the opinion
required by Section 5(a)(18)(E) hereof.
(E) Opinion of Maryland Counsel for SunAmerica. The favorable
------------------------------------------
opinion, dated such Date of Delivery, of Piper & Marbury L.L.P.,
Maryland counsel for SunAmerica, to the same effect as the opinion
required by Section 5(a)(18)(F) hereof.
(F) Opinion of General Counsel for SunAmerica. The favorable
-----------------------------------------
opinion, dated such Date of Delivery, of Susan L. Harris, Senior Vice
President, General Counsel--Corporate Affairs and Secretary of
SunAmerica, to the same effect as the opinion required by Section
5(a)(18)(G) hereof.
(G) Opinion of Special Counsel for SunAmerica and Counsel for
---------------------------------------------------------
the Selling Stockholder. The favorable opinion, dated such Date of
-----------------------
Delivery, of Davis Polk & Wardwell, special counsel for SunAmerica and
counsel for the Selling Stockholder, dated such Date of Delivery, to
the same effect as the opinion required by Section 5(a)(18)(H) hereof.
(H) SunAmerica Bring-down Comfort Letter. A letter from
------------------------------------
SunAmerica's independent public accountants, in form and substance
satisfactory to the Company and dated such Date of Delivery, to the
effect that they reaffirm
21
the statements made in the letter furnished to the Underwriter
pursuant to Section 5(a)(18)(J) hereof.
(c) Termination of Agreement. If any condition specified in subsection
(a) of this Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement, or, in the case of any condition to the purchase of
Option Securities on a Date of Delivery which is after the Closing Time, the
obligations of the Underwriter to purchase the relevant Option Securities, may
be terminated by the Underwriter by notice to the Company at any time at or
prior to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect. If any condition specified
in subsection (b) of this Section shall not have been fulfilled when and as
required to be fulfilled, this Agreement, or, in the case of any condition to
the sale of Option Securities on a Date of Delivery which is after the Closing
Time, the obligations of the Company to sell the relevant Option Securities, may
be terminated by the Company by notice to the Underwriter at any time at or
prior to Closing Time or such Date of Delivery, as the case may be, and such
termination shall be without liability of any party to any other party except as
provided in Section 4 and except that Sections 1, 6, 7 and 8 shall survive any
such termination and remain in full force and effect.
SECTION 6. Indemnification.
---------------
(a) Indemnification of the Underwriter by the Company. The Company agrees
to indemnify and hold harmless the Underwriter and each person, if any, who
controls the Underwriter within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the ML&Co. Registration
Statement (or any amendment thereto), including the Rule 430A Information
and the Rule 434 Information, if applicable, or the omission or alleged
omission therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading or arising out of
any untrue statement or alleged untrue statement of a material fact
contained in any ML&Co. preliminary prospectus or the ML&Co. Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, referred to under (i) above; provided
that (subject to Section 6(d) below) any such settlement is effected with
the written consent of the Company; and
22
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by the Underwriter),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, referred to under (i) above, to the extent that any such expense
is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by the
Underwriter expressly for use in the ML&Co. Registration Statement (or any
amendment thereto), including the Rule 430A Information and the Rule 434
Information, if applicable, or any ML&Co. preliminary prospectus or the ML&Co.
Prospectus (or any amendment or supplement thereto); and provided, further, that
-------- -------
this indemnity agreement with respect to any preliminary prospectus shall not
inure to the benefit of the Underwriter from whom the person asserting any such
losses, liabilities, claims, damages or expenses purchased Securities, or any
person controlling the Underwriter, if a copy of the Prospectus (as then amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) was not sent or given by or on behalf of the Underwriter to
such person, if such is required by law, at or prior to the written confirmation
of the sale of such Securities to such person and if the Prospectus (as so
amended or supplemented) would have cured the defect giving rise to such loss,
liability, claim, damage or expense.
Insofar as this indemnity agreement may permit indemnification for
liabilities under the 1933 Act of any person who controls an underwriter within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act and who,
at the date of this Agreement, is a director or officer of the Company or
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act, such indemnity agreement is subject to the undertaking of
the Company in the ML&Co. Registration Statement under Item 17 thereof.
(b) Indemnification of the Company, Directors and Officers. The
Underwriter agrees to indemnify and hold harmless the Company, its directors,
each of its officers who signed the ML&Co. Registration Statement, and each
person, if any, who controls the Company within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act against any and all loss, liability,
claim, damage and expense described in the indemnity contained in subsection (a)
of this Section, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, made in the ML&Co.
Registration Statement (or any amendment thereto), including the Rule 430A
Information and the Rule 434 Information, if applicable, or any ML&Co.
preliminary prospectus or the ML&Co. Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by the Underwriter expressly for use in the ML&Co. Registration
Statement (or any amendment thereto) or such ML&Co. preliminary prospectus or
the ML&Co. Prospectus (or any amendment or supplement thereto).
23
(c) Actions against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a), counsel
to the indemnified parties shall be selected by the Underwriter, and, in the
case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement without Consent if Failure to Reimburse. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. Contribution.
------------
If the indemnification provided for in Sections 6(a) and 6(b) is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then the Company and the Underwriter shall contribute to the aggregate
amount of such losses, liabilities, claims, damages and expenses incurred by
such indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and the
Underwriter on the other hand from the offering of the Securities pursuant to
this Agreement or (ii) if the allocation provided by clause (i) is not permitted
by applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company
24
on the one hand and of the Underwriter on the other hand in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Underwriter on the other hand in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company
and the total underwriting discount received by the Underwriter, in each case as
set forth on the cover of the ML&Co. Prospectus, or, if Rule 434 is used, the
corresponding location on the ML&Co. Term Sheet, bear to the aggregate initial
public offering price of the Securities as set forth on such cover. The
relative fault of the Company on the one hand and the Underwriter on the other
hand shall be determined by reference to, among other things, whether any such
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
or by the Underwriter and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
Notwithstanding the provisions of this Section 7, the Underwriter shall not
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which the
Underwriter has otherwise been required to pay by reason of any such untrue or
alleged untrue statement or omission or alleged omission.
The Company and the Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 7 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls the
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as the Underwriter, and
each director of the Company, each officer of the Company who signed the ML&Co.
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Company.
SECTION 8. Representations, Warranties and Agreements to Survive Delivery.
--------------------------------------------------------------
All representations, warranties and agreements contained in this Agreement or in
certificates of officers of the Company, SunAmerica or the Selling Stockholder
submitted pursuant hereto, shall
25
remain operative and in full force and effect, regardless of any investigation
made by or on behalf of the Underwriter or controlling person, or by or on
behalf of the Company or the Selling Stockholder, and shall survive delivery of
the Securities to the Underwriter.
SECTION 9. Termination of Agreement.
------------------------
(a) Termination; General. The Underwriter may terminate this Agreement,
by notice to the Company, at any time at or prior to Closing Time (i) if there
has been, since the time of execution of this Agreement or since the respective
dates as of which information is given in the ML&Co. Prospectus, any 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, or (ii) if there has been, since the time of execution of this
Agreement, or since the respective dates as of which information is given in the
SunAmerica Prospectus, any material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business prospects of
SunAmerica and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, or (iii) if there has occurred any
material adverse change in the financial markets in the United States, any
outbreak of hostilities or escalation thereof or other calamity or crisis or any
change or development involving a prospective change in national or
international political, financial or economic conditions, in each case the
effect of which is such as to make it, in the judgment of the Underwriter,
impracticable to market the Securities or to enforce contracts for the sale of
the Securities, or (iv) if trading in any securities of the Company or in the
SunAmerica Common Stock has been suspended or limited by the Commission or the
New York Stock Exchange, or if trading generally on the American Stock Exchange
or the New York Stock Exchange or in the Nasdaq National Market has been
suspended or limited, or minimum or maximum prices for trading have been fixed,
or maximum ranges for prices have been required, by any of said exchanges or by
such system or by order of the Commission, the NASD or any other governmental
authority, or (v) if a banking moratorium has been declared by either federal or
New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Notices. All notices and other communications hereunder shall
-------
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriter shall be directed to it at North Tower, World Financial Center, New
York, New York 10281-1328, attention of Douglas Squires, Managing Director; and
notices to the Company shall be directed to it at 100 Church St., 12th Floor,
New York, New York 10007, attention of the Secretary, with a copy to the
Treasurer at World Financial Center, South Tower, New York, New York 10080-6107.
SECTION 11. Parties. This Agreement shall each inure to the benefit of
-------
and be binding upon each of the Underwriter and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person,
26
firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities
from the Underwriter shall be deemed to be a successor by reason merely of such
purchase.
SECTION 12. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED BY
----------------------
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. SPECIFIED
TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 13. Effect of Headings. The Article and Section headings herein
------------------
and the Table of Contents are for convenience only and shall not affect the
construction hereof.
SECTION 14. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be an original; but such counterparts shall
together constitute but one and the same agreement.
27
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
the Underwriter and the Company in accordance with its terms.
Very truly yours,
MERRILL LYNCH & CO., INC.
By _______________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By ___________________________________
Authorized Signatory
28
SCHEDULE A
MERRILL LYNCH & CO. INC
____% STRYPES(SM) DUE ____, 1999
1. The initial public offering price of the Securities shall be
$__________ per STRYPES.
2. The purchase price for the Securities to be paid by the
Underwriter shall be $___________ per STRYPES, being an amount equal to the
initial public offering price set forth above less $_______ per STRYPES.
__________________________
/SM/ Service mark of Merrill Lynch & Co., Inc.
Sch A - 1
Exhibit A
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(a)(3)
(i) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware.
(ii) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
ML&Co. Prospectus and to enter into and perform its obligations under the
Underwriting Agreement.
(iii) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure so
to qualify or to be in good standing would not result in a Material Adverse
Effect.
(iv) Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S")
has been duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Delaware, has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the ML&Co. Prospectus and is duly qualified as a
foreign corporation to transact business and is in good standing in the
State of New York; all of the issued and outstanding capital stock of
MLPF&S has been duly authorized and validly issued, is fully paid and non-
assessable and, to the best of our knowledge, is owned by the Company,
directly or through subsidiaries, free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; none of the
outstanding shares of capital stock of MLPF&S was issued in violation of
the preemptive or similar rights of any securityholder of MLPF&S.
(v) The Underwriting Agreement has been duly authorized, executed
and delivered by the Company.
(vi) The Indenture has been duly authorized, executed and delivered
by the Company and (assuming the due authorization, execution and delivery
thereof by the Trustee) constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or similar laws affecting enforcement of
creditors' rights generally and except as enforcement thereof is subject to
general
A-1
principles of equity (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(vii) The Securities are in the form contemplated by the Indenture,
have been duly authorized by the Company and, assuming that the Securities
have been duly authenticated by the Trustee in the manner described in its
certificate delivered to you today (which fact such counsel need not
determine by an inspection of the Securities), the Securities have been
duly executed, issued and delivered by the Company and constitute valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium or similar
laws affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law),
and will be entitled to the benefits of the Indenture.
(viii) The Stock Agreement has been duly authorized, executed and
delivered by the Company and the ML&Co. Subsidiary and (assuming the due
authorization, execution and delivery thereof by the Selling Stockholder)
constitutes a valid and binding agreement of the Company and the ML&Co.
Subsidiary, enforceable against the Company and the ML&Co. Subsidiary in
accordance with its terms, except as the enforcement thereof may be limited
by bankruptcy, insolvency (including, without limitation, all laws relating
to fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity (regardless
of whether enforcement is considered in a proceeding in equity or at law).
(ix) The Indenture has been duly qualified under the 1939 Act.
(x) The Securities, the Indenture and the Stock Agreement conform
in all material respects as to legal matters to the descriptions thereof
contained in the ML&Co. Prospectus.
(xi) The ML&Co. Registration Statement, including any ML&Co. Rule
462(b) Registration Statement, has been declared effective under the 1933
Act; any required filing of the ML&Co. Prospectus pursuant to Rule 424(b)
has been made in the manner and within the time period required by Rule
424(b); and, to the best of our knowledge, no stop order suspending the
effectiveness of the ML&Co. Registration Statement or any ML&Co. Rule
462(b) Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or
threatened by the Commission.
(xii) The ML&Co. Registration Statement, including any ML&Co. Rule
462(b) Registration Statement, the Rule 430A Information and the Rule 434
Information, as applicable, the ML&Co. Prospectus, excluding the documents
incorporated by reference therein, and each amendment or supplement to the
ML&Co. Registration Statement and
A-2
ML&Co. Prospectus, excluding the documents incorporated by reference
therein, as of their respective effective or issue dates (other than the
financial statements and supporting schedules included therein or omitted
therefrom, and the Trustee's Statement of Eligibility on Form T-1 (the
"Form T-1"), as to which we need express no opinion) complied as to form in
all material respects with the requirements of the 1933 Act and the 1933
Act Regulations.
(xiii) The documents incorporated by reference in the ML&Co.
Prospectus (other than the financial statements and supporting schedules
included therein or omitted therefrom, as to which we need express no
opinion), when they became effective or were filed with the Commission, as
the case may be, complied as to form in all material respects with the
requirements of the 1933 Act or the 1934 Act, as applicable, and the rules
and regulations of the Commission thereunder.
(xiv) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign (other than under the 1933 Act and
the 1933 Act Regulations, which have been obtained, or as may be required
under the securities or blue sky laws of the various states and except for
the qualification of the Indenture under the 1939 Act, as to which we need
express no opinion) is necessary or required in connection with the due
authorization, execution and delivery of the Underwriting Agreement by the
Company or the due execution, delivery or performance of the Indenture or
the Stock Agreement by the Company or for the offering, issuance, sale or
delivery of the Securities or for the due execution, delivery or
performance of the Stock Agreement by the ML&Co. Subsidiary.
(xv) (A) The execution, delivery and performance by the Company of
the Underwriting Agreement, the Indenture and the Securities and the Stock
Agreement and the consummation by the Company of the transactions
contemplated in the Underwriting Agreement and the Stock Agreement and in
the ML&Co. Registration Statement (including the issuance and sale of the
Securities and the delivery of shares of SunAmerica Common Stock pursuant
thereto and the use of the proceeds from the sale of the Securities as
described in the ML&Co. Prospectus under the caption "Use of Proceeds") and
compliance by the Company with its obligations under the Underwriting
Agreement, the Indenture, the Securities and the Stock Agreement and (B)
the execution, delivery and performance by the ML&Co. Subsidiary of the
Stock Agreement and the consummation by the ML&Co. Subsidiary of the
transactions contemplated therein and compliance by the ML&Co. Subsidiary
with its obligations under the Stock Agreement do not and will not, whether
with or without the giving of notice or lapse of time or both, conflict
with or constitute a breach of, or default or Repayment Event (as defined
in Section 1(a)(xiii) of the Underwriting Agreement) under or result in the
creation or imposition of any lien, charge or encumbrance upon any property
or assets of the Company or any subsidiary pursuant to any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note, lease
or any other agreement or instrument, known to us, to which the Company or
any subsidiary 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 subsidiary is
subject (except for such conflicts, breaches or defaults or liens, charges
or encumbrances
A-3
that would not have a Material Adverse Effect), nor will such action result
in any violation of the provisions of the charter or by-laws of the Company
or any subsidiary, or any applicable law, statute, rule, regulation,
judgment, order, writ or decree, known to us, of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company or any subsidiary or any of their respective properties, assets or
operations.
We have participated in conferences with officers and representatives
of the Company and representatives of the independent accountants of the
Company and the Underwriter at which the contents of the ML&Co.
Registration Statement and Prospectus and related matters were discussed
and, although we are not passing upon or assuming responsibility for the
accuracy, completeness or fairness of the statements contained or
incorporated by reference in said Registration Statement and Prospectus and
have made no independent check or verification thereof, on the basis of the
foregoing, nothing has come to our attention that would lead us to believe
that the ML&Co. Registration Statement or any amendment thereto, including
the Rule 430A Information and Rule 434 Information (if applicable), (except
for financial statements and schedules and other financial data included or
incorporated by reference therein or omitted therefrom and the Form T-1, as
to which we need make no statement), at the time such ML&Co. Registration
Statement or any such amendment became effective or at the date of the
Underwriting Agreement, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading or that the ML&Co. Prospectus
or any amendment or supplement thereto (except for financial statements and
schedules and other financial data included or incorporated by reference
therein or omitted therefrom, as to which we need make no statement), at
the time the ML&Co. Prospectus was issued, at the time any such amended or
supplemented prospectus was issued or at the Closing Time, included or
includes an untrue statement of a material fact or omitted or omits to
state a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.
In rendering such opinion, such counsel may rely as to matters of fact (but
not as to legal conclusions), to the extent they deem proper, on certificates of
responsible officers of the Company and public officials.
A-4
Exhibit B
FORM OF OPINION OF UNDERWRITER'S COUNSEL
TO BE DELIVERED PURSUANT TO
SECTION 5(a)(4)
(i) The SunAmerica Registration Statement, including any SunAmerica
Rule 462(b) Registration Statement, has been declared effective under the
1933 Act; any required filing of the SunAmerica Prospectus pursuant to Rule
424(b) has been made in the manner and within the time period required by
Rule 424(b); and, to the best of our knowledge, no stop order suspending
the effectiveness of the SunAmerica Registration Statement or any
SunAmerica Rule 462(b) Registration Statement has been issued under the
1933 Act and no proceedings for that purpose have been instituted or are
pending or threatened by the Commission.
(ii) The SunAmerica Registration Statement, including any SunAmerica
Rule 462(b) Registration Statement, the SunAmerica Prospectus, excluding
the documents incorporated by reference therein, and each amendment or
supplement to the SunAmerica Registration Statement and SunAmerica
Prospectus, excluding the documents incorporated by reference therein, as
of their respective effective or issue dates (other than the financial
statements and supporting schedules included therein or omitted therefrom,
as to which we need express no opinion) complied as to form in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations.
We have participated in conferences with officers and representatives
of SunAmerica, representatives of the independent accountants of
SunAmerica, and the Underwriter at which the contents of the SunAmerica
Registration Statement and Prospectus and related matters were discussed
and, although we are not passing upon or assuming responsibility for the
accuracy, completeness or fairness of the statements contained or
incorporated by reference in said Registration Statement and Prospectus and
have made no independent check or verification thereof, on the basis of the
foregoing, nothing has come to our attention that would lead us to believe
that the SunAmerica Registration Statement or any amendment thereto,
(except for financial statements and schedules and other financial data
included or incorporated by reference therein or omitted therefrom, as to
which we need make no statement), at the time such SunAmerica Registration
Statement or any such amendment became effective, contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading or that the SunAmerica Prospectus or any amendment or supplement
thereto (except for financial statements and schedules and other financial
data included or incorporated by reference therein or omitted therefrom, as
to which we need make no statement), at the time the SunAmerica Prospectus
was issued, at the time any such amended or supplemented prospectus was
B-1
issued or at the Closing Time, included or includes an untrue statement of
a material fact or omitted or omits to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading.
In rendering such opinion, such counsel may rely as to matters of fact (but
not as to legal conclusions), to the extent they deem proper, on certificates of
responsible officers of SunAmerica and public officials.
B-2
Exhibit C
---------
FORM OF OPINION OF SUNAMERICA'S MARYLAND COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(a)(5)
(i) SunAmerica has been duly incorporated and is validly existing
as a corporation in good standing under the laws under the State of
Maryland; and SunAmerica has the corporate power under the laws of the
State of Maryland and under its charter to own, lease and operate its
properties and to conduct its business as described in the SunAmerica
Registration Statement and the SunAmerica Prospectus;
(ii) the Registration Agreement has been duly authorized and
executed by SunAmerica;
(iii) all of the shares of issued and outstanding Nontransferable
Class B Stock, par value $1.00 (the "Class B Stock"), of SunAmerica have
been duly authorized and validly issued and are fully paid and non-
assessable;
(iv) the statements in the SunAmerica Prospectus under the caption
"Description of Capital Stock", insofar as such statements constitute
summaries of the legal matters or documents or proceedings referred to
therein, fairly present the matters referred to therein;
(v) the execution and delivery of the Registration Agreement, and
the consummation of the transactions contemplated therein and in the
Underwriting Agreement and Stock Agreement, the delivery, if any, to the
ML&Co. Subsidiary of Class B Stock pursuant to the Stock Agreement, and the
issuance and delivery to the ML&Co. Subsidiary of shares of SunAmerica
Common Stock upon conversion of any such Class B Common Stock, will not
result in any violation of the provisions of the articles of incorporation
or by-laws of SunAmerica or any material law, administrative regulations or
administrative or court decree applicable to SunAmerica (except that no
opinion need be expressed with respect to Maryland securities or Blue Sky
laws);
(vi) each share of Class B Stock is convertible into one share of
SunAmerica Common Stock; the shares of SunAmerica Common Stock issuable
upon conversion of the Class B Stock have been duly authorized and reserved
for issuance upon such conversion; and, upon the delivery, if any, to the
ML&Co. Subsidiary of shares of Class B Stock pursuant to the Stock
Agreement, such shares will immediately and automatically convert into a
like number of shares of SunAmerica Common Stock and such shares of
SunAmerica Common Stock, when issued and delivered upon such conversion,
will be validly issued, fully paid and non-assessable and the issuance of
such shares of SunAmerica Common Stock upon such conversion will not be
subject to any preemptive or other similar rights arising by law or under
SunAmerica's charter or by-laws;
C-1
(vii) the forms of certificates used to evidence the Class B Stock
and the SunAmerica Common Stock comply with all applicable statutory
requirements; and
(viii) SunAmerica's Restated Articles of Incorporation filed with the
Maryland State Department of Assessments and Taxation on October 3, 1991
represented on such date the true, correct and complete articles of
incorporation, as amended, governing SunAmerica.
C-2
Exhibit D
---------
FORM OF OPINION OF SUNAMERICA'S GENERAL COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(a)(6)
(i) to the best of such counsel's knowledge and information,
SunAmerica is duly qualified as a foreign corporation to transact business
and in good standing in each jurisdiction in which such qualification is
required, except where the failure to so qualify or be in good standing
would not have a material adverse effect on the condition, financial or
otherwise, on the earnings or business affairs of SunAmerica and its
subsidiaries, taken as a whole;
(ii) the authorized, issued and outstanding capital stock of
SunAmerica is correctly set forth in the SunAmerica Prospectus under
"Description of Capital Stock";
(iii) each of SunAmerica Life Insurance Company, First SunAmerica
Life Insurance Company, Anchor National Life Insurance Company, SunAmerica
Asset Management Corp., Resources Trust Company, Royal Alliance Associates,
Inc., SunAmerica Securities, Inc., and Ford Life Insurance Company (each a
"Subsidiary" and, collectively, the "Subsidiaries") has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the corporate
power and authority to own, lease and operate its properties and to conduct
its business as presently conducted and as described in the SunAmerica
Registration Statement and SunAmerica Prospectus, it being understood that
as to each Subsidiary, the foregoing opinion is based solely on a
certificate dated as of a recent date of an appropriate official of the
jurisdiction of incorporation of such Subsidiary and, as applicable, a
letter from CT Corporation System dated as of a recent date as to the good
standing of such Subsidiary in such jurisdiction, copies of which will be
delivered to the Underwriter on the date of such opinion; nothing has come
to the attention of such counsel to lead such counsel to believe that any
of SunAmerica Life Insurance Company, Anchor National Life Insurance
Company or SunAmerica Asset Management Corp. is not duly qualified as a
foreign corporation to transact business or is not in good standing in each
jurisdiction in which such qualification is required, except where the
failure to so qualify or be in good standing would not have a material
adverse effect on the condition, financial or otherwise, or the earnings or
business affairs of SunAmerica and its subsidiaries, considered as one
enterprise; to the best of such counsel's knowledge and information, all of
the issued and outstanding capital stock of each Subsidiary is owned
(except for directors qualifying shares) directly or through subsidiaries,
by SunAmerica, free and clear of any security interest, mortgage, pledge,
lien, encumbrance, claim or equity;
(iv) to the best of such counsel's knowledge and information, the
execution and delivery of the Registration Agreement by SunAmerica and the
consummation of the
D-1
transactions contemplated therein by SunAmerica, and the delivery, if any,
to the ML&Co. Subsidiary of Nontransferable Class B Stock, par value $1.00
per share (the "Class B Stock"), of SunAmerica pursuant to the Stock
Agreement and the issuance and delivery to the ML&Co. Subsidiary of shares
of SunAmerica Common Stock upon conversion of any such Class B Common
Stock, will not conflict with or constitute a breach of, or default under,
or result in the creation or imposition of any lien, charge or encumbrance
upon any property of assets of SunAmerica or any of the Subsidiaries
pursuant to, any material contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which SunAmerica or any of the
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 SunAmerica or any of the
Subsidiaries is subject, except for a conflict, breach, default, lien,
charge or encumbrance which would not have a material adverse effect on the
condition, financial or otherwise, or the earnings or business affairs of
SunAmerica and its subsidiaries considered as one enterprise, nor will such
action result in any violation of the provisions of the articles of
incorporation or by-laws of SunAmerica and the Subsidiaries or any material
applicable law, administrative regulation or administrative or court decree
and, to the best of such counsel's knowledge and information, no consent,
approval, authorization or order of or qualification with any court or
administrative or governmental authority or agency is required for the
performance by SunAmerica of its obligations under the Registration
Agreement except such as may be required by the 1933 Act or the rules and
regulations thereunder, the securities or Blue sky laws or insurance
securities laws of the various states or except such as have been obtained;
(v) to the best of such counsel's knowledge and information, there
are no statutes or regulations that are required to be described in the
SunAmerica Registration Statement or the SunAmerica Prospectus that are not
described as required and there are no legal or governmental proceedings
pending or threatened which are required to be described in the SunAmerica
Registration Statement, other than these disclosed therein;
(vi) to the best of such counsel's knowledge and information there
are no contracts, indentures, mortgages, loan agreements, notes, leases or
other instruments required to be described or referred to in the SunAmerica
Registration Statement or to be filed as exhibits thereto, other than those
described or referred to therein or filed as exhibits thereto, the
descriptions thereof or references thereto are correct in all material
respects and, to the best of such counsel's knowledge and information, no
default exists in the due performance or observance of any material
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage loan agreement, note, lease or other instrument so
described, referred to or filed, which default could have a material
adverse effect on SunAmerica and its subsidiaries considered as one
enterprise;
(vii) such counsel (1) is of the opinion that each document, if any,
filed pursuant to the 1934 Act and incorporated by reference in the
SunAmerica Prospectus at the time it was filed or last amended (except for
financial statements, supporting schedules and other financial data
included or incorporated by reference therein, as to which such counsel
need not express any opinion) appeared on its face to be appropriately
responsive in all material respects to the requirements of the 1934 Act and
the applicable rules and
D-2
regulations of the Commission thereunder, (2) believes that (except for
financial statements, supporting schedules and other financial data
included or incorporated by reference therein, as to which such counsel
need not express any belief) each part of the Registration Statement and
any SunAmerica Rule 462(b) Registration Statement, when such part became
effective and as of the date of the Underwriting Agreement, did not contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, (3) is of the opinion that each of the SunAmerica
Registration Statement (and any SunAmerica Rule 462(b) Registration
Statement, as of its effective date, and the SunAmerica Prospectus, as of
the Closing Time (except in each case for financial statements, supporting
schedules and other financial data included or incorporated by reference
therein, as to which such counsel need not express any opinion), appeared
on their face to be appropriately responsive in all material respects to
the requirements of the 1933 Act and the applicable rules and regulations
of the Commission thereunder and (4) believes that (except for financial
statements, supporting schedules and other financial data included or
incorporated by reference therein, as to which such counsel need not
express any belief) the SunAmerica Prospectus, as of its date and as of the
Closing Time, does not contain any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading; and
(viii) the SunAmerica Registration Statement (including any
SunAmerica Rule 462(b) Registration Statement) is effective under the 1933
Act and to the best of such counsel's knowledge, no stop order suspending
the effectiveness of the SunAmerica Registration Statement or any
SunAmerica Rule 462(b) Registration Statement is in effect under the 1933
Act, and no proceedings for such purpose are pending before or threatened
by the Commission.
With respect to the foregoing paragraph, such counsel may state that her
opinion and belief are based upon her participation in the preparation of the
SunAmerica Registration Statement and SunAmerica Prospectus and any amendments,
supplements thereto and documents incorporated therein by reference and review
and discussion of the contents thereof, but are without independent check or
verification, except as specified.
In rendering such opinion, such counsel may rely, as to matters governed by
laws other than the laws of the State of California and the federal law of the
United States of America, on an opinion or opinions of Davis Polk & Wardwell and
Piper & Marbury L.L.P., in each case so long as such opinion shall be dated as
of Closing Time and in form and substance satisfactory to the Underwriter, and
shall expressly permit the Underwriter to rely thereon as if such opinion were
addressed to the Underwriter.
D-3
Exhibit E
---------
FORM OF OPINION OF SUNAMERICA'S SPECIAL COUNSEL
AND THE SELLING STOCKHOLDER'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(a)(7)
(i) the statements in the SunAmerica Prospectus under the caption
"Description of Capital Stock" [and in the ML&Co. Prospectus under the
captions "Summary--Stock Agreement with the Selling Stockholder" and
"Certain Arrangements with the Selling Stockholder",] insofar as such
statements constitute summaries of the legal matters or documents or
proceedings referred to therein, fairly present the information called for
with respect to such legal matters, documents or proceedings and fairly
summarize the matters referred to therein;
(ii) such counsel (1) believes that (except for financial
statements, supporting schedules and other financial data included or
incorporated by reference therein and any of the documents incorporated by
reference therein, as to which such counsel need not express any belief)
each part of the SunAmerica Registration Statement and any SunAmerica Rule
462(b) Registration Statement, when such part became effective and as of
the date of the Underwriting Agreement, did not contain any untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, (2) is of the opinion that each of the SunAmerica Registration
Statement and any SunAmerica Rule 462(b) Registration Statement, as of its
effective date, and the SunAmerica Prospectus, as of the Closing Time
(except in each case for financial statements, supporting schedules and
other financial data included or incorporated by reference therein and any
of the documents incorporated or deemed to be incorporated by reference
therein, as to which such counsel need not express any opinion) appeared on
its face to be appropriately responsive in all material respects to the
requirements of the 1933 Act and the applicable rules and regulations of
the Commission thereunder and (3) believes that (except for financial
statements, supporting schedules and other financial data included or
incorporated by reference therein or in any of the documents incorporated
or deemed to be incorporated by reference therein, as to which such counsel
need not express any belief) the SunAmerica Prospectus, as of its date and
as of the Closing Time, did not contain any untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading;
(iii) the SunAmerica Registration Statement (including any SunAmerica
Rule 462(b) Registration Statement) is effective under the 1933 Act and, to
the best of such counsel's knowledge, no stop order suspending the
effectiveness of the SunAmerica Registration Statement or any SunAmerica
Rule 462(b) Registration Statement is in effect under the 1933 Act, and no
proceedings for such purpose are pending before or threatened by the
Commission;
E-1
(iv) SunAmerica is not an "investment company" or a company
"controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended;
(v) to the best of such counsel's knowledge and information, no
consent, approval, authorization or order of or qualification or filing
with any New York State or federal court or New York State or federal
administrative or governmental authority or agency is required for the
execution, delivery or performance by SunAmerica or the Selling Stockholder
of the Underwriting Agreement, the Registration Agreement or the Stock
Agreement, or the delivery, if any, to the ML&Co. Subsidiary of
Nontransferable Class B Stock, par value $1.00 per share (the "Class B
Stock"), of SunAmerica pursuant to the Stock Agreement or the issuance and
delivery to the ML&Co. Subsidiary of shares of SunAmerica Common Stock upon
conversion of any such Class B Stock, except such as have been obtained
under the 1933 Act or such as may be required under the securities or Blue
Sky laws or insurance securities laws of the various states;
(vi) the Underwriting Agreement has been duly executed and delivered
by the Selling Stockholder;
(vii) the Stock Agreement has been duly executed and delivered by,
and is a valid and binding agreement of, the Selling Stockholder,
enforceable in accordance with its terms except (a) as the enforceability
thereof may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally, (b) as the availability of equitable remedies
may be limited by equitable principles of general applicability and (c)
that such counsel shall state that its opinion, set forth in this paragraph
(vii) does not consider the application of the CEA to the matters set forth
herein;
(viii) the execution and delivery of the Underwriting Agreement, the
Registration Agreement and the Stock Agreement and the consummation of the
transactions contemplated therein, and the delivery, if any, to the ML&Co.
Subsidiary of Class B Stock pursuant to the Stock Agreement and the
issuance and delivery to the ML&Co. Subsidiary of shares of SunAmerica
Common Stock upon conversion of any such Class B Common Stock, will not, to
the best of such counsel's knowledge and information, conflict with or
constitute a breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Selling Stockholder pursuant to, any material contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Selling Stockholder is a party or by which the Selling Stockholder may be
bound, or to which any of the property or assets of the Selling Stockholder
is subject, nor will any such action result in any violation of any
material applicable law or administrative regulation of the United States
or of the State of New York or any material administrative or court decree;
(ix) the Selling Stockholder is the sole registered owner of the
3,000,000 shares of Class B Stock (the "Subject Shares") delivered to .
pursuant to the Stock Agreement and of at least 450,000 additional shares
(the "Additional Shares") of Class B Stock, in each case, free and clear,
to the best knowledge and information of such counsel, of any
E-2
security interest, mortgage, pledge, lien, encumbrance, claim or equity; to
the best knowledge and information of such counsel, the Selling Stockholder
is the sole beneficial owner of, and no person other than the Selling
Stockholder has any beneficial interest, in the Subject Shares or the
Additional Shares; and
(x) upon delivery to the ML&Co. Subsidiary of certificates for
shares of Class B Stock or SunAmerica Common Stock pursuant to the Stock
Agreement, in each case in registered form duly endorsed to the ML&Co.
Subsidiary or in blank by the Selling Stockholder, the ML&Co. Subsidiary
will acquire, assuming that the ML&Co. Subsidiary purchased such shares for
value and in good faith and without notice of any "adverse claim" (as such
term is defined in Section 8-302(2) of the New York Uniform Commercial
Code), all of the rights of the Selling Stockholder (a) in the case of
shares of SunAmerica Common Stock, such shares and (b) in the case of
shares of Class B Stock, an equivalent number of shares of SunAmerica
Common Stock, in each case free and clear of all adverse claims, any
security interest created by the transferor that may be perfected under the
New York Uniform Commercial Code and, to the best of their knowledge,
without independent investigation, any mortgage, pledge, lien, encumbrance
or equity.
With respect to the opinion set forth in paragraph (iv), such counsel may
state that their opinion and belief are based upon their participation in the
preparation of the SunAmerica Registration Statement and the SunAmerica
Prospectus and any amendments or supplements thereto (other than the documents
incorporated by reference) and upon review and discussion of the contents
thereof (including documents incorporated by reference) but are without
independent check or verification, except as specified.
In rendering such opinion, such counsel may rely, as to matters governed by
laws other than the laws of the State of New York and the federal law of the
United States of America, on an opinion or opinions of Piper & Marbury L.L.P.,
so long as such opinion shall be dated as of Closing Time and in form and
substance satisfactory to the Underwriter, and shall expressly permit the
Underwriter to rely thereon as if such opinion were addressed to the
Underwriter.
E-3