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Exhibit 1
ADVANTA CORP.
VALUE NOTES(SM), SERIES A
DUE FROM 9 MONTHS TO 15 YEARS FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
August 7, 1997
PaineWebber Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Sage ▇▇▇▇▇ & Co.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Dear Sirs:
Advanta Corp., a Delaware corporation (the "Company"), confirms its
agreement with PaineWebber Incorporated, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated
and Sage ▇▇▇▇▇ & Co. (each referred to as an "Agent" and collectively referred
to as the "Agents") with respect to the issue and sale by the Company of its
Value Notes(SM)* described herein (the "Notes"). The Notes are to be issued
pursuant to an Indenture (the "Indenture") dated as of November 15, 1993 between
the Company and The Chase Manhattan Bank, as trustee (the "Trustee"). As of the
date hereof, the Company has authorized the issuance and sale of up to U.S.
$250,000,000 aggregate principal amount of Notes designated as its "Value Notes,
Series A" to or through the Agents pursuant to the terms of this Agreement. It
is understood, however, that the Company may from time to time authorize the
issuance of additional series of Notes and that such additional Notes may be
sold to or through the Agents pursuant to the terms of this Agreement.
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* Service ▇▇▇▇ application pending.
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This Agreement provides both for the sale of Notes by the Company to
one or more Agents as principal for resale to investors and other purchasers and
for the sale of Notes by the Company directly to investors (as may from time to
time be agreed to by the Company and the applicable Agent), in which case the
applicable Agent will act as an agent of the Company in soliciting offers for
the purchase of Notes.
The Company has filed with the Securities and Exchange Commission (the
"SEC") a registration statement on Form S-3 (No. 333-05701) for the registration
of debt securities, including the Notes, 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 SEC under the 1933
Act (the "1933 Act Regulations"), and the Company has filed such post-effective
amendments thereto as may be required prior to any acceptance by the Company of
an offer for the purchase of Notes. Such registration statement (as so amended,
if applicable) has been declared effective by the SEC and the Indenture has been
duly qualified under the Trust Indenture Act of 1939 (the "1939 Act").
Registration Statement No. 333-05701 (and any further registration statements
which may be filed by the Company for the purpose of registering additional
Notes and in connection with which this Agreement is included or incorporated by
reference as an exhibit) and the prospectus constituting a part thereof, and any
prospectus supplements relating to the Notes, including all documents
incorporated therein by reference, as from time to time amended or supplemented
by the filing of documents pursuant to the Securities Exchange Act of 1934, as
amended (the "1934 Act"), or the 1933 Act or otherwise, are referred to herein
as the "Registration Statement" and the "Prospectus", respectively, except that
if any revised prospectus shall be provided to the Agents by the Company for use
in connection with the offering of the Notes, whether or not such revised
prospectus is required to be filed by the Company pursuant to Rule 424(b) of the
1933 Act Regulations, the term "Prospectus" shall refer to such revised
prospectus from and after the time it is first provided to each Agent for such
use. For purposes of this Agreement, all references to the Registration
Statement, the Prospectus 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 ("▇▇▇▇▇").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement or Prospectus (or other references of like import) shall
be deemed to mean and include all such financial statements and schedules and
other information which are incorporated by reference in the Registration
Statement or Prospectus, as the case may be; and all references in this
Agreement to amendments or supplements to the Registration Statement or
Prospectus shall be deemed to mean and include the filing of any document under
the 1934 Act, which is incorporated by reference in the Registration Statement
or Prospectus, as the case may be.
SECTION 1. Appointment as Agents.
(a) Appointment. Subject to the terms and conditions stated herein and
subject to the reservation by the Company of the right to sell Notes directly on
its own behalf, the Company hereby agrees that Notes will be sold to or through
the Agents. Each Agent is authorized to
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engage the services of any other broker or dealer in connection with the offer
or sale of the Notes purchased by such Agent as principal for resale to others
but is not authorized to appoint sub-agents. In connection with sales by an
Agent of Notes purchased by such Agent as principal to other brokers or dealers,
such Agent may allow all or any portion of the discount it has received in
connection with such purchase from the Company to such brokers or dealers. Each
Agent is acting in connection with the Notes individually and not collectively
or jointly. The appointment of the Agents hereunder is not exclusive and the
Company may from time to time offer Notes for sale otherwise than to or through
an Agent; provided, however, that so long as this Agreement is in effect the
Company will not appoint any other agent for the purpose of soliciting purchases
of the Notes on a continuous basis. It is understood, however, that if from time
to time the Company is approached by a prospective agent offering to solicit a
specific purchase of Notes, the Company may engage such agent with respect to
such specific purchase, provided that (i) such agent is engaged on terms
substantially similar to the applicable terms of this Agreement (including the
same commission schedule as set forth hereto as Schedule A) and (ii) the Agents
are given notice of such purchase promptly, in each case after the purchase is
agreed to.
(b) Sale of Notes. The Company shall not sell or approve the
solicitation of purchases of Notes in excess of the amount which shall be
authorized by the Company from time to time or in excess of the principal amount
of Notes registered pursuant to the Registration Statement. The Agents shall
have no responsibility for maintaining records with respect to the aggregate
principal amount of Notes sold, or of otherwise monitoring the availability of
Notes for sale, under the Registration Statement.
(c) Purchases as Principal. The Agents shall not have any obligation to
purchase Notes from the Company as principal, but each Agent may agree from time
to time to purchase Notes as principal. Any such purchase of Notes by an Agent
as principal shall be made in accordance with Section 3(a) hereof.
(d) Solicitations as Agent. If agreed upon by the Agents and the
Company, the Agents, acting solely as agents for the Company and not as
principal, will solicit offers for the purchase of the Notes. Each Agent will
communicate to the Company, orally, each offer to purchase Notes solicited by
such Agent on an agency basis, other than those offers rejected by such Agent.
Each Agent shall have the right, in its discretion reasonably exercised, to
reject any proposed purchase of Notes, as a whole or in part, and any such
rejection shall not be deemed a breach of such Agent's agreement contained
herein. The Company may accept or reject any proposed purchase of the Notes, in
whole or in part. Each Agent shall make reasonable efforts to assist the Company
in obtaining performance by each purchaser whose offer to purchase Notes has
been solicited by such Agent and accepted by the Company. The Agents shall not
have any liability to the Company in the event any such agency purchase is not
consummated for any reason. If the Company shall default on its obligation to
deliver Notes to a purchaser whose offer has been solicited by an Agent and
accepted by the Company, the Company shall (i) hold the applicable Agent
harmless against any loss, claim or damage arising from or as a result of
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such default by the Company and (ii) notwithstanding such default, pay to the
applicable Agent any commission to which it would be entitled in connection with
such sale.
(e) Reliance. The Company and each Agent agree that any Notes purchased
by such Agent as principal shall be purchased, and any Notes the placement of
which such Agent arranges as an agent of the Company shall be placed, by such
Agent, in reliance on the representations, warranties, covenants and agreements
of the Company contained herein and on the terms and conditions and in the
manner provided herein.
SECTION 2. Representations and Warranties.
(a) The Company represents and warrants to each Agent as of the date
hereof, as of the date of each acceptance by the Company of an offer for the
purchase of Notes (whether to an Agent as principal or through an Agent as
agent), as of the date of each delivery of Notes (whether to an Agent as
principal or through an Agent as agent) (the date of each such delivery to an
Agent as principal being hereafter referred to as a "Settlement Date"), and as
of any time that the Registration Statement or the Prospectus shall be amended
or supplemented or there is filed with the SEC any document incorporated by
reference into the Prospectus (each of the times referenced above being referred
to herein as a "Representation Date") as follows:
(i) Due Incorporation and Qualification. The Company has been
duly incorporated and is validly existing as a corporation in good
standing under the laws of the State of Delaware with corporate power
and authority to own, lease and operate its properties and to conduct
its business as described in the Prospectus and to enter into this
Agreement and consummate the transactions contemplated in the
Prospectus; and 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 to so qualify and be in good standing would not have
a material adverse effect on the condition, financial or otherwise, or
the earnings or business affairs of the Company and its subsidiaries
considered as one enterprise.
(ii) Subsidiaries. Each subsidiary of the Company which is a
significant subsidiary (each, a "Significant Subsidiary"), as defined
in Rule 405 of Regulation C of the 1933 Act Regulations, has been duly
incorporated 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
conduct its business as described in the 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 property or the
conduct of business, except where the failure to so qualify and be in
good standing would not have a material adverse effect on the
condition, financial or otherwise, or the earnings or business affairs
of the Company and its subsidiaries considered as one enterprise; and
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all of the issued and outstanding capital stock of each Significant
Subsidiary has been duly authorized and validly issued, 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.
(iii) Registration Statement and Prospectus. At the time the
Registration Statement became effective, the Registration Statement
complied, and as of each applicable Representation Date will comply, in
all material respects with the requirements of the 1933 Act and the
1933 Act Regulations and the 1939 Act and the rules and regulations of
the SEC promulgated thereunder. The Registration Statement, at the time
it became effective, did not, and at each time thereafter at which any
post-effective amendment to the Registration Statement becomes
effective or any Annual Report on Form 10-K is filed by the Company
with the SEC and as of each Representation Date, 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. The Prospectus delivered to the Agents for use
in connection with the offering of Notes are identical to any
electronically transmitted copies thereof filed with the SEC pursuant
to ▇▇▇▇▇, except to the extent permitted by Regulation S-T. The
Prospectus, as of the date hereof does not, and as of each
Representation Date will not, include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the representations
and warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus made in
reliance upon and in conformity with information furnished to the
Company in writing by the Agents expressly for use in the Registration
Statement or Prospectus.
(iv) Incorporated Documents. The documents incorporated or
deemed to be incorporated by reference in the Prospectus, at the time
they were or hereafter are filed with the SEC, complied or when so
filed will comply, as the case may be, in all material respects with
the requirements of the 1934 Act and the rules and regulations
promulgated thereunder (the "1934 Act Regulations").
(v) Accountants. The accountants who certified the financial
statements included or incorporated by reference in the Prospectus are
independent public accountants within the meaning of the 1933 Act and
the 1933 Act Regulations.
(vi) Financial Statements. The financial statements and any
supporting schedules and notes thereto of the Company and its
consolidated subsidiaries included or incorporated by reference in the
Registration Statement and the Prospectus present fairly the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the consolidated results of
their operations for the periods specified; and, except as stated
therein, said financial statements have been prepared in
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conformity with generally accepted accounting principles in the United
States applied on a consistent basis throughout the periods mentioned;
and the supporting schedules included in the Registration Statement
present fairly the information required to be stated therein.
(vii) Authorization and Validity of this Agreement, the
Indenture and the Notes. This Agreement has been duly authorized,
executed and delivered by the Company and, upon execution and delivery
by the Agents, will be a valid and legally binding agreement of the
Company; the Indenture has been duly authorized, executed and delivered
by the Company and (assuming the Indenture has been duly authorized,
executed and delivered by the Trustee) constitutes a valid and legally
binding obligation of the Company enforceable against the Company in
accordance with its terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting enforcement of creditors' rights
generally or by general equity principles; the Notes have been duly and
validly authorized for issuance, offer and sale pursuant to this
Agreement and, when issued, authenticated and delivered pursuant to the
provisions of this Agreement and the Indenture against payment of the
consideration therefor specified in the Prospectus or agreed upon
pursuant to the provisions of this Agreement, the Notes will constitute
valid and legally binding obligations of the Company enforceable
against the Company in accordance with their terms, except as
enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or
affecting enforcement of creditors' rights generally or by general
equity principles; the Notes and the Indenture will be substantially in
the form heretofore delivered to the Agents and conform in all material
respects to all statements relating thereto contained in the
Prospectus; and each holder of Notes will be entitled to the benefits
of the Indenture.
(viii) Material Changes. Since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, except as may otherwise be stated therein or contemplated
thereby, 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.
(ix) No Defaults; Regulatory Approvals. Neither the Company
nor any of its Significant Subsidiaries is in violation of its charter
or by-laws, or in default in the performance or observance of any
material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which it is a party or by which it or any of them or
their properties may be bound, the violation or default of which would
have a material adverse effect on the Company and its subsidiaries
considered as one enterprise; the execution and delivery of this
Agreement and the Indenture and the consummation of the transactions
contemplated herein and therein have been duly authorized by all
necessary corporate action and do not
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and will not conflict with or constitute a breach of any of the terms
or provisions of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its subsidiaries pursuant to, any
contract, indenture, mortgage, loan agreement, note, lease or other
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 such subsidiary is subject,
nor will such action result in any violation of the provisions of the
charter or by-laws of the Company or any law, rule, regulation,
judgment, administrative regulation or administrative or court order or
decree; and no consent, approval, authorization, order or decree of any
court or governmental agency or body is necessary or required for the
consummation by the Company of the transactions contemplated by this
Agreement or in connection with the issuance and sale of Notes
hereunder, except such as have been obtained or rendered, as the case
may be, or as may be required under the securities laws of any state or
other jurisdiction of the United States (the "Blue Sky" laws).
(x) Legal Proceedings. Except as disclosed in the Registration
Statement or the Prospectus, no legal or governmental actions, suits or
proceedings, domestic or foreign, are pending to which the Company or
any of its subsidiaries is a party or to which the property of the
Company or any of its subsidiaries is subject that would reasonably be
expected to materially and adversely affect the consummation of this
Agreement or the Indenture or any transaction contemplated hereby or
thereby or that would reasonably be expected to result in any material
adverse change in the condition (financial or otherwise), business,
properties or results of operations of the Company and its subsidiaries
considered as one enterprise or which are required to be described in
the Registration Statement or the Prospectus and are not described
therein, and to the knowledge of the Company no proceedings required to
be so described have been threatened against the Company or any of its
subsidiaries or with respect to any of their respective properties.
(xi) Company and Bank Status. The Company is a company
described in Section 4(f)(1) of the Bank Holding Company Act of 1956,
as amended (the "BHCA"). Advanta National Bank (formerly, Advanta
National Bank USA and referred to herein as the "Bank") is validly
existing as an association in good standing under the laws of the
United States. The Bank is in compliance in all material respects with
all regulations of the Office of the Comptroller of the Currency, the
Board of Governors of the Federal Reserve System and the Federal
Deposit Insurance Corporation (the "FDIC") the failure to comply with
which would have a material adverse effect on the Company and its
subsidiaries considered as one enterprise. The Bank is in compliance
with each of the limitations contained in Section 4(f)(3) of the BHCA.
(xii) Accuracy of Exhibits. There are no contracts or
documents of a character required to be described in the Registration
Agreement or Prospectus or to be
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filed as an exhibit to the Registration Statement by the 1933 Act or by
the 1933 Act Regulations that are not described or filed as required.
(xiii) Possession of Licenses and Permits. The Company and its
subsidiaries each owns, possesses or has obtained adequate governmental
licenses, permits, certificates, consents, orders, approvals and other
authorizations necessary to carry on its business as presently
conducted, except those governmental licenses, permits, certificates,
consents, orders, approvals and other authorizations which the failure
to own, possess or obtain would not individually or in the aggregate
have a material adverse effect on the Company and its subsidiaries
considered as one enterprise, and none of them has received any notice
of proceedings relating to revocation or modification of any such
licenses, permits, certificates, consents, orders, approvals or
authorizations that, if determined adversely would, individually or in
the aggregate have a material adverse effect on the Company and its
subsidiaries considered as one enterprise.
(xiv) Possession of Intellectual Property. The Company and its
subsidiaries each owns, possesses or is licensed to use, or can acquire
on reasonable terms, adequate patents, patent licenses, trademarks,
service marks, trade names and other intellectual property rights
(collectively "Intellectual Property Rights") necessary to carry on its
business as presently conducted, except those Intellectual Property
Rights that the failure to own, possess or be licensed to use would not
individually or in the aggregate have a material adverse effect on the
Company and its subsidiaries considered as one enterprise, and none of
them has received any notice of infringement of or conflict with
asserted rights of others with respect to any Intellectual Property
Rights that would individually or in the aggregate reasonably be
expected to have a material adverse effect on the Company and its
subsidiaries considered as one enterprise.
(xv) Debt Securities Ratings. Unless the Agents have been
otherwise notified in writing, the ratings assigned to any debt
securities of the Company by any nationally recognized statistical
rating organization have not been downgraded from the ratings assigned
by such organizations as of the date of this Agreement and no public
announcement has been made by any nationally recognized statistical
rating organization that it has under surveillance or review, with
negative implication, its rating of any debt securities of the Company.
(b) Additional Certifications. Any certificate signed by any director
or duly authorized officer of the Company or any Significant Subsidiary and
delivered to the Agents or to counsel for the Agents in connection with an
offering of Notes through an Agent as agent or the sale of Notes to an Agent as
principal shall be deemed a representation and warranty by the Company to such
Agent as to the matters covered thereby on the date of such certificate and at
each Representation Date subsequent thereto.
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SECTION 3. Purchases as Principal; Solicitations as Agent.
(a) Purchases as Principal. Unless otherwise agreed by an Agent and the
Company, Notes shall be purchased by such Agent as principal. Such purchases
shall be made in accordance with terms agreed upon by such Agent and the Company
(which terms shall be agreed upon orally, with written confirmation prepared by
such Agent and delivered to the Company). Each Agent's commitment to purchase
Notes as principal shall be deemed to have been made on the basis of the
representations and warranties of the Company herein contained and shall be
subject to the terms and conditions herein set forth. Each purchase of Notes,
unless otherwise agreed, shall be at a discount from the principal amount of
each such Note equivalent to the applicable commission set forth in Schedule A
hereto. The Agents may engage the services of any other broker or dealer in
connection with the resale of the Notes purchased as principal and may allow all
or any portion of the discount received in connection with such purchases from
the Company to such brokers and dealers. At the time of each purchase of Notes
by an Agent as principal, such Agent shall specify the requirements, if any, for
the stand-off agreement, officer's certificate, opinion of counsel and comfort
letter pursuant to Sections 4(j), 7(b), 7(c) and 7(d) hereof.
(b) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein set
forth, when agreed by the Company and an Agent, such Agent, as an agent of the
Company, will use its reasonable efforts to solicit offers to purchase the Notes
upon the terms and conditions set forth herein and in the Prospectus. All Notes
sold through an Agent as agent will be sold at 100% of their principal amount
unless otherwise agreed to in writing signed by the Company and such Agent.
The Company reserves the right, in its sole discretion, to
suspend solicitation of purchases of the Notes through an Agent, as agent,
commencing at any time for any period of time or permanently. Upon receipt of
instructions from the Company, the Agents will forthwith suspend solicitation of
purchases from the Company until such time as the Company has advised the Agents
that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form
of a discount, equal to the applicable percentage of the principal amount of
each Note sold by the Company as a result of a solicitation made by such Agent
as set forth in Schedule A hereto.
(c) Administrative Procedures. The purchase price, interest rate,
maturity date and other terms of the Notes (as applicable) specified in Exhibit
A hereto shall be agreed upon by the Company and the applicable Agent and set
forth in a pricing supplement to the Prospectus to be prepared in connection
with each sale of Notes. Except as may be otherwise provided in such supplement
to the Prospectus, the Notes will be issued in denominations of U.S. $1,000 or
any larger amount that is an integral multiple of U.S. $1,000. Administrative
procedures with respect to the sale of Notes shall be agreed upon from time to
time by the Agents, the Company and the Trustee (the "Procedures"). The Agents
and the Company agree to perform the respective duties and obligations
specifically provided to be performed by them in the Procedures.
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(d) Representations, Warranties and Agreements of Agents. Each Agent
represents, warrants, and agrees as follows:
(i) Such Agent is a registered and licensed broker-dealer under
the 1934 Act and in each jurisdiction in which it will solicit
customers for the purchase of Notes and is duly authorized to
act as an Agent pursuant to this Agreement.
(ii) Such Agent will perform its obligations under this Agreement
pursuant to the Rules of Fair Practice of the National
Association of Securities Dealers and the applicable Federal
and state securities or Blue Sky laws of all states applicable
to its performance hereunder.
(iii) Upon the execution and delivery by the Company, this Agreement
will be a legal, valid and binding agreement of the Agent.
(iv) No Agent nor any of its registered representatives shall give
any information or make any representation in connection with
the offer or sale of Notes other than those contained in the
Prospectus as supplemented or amended. Each Agent and its
registered representatives shall use and distribute in
connection with the offer and sale of the Notes, only the
Prospectus and such sales literature or advertising that has
been approved in writing by the Company and which advertising
shall conform in all respects to restrictions imposed by the
applicable regulatory authorities.
SECTION 4. Covenants of the Company.
The Company covenants with each Agent as follows:
(a) Notice of Certain Events. The Company will notify the Agents
immediately (and, if reasonably requested by the Agents, will confirm such
notice in writing) of (i) the effectiveness of any amendment to the Registration
Statement, (ii) the transmittal to the SEC for filing of any supplement to the
Prospectus relating to the sale of Notes through such Agent or any document to
be filed pursuant to the 1934 Act which will be incorporated by reference in the
Prospectus, (iii) the receipt of any comments from the SEC with respect to the
Registration Statement or the Prospectus, (iv) any request by the SEC for any
amendment to the Registration Statement or any amendment or supplement to the
Prospectus or for additional information, and (v) the issuance by the SEC of any
stop order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose. The Company will make every
reasonable effort 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) Notice of Certain Proposed Filings. The Company will give the
Agents advance notice of its intention to file or prepare any additional
registration statement with respect to the
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registration of additional Notes, any amendment to the Registration Statement or
any amendment or supplement to the Prospectus (other than an amendment or
supplement providing solely for a change in the interest rates of Notes or any
amendment or supplement which relates exclusively to an offering of debt
securities other than the Notes), whether by the filing of documents pursuant to
the 1934 Act, the 1933 Act or otherwise, and will furnish the Agents with copies
of any such amendment or supplement or other documents proposed to be filed or
prepared a reasonable time in advance of such proposed filing or preparation, as
the case may be, and will not file any such amendment or supplement or other
documents in a form to which the Agents or counsel for the Agents shall
reasonably object.
(c) Delivery of the Registration Statement and the Prospectus. The
Company will deliver to the Agents as many conformed copies of the Registration
Statement (as originally filed) and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein and documents
incorporated by reference in the Prospectus) as the Agents may reasonably
request. The Company will deliver to the Agents, without charge, as many copies
of the Prospectus (as amended or supplemented) as the Agents shall reasonably
request so long as the Agents are required to deliver a Prospectus in connection
with sales or solicitations of offers to purchase the Notes.
(d) Preparation of Pricing Supplements. The Company will prepare, with
respect to any Notes to be sold through or to the Agents pursuant to this
Agreement, a Pricing Supplement with respect to such Notes in a form previously
approved by the Agents, and will file such Pricing Supplement pursuant to Rule
424(b)(3) under the 1933 Act not later than the close of business of the SEC on
the fifth business day after the date on which such Pricing Supplement is first
used.
(e) Revisions of Prospectus -- Material Changes. Except as otherwise
provided in subsection (k) of this Section, if at any time during the term of
this Agreement any event shall occur or condition exist as a result of which it
is necessary, in the reasonable opinion of counsel for the Agents or counsel for
the Company, to further amend or supplement the Prospectus in order that the
Prospectus will not include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein not
misleading in the light of the circumstances existing at the time the Prospectus
is delivered to a purchaser, or if it shall be necessary, in the reasonable
opinion of either such counsel, to amend or supplement the Registration
Statement or the Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, immediate notice shall be given, and confirmed
in writing, to the Agents to cease the solicitation of offers to purchase the
Notes in the Agents' capacity as agent and to cease sales of any Notes the
Agents may then own as principal, and the Company will promptly amend the
Registration Statement and the Prospectus, subject to Section 4(b) herein,
whether by filing documents pursuant to the 1934 Act, the 1933 Act or otherwise,
as may be necessary to correct such untrue statement or omission or to make the
Registration Statement and Prospectus comply with such requirements.
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(f) Prospectus Revisions -- Periodic Financial Information. Except as
otherwise provided in subsection (k) of this Section, on or prior to the date on
which there shall be released to the general public interim financial statement
information related to the Company with respect to each of the first three
quarters of any fiscal year or preliminary financial statement information with
respect to any fiscal year, the Company shall cause the Prospectus to be amended
or supplemented to include or incorporate by reference financial information
with respect thereto and corresponding information for the comparable period of
the preceding fiscal year, as well as such other information and explanations as
shall be necessary for an understanding thereof or as shall be required by the
1933 Act or the 1933 Act Regulations and shall provide copies of such amendment
or supplement to the Agents upon the filing thereof.
(g) Prospectus Revisions -- Audited Financial Information. Except as
otherwise provided in subsection (k) of this Section, on or prior to the date on
which there shall be released to the general public financial information
included in or derived from the audited financial statements of the Company for
the preceding fiscal year, the Company shall cause the Registration Statement
and the Prospectus to be amended, whether by the filing of documents pursuant to
the 1934 Act, the 1933 Act or otherwise, to include or incorporate by reference
such audited financial statements and the report or reports, and consent or
consents to such inclusion or incorporation by reference, of the independent
accountants with respect thereto, as well as such other information and
explanations as shall be necessary for an understanding of such financial
statements or as shall be required by the 1933 Act or the 1933 Act Regulations.
(h) Earnings Statements. The Company will make generally available to
its security holders as soon as practicable after the close of the period
covered thereby, an earnings statement (in form complying with the provisions of
Rule 158 under the ▇▇▇▇ ▇▇▇) covering each twelve month period beginning, in
each case, not later than the first day of the Company's fiscal quarter next
following the "effective date" (as defined in such Rule 158) of the Registration
Statement with respect to each sale of Notes.
(i) 1934 Act Filings. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act, will file promptly
all documents required to be filed with the SEC pursuant to the 1934 Act,
including, without limitation, Sections 13(a), 13(c), 14 or 15(d) of the 1934
Act.
(j) Stand-Off Agreement. If specified by an Agent in connection with a
purchase by it of Notes as principal, between the date of the agreement to
purchase such Notes and the Settlement Date with respect to such purchase, the
Company will not, without such Agent's prior written consent, offer or sell, or
enter into any agreement to sell, any debt securities of the Company (other than
the Notes that are to be sold pursuant to such agreement, commercial paper in
the ordinary course of business, and debt securities sold by the Company or its
selling agents pursuant to the Company's existing retail note program and
institutional medium-term note program).
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(k) Suspension of Certain Obligations. The Company shall not be
required to comply with the provisions of subsections (e), (f) or (g) of this
Section during any period from the time (i) the Agents shall have suspended
solicitation of purchases of the Notes in their capacity as agents pursuant to a
request from the Company and (ii) the Agents shall not then hold any Notes
purchased as principal pursuant hereto, until the time the Company shall
determine that solicitation of purchases of the Notes should be resumed or the
Agent shall subsequently purchase Notes from the Company as principal.
SECTION 5. Conditions of Agents' Obligations.
The obligations of each Agent to purchase Notes as principal and to
solicit offers to purchase the Notes as agent of the Company, and the
obligations of any purchasers of the Notes sold through each Agent as agent,
will be subject to the accuracy of the representations and warranties on the
part of the Company herein and to the accuracy of the statements of the
Company's officers made in any certificate furnished pursuant to the provisions
hereof, to the performance and observance by the Company of all its covenants
and agreements herein contained and to the following additional conditions
precedent:
(a) Effectiveness of Registration Statement. The Registration Statement
(including any post-effective amendments or further registration statements
filed by the Company for the purpose of registering additional Notes in
connection with this Agreement) has become effective under the 1933 Act and no
stop order suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act and no proceedings for that purpose shall have
been instituted or shall be pending 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 Agents.
(b) Legal Opinions. On the date hereof, the Agents shall have received
the following legal opinions, dated as of the date hereof and in form and
substance satisfactory to the Agents:
(1) Opinion of Company Counsel. The opinion of ▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇, Senior Vice President, Secretary and General Counsel to the
Company, to the effect that:
(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 Prospectus and to enter
into this Agreement and consummate the
transactions contemplated in the Prospectus.
(iii) To the best of such counsel's knowledge, the
Company is duly qualified as a foreign
corporation to transact business and is in
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good standing in each jurisdiction in which
such qualification is required, whether by
reason of the ownership or leasing of
property or the conduct of business, except
where the failure to so qualify and be in
good standing would not have a material
adverse effect on the condition, financial
or otherwise, or the earnings or business
affairs of the Company and its subsidiaries
considered as one enterprise.
(iv) Each Significant Subsidiary of the Company
has been duly incorporated 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 conduct its business as
described in the Prospectus, and, to the
best of such counsel's knowledge, 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 to so qualify and be in good
standing would not have a material adverse
effect on the condition, financial or
otherwise, or the earnings or business
affairs of the Company and its subsidiaries
considered as one enterprise; all of the
issued and outstanding capital stock of each
such Significant Subsidiary has been duly
authorized and validly issued, is fully paid
and non-assessable and is owned by the
Company directly or indirectly through one
of its wholly-owned subsidiaries, free and
clear of any mortgage, pledge, lien,
encumbrance, claim or equity.
(v) This Agreement has been duly and validly
authorized, executed and delivered by the
Company.
(vi) The Indenture has been duly and validly
authorized, executed and delivered by the
Company and (assuming the Indenture has been
duly authorized, executed and delivered by
the Trustee) constitutes a legal, valid and
binding agreement of the Company,
enforceable against the Company in
accordance with its terms, except as
enforcement thereof may be limited by
bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or
affecting enforcement of creditors' rights
generally, or by general equity principles.
(vii) The Notes are in form contemplated by the
Indenture, have been duly authorized for
issuance, offer and sale pursuant to this
Agreement and, when issued, authenticated
and delivered
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pursuant to the provisions of this Agreement
and the Indenture against payment of the
consideration therefor, will constitute
valid and legally binding obligations of the
Company, enforceable against the Company in
accordance with their terms, except as
enforcement thereof may be limited by
bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to
or affecting enforcement of creditors'
rights generally or by general equity
principles.
(viii) The statements in the Prospectus under the
captions "Description of Notes" and
"Description of Debt Securities" insofar as
they purport to summarize certain provisions
of documents specifically referred to
therein, are accurate summaries of such
provisions.
(ix) The Indenture is qualified under the 1939
Act.
(x) The 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
Registration Statement has been issued under
the 1933 Act or proceedings therefor
initiated or threatened by the SEC.
(xi) At the time the Registration Statement
became effective, the Registration Statement
(other than the financial statements
included therein, as to which no opinion
need be rendered) complied as to form in all
material respects with the requirements of
the 1933 Act, the 1939 Act and the
regulations under each of those Acts.
(xii) Except as disclosed in the Registration
Statement or the Prospectus, to the best of
such counsel's knowledge, there are no legal
or governmental actions, suits or
proceedings, domestic or foreign, pending or
threatened which are required to be
disclosed in the Prospectus, or that would
reasonably be expected to materially and
adversely affect the consummation of this
Agreement or the Indenture or any
transaction contemplated thereby or that
would reasonably be expected to result in
any material adverse change in the condition
(financial or otherwise), business,
properties or results of operations of the
Company and its subsidiaries considered as
one enterprise.
(xiii) To the best of such counsel's knowledge,
neither the Company nor any of its
Significant Subsidiaries is in violation of
its
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charter or by-laws, or in default in the
performance or observance of any material
obligation, agreement, covenant or condition
contained in any contract, indenture,
mortgage, loan agreement, note or lease to
which it is a party or by which it or any of
them or their properties may be bound, the
violation or default of which would have a
material adverse effect on the Company and
its subsidiaries considered as one
enterprise. The execution and delivery of
this Agreement or of the Indenture, or the
consummation by the Company of the
transactions contemplated herein and therein
have been duly authorized by all necessary
corporate action and does not and will not
conflict with or constitute a breach of any
of the terms or provisions of or default
under, or result in the creation or
imposition of any lien, charge or
encumbrance upon any property or assets of
the Company or any of its Significant
Subsidiaries pursuant to, any contract,
indenture, mortgage, loan agreement, note,
lease or other instrument known to such
counsel and to which the Company or any such
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
such subsidiary is subject, or any law,
rule, regulation, judgment, administrative
regulation or administrative or court decree
known to such counsel to be applicable to
the Company of any court or governmental
agency, authority or body or any arbitrator
having jurisdiction over the Company; nor
will such action result in any violation of
the provisions of the charter or by-laws of
the Company.
(xiv) To the best of such counsel's knowledge,
there are no contracts, indentures,
mortgages, loan agreements, notes, leases or
other instruments or documents required to
be described or referred to in the
Registration Statement or to be filed as
exhibits thereto other than those described
or referred to therein or filed or
incorporated by reference as exhibits
thereto, the descriptions thereof or
references thereto are correct, and 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, filed or
incorporated by reference which would have a
material adverse effect on the Company and
its subsidiaries considered as one
enterprise.
(xv) No consent, approval, authorization, order
or decree of any court or governmental
agency or body (including the SEC) is
required for the consummation by the Company
of the transactions
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contemplated by this Agreement or in
connection with the sale of Notes hereunder,
except such as have been obtained or
rendered, as the case may be.
(xvi) Each document filed pursuant to the 1934 Act
and incorporated by reference in the
Prospectus complied when filed as to form in
all material respects with the 1934 Act and
the 1934 Act Regulations thereunder.
(xvii) The information contained in the Prospectus
under the caption "Government Regulation"
and under the caption "Government
Regulation" in the Company's Annual Report
on Form 10-K, to the extent that it
constitutes matters of law or legal
conclusions, has been reviewed by such
counsel and is correct.
(xviii) The Company is a company described in
Section 4(f)(1) of the BHCA. The Bank is
validly existing as an association in good
standing under the laws of the United
States. The Bank is in compliance in all
material respects with all regulations of
the Office of the Comptroller of the
Currency, the Board of Governors of the
Federal Reserve System and the FDIC the
failure to comply with which would have a
material adverse effect on the Company and
its subsidiaries considered as one
enterprise. The Bank is in compliance with
each of the limitations contained in Section
4(f)(3) of the BHCA.
(xiii) To the best of such counsel's knowledge, the
Company and its subsidiaries each owns,
possesses or has obtained adequate
governmental licenses, permits,
certificates, consents, orders, approvals
and other authorizations necessary to carry
on its business as presently conducted,
except those governmental licenses, permits,
certificates, consents, orders, approvals
and other authorizations which the failure
to own, possess or obtain would not
individually or in the aggregate have a
material adverse effect on the Company and
its subsidiaries considered as one
enterprise, and none of them has received
any notice of proceedings relating to
revocation or modification of any such
licenses, permits, certificates, consents,
orders, approvals or authorizations that, if
determined adversely would, individually or
in the aggregate have a material adverse
effect on the Company and its subsidiaries
considered as one enterprise.
(xiv) To the best of such counsel's knowledge, the
Company and its subsidiaries each owns,
possesses or is licensed to use, or can
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acquire on reasonable terms, adequate
patents, patent licenses, trademarks,
service marks, trade names and other
intellectual property rights (collectively
"Intellectual Property Rights") necessary to
carry on its business as presently
conducted, except those Intellectual
Property Rights that the failure to own,
possess or be licensed to use would not
individually or in the aggregate have a
material adverse effect on the Company and
its subsidiaries considered as one
enterprise, and none of them has received
any notice of infringement of or conflict
with asserted rights of others that would
individually or in the aggregate reasonably
be expected to have a material adverse
effect on the Company and its subsidiaries
considered as one enterprise.
In rendering such opinion, ▇▇. ▇▇▇ may rely on the opinion of
counsel for the Agents as to matters of New York law.
(2) Opinion of Counsel to the Agents. The opinion of ▇▇▇▇▇ &
Wood LLP, counsel to the Agents, covering the matters referred to in
subparagraph (1) under the subheadings (i) and (v) to (xi), inclusive,
above.
(3) In giving their opinions required by subsection (b)(1) and
(b)(2) of this Section, ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇, Esq. and ▇▇▇▇▇ & Wood LLP
shall each additionally state that nothing has come to their attention
that would lead them to believe that the Registration Statement, at the
time it became effective or, if an amendment to the Registration
Statement or an Annual Report on Form 10-K has been filed by the
Company with the SEC subsequent to the effectiveness of the
Registration Statement, then at the time such amendment became
effective or at the time of the most recent such filing, as the case
may be, contained an untrue statement of a material fact or omitted or
omits to state a material fact required to be stated therein or
necessary in order to make the statements therein not misleading or
that the Prospectus, as amended or supplemented at the date hereof, or
(if such opinion is being delivered in connection with the purchase of
Notes by an Agent as principal pursuant to Section 7(c) hereof) at the
date of any agreement by such Agent to purchase Notes as principal and
at the Settlement Date with respect thereto, as the case may be,
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.
(c) Officers' Certificate. At the date hereof, the Agents shall have
received a certificate of the President or any Vice President and the chief
financial or chief accounting officer of the Company, dated as of the date
hereof, to the effect that (i) since the respective dates as of which
information is given in the Registration Statement and the Prospectus or since
the date of any agreement by an Agent to purchase Notes as principal, there has
not been any material adverse change in the condition, financial or otherwise,
or in the earnings, business
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affairs or business prospects of the Company and its subsidiaries considered as
one enterprise, whether or not arising in the ordinary course of business, (ii)
the other representations and warranties of the Company contained in Section 2
hereof are true and correct with the same force and effect as though expressly
made at and as of the date of such certificate, (iii) the Company has performed
or complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the date of such certificate, and (iv)
that no stop order suspending the effectiveness of the Registration Statement
has been issued and no proceedings for that purpose have been initiated or
threatened by the SEC.
(d) Comfort Letter. On the date hereof, the Agents shall have received
a letter from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP, dated as of the date hereof in the form
heretofore agreed to by the Agents.
(e) Other Documents. On the date hereof and on each Settlement Date,
counsel to the Agents shall have been furnished with such documents and opinions
as such counsel may reasonably require for the purpose of enabling such counsel
to pass upon the issuance and sale of Notes as herein contemplated and related
proceedings, or in order to evidence the accuracy and completeness of any of the
representations and warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company in connection with
the issuance and sale of Notes as herein contemplated shall be satisfactory in
form and substance to the Agents and to counsel to the Agents.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement (or, at the
option of the applicable Agent, any applicable agreement by such Agent to
purchase Notes as principal) may be terminated by the Agents by notice to the
Company at any time and any such termination shall be without liability of any
party to any other party, except that the covenant regarding provision of an
earnings statement set forth in Section 4(h) hereof, the provisions concerning
payment of expenses under Section 10 hereof, the indemnity and contribution
agreement set forth in Sections 8 and 9 hereof, the provisions concerning the
representations, warranties and agreements to survive delivery of Section 11
hereof, the provisions relating to governing law set forth in Section 14 and the
provisions set forth under "Parties" of Section 15 hereof shall remain in
effect.
SECTION 6. Delivery of and Payment for Notes Sold through the Agents.
Delivery of Notes sold through an Agent as agent shall be made by the
Company to such Agent for the account of any purchaser only against payment
therefor in immediately available funds. In the event that a purchaser shall
fail either to accept delivery of or to make payment for a Note on the date
fixed for settlement, the applicable Agent shall promptly notify the Company and
deliver the Note to the Company, and, if such Agent has theretofore paid the
Company for such Note, the Company will promptly return such funds to such
Agent. If such failure occurred for any reason other than default by an Agent in
the performance of its obligations hereunder, the Company will reimburse such
Agent on an equitable basis for its loss of the use of the funds for the period
such funds were credited to the Company's account.
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SECTION 7. Additional Covenants of the Company.
The Company covenants and agrees with each Agent that:
(a) Reaffirmation of Representations and Warranties. Each acceptance by
it of an offer for the purchase of Notes (whether to an Agent as principal or
through an Agent as agent), and each delivery of Notes to an Agent (whether to
an Agent as principal or through an Agent as agent), shall be deemed to be an
affirmation that the representations and warranties of the Company contained in
this Agreement and in any certificate theretofore delivered to such Agents
pursuant hereto are true and correct at the time of such acceptance or sale, as
the case may be, and an undertaking that such representations and warranties
will be true and correct at the time of delivery to the purchaser or its agent,
or to such Agent, of the Note or Notes relating to such acceptance or sale, as
the case may be, as though made at and as of each such time (and it is
understood that such representations and warranties shall relate to the
Registration Statement and Prospectus as amended and supplemented to each such
time).
(b) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by an amendment or supplement providing solely for a change in the interest
rates of Notes or similar changes, and other than by an amendment or supplement
which relates exclusively to an offering of debt securities other than the
Notes), (ii) there is filed with the SEC any document incorporated by reference
into the Prospectus (other than any Current Report on Form 8-K unless the Agents
shall otherwise specify), (iii) (if required in connection with the purchase of
Notes by an Agent as principal) the Company sells Notes to an Agent as principal
or (iv) the Company issues and sells Notes in a form not previously certified to
the Agents by the Company, the Company shall furnish or cause to be furnished to
the Agents forthwith a certificate dated the date of filing with the SEC of such
supplement or document, the date of effectiveness of such amendment, or the date
of such sale, as the case may be, in form satisfactory to the Agents or, in lieu
of such certificate, a certificate of the same tenor as the certificate referred
to in said Section 5(c), modified as necessary to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of delivery
of such certificate; provided that the certificate delivered with respect to
(iv) above may be limited to the due authorization, execution, delivery and
enforceability of such Notes.
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by an amendment or supplement providing solely for a change in the interest
rates of the Notes or similar changes or solely for the inclusion of additional
financial information, and, other than by an amendment or supplement which
relates exclusively to an offering of debt securities other than the Notes),
(ii) there is filed with the SEC any document incorporated by reference into the
Prospectus (other than any Current Report on Form 8-K, unless the Agents shall
otherwise specify), (iii) (if required in connection with the purchase of Notes
by an Agent as principal) the Company sells Notes to an Agent as principal or
(iv) if the Company issues and sells Notes in a form not previously certified to
the Agents by the Company, the Company shall furnish or cause to be furnished
forthwith to the Agents and to counsel to the Agents a written opinion of
▇▇▇▇▇▇▇▇▇ ▇.
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Mai, Esq., General Counsel to the Company, or other counsel satisfactory to the
Agents dated the date of filing with the SEC of such supplement or document, the
date of effectiveness of such amendment, or the date of such sale, as the case
may be, in form and substance satisfactory to the Agents, or, in lieu of such
opinion, counsel last furnishing such opinion to the Agents shall furnish the
Agents with a letter to the effect that the Agents may rely on such last opinion
to the same extent as though it was dated the date of such letter authorizing
reliance (except that statements in such last opinion shall be deemed to relate
to the Registration Statement and the Prospectus as amended and supplemented to
the time of delivery of such letter authorizing reliance); provided that the
opinion delivered with respect to (iv) above may be limited to the due
authorization, execution, delivery and enforceability of such Notes.
(d) Subsequent Delivery of Comfort Letters. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information or there is filed with the SEC (other
than any Current Report on Form 8-K, unless the Agents shall otherwise
reasonably specify) any document incorporated by reference into the Prospectus
which contains additional financial information, or (ii) (if required in
connection with the purchase of Notes by an Agent as principal) the Company
sells Notes to an Agent as principal, the Company shall cause ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP forthwith to furnish such Agent a letter, dated the date of effectiveness of
such amendment, supplement or document with the SEC, or the date of such sale,
as the case may be, in form satisfactory to such Agent, of the same tenor as the
letter referred to in Section 5(d) hereof but modified to relate to the
Registration Statement and Prospectus, as amended and supplemented to the date
of such letter, and with such changes as may be necessary to reflect changes in
the financial statements and other information derived from the accounting
records of the Company; provided, however, that if the Registration Statement or
the Prospectus is amended or supplemented solely to include financial
information as of and for a fiscal quarter, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP may limit the
scope of such letter to the unaudited financial statements included in such
amendment or supplement unless any other information included therein of an
accounting, financial or statistical nature is of such a nature that, in the
reasonable judgment of such Agent, such letter should cover such other
information.
SECTION 8. Indemnification.
(a) Indemnification of the Agents. The Company agrees to indemnify and
hold harmless each Agent and each person, if any, who controls each Agent within
the meaning of Section 15 of the 1933 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 Registration Statement (or any amendment
thereto), or the omission or alleged omission therefrom of a
material fact necessary to make the statements therein not
misleading or arising out of any untrue statement or alleged
untrue statement of a material fact included in the Prospectus
(or any amendment or supplement thereto) or the omission or
alleged omission therefrom of a material fact necessary to
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make the statements therein, in the light of the
circumstances under which they were made, not misleading,
unless such untrue statement or omission or such alleged
untrue statement or omission was made in reliance upon and in
conformity with written information furnished to the Company
by the Agents expressly for use in the Registration Statement
or the Prospectus;
(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
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, if such settlement is
effected with the written consent of the Company; and
(iii) against any and all expense whatsoever, as
incurred (including the fees and disbursements of counsel
chosen by the Agents) reasonably incurred in investigating,
preparing or defending against any litigation, or
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, to the extent that any
such expense is not paid under (i) or (ii) above.
(b) Indemnification of the Company. Each Agent severally agrees to
indemnify and hold harmless the Company, its directors, each of its officers who
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of Section 15 of the 1933 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
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by the Agents expressly for use in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto).
(c) General. Each indemnified party shall give prompt notice 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 which it may
have otherwise than on account of this indemnity agreement. An indemnifying
party may participate at its own expense in the defense of such action. In no
event shall the indemnifying parties be liable for the fees and expenses of
more than one counsel (in addition to any local 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 party, effect any settlement of any pending or threatened
action in respect of which an indemnified party is or could have been a party
and indemnity could
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have been sought hereunder by such indemnified party unless such settlement (i)
includes an unconditional release of such indemnified party from all liability
on any claims that are the subject matter of such action 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.
SECTION 9. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in Section 8 hereof is
for any reason held to be unavailable to or insufficient to hold harmless the
indemnified parties although applicable in accordance with its terms, the
Company and the Agents shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by the indemnification
provisions of Section 8 hereof incurred by the indemnified party, as incurred,
in such proportions that each Agent is responsible for that portion represented
by the percentage that the total commissions and underwriting discounts received
by such Agent to the date of such liability bears to the total sales price from
the sale of Notes sold to or through such Agent to the date of such liability,
and the Company is responsible for the balance; provided, however, that no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of this Section,
each person, if any, who controls each Agent within the meaning of Section 15 of
the 1933 Act shall have the same rights to contribution as such Agent, and each
director of the Company, each officer of the Company who signed the Registration
Statement, and each person, if any, who controls the Company within the meaning
of Section 15 of the 1933 Act shall have the same rights to contribution as the
Company.
SECTION 10. Payment of Expenses.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(a) The preparation and filing of the Registration Statement and all
amendments thereto and the Prospectus and any amendments or supplements thereto;
(b) The preparation, filing and reproduction of this Agreement;
(c) The preparation, printing, issuance and delivery of the Notes,
including any fees and expenses relating to the use of book-entry notes;
(d) The fees and disbursements of the Company's accountants and
counsel, of the Trustee and its counsel;
(e) The reasonable fees and disbursements of ▇▇▇▇▇ & Wood LLP, counsel
to the Agents, or such other counsel to the Agents acceptable to the Company,
incurred in connection
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with the establishment of the program relating to the Notes and incurred from
time to time in connection with the transactions contemplated hereby;
(f) The printing and delivery to the Agents in quantities as
hereinabove stated of copies of the Registration Statement and any amendments
thereto, and of the Prospectus and any amendments or supplements thereto, and
the delivery by the Agents of the Prospectus and any amendments or supplements
thereto in connection with solicitations or confirmations of sales of the Notes;
(g) The preparation, printing, reproducing and delivery to the Agents
of copies of the Indenture and all supplements and amendments thereto;
(h) Any fees charged by rating agencies for the rating of the Notes;
(i) The fees and expenses incurred in connection with the listing of
the Notes on any securities exchange;
(j) The fees and expenses, if any, incurred with respect to any filing
with the National Association of Securities Dealers, Inc.;
(k) Any advertising and other out-of-pocket expenses of the Agents
incurred with the approval of the Company;
(l) The cost of providing any CUSIP or other identification numbers for
the Notes; and
(m) The fees and expenses of any Depositary (as defined in the
Indenture) and any nominees thereof in connection with the Notes.
SECTION 11. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company submitted pursuant
hereto or thereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Agents or any
controlling person of the Agents, or by or on behalf of the Company, and shall
survive each delivery of and payment for any of the Notes.
SECTION 12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any
agreement hereunder by an Agent to purchase Notes as principal) may be
terminated for any reason, at any time by either the Company or an Agent (as to
such Agent) upon the giving of written notice of such termination to the other
party hereto.
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(b) Termination of Agreement to Purchase Notes as Principal. Each Agent
may terminate any agreement hereunder by such Agent to purchase Notes as
principal, immediately upon notice to the Company, at any time prior to the
Settlement Date relating thereto (i) if there has been, since the date of such
agreement or since the respective dates as of which information is given in the
Registration Statement, 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 shall have occurred
any material adverse change in the financial markets in the United States or any
outbreak or escalation of hostilities or other national or international
calamity or crisis the effect of which is such as to make it, in the judgment of
such Agent, impracticable to market the Notes or enforce contracts for the sale
of the Notes, or (iii) if trading in any securities of the Company has been
suspended or limited by the SEC or a national securities exchange, or if trading
generally on either the American Stock Exchange or the New York Stock Exchange
shall have been suspended or limited, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices for securities have been required,
by either of said exchanges or by order of the SEC or any other governmental
authority, or if a banking moratorium shall have been declared by either
Federal, New York or Pennsylvania authorities, or (iv) if the rating assigned by
any nationally recognized securities rating agency to any debt securities of the
Company (including the Notes) as of the date of any applicable principal
purchase shall have been lowered since that date or if any such rating agency
shall have publicly announced that it has under surveillance or review, with
possible negative implications, its rating of any debt securities of the
Company, or (v) if there shall have come to such Agent's attention any facts
that would cause such Agent to believe that the Prospectus, at the time it was
required to be delivered to a purchaser of Notes, included an untrue statement
of a material fact or omitted to state a material fact necessary in order to
make the statements therein, in light of the circumstances existing at the time
of such delivery, not misleading.
(c) General. In the event of any such termination, neither party will
have any liability to the other party hereto, except that (i) the applicable
Agent shall be entitled to any commission earned in accordance with the third
paragraph of Section 3(b) hereof, (ii) if at the time of termination (a) the
applicable Agent shall own any Notes purchased by it as principal with the
intention of reselling them or (b) an offer to purchase any of the Notes has
been accepted by the Company but the time of delivery to the purchaser or his
agent of the Note or Notes relating thereto has not occurred, the covenants set
forth in Sections 4 and 7 hereof shall remain in effect until such Notes are so
resold or delivered, as the case may be, and (iii) the covenant set forth in
Section 4(h) hereof, the provisions of Section 10 hereof, the indemnity and
contribution agreements set forth in Sections 8 and 9 hereof, and the provisions
of Sections 11, 14 and 15 hereof shall remain in effect.
SECTION 13. Notices.
Unless otherwise provided herein, all notices required under the terms
and provisions hereof shall be in writing, either delivered by hand, by mail or
by telex, telecopier or telegram, and any such notice shall be effective when
received at the address specified below.
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If to the Company:
Advanta Corp.
Welsh & ▇▇▇▇▇▇ ▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇, General Counsel
If to PaineWebber Incorporated:
1285 Avenue of the ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
If to ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
If to Sage ▇▇▇▇▇ & Co.:
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 13.
SECTION 14. Governing Law; Forum.
This Agreement and all the rights and obligations of the parties shall
be governed by and construed in accordance with the laws of the State of New
York applicable to agreements made and to be performed in such State, without
regard to conflict of law principles. Any suit, action or proceeding brought by
the Company against the Agents in connection with or arising under this
Agreement shall be brought solely in the state or federal court of appropriate
jurisdiction located in the Borough of Manhattan, The City of New York.
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SECTION 15. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Agents and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to in
Sections 8 and 9 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 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 Notes shall be deemed to be a
successor by reason merely of such purchase.
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If the foregoing is in accordance with the Agents' 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
between the Agents and the Company in accordance with its terms.
Very truly yours,
Advanta Corp.
By: /s/
----------------------------
Name:
Title:
Accepted:
PaineWebber Incorporated
By: /s/
-------------------------------
Name:
Title:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Incorporated
By: /s/
-------------------------------
Name:
Title:
Sage ▇▇▇▇▇ & Co.
By: /s/
-------------------------------
Name:
Title:
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EXHIBIT A
The following terms, if applicable, shall be agreed to by the
applicable Agent and the Company in connection with each sale of Notes:
Principal Amount: $_______
Interest Rate:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Date of Maturity:
Purchase Price: ___%
Settlement Date and Time:
Additional Terms:
Also, in connection with the purchase of Notes by an Agent as principal,
agreement as to whether the following will be required:
Officer's Certificate pursuant to Section 7(b) of the Distribution Agreement.
Legal Opinion pursuant to Section 7(c)of the Distribution Agreement.
Comfort Letter pursuant to Section 7(d) of the Distribution Agreement.
Stand-off Agreement pursuant to Section 4(j) of the Distribution Agreement.
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SCHEDULE A
As compensation for the services of the Agents hereunder, the Company
shall pay to the applicable Agent, on a discount basis, a commission for the
sale of each Note equal to the principal amount of such Note multiplied by the
appropriate percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
--------------- ----------------
FROM 9 MONTHS TO 1 YEAR .......................................... .20%
FROM 1 YEAR TO LESS THAN 2 YEARS ................................. .35%
FROM 2 YEARS TO LESS THAN 3 YEARS ................................ .60%
FROM 3 YEARS TO LESS THAN 4 YEARS ................................ .90%
FROM 4 YEARS TO LESS THAN 5 YEARS ................................ 1.20%
FROM 5 YEARS TO LESS THAN 6 YEARS ................................ 1.50%
FROM 6 YEARS TO LESS THAN 7 YEARS ................................ 1.75%
FROM 7 YEARS TO LESS THAN 8 YEARS ................................ 2.00%
FROM 8 YEARS TO LESS THAN 9 YEARS ................................ 2.00%
FROM 9 YEARS TO LESS THAN 10 YEARS ............................... 2.25%
FROM 10 TO 15 YEARS .............................................. 2.50%
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