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Exhibit 1
ADVANTA CORP.
MEDIUM-TERM NOTES DUE
FROM 9 MONTHS TO 40 YEARS FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
September 26, 1997
SALOMON BROTHERS INC
Seven World Trade Center
New York, NY 10048
BEAR, ▇▇▇▇▇▇▇ & CO. INC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
CHASE SECURITIES INC.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
CREDIT SUISSE FIRST BOSTON CORPORATION
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO.,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
North Tower, 10th Floor
New York, NY 10281-1310
Dear Sirs:
Advanta Corp., a Delaware corporation (the "Company"), confirms its
agreement with Salomon Brothers Inc, Bear, ▇▇▇▇▇▇▇ & Co. Inc., Chase Securities
Inc., Credit Suisse First Boston Corporation and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇
Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (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 Medium-Term Notes described herein (the "Notes"). The Notes
are to be issued pursuant to an indenture (the "Indenture") dated as of November
15, 1993 between the
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Company and The Chase Manhattan Bank (successor by merger to The Chase Manhattan
Bank (National Association)), as trustee (the "Trustee"). As of the date hereof,
the Company has authorized the issuance and sale of up to U.S. $350,000,000
aggregate principal amount (or its equivalent, based upon the applicable
exchange rate at the time of issuance, in such foreign or composite currencies
as the Company shall designate at the time of issuance) of Notes designated as
its "Medium-Term Notes, Series E" 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.
This Agreement provides both for the sale of Notes by the Company to an
Agent 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 Note purchases.
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 (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"). Such registration statement has been declared effective by the
SEC and the Indenture has been 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 (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
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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 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
subagents. In connection with sales by an Agent of Notes purchased by such Agent
as principal to other brokers or dealers, such Agent may allow 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 will 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 purchases 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
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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 it has accepted, the Company shall (i) hold the applicable Agent harmless
against any loss, claim or damage arising from or as a result of 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 shall be purchased, and any Notes the placement of which such
Agent arranges 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
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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 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 is identical to any
electronically transmitted copies thereof filed with the SEC pursuant
to ▇▇▇▇▇, except to the extent permitted by Regulation S-T; and 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 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").
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(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 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 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, and except further as enforcement thereof
may be limited by (i) requirements that a claim with respect to any
Notes denominated other than in U.S. dollars (or a foreign currency or
currency unit judgment in respect of such claim) be converted into U.S.
dollars at a rate of exchange prevailing on a date determined pursuant
to applicable law or (ii) governmental authority to limit, delay or
prohibit the making of payments outside the United States; 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, and except further as
enforcement thereof may be limited by (i) requirements that a claim
with respect to any Notes denominated other than in U.S. dollars (or a
foreign currency or currency unit judgment in respect of such claim) be
converted into U.S. dollars at a rate or exchange prevailing on a date
determined pursuant to applicable law or (ii) governmental authority to
limit, delay or prohibit the making of payments outside the United
States; the Notes
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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 and will not conflict with or
constitute a breach 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.
(x) Legal Proceedings; Contracts. 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
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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; and 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 Statement
or Prospectus or to be 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 or 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
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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 implications, its rating of any debt
securities of the Company.
(b) Additional Certifications. Any certificate signed by any director
or 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.
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. In
connection with any Notes sold by an Agent as agent for the Company, the Agent
shall prepare and deliver to the Company written confirmation of the terms
agreed upon by the Agent and the Company and shall
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prepare and deliver to the Company a representation letter in the form of
Exhibit B hereto, or such other substantially similar form as is mutually agreed
upon by the Company and the Agents (the "Agent Representation Letter").
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 or
formula, 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.
$100,000 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.
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.
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(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 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) Copies of the Registration Statement and the Prospectus. The
Company will deliver to the Agents one signed and 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 furnish to the Agents 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 explana-
tions 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 1933 Act) 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. In connection with a purchase of Notes by an
Agent as principal, if the Company and the Agent shall mutually agree in writing
(or orally and confirmed in writing), then 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
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ordinary course of business, debt securities sold by the Company or its selling
agents pursuant to the Company's existing retail note program and retail
medium-term note program).
(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 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 and consummate the
transactions contemplated in the
Prospectus.
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(iii) To the best of such counsel's knowledge,
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.
(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 similar laws relating
to or affecting enforcement of creditors'
rights generally, or by general equity
principles, and except
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further as enforcement thereof may be
limited by (A) requirements that a claim
with respect to any Notes denominated
other than in U.S. dollars (or a foreign
currency or foreign currency unit
judgment in respect of such claim) be
converted into United States dollars at a
rate of exchange prevailing on a date
determined pursuant to applicable law or
(B) governmental authority to limit,
delay or prohibit the making of payments
in foreign currency or currency units or
payments outside the United States.
(vii) The Notes are in the form contemplated by
the Indenture, have been duly 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, 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, and except further as
enforcement thereof may be limited by (A)
requirements that a claim with respect to
any Notes denominated other than in U.S.
dollars (or a foreign currency or foreign
currency unit judgment in respect of such
claim) be converted into United States
dollars at a rate of exchange prevailing
on a date determined pursuant to
applicable law or (B) governmental
authority to limit, delay or prohibit the
making of payments in foreign currency or
currency units or payments outside the
United States, and each holder of Notes
will be entitled to the benefits of the
Indenture.
(viii) The statements in the Prospectus under
the captions "Description of the 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
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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 in 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 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
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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 necessary or required for the
consummation by the Company of the
transactions 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
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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.
(xix) 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.
(xx) To the best of such counsel's knowledge,
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 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.
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(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) Disclosure Statements. In giving their opinions required
by subsection (b)(1) and (b)(2) of this Section, ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇, Esq.
and Brown & 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
post-effective 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 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 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
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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.
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).
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(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
▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇, 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 and the description thereof in the Prospectus conforms to the terms 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
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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 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
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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 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 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
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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 or underwriting
discounts received by such Agent in respect of the sale of Notes to or through
it that were the subject of the claim for indemnification bears to the total
sales price from the sale of such Notes, 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 1933 Act) 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, and of any Calculation Agent or
Exchange Rate Agent;
(e) The reasonable fees and disbursements of Brown & Wood LLP, counsel
to the Agents, or such other counsel to the Agents acceptable to the Company,
incurred in connection 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;
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(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.
(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
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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 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 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 if a banking moratorium
shall have been declared by the relevant authorities in the country or countries
of origin of any foreign currency or currencies in which the Notes are
denominated or payable, or (iv) if the rating assigned by any nationally
recognized securities rating agency to any debt securities of the Company 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.
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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.
If to the Company:
Advanta Corp.
Welsh & ▇▇▇▇▇▇ Roads
Spring House, PA 19477-0844
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇, General Counsel
If to Salomon Brothers Inc:
Seven World Trade Center
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Medium-Term Note Group
If to Bear, ▇▇▇▇▇▇▇ & Co. Inc.:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Medium-Term Note Group
If to Chase Securities Inc.:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Medium-Term Notes Desk
If to Credit Suisse First Boston Corporation:
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Short and Medium-Term Finance Dept.
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If to ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
World Financial Center
North Tower, 10th Floor
New York, NY 10281-1310
Attention: MTN Product Management
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
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. 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.
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: Senior Vice President and
Accepted: Chief Financial Officer
Salomon Brothers Inc
By: /s/
-------------------------------
Name:
Title:
Bear, ▇▇▇▇▇▇▇ & Co. Inc.
By: /s/
-------------------------------
Name:
Title:
Chase Securities Inc.
By: /s/
-------------------------------
Name:
Title:
Credit Suisse First Boston Corporation
By: /s/
-------------------------------
Name:
Title:
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
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: $_______
(or principal amount of foreign currency)
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Initial Interest Rate:
Spread or Spread Multiplier, if any:
Interest Reset Date(s):
Interest Payment Date(s):
Index Maturity:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
If Repayable:
Optional Repayment Date(s):
Date of Maturity:
Purchase Price: ___%
Settlement Date and Time:
Currency of Denomination:
Denominations (if currency is other than U.S. dollar):
Currency of Payment:
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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EXHIBIT B
[LETTERHEAD OF AGENT]
[DATE]
Advanta Corp.
Welsh & ▇▇▇▇▇▇ Road
P.O. Box 844
Spring House, Pennsylvania 19477-0844
Ladies and Gentlemen:
Reference is hereby made to that certain Distribution Agreement dated
as of September __, 1997 by and among Advanta Corp., Salomon Brothers Inc, Bear,
▇▇▇▇▇▇▇ & Co. Inc., Chase Securities Inc., Credit Suisse First Boston
Corporation and ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated (the "Distribution Agreement"). Capitalized terms used herein
without definition shall have the respective
meanings ascribed thereto in the Distribution Agreement.
The undersigned hereby represents and warrants to you that it is taking
delivery of the Notes being delivered to it on this date (the "Subject Notes")
solely as agent and the Subject Notes are being sold to investors at 100% of
their principal amount.
If any securities are or will be "taken in trade" (as defined in Rule
2730 of the National Association of Securities Dealers, Inc. Conduct Rules
("Rule 2730")) in connection with the sale of the Subject Notes to investors,
the undersigned acknowledges that such transaction is subject to Rule 2730 and
certifies that the transaction will comply with all aspects of Rule 2730.
Very truly yours,
[AGENT]
By:__________________________
Name:
Title:
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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
--------------- ----------------
LESS THAN 1 YEAR ............................................... .125%
FROM 1 YEAR TO LESS THAN 18 MONTHS ............................. .150%
FROM 18 MONTHS TO LESS THAN 2 YEARS ............................ .200%
FROM 2 YEARS TO LESS THAN 3 YEARS .............................. .250%
FROM 3 YEARS TO LESS THAN 4 YEARS .............................. .350%
FROM 4 YEARS TO LESS THAN 5 YEARS .............................. .450%
FROM 5 YEARS TO LESS THAN 6 YEARS .............................. .500%
FROM 6 YEARS TO LESS THAN 7 YEARS .............................. .550%
FROM 7 YEARS TO LESS THAN 10 YEARS ............................. .600%
FROM 10 YEARS TO LESS THAN 15 YEARS ............................ .625%
FROM 15 YEARS TO LESS THAN 20 YEARS ............................ .700%
FROM 20 YEARS TO LESS THAN 30 YEARS ............................ .750%
FROM 30 YEARS TO LESS THAN 40 YEARS ............................ .875%
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