EXHIBIT 1.1
[_________], [_________]
First Consumers Credit Card Master Note Trust
$[_____________] Class A [Floating Rate] [___]% Asset Backed
Notes, Series [______]
$[_____________] Class B [Floating Rate] [___]% Asset Backed
Notes, Series [______]
$[_____________] Class C [Floating Rate] [___]% Asset Backed
Notes, Series [______]
UNDERWRITING AGREEMENT
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[________________________]
as Representative of the
Underwriters set forth herein (the "Representative")
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[Address]
Ladies and Gentlemen:
1. Introductory. First Consumers National Bank (the "Bank") proposes to
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cause First Consumers Credit Card Master Note Trust (the "Issuer") to issue
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$[__________] aggregate principal amount of First Consumers Credit Card Master
Note Trust Class A [Floating Rate] [___]% Asset Backed Notes, Series [______]
(the "Class A Notes"), $[__________] aggregate principal amount of First
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Consumers Credit Card Master Note Trust Class B [Floating Rate] [___]% Asset
Backed Notes, Series [______] (the "Class B Notes"), and $[__________] aggregate
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principal amount of First Consumers Credit Card Master Note Trust Class C
[Floating Rate] [___]% Asset Backed Notes, Series [______] (the "Class C Notes,"
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and together with the Class A Notes and the Class B Notes, the "Notes").
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The Issuer is a common law trust formed pursuant to a Trust Agreement,
dated as of [______________], 2001 (the "Trust Agreement"), between the Bank and
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Bankers Trust Company, as owner trustee (the "Owner Trustee"). The Notes will
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be issued pursuant to a Master Indenture, dated as of [______________], 2001
(the "Master Indenture"), between the Issuer and The Bank of New York, as
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indenture trustee (the "Indenture Trustee"), as supplemented by the Series
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[______] Indenture Supplement with respect to the Notes to be dated as of
[_________], [_____] (the "Indenture Supplement," and together with the Master
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Indenture, the "Indenture").
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Initially, the primary asset of the Issuer will be a certificate (the
"Collateral Certificate") representing a beneficial interest in the assets held
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in the First Consumers Master Trust ("FCMT"), issued pursuant to the Amended and
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Restated Pooling and Servicing Agreement, dated as of
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February 1, 1999 (as heretofore amended, the "Amended and Restated Pooling and
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Servicing Agreement"), among the Bank and The Bank of New York (successor-in-
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interest to the corporate trust administration of Xxxxxx Trust and Savings
Bank), as trustee (the "FCMT Trustee"), and the Collateral Series Supplement,
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dated as of [______________], 2001, to the Amended and Restated Pooling and
Servicing Agreement (the "Collateral Supplement" and together with the Amended
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and Restated Pooling and Servicing Agreement, the "PSA"). The assets of FCMT
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include, among other things, certain amounts due (the "Receivables") on a pool
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of private label credit card accounts (the "Accounts").
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The Receivables are transferred by the Bank to FCMT pursuant to the Amended
and Restated Pooling and Servicing Agreement. The Collateral Certificate will
be transferred by the Bank to the Issuer pursuant to the Transfer and Servicing
Agreement, dated as of [______________], 2001 (the "Transfer and Servicing
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Agreement"), among the Bank, as Seller and Servicer, and the Issuer.
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The Bank has agreed to provide notices and perform on behalf of the Issuer
certain other administrative obligations required by the Transfer and Servicing
Agreement, the Master Indenture and each indenture supplement for each series of
Notes issued by the Issuer, pursuant to an Administration Agreement, dated as of
[_____________], 2001 (the "Administration Agreement"), between the Bank, as
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administrator (in such capacity, the "Administrator"), and the Issuer. The
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Transfer and Servicing Agreement, the PSA, the Indenture, the Trust Agreement
and the Administration Agreement are referred to herein, collectively, as the
"Transaction Documents."
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This Underwriting Agreement is referred to herein as this "Agreement." To
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the extent not defined herein, capitalized terms used herein have the meanings
assigned in the Transaction Documents.
The Bank and Spiegel Inc. ("Spiegel") hereby agree, severally and not
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jointly, with the underwriters for the Class A Notes listed on Schedule A hereto
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(the "Class A Underwriters"), the underwriters for the Class B Notes listed on
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Schedule A hereto (the "Class B Underwriters"), and the underwriters for the
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Class C Notes listed on Schedule A hereto (the "Class C Underwriters," and
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together with the Class A Underwriters and the Class B Underwriters, the
"Underwriters") as follows:
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2. Representations and Warranties of the Bank and Spiegel. Each of the
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Bank and Spiegel represents and warrants to, and agrees with, the Underwriters
that:
(a) Spiegel is duly organized and validly existing in good standing
as a corporation under the laws of the State of Delaware, and has all
requisite corporate power, authority and legal right to own its property
and transact the business in which it is now engaged.
(b) The Bank is a national banking association duly organized and
validly existing in good standing under the laws of the United States, and
has all requisite corporate
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power, authority and legal right to own its property and conduct its credit
card business as such properties are now owned and such business is
conducted at present, and to own the Accounts and to execute, deliver and
perform its obligations under the Transfer and Servicing Agreement, the PSA
and the Administration Agreement.
(c) The execution and delivery of each of the Transaction Documents
to which it is a party, and the incurrence of the obligations therein set
forth and the consummation of the transactions contemplated thereunder have
been duly authorized by the Bank by all necessary action on the part of the
Bank.
(d) This Agreement has been duly authorized, executed and delivered
by the Bank and Spiegel.
(e) Each of the Transaction Documents has been, or on or before the
Closing Date will be, executed and delivered by the Bank and when executed
and delivered by the other parties thereto, will constitute a valid and
binding agreement of the Bank enforceable against the Bank in accordance
with its terms, except, in each case, to the extent that (i) the
enforceability thereof may be subject to insolvency, reorganization,
moratorium, receivership or other similar laws now or hereafter in effect
relating to creditors' or other obligees' rights generally or the rights of
creditors or other obligees of institutions insured by the FDIC, (ii) the
remedy of specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of the
court before which any proceeding therefor may be brought and (iii) certain
remedial provisions of the Indenture may be unenforceable in whole or in
part under the UCC, but the inclusion of such provisions does not render
the other provisions of the Indenture invalid and notwithstanding that such
provisions may be unenforceable in whole or in part, the Indenture Trustee,
on behalf of the Noteholders, will be able to enforce the remedies of a
secured party under the UCC.
(f) The Notes will be issued pursuant to the terms of the Indenture
and, when executed by the Owner Trustee on behalf of the Issuer and
authenticated by the Indenture Trustee in accordance with the Indenture and
delivered pursuant to this Agreement, will be validly issued and
outstanding. The Notes will be in the form contemplated by the Indenture,
and the Notes and the Indenture will conform to the descriptions thereof
contained in the Prospectus and Registration Statement, as amended or
supplemented.
(g) The Collateral Certificate will be issued pursuant to the terms
of the PSA and, when executed by the FCMT Trustee in accordance with the
PSA, will be validly issued and outstanding. The Collateral Certificate
will be in the form contemplated by the PSA, and the Collateral Certificate
and the PSA will conform to the description thereof contained in the
Prospectus and the Registration Statement, as amended or supplemented.
(h) Neither Spiegel nor the Bank is in violation of any Requirement
of Law or in default in the performance or observance of any obligation,
agreement, covenant or
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condition contained in any contract, indenture, mortgage, deed of trust,
loan agreement, note, lease or other instrument to which it is a party or
by which it is bound or to which any of its property is subject, which
violations or defaults separately or in the aggregate would have a material
adverse effect on Spiegel or the Bank.
(i) None of the issuance and sale of the Notes, the issuance of the
Collateral Certificate or the execution and delivery by Spiegel or the Bank of
this Agreement or any Transaction Document to which it is a party, nor the
incurrence by Spiegel or the Bank of the obligations herein and therein set
forth, nor the consummation of the transactions contemplated hereunder or
thereunder, nor the fulfillment of the terms hereof or thereof does or will (i)
violate any Requirement of Law presently in effect, applicable to it or its
properties or by which it or its properties are or may be bound or affected,
(ii) conflict with, or result in a breach of, or constitute a default under, any
indenture, contract, agreement, deed, lease, mortgage or instrument to which it
is a party or by which it or its properties are bound or (iii) result in the
creation or imposition of any Lien upon any of its property or assets, except
for those encumbrances created under the Transaction Documents.
(j) All consents, approvals, authorizations, orders, filings,
registrations or qualifications of or with any court or any other governmental
agency, board, commission, authority, official or body required in connection
with the execution and delivery by Spiegel or the Bank of this Agreement or the
Transaction Documents to which it is a party or to the consummation of the
transactions contemplated hereunder and thereunder, or to the fulfillment of the
terms hereof and thereof have been or will have been obtained on or before the
Closing Date.
(k) All actions required to be taken by Spiegel and the Bank as a
condition to the offer and sale of the Notes as described herein or the
consummation of any of the transactions described in the Prospectus and the
Registration Statement (each as defined below) have been or, prior to the
Closing Date, will be taken.
(l) The Indenture has been duly qualified under the Trust Indenture Act
of 1939, as amended (the "TIA"), and complies as to form with the TIA and the
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rules and regulations of the Securities and Exchange Commission (the
"Commission") thereunder.
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(m) The representations and warranties made by the Bank in the Transfer
and Servicing Agreement, the PSA, the Trust Agreement and the Administration
Agreement or made in any Officer's Certificate of the Bank delivered pursuant to
any Transaction Document to which it is a party will be true and correct at the
time made and on and as of the Closing Date as if set forth herein, except that
to the extent that any such representation or warranty expressly relates to an
earlier date, such representation or warranty is true and correct at and as of
such earlier date.
(n) The Receivables had an aggregate outstanding balance determined as of
[_____________], [___________] in the amount set forth in the Prospectus.
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(o) The Bank agrees it has not granted, assigned, pledged or transferred
and shall not grant, assign, pledge or transfer to any Person a security
interest in, or any other right, title or interest in, the Receivables or the
Collateral Certificate, except as provided in the PSA and the Transfer and
Servicing Agreement and agrees to take all actions required by the PSA or the
Transfer and Servicing Agreement in order to maintain the security interests in
the Receivables and the Collateral Certificate granted pursuant to the PSA and
the Transfer and Servicing Agreement.
(p) A registration statement on Form S-3 (Nos. 333-48860 and 333-
[_______]), including a form of prospectus and such amendments thereto as may
have been filed prior to the date hereof, relating to the Notes and the offering
thereof in accordance with Rule 415 under the Securities Act of 1933, as amended
(the "Act"), has been filed with, and has been declared effective by, the
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Commission. If any post-effective amendment to such registration statement has
been filed with the Commission prior to the execution and delivery of this
Agreement, the most recent such amendment has been declared effective by the
Commission. For purposes of this Agreement, "Effective Time" means the date and
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time as of which such registration statement, or the most recent post-effective
amendment thereto, if any, was declared effective by the Commission, and
"Effective Date" means the date of the Effective Time. Such registration
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statement, as amended at the Effective Time, is hereinafter referred to as the
"Registration Statement." The Bank proposes to file with the Commission pursuant
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to Rule 424(b) ("Rule 424(b)") under the Act a supplement (the "Prospectus
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Supplement") to the prospectus included in the Registration Statement (such
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prospectus, in the form it appears in the Registration Statement or in the form
most recently revised and filed with the Commission pursuant to Rule 424(b), is
hereinafter referred to as the "Base Prospectus") relating to the Notes and the
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method of distribution thereof. The Base Prospectus and the Prospectus
Supplement, together with any amendment thereof or supplement thereto, are
hereinafter referred to as the "Prospectus".
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(q) On the Effective Date, the Registration Statement conformed in all
respects to the requirements of the Act and the rules and regulations of the
Commission thereunder (the "Rules and Regulations") and the TIA and the rules
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and regulations thereunder and did not include any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading, and on the date of
this Agreement, the Registration Statement and the Prospectus conform, and at
the time of filing of the Prospectus pursuant to Rule 424(b) the Registration
Statement and the Prospectus will conform, in all respects with the requirements
of the Act and the Rules and Regulations and the TIA and the rules and
regulations thereunder and neither of such documents includes, or will include,
any untrue statement of a material fact or omits, or will omit, to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, except that the foregoing does not apply to statements
in or omissions from either of such documents based upon written information
furnished to the Bank by the Underwriters specifically for use therein. Each of
the Bank and Spiegel hereby acknowledges that (i) the only information provided
by the Class A Underwriters for
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inclusion in the Registration Statement and the Prospectus is set forth on the
cover page of the Prospectus Supplement in the table under the heading "Class A
Notes" and on the line across from "Price to public," in the table listing the
Class A Underwriters and the Principal Amount of Class A Notes under the heading
"Underwriting" in the Prospectus Supplement, in the table following the third
paragraph under the heading "Underwriting" in the Prospectus Supplement in the
column labeled "Class A Notes", and in the first sentence of the penultimate
paragraph under the heading "Underwriting" in the Prospectus Supplement (the
"Class A Underwriters' Information"); (ii) the only information provided by the
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Class B Underwriters for inclusion in the Registration Statement and the
Prospectus is set forth on the cover page of the Prospectus Supplement in the
table under the heading "Class B Notes" and on the line across from "Price to
public," in the table listing the Class B Underwriters and the Principal Amount
of Class B Notes and under the heading "Underwriting" in the Prospectus
Supplement, in the table following the third paragraph under the heading
"Underwriting" in the Prospectus Supplement in the column labeled "Class B
Notes", and in the first sentence of the penultimate paragraph under the heading
"Underwriting" in the Prospectus Supplement (the "Class B Underwriters'
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Information") and (iii) the only information provided by the Class C
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Underwriters for inclusion in the Registration Statement and the Prospectus is
set forth on the cover page of the Prospectus Supplement in the table under the
heading "Class C Notes" and on the line across from "Price to public," in the
table listing the Class C Underwriters and the Principal Amount of Class C Notes
and under the heading "Underwriting" in the Prospectus Supplement in the table
following the third paragraph under the heading "Underwriting" in the Prospectus
Supplement in the column labeled "Class C Notes" and in the first sentence of
the penultimate paragraph under the heading "Underwriting" in the Prospectus
Supplement (the "Class C Underwriters' Information").
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(r) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise set forth
therein, there has not been any material adverse change, or any development
involving a prospective material adverse change, in the condition, financial or
otherwise, or in the earnings, business or operations of the Bank that would
have a material adverse effect on the Bank or the Issuer.
3. Purchase, Sale, Payment and Delivery of the Notes.
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(a) On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth, the Bank
agrees to sell to the Class A Underwriters, and the Class A Underwriters agree
to purchase from the Bank, at a purchase price of [______]% of the principal
amount thereof, $[________] aggregate principal amount of the Class A Notes,
each Class A Underwriter to purchase the amounts shown on Schedule A hereto.
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(b) On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth, the Bank
agrees to sell to the Class B Underwriters, and the Class B Underwriters agree
to purchase from the Bank,
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at a purchase price of [______]% of the principal amount thereof,
$[__________] aggregate principal amount of the Class B Notes, each Class B
Underwriter to purchase the amounts shown on Schedule A hereto.
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(c) On the basis of the representations, warranties and agreements
herein contained, but subject to the terms and conditions herein set forth,
the Bank agrees to sell to the Class C Underwriters, and the Class C
Underwriters agree to purchase from the Bank, at a purchase price of
[______]% of the principal amount thereof, $[__________] aggregate
principal amount of the Class C Notes, each Class C Underwriter to purchase
the amounts shown on Schedule A hereto.
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(d) The Bank will cause the Issuer to deliver the Notes to the
Underwriters against payment of the purchase price in immediately available
funds, drawn to the order of the Bank, at the office of [___________], in
[________________] at 10:00 a.m., Chicago time, on [____________], [____],
or at such other time not later than seven full business days thereafter as
the Representative and the Bank determine, such time being herein referred
to as the "Closing Date." Each of the Class A Notes, the Class B Notes and
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the Class C Notes so to be delivered shall be represented by one or more
definitive notes registered in the name of Cede & Co., as nominee for The
Depository Trust Company. The Notes will be available for inspection by the
Underwriters at the office at which the Notes are to be delivered no later
than five hours before the close of business in Chicago on the business day
prior to the Closing Date.
4. Offering by Underwriters. It is understood that after the Effective
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Date, the Underwriters propose to offer the Notes for sale to the public (which
may include selected dealers) as set forth in the Prospectus.
5. Certain Agreements of the Bank. The Bank agrees with the Underwriters
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that:
(a) Immediately following the execution of this Agreement, the Bank
will prepare a Prospectus Supplement setting forth the amount of Notes
covered thereby and the terms thereof not otherwise specified in the Base
Prospectus, the price at which such Notes are to be purchased by the
Underwriters, the initial public offering price, the selling concessions
and allowances, and such other information as the Bank deems appropriate.
The Bank will transmit the Prospectus, including such Prospectus
Supplement, to the Commission pursuant to Rule 424(b) by a means reasonably
calculated to result in filing with the Commission pursuant to Rule 424(b).
The Bank will not file any amendment of the Registration Statement with
respect to the Notes or supplement to the Prospectus unless a copy has been
furnished to the Representative for its review a reasonable time prior to
the proposed filing thereof or to which the Representative shall reasonably
object in writing. The Bank will advise the Representative promptly of (i)
the effectiveness of any amendment or supplementation of the Registration
Statement or Prospectus, (ii) any request by the Commission for any
amendment or supplementation of the Registration Statement or the
Prospectus or for any additional information, (iii) the receipt by the Bank
of any notification
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with respect to the suspension of qualification of the Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purposes and (iv) the institution by the Commission of any stop order proceeding
in respect of the Registration Statement, and will use its best efforts to
prevent the issuance of any such stop order and to obtain as soon as possible
its lifting, if issued.
(b) If at any time when a prospectus relating to the Notes is required to
be delivered under the Act, any event occurs as a result of which the
Prospectus, as then amended or supplemented, would include an untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend the Prospectus
to comply with the Act, the Bank promptly will prepare and file with the
Commission an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance. Neither the
Underwriters' consent to, nor the Underwriters' delivery of, any such amendment
or supplement shall constitute a waiver of any of the conditions set forth in
Section 6.
(c) As soon as practicable, the Bank will cause the Issuer to make
generally available to the Noteholders an earnings statement or statements of
the Issuer covering a period of at least 12 months beginning after the Effective
Date which will satisfy the provisions of Section 11(a) of the Act and Rule 158
of the Commission promulgated thereunder.
(d) The Bank will furnish to the Representative copies of the Registration
Statement (one of which will be signed and will include all exhibits), the
Prospectus and all amendments and supplements to such documents, in each case as
soon as available and in such quantities as the Representative reasonably
requests.
(e) The Bank will endeavor to qualify the Notes for sale under the
securities or Blue Sky laws of such jurisdictions as the Representative shall
reasonably request and the determination of the eligibility for investment of
the Notes under the laws of such jurisdictions as the Representative may
designate and will continue such qualifications in effect so long as required
for the distribution of the Notes; provided, however, that the Bank shall not be
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obligated to qualify to do business in any jurisdiction where such qualification
would subject the Bank to general or unlimited service of process in any
jurisdiction where it is not now so subject.
(f) So long as any Note is outstanding, the Bank will furnish, or cause
the Servicer to furnish, to the Representative copies of each certificate and
the annual statements of compliance delivered to the Owner Trustee, the
Indenture Trustee and each Rating Agency pursuant to Section 3.5 of the Transfer
and Servicing Agreement and independent certified public accountant's servicing
reports furnished to the Indenture Trustee, the Servicer and the Rating Agencies
pursuant to Sections 3.6(a) and (b) of the Transfer and Servicing Agreement, by
first class mail as soon as practicable after such certificates,
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statements and reports are furnished to the Owner Trustee, the Indenture
Trustee or the Rating Agencies, as the case may be.
(g) So long as any Note is outstanding, the Bank will furnish, or
cause the Servicer to furnish, to the Representative, by first-class mail
as soon as practicable (i) all documents concerning the Notes distributed
by the Bank or the Servicer to the Owner Trustee, the Indenture Trustee or
the Noteholders, or filed with the Commission pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), (ii) any order of
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the Commission under the Act or the Exchange Act applicable to the Issuer
or to the Bank, or pursuant to a "no-action" letter obtained from the staff
of the Commission by the Bank and affecting the Issuer or the Bank and
(iii) from time to time, such other information concerning the Issuer as
the Representative may reasonably request.
(h) Whether or not the transactions contemplated by this Agreement
are consummated or this Agreement is terminated for any reason, the Bank
will pay all expenses incident to the performance of its obligations under
this Agreement and will reimburse the Underwriters for any reasonable
expenses (including reasonable fees and disbursements of counsel to the
Underwriters) incurred by them in connection with the transactions
contemplated by this Agreement, including without limitation, all
reasonable costs and expenses (i) incident to the preparation, issuance,
execution, authentication and delivery of the Notes, (ii) incident to the
preparation, printing (including word processing and duplication costs) and
delivery of the Prospectus and Preliminary Prospectus (including in each
case all exhibits, amendments, attachments and supplements thereto), (iii)
in connection with the printing (including word processing and duplication
costs) and delivery of this Agreement and the other Transaction Documents
and the furnishing to the Underwriters of copies of the Prospectus as
herein provided, (iv) in connection with the structuring and marketing of
the Notes, (v) incident to the qualification of the Notes for sale and
determination of the eligibility of the Notes for investment under the laws
of such jurisdictions as the Representative designates, (vi) for any fees
charged by investment rating agencies for the rating of the Notes and (vii)
for any filing fee of the National Association of Securities Dealers, Inc.
relating to the Notes.
(i) To the extent, if any, that any of the ratings provided with
respect to the Notes by any Rating Agency are conditional upon the
furnishing of documents or the taking of any other actions by the Bank, the
Bank shall furnish such documents and take any such other actions as are
reasonably necessary to satisfy such condition.
6. Conditions of the Obligations of the Underwriters. The obligation of
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the Underwriters to purchase and pay for the Notes will be subject to the
accuracy of the representations and warranties by Spiegel and the Bank herein,
to the accuracy of the statements of officers of Spiegel and the Bank made
pursuant to the provisions hereof, to the performance by Xxxxxxx and the Bank of
their respective obligations hereunder and to the following additional
conditions precedent:
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(a) On or prior to the date of this Agreement, the Representative shall
have received a letter, dated the date of this Agreement, of [________________],
confirming that they are independent public accountants within the meaning of
the Act and the applicable published Rules and Regulations thereunder,
substantially in the form heretofore agreed to and otherwise in form and in
substance satisfactory to the Representative and its counsel.
(b) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 5(a) of this Agreement;
and, prior to the Closing Date, no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or, to the knowledge of the Bank or the
Representative, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement none of
the following shall have occurred: (i) any change, or any development involving
a prospective change, in or affecting particularly the business or properties of
Spiegel or the Bank which, in the judgment of the Underwriters, make it
impractical or inadvisable to proceed with the public offering or delivery of
the Notes on the terms and in the manner contemplated in the Prospectus, (ii)
trading in securities generally on the New York Stock Exchange, the American
Stock Exchange or the over-the-counter market shall have been suspended or
minimum prices shall have been established on either of such exchanges or such
market by the Commission, by such exchange or by any other regulatory body or
governmental authority having jurisdiction; (iii) a banking moratorium shall
have been declared by Federal or state authorities; (iv) the United States shall
have become engaged in hostilities, there shall have been an escalation of
hostilities involving the United States or there shall have been a declaration
of a national emergency or war by the United States; (v) there shall have
occurred such a material adverse change in general economic, political or
financial conditions (or the effect of international conditions on the financial
markets of the United States shall be such) as to make it, in the judgment of
the Underwriters, impractical or inadvisable to proceed with the public offering
or delivery of the Notes on the terms and in the manner contemplated in the
Prospectus or (vi) any material adverse change in the financial markets for
asset-backed securities in the United States if, in the judgment of the
Underwriters, the effect of which is to make it impractical or inadvisable to
proceed with the public offering or delivery of the Notes on the terms and in
the manner contemplated in the Prospectus.
(d) The Representative shall have received an opinion, dated the Closing
Date, of Xxxxx, Xxxxx and Xxxxx, special counsel for Spiegel and the Bank,
satisfactory in form and substance to the Representative and its counsel to the
effect that:
(i) Spiegel is a corporation in good standing, duly organized and
validly existing under the laws of the State of Delaware; the Bank is a
national banking association in good standing, duly organized and validly
existing under the laws of the United States of America; and each of
Spiegel and the Bank (each collectively
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referred to in this subsection (d) as a "Spiegel Entity") is authorized by
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its certificate of incorporation or articles of association, as the case
may be, to transact the business in which it is engaged and the Bank is not
required to qualify or register as a foreign corporation, in any state in
order to conduct its business as presently conducted, except where the
failure to so qualify or register would not have a material adverse effect
upon the Noteholders;
(ii) Each Spiegel Entity has full corporate power and authority to
enter into and perform its obligations under each Transaction Document and
this Agreement to which it is a party;
(iii) The Bank has the corporate power and authority and legal right
to acquire, own, transfer and service the Receivables;
(iv) Each of the Transaction Documents and this Agreement has been
duly authorized, executed and delivered by each Spiegel Entity that is a
party thereto;
(v) No consent, approval, authorization or order of any court or
governmental agency or body is required for (a) the execution and delivery
by any Spiegel Entity of any Transaction Document or this Agreement to
which such Spiegel Entity is a party or the performance by such Spiegel
Entity of its obligations thereunder, or (b) the issuance and sale of the
Notes;
(vi) Neither the execution and delivery of the Transaction Documents
and this Agreement by any Spiegel Entity that is party thereto nor the
performance by such Spiegel Entity of the transactions therein contemplated
nor the fulfillment of the terms thereof does or will result in any
violation of any statute or regulation or any order or decree of any court
or governmental authority binding upon such Spiegel Entity or its property,
or conflict with, or result in a breach or violation of any term or
provision, or result in a default under any of the terms and provisions, of
such Spiegel Entity's certificate of incorporation or articles of
association, as the case may be, or by-laws or any material indenture, loan
agreement or other material agreement known to such counsel to which such
Spiegel Entity is a party or by which such Spiegel Entity is bound;
(vii) There is no legal or governmental proceeding pending to which
any Spiegel Entity is a party or to which any Spiegel Entity is subject
which, individually or in the aggregate (a) would have a material adverse
effect on the ability of such Spiegel Entity to perform its obligations
under the Transaction Documents or this Agreement, (b) assert the
invalidity of any Transaction Document, this Agreement, the Seller Interest
or the Collateral Certificate, (c) seek to prevent the issuance, sale or
delivery of the Notes or any of the transactions contemplated by the
Transaction Documents or this Agreement or (d) seek to adversely affect the
federal income tax consequences of the Notes; and
-11-
(viii) The Registration Statement has become effective under the Act
and no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or threatened under the Act.
(ix) Each of the Transaction Documents to which the Bank is a party
constitutes the legal, valid and binding agreement of the Bank under the
laws of Illinois, enforceable against each such Person in accordance with
its terms, subject to (w) limitations imposed by bankruptcy, insolvency,
reorganization, liquidation, arrangement, fraudulent conveyance,
moratorium, receivership, conservatorship, readjustment of debts,
creditors' rights or other laws relating to or affecting the rights of
creditors generally or the rights of creditors of national banking
associations; (x) rights to indemnification and contribution which may be
limited by applicable law and equitable principles or otherwise
unenforceable as against public policy; (y) the unenforceability under
certain circumstances of provisions imposing penalties, forfeiture, late
payment charges, or an increase in interest rate upon delinquency in
payment or the occurrence of any event of default; and (z) general
principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the possible
unavailability of specific performance or injunctive relief, regardless of
whether such enforceability is considered in a proceeding in equity or at
law.
(x) This Agreement constitutes the legal, valid and binding
obligation of Spiegel and the Bank under the laws of the State of Illinois,
enforceable against Spiegel and the Bank in accordance with its terms,
subject to (w) limitations imposed by bankruptcy, insolvency,
reorganization, liquidation, arrangement, fraudulent conveyance,
moratorium, receivership, conservatorship, readjustment of debts,
creditors' rights or other laws relating to or affecting the rights of
creditors generally or the rights of creditors of national banking
associations; (x) rights to indemnification and contribution which may be
limited by applicable law and equitable principles or otherwise
unenforceable as against public policy; (y) the unenforceability under
certain circumstances of provisions imposing penalties, forfeiture, late
payment charges, or an increase in interest rate upon delinquency in
payment or the occurrence of any event of default; and (z) general
principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the possible
unavailability of specific performance or injunctive relief, regardless of
whether such enforceability is considered in a proceeding in equity or at
law.
(xi) When the Notes have been duly executed and delivered by the
Issuer, authenticated by the Indenture Trustee in accordance with the terms
of the Indenture and delivered to and paid for by the Underwriters in
accordance with this Agreement, they will be validly issued and
outstanding, will constitute legal, valid and binding
-12-
obligations of the Issuer, enforceable against the Issuer in accordance
with their terms and will be entitled to the benefits of the Indenture,
subject to (w) limitations imposed by bankruptcy, insolvency,
reorganization, liquidation, arrangement, fraudulent conveyance,
moratorium, receivership, conservatorship, readjustment of debts,
creditors' rights or other laws relating to or affecting the rights of
creditors generally or the rights of creditors of national banking
associations; (x) rights to indemnification and contribution which may be
limited by applicable law and equitable principles or otherwise
unenforceable as against public policy; (y) the unenforceability under
certain circumstances of provisions imposing penalties, forfeiture, late
payment charges, or an increase in interest rate upon delinquency in
payment or the occurrence of any event of default; and (z) general
principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the possible
unavailability of specific performance or injunctive relief, regardless of
whether such enforceability is considered in a proceeding in equity or at
law.
(xii) The statements in the Base Prospectus under the headings "Risk
Factors--If a conservator or receiver were appointed for us, delays or
reductions in payment of your notes could occur," "Material Legal Aspects
of the Receivables," "ERISA Considerations" and "Federal Income Tax
Consequences" and the statements in the Prospectus Supplement under the
headings "Structural Summary--Tax Status" and "--ERISA Considerations" to
the extent that they constitute matters of law or legal conclusions with
respect thereto, have been reviewed by us and are correct in all material
respects.
(xiii) This Agreement, the Transaction Documents and the Notes conform
in all material respects to the descriptions thereof contained in the
Prospectus.
(xiv) The Indenture has been duly qualified under the TIA and
complies as to form with the TIA and the rules and regulations of the
Commission thereunder. The Issuer is not now, and immediately following the
issuance of the Notes pursuant to the Indenture will not be, required to be
registered under the Investment Company Act of 1940, as amended.
(xv) Subject to the discussion in the Base Prospectus under the
heading "Federal Income Tax Consequences", the Notes will properly be
characterized as indebtedness and the issuance of the Notes will not cause
the Issuer to be deemed an association (or publicly traded partnership)
taxable as a corporation, for U.S. federal income tax purposes.
(xvi) The Indenture constitutes the legal, valid and binding
obligation of the Issuer under the laws of the State of Illinois, subject
to (w) limitations imposed by bankruptcy, insolvency, reorganization,
liquidation, arrangement, fraudulent conveyance, moratorium, receivership,
conservatorship, readjustment of debts,
-13-
creditors' rights or other laws relating to or affecting the rights of
creditors generally or the rights of creditors of national banking
associations; (x) rights to indemnification and contribution which may be
limited by applicable law and equitable principles or otherwise
unenforceable as against public policy; (y) the unenforceability under
certain circumstances of provisions imposing penalties, forfeiture, late
payment charges, or an increase in interest rate upon delinquency in
payment or the occurrence of any event of default; and (z) general
principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing, and the possible
unavailability of specific performance or injunctive relief, regardless of
whether such enforceability is considered in a proceeding in equity or at
law.
(xvii) Each of the Registration Statement, as of its effective date,
and the Prospectus, as of its date, complied as to form in all material
respects with the requirements of the Act and the Rules and Regulations
under the Act, except that in each case such counsel need not express any
opinion as to the financial and statistical data included therein or
excluded therefrom or the exhibits to the Registration Statement and,
except as and, to the extent set forth in paragraphs (xii) and (xiii), such
counsel does not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or
the Prospectus.
(xviii) If the FDIC is appointed as conservator or receiver for the
Bank and if a court were to determine that the Indenture Trustee has a
security interest in the Receivables and the proceeds thereof, the court
would hold that the security interest of the Indenture Trustee would be
enforceable against the Bank with respect to the Receivables and such
proceeds.
(xix) When the Indenture Trustee has taken possession of the
Collateral Certificate issued by FCMT, the Transaction Documents have been
executed and delivered and FCMT has received payment for the Collateral
Certificate, the Indenture Trustee will become the registered holder of the
Collateral Certificate, subject to no Liens of record.
Such counsel also shall state that they have participated in conferences
with representatives of Spiegel and the Bank and their accountants, the
Underwriters and counsel to the Underwriters concerning the Registration
Statement and the Prospectus and have considered the matters to be stated
therein and the matters stated therein, although they are not independently
verifying the accuracy, completeness or fairness of such statements (except as
stated in paragraph (xii) above) and based upon and subject to the foregoing,
nothing has come to such counsel's attention to cause such counsel to believe
that the Registration Statement (excluding any exhibits filed therewith), at the
time it became effective, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary to
make the statements therein not misleading, or that the Prospectus, as of the
date hereof, contains any untrue statement of a material fact
-14-
or omits to state any material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading (it being understood that such counsel has
not been requested to, and does not, make any comment in such opinion with
respect to the financial statements, supporting schedules and other financial or
statistical information contained in the Registration Statement or the
Prospectus).
(e) The Representative shall have received from [____________________],
special counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to such matters relating to this transaction as the
Representative may require, and the Bank shall have furnished to such counsel
such documents as they request for the purpose of enabling them to pass upon
such matters.
(f) The Representative shall have received an opinion, dated the Closing
Date, of [____________], special Oregon counsel for the Bank, satisfactory in
form and substance to the Representative and its counsel with respect to (i)
certain matters relating to the transfer of the Receivables from the Bank to the
Issuer under the PSA and (ii) the perfection of the security interest in favor
of FCMT in the Receivables and the proceeds thereof.
(g) The Representative shall have received a certificate from the Bank,
dated the Closing Date, of a Treasurer, Vice President or more senior officer of
the Bank in which such officer, to the best of his/her knowledge after
reasonable investigation, shall state that (u) the representations and
warranties of the Bank in this Agreement are true and correct on and as of the
Closing Date, (v) the Bank has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied hereunder at or prior to the
Closing Date, (w) the representations and warranties of the Bank contained in
this Agreement and the Transaction Documents to which it is a party are true and
correct as of the dates specified herein and therein, (x) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been instituted or are threatened by the
Commission, (y) nothing has come to such officers' attention that would lead
such officers to believe that the Registration Statement or the Prospectus, and
any amendment or supplement thereto, as of its date and as of the Closing Date,
contained an untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading, and (z) subsequent
to the date of the Prospectus, there has been no material adverse change in the
financial position or results of operation of the Bank's credit card business
except as set forth in or contemplated by the Prospectus or as described in such
certificate.
(h) The Representative shall have received an opinion of [_____________],
counsel to the Owner Trustee, dated the Closing Date, satisfactory in form and
substance to the Representative and its counsel, to the effect that:
-15-
(i) The Owner Trustee is duly incorporated and validly existing as
a banking corporation in good standing under the laws of the State of New
York;
(ii) The Owner Trustee has the power and authority to execute,
deliver and perform the Trust Agreement and to consummate the transactions
contemplated thereby;
(iii) The Trust Agreement has been duly authorized, executed and
delivered by the Owner Trustee and constitutes a legal, valid and binding
obligation of the Owner Trustee, enforceable against the Owner Trustee in
accordance with its terms;
(iv) Each of the Indenture, the Trust Agreement and the Transfer and
Servicing Agreement (collectively referred to in this subsection (i) as the
"Trust Documents") has been duly executed and delivered by the Owner
---------------
Trustee, as Owner Trustee on behalf of the Issuer;
(v) Neither the execution, delivery or performance by the Owner
Trustee, in its individual capacity or as Owner Trustee, as the case may
be, of the Trust Documents, nor the consummation of the transactions by the
Owner Trustee, in its individual capacity or as Owner Trustee, as the case
may be, contemplated thereby, requires the consent or approval of, the
withholding of objection on the part of, the giving of notice to, the
filing, registration or qualification with, or the taking of any other
action in respect of, any governmental authority or agency of the States of
New York and Illinois or the United States of America governing the banking
or trust powers of the Owner Trustee;
(vi) Neither the execution, delivery and performance by the Owner
Trustee, in its individual capacity or as Owner Trustee, as the case may
be, of the Trust Documents, nor the consummation of the transactions by the
Owner Trustee, in its individual capacity or as Owner Trustee, as the case
may be, contemplated thereby, is in violation of the charter or bylaws of
the Owner Trustee or of any law, governmental rule or regulation of the
State of Illinois, the State of New York or of the United States of America
governing the banking or trust powers of the Owner Trustee or, to such
counsel's knowledge, without independent investigation, any indenture,
mortgage, bank credit agreement, note or bond purchase agreement, long-term
lease, license or other agreement or instrument to which it is a party or
by which it is bound or, to such counsel's knowledge, without independent
investigation, of any judgment or order applicable to the Owner Trustee;
(vii) No consent, approval or other authorization of, or
registration, declaration or filing with, any court or governmental agency
or commission of the State of Illinois or the State of New York is required
by or with respect to the Owner Trustee, in its individual capacity or as
Owner Trustee, as the case may be, for the
-16-
valid execution and delivery of the Trust Documents, or for the
validity or enforceability thereof; and
(viii) To such counsel's knowledge, without independent
investigation, there are no pending or threatened actions, suits or
proceedings affecting the Owner Trustee before any court or other
governmental authority which, if adversely determined, would
materially and adversely affect the ability of the Owner Trustee to
carry out the transactions contemplated by the Trust Agreement.
(i) The Representative shall have received an opinion of Xxxxx, Xxxxx
and Xxxxx, special Illinois counsel to the Issuer, dated the Closing Date,
satisfactory in form and substance to the Representative and its counsel,
to the effect that:
(i) The Issuer is validly existing as a common law trust under
the laws of the State of Illinois;
(ii) The Issuer, through the Owner Trustee, (A) has the trust
power and authority pursuant to the Trust Agreement to (x) execute,
deliver and perform its obligations under the Trust Agreement, the
Administration Agreement, the Indenture and the Transfer and Servicing
Agreement (collectively referred to in this subsection (j) as the
"Trust Documents"), (y) to execute, deliver and issue the Notes, and
---------------
(z) to issue the Seller Interest, and (B) has duly authorized,
executed and delivered the Trust Documents and the Notes;
(iii) Each of the Trust Documents to which the Issuer is a party
constitutes the legal, valid and binding agreement of the Issuer,
acting through the Owner Trustee, under the laws of Illinois,
enforceable against the Issuer, through the Owner Trustee, in
accordance with its terms, subject to (w) limitations imposed by
bankruptcy, insolvency, reorganization, liquidation, arrangement,
fraudulent conveyance, moratorium, receivership, conservatorship,
readjustment of debts, creditors' rights or other laws relating to or
affecting the rights of creditors generally or the rights of creditors
of national banking associations; (x) rights to indemnification and
contribution which may be limited by applicable law and equitable
principles or otherwise unenforceable as against public policy; (y)
the unenforceability under certain circumstances of provisions
imposing penalties, forfeiture, late payment charges, or an increase
in interest rate upon delinquency in payment or the occurrence of any
event of default; and (z) general principles of equity, including,
without limitation, concepts of materiality, reasonableness, good
faith and fair dealing, and the possible unavailability of specific
performance or injunctive relief, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
(iv) When issued in accordance with the Trust Agreement, the
Seller Interest will be validly issued and entitled to the benefits of
the Trust Agreement;
-17-
(v) Neither the execution, delivery and performance by the Issuer
of the Trust Documents or the Notes, nor the consummation by the Issuer of
any of the transactions by the Issuer contemplated thereby, requires the
consent or approval of, the withholding of objection on the part of, the
giving of notice to, the filing, registration or qualification with, or the
taking of any other action in respect of, any governmental authority or
agency of the State of Illinois other than the filing of any financing
statements with the Illinois Secretary of State in connection with the
Indenture;
(vi) Neither the execution, delivery and performance by the Issuer
of the Trust Documents, nor the consummation by the Issuer of the
transactions contemplated thereby, is in violation of the Trust Agreement
or of any law, rule or regulation of the State of Illinois applicable to
the Issuer; and
(vii) With respect to the Issuer and the Receivables: (a) there is no
document, stamp, exercise or other similar tax imposed by the State of
Illinois upon the perfection of a security interest in the Receivables, in
the transfer of the Receivables to or from the Issuer, or upon the issuance
of the Notes; (b) there is no personal property tax imposed by the State of
Illinois upon or measured by the corpus of the Issuer; and (c) the
characterization of the Issuer for federal income tax purposes will be
determinative of the characterization of the Issuer for Illinois income tax
purposes and assuming that the Issuer has only one owner, the Issuer will
not be subject to Illinois income tax or personal property replacement tax
and Noteholders who are not otherwise subject to Illinois income tax will
not be subject to tax by reason of their ownership of the Notes and the
receipt of income therefrom.
(j) The Representative shall have received an opinion of [____________],
counsel to the Indenture Trustee dated the Closing Date, satisfactory in form
and substance to the Representative and its counsel, to the effect that:
(i) The Indenture Trustee is a banking corporation organized and
validly existing and in good standing under the laws of the State of New
York and is authorized and qualified to accept the trusts imposed by the
Indenture and to act as Indenture Trustee under the Indenture;
(ii) The acknowledgment by the Indenture Trustee of the Transfer and
Servicing Agreement has been duly authorized, executed and delivered by the
Indenture Trustee. The Indenture Trustee has duly authorized, executed and
delivered the Indenture. Assuming the due authorization, execution and
delivery thereof by the other parties thereto, the Indenture is the legal,
valid and binding obligation of the Indenture Trustee, enforceable against
the Indenture Trustee in accordance with its terms, subject to bankruptcy
and insolvency laws and general principles of equity;
-18-
(iii) The Indenture Trustee has duly executed and authenticated
the Notes;
(iv) The Indenture Trustee is duly authorized and empowered to
exercise trust powers under applicable law;
(v) None of (x) the execution and authentication of the Notes,
(y) the acknowledgment of the Transfer and Servicing Agreement or (z)
the execution, delivery and performance of the Indenture by the
Indenture Trustee conflicts with or will result in a violation of (A)
any law or regulation of the United States of America or the States of
New York and Illinois governing the banking or trust powers of the
Indenture Trustee or (B) the Organization Certificate or Bylaws of the
Indenture Trustee.
(vi) No approval, authorization or other action by, or filing
with, any governmental authority of the United States of America or
the State of New York having jurisdiction over the banking or trust
powers of the Indenture Trustee is required in connection with the
execution and delivery by the Indenture Trustee of the Indenture or
the performance by the Indenture Trustee of the terms of the Indenture
or the acknowledgment of the Transfer and Servicing Agreement.
(k) The Representative shall have received reliance letters addressed
to the Representative, dated as of the Closing Date, allowing the
Representative to rely on each opinion of counsel delivered to a Rating
Agency, the Indenture Trustee or the Bank in connection with the issuance
of the Notes.
(l) [The Representative shall have received evidence satisfactory to
the Representative that the Class A Notes shall be rated Aaa by Xxxxx'x
Investors Service, Inc., AAA by Standard & Poor's Ratings Services and AAA
by Fitch, Inc.; that the Class B Notes shall be rated no lower than A2 by
Xxxxx'x Investors Service, Inc., A by Standard & Poor's Ratings Services
and A by Fitch, Inc.; and that the Class C Notes shall be rated no lower
than Baa2 by Xxxxx'x Investors Service, Inc., BBB by Standard & Poor's
Ratings Services and BBB by Fitch, Inc.]
The Bank will furnish the Representative with such conformed copies of such
opinions, certificates, letters and documents as the Representative reasonably
request.
7. Indemnification and Contribution. Spiegel and the Bank, jointly and
--------------------------------
severally, will indemnify and hold harmless the Underwriters against any losses,
claims, damages or liabilities, joint or several, to which the Underwriters may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated
-19-
therein or necessary to make the statements therein not misleading, and will
reimburse the Underwriters for any legal or other expenses reasonably incurred
by the Underwriters in connection with investigating or defending any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
--------
however, that Spiegel and the Bank will not be liable in any such case to the
-------
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity with the
Class A Underwriters' Information, the Class B Underwriters' Information or the
Class C Underwriters' Information; provided further, that Spiegel and the Bank
will not be liable to any Underwriter under the indemnity agreement in this
subsection (a) with respect to any preliminary prospectus to the extent that any
loss, claim, damage or liability of such Underwriter results from the fact that
such Underwriter sold Notes to a Person as to whom it is established that there
was not sent or given, at or prior to written confirmation of such sale, a copy
of the Prospectus (excluding documents incorporated by reference) or of the
Prospectus as then amended or supplemented (excluding documents incorporated by
reference) in any case where such delivery is required by the Act if Spiegel or
the Bank notified the Representative in writing in accordance with Section 5(a)
hereof and previously furnished copies of the Prospectus (excluding documents
incorporated by reference) in the quantity requested in accordance with Section
5(d) hereof to such Underwriter and the loss, claim, damage or liability of such
Underwriter results from an untrue statement or omission of a material fact
contained in the preliminary prospectus and corrected in the Prospectus or the
Prospectus as then amended or supplemented.
(b) The Underwriters agree, severally and not jointly, to indemnify
and hold harmless Spiegel and the Bank against any losses, claims, damages
or liabilities to which Spiegel or the Bank may become subject, under the
Act or otherwise and will reimburse any legal or other expenses reasonably
incurred by Spiegel or the Bank in connection with investigating or
defending any such loss, claim, damage, liability or action as such
expenses are incurred, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, the Prospectus, or any amendment
or supplement thereto, or arise out of or are based upon the omission or
the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each
case to the extent, but only to the extent, that, with respect to each of
the Class A Underwriters, the Class B Underwriters and the Class C
Underwriters, such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with the
Class A Underwriters' Information, the Class B Underwriters' Information or
the Class C Underwriters' Information, respectively, and will reimburse any
legal or other expenses reasonably incurred by Spiegel and the Bank in
connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under this section
of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under subsection (a) or (b) above, notify
-20-
the indemnifying party of the commencement thereof; provided, however, that
-------- -------
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 7 except to the extent it
has been materially prejudiced by such failure; and provided further,
-------- -------
however, that the failure to notify any indemnifying party shall not
-------
relieve it from any liability which it may have to any indemnified party
otherwise than under this Section 7. In case any such action is brought
against any indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein and to the extent that it may wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof,
with counsel reasonably satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of
any pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding and does not include
a statement as to, or an admission of, fault, culpability or failure to act
by or on behalf of any indemnified party.
(d) If the indemnification provided for in this section is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnified party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or (b)
above (i) in such proportion as is appropriate to reflect the relative
benefits received by Spiegel and the Bank on the one hand and the
Underwriters on the other from the offering of the Notes, or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of
Spiegel and the Bank on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations. The relative benefits received by Spiegel and the Bank on
the one hand and the Underwriters on the other shall be deemed to be in the
same proportion as the total net proceeds from the offering (before
deducting expenses) of the Notes received by the Bank bear to the total
underwriting discounts and commissions received by the Underwriters with
respect to the Notes. The relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by Spiegel and the Bank or the Underwriters
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission with
respect to the Notes. The amount paid by an indemnified party as a result
of the losses, claims, damages
-21-
or liabilities referred to in the first sentence of this subsection (d)
shall be deemed to include any other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action
or claim which is the subject of this subsection (d). Notwithstanding the
provisions of this subsection (d), the Underwriters shall not be required
to contribute any amount in excess of the amount by which the total
underwriting discount as set forth on the cover page of the Prospectus
Supplement exceeds the amount of damages which the Underwriters have
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission with respect to the Notes. No
Person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
(e) The obligations of Spiegel and the Bank under this Section shall
be in addition to any liability which Spiegel or the Bank may otherwise
have and shall extend, upon the same terms and conditions, to each Person,
if any, who controls the Underwriters within the meaning of the Act; and
the obligations of the Underwriters under this section shall be in addition
to any liability which the Underwriters may otherwise have and shall
extend, upon the same terms and conditions, to each director of Spiegel or
the Bank, to each officer of the Bank who has signed the Registration
Statement and to each Person, if any, who controls Spiegel or the Bank
within the meaning of the Act.
8. Survival of Certain Representations and Obligations. The respective
---------------------------------------------------
indemnities, agreements, representations, warranties and other statements of
Spiegel and the Bank or their officers and of the Underwriters set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation, or statement as to the results thereof, made by or on
behalf of the Underwriters, Spiegel, the Bank or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Notes. If this Agreement is terminated
or if for any reason other than default by the Underwriters the purchase of the
Notes by the Underwriters is not consummated, the Bank and Spiegel shall remain
responsible for the expenses to be paid by them pursuant to Section 5 and the
respective obligations of Spiegel, the Bank and the Underwriters pursuant to
Section 7 shall remain in effect. If for any reason the purchase of the Notes
by the Underwriters is not consummated other than solely because of the
occurrence of any event specified in clause (iii), (iv) or (v) of Section 6(c),
the Bank and Spiegel will reimburse the Underwriters for all out-of-pocket
expenses reasonably incurred by them in connection with the offering of the
Notes.
9. Computational Materials and ABS Term Sheets. (a) Each Underwriter
-------------------------------------------
agrees to provide to the Bank, not less than two Business Days prior to the date
on which the Bank is required to file the Prospectus Supplement pursuant to Rule
424(b), any information used by it (in such written or electronic format as
required by the Bank) with respect to the offering of the Notes that constitutes
"Computational Materials," as defined in the Commission's No-Action Letter,
-----------------------
dated May 20, 1994, addressed to Xxxxxx, Xxxxxxx Acceptance Corporation I,
Xxxxxx, Xxxxxxx & Co. Incorporated and Xxxxxx Structured Asset Corporation (as
made generally applicable to registrants, issuers and underwriters by the
Commission's response to the request of the Public Securities
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Association dated May 27, 1994 (the "Xxxxxx/PSA Letter")), that is not contained
-----------------
in the Prospectus (without taking into account information incorporated therein
by reference).
(b) Each Underwriter agrees to provide to the Bank, not less than two
Business Days prior to the date on which the Bank is required to file the
Prospectus Supplement pursuant to Rule 424(b), any information used by it
(in such written or electronic format as required by the Bank) with respect
to the offering of the Notes that constitutes "ABS Term Sheets," as defined
---------------
in the Commission's No-Action Letter, dated February 17, 1995, addressed to
the Public Securities Association, that is not contained in the Prospectus
(without taking into account information incorporated therein by
reference).
(c) Each Underwriter severally agrees, assuming all information
provided by the Bank is accurate and complete in all material respects, to
indemnify and hold harmless the Bank, each of the officers and directors of
the Bank and each Person who controls the Bank within the meaning of
Section 15 of the Act against any and all losses, claims, damages or
liabilities, joint or several, to which they may become subject under the
Act or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue
statement of a material fact contained in the Computational Materials or
ABS Term Sheets, if any, provided by such Underwriter, or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and agrees to reimburse each such indemnified party for any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such
loss, claim, damage, liability or action as such expenses are incurred. The
obligations of each Underwriter under this Section 9(c) shall be in
addition to any liability that such Underwriter may otherwise have.
(d) The Bank shall file with the Commission any Computational
Materials or ABS Term Sheets, if any, provided by the Underwriters no later
than the date on which such Computational Materials or ABS Term Sheets are
required to be filed pursuant to the applicable No-Action Letters.
The procedures set forth in Sections 7(c) and 7(d) shall be equally
applicable to this Section 9(c). Notwithstanding anything in this Section 9,
each Underwriter represents and warrants that it has not used any Computational
Materials or ABS Term Sheets in connection with the offering of the Notes.
10. Obligation of the Underwriters. Each Underwriter represents and agrees
------------------------------
that it has not and will not, directly or indirectly, offer, sell or deliver any
of the Notes or distribute the Prospectus or any other offering materials
relating to the Notes in or from any jurisdiction except under circumstances
that will, to the best of its knowledge and belief, result in compliance with
any applicable laws and regulations thereof in effect on the date hereof and
that, to the best of its knowledge and belief, will not impose any material
obligations under laws and regulations of the
-23-
subject jurisdictions that relate to the issuance of securities, as in effect on
the date of this Agreement, on the Bank, Spiegel or the Issuer except as set
forth herein.
11. Default by an Underwriter. If any one or more Underwriters shall fail
-------------------------
to purchase and pay for any of the Notes agreed to be purchased by such
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Notes set forth
opposite their names in Schedule A hereto bear to the aggregate amount of Notes
set forth opposite the names of all the remaining Underwriters) the Notes which
the defaulting Underwriter or Underwriters agreed but failed to purchase;
provided, however, that in the event that the aggregate amount of Notes which
the defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate amount of Notes set forth in Schedule A hereto, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Notes, and if such nondefaulting
Underwriters do not purchase all the Notes, this Agreement will terminate
without liability to any nondefaulting Underwriter, Spiegel or the Bank. In the
event of a default by any Underwriter as set forth in this Section 11, the
Closing Date shall be postponed for such period, not exceeding seven days, as
the Representative shall determine in order that the required changes in the
Registration Statement and the Final Prospectus or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Underwriter for its liability, if any, to Spiegel and the Bank
and any nondefaulting Underwriter for damages occasioned by its default
hereunder.
12. Notices. All communications hereunder will be in writing and, if sent
-------
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to:
[Address]
13. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
14. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
--------------
ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
15. Financial Services Act. Each Underwriter represents and warrants to,
----------------------
and agrees with, Spiegel and the Bank that (w) it has complied and shall comply
with all applicable provisions of the Financial Services Act 1986 and the Public
Offers of Securities Regulations 1995 (the "Regulations") with respect to
-----------
anything done by it in relation to the Notes in, from or otherwise involving the
United Kingdom; (x) it has only issued or passed on and shall only issue or pass
on in the United Kingdom any document received by it in connection with the
issue of the Notes to a
-24-
Person who is of a kind described in Article 11(3) of the Financial Services Act
1986 (Investment Advertisements) (Exemptions) Order 1996 or who is a Person to
whom the document may otherwise lawfully be issued or passed on; (y) it has not
offered or sold and, during the period of six months from the date hereof, will
not offer or sell any Note to Persons in the United Kingdom except to Persons
whose ordinary activities involve them in acquiring, holding, managing, or
disposing of investments (as principal or agent) for the purposes of their
businesses or otherwise in circumstances which have not resulted and will not
result in an offer to the public in the United Kingdom within the meaning of the
Regulations.
-25-
If you are in agreement with the foregoing, please sign two counterparts
hereof and return one to the Bank whereupon this letter and your acceptance
shall become a binding agreement among Spiegel, the Bank and the Underwriters.
Very truly yours,
SPIEGEL, INC.
By__________________________
Name:
Title:
FIRST CONSUMERS NATIONAL BANK
By__________________________
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date hereof
[________________________]
as Representative of the
Underwriters set forth herein
By__________________________
Name:
Title:
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SCHEDULE A
Class A Notes
-------------
Underwriters Principal Amount of
------------
Class A Notes
-------------
$_____________
$_____________
Total $
==============
Class B Notes
-------------
Underwriters Principal Amount of
------------
Class B Notes
-------------
$
$_____________
Total $
==============
Class C Notes
-------------
Underwriters Principal Amount of
------------
Class C Notes
-------------
$
$_____________
Total $
==============
