Exhibit 1.1
FRANKLIN AUTO TRUST 1998-1
$__________ ____% CLASS A-1 ASSET BACKED NOTES
$__________ ____% CLASS A-2 ASSET BACKED NOTES
$__________ ____% CLASS A-3 ASSET BACKED NOTES
$__________ ____% CLASS A-4 ASSET BACKED NOTES
$__________ ____% CLASS A-5 ASSET BACKED NOTES
Franklin Receivables LLC
(SELLER)
FORM OF UNDERWRITING AGREEMENT
___________, 1998
Xxxxxxx, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
1. Introductory. FCC Receivables Corp. and Franklin
Receivables LLC (together, the "Registrants") have previously filed a
registration statement with the Securities and Exchange Commission relating to
the issuance and sale from time to time of up to $________ of asset backed notes
and/or asset backed certificates. FCC Receivables Corp. (the "Seller") proposes
to cause FRANKLIN AUTO TRUST 1998-1 (the "Trust") to issue and sell to Xxxxxxx,
Xxxxx & Co. (the "Underwriter") $_______ principal amount of its _____% Class
A-1 Asset Backed Notes (the "Class A-1 Notes"), $_______ principal amount of its
___% Class A-2 Asset Backed Notes (the "Class A-2 Notes"), $______ principal
amount of its ___% Class A-3 Asset Backed Notes (the "Class A-3 Notes"),
$________ principal amount of its ____% Class A-4 Asset Backed Notes (the "Class
A-4 Notes") and $_______ principal amount of its ___% Class A-5 Asset Backed
Notes (the "Class A-5 Notes" and together with the Class A-1 Notes, Class A-2
Notes, Class A-3 Notes and Class A-4 Notes, the "Notes"). The Trust will also
issue Asset Backed Certificates (the "Certificates" and together with the Notes,
the "Securities") which will be retained by the Seller. The assets of the Trust
will include, among other things, a pool of motor vehicle retail installment
sale contracts (the "Receivables") secured by new and used automobiles and light
trucks financed thereby (the "Financed Vehicles"), and certain monies received
thereunder on or after August 1, 1998 (the "Cutoff Date"), and the other
property and the proceeds thereof to be conveyed to the Trust pursuant to the
Sale and Servicing Agreement to be dated as of August 1, 1998 (the "Sale and
Servicing Agreement") among Franklin Auto Trust 1998-1 (the "Trust"), the Seller
and Franklin Capital Corporation ("Franklin Capital"), as servicer (the
"Servicer") and as representative (the "Representative"). Pursuant to the Sale
and Servicing Agreement, the Seller will sell the Receivables to the Trust and
the Servicer will service the Receivables on behalf of the Trust. In addition,
pursuant to the Sale and Servicing Agreement, the Servicer will agree to perform
certain administrative tasks on behalf of the Trust imposed on the Trust under
the Indenture. The Notes will be issued pursuant to the Indenture to be dated as
of August 1, 1998 (as amended and supplemented from time to time, the
"Indenture"), between the Trust and ________________ (the "Trustee"). The
Representative will cause the Seller to form the Trust pursuant to a Trust
Agreement (the "Trust Agreement") to be dated as of August 1, 1998 between the
Seller and _____________, as owner trustee (the "Owner Trustee"). The
Certificates, each representing a fractional undivided interest in the Trust,
will be issued pursuant to the Trust Agreement.
The Receivables were originated or acquired by the
Representative. The Representative will sell the Receivables owned by it to the
Seller pursuant to the terms of the Loan Purchase Agreement (the "Loan Purchase
Agreement") dated as of August 1, 1998 between the Seller and the
Representative.
Capitalized terms used and not otherwise defined herein shall
have the meanings given them in the preliminary prospectus or, if not defined
therein, as defined in the Sale and Servicing Agreement. As used herein, the
term "Basic Documents" refers to the Sale and Servicing Agreement, Indenture,
Trust Agreement, Spread Account Agreement, Guarantee Agreement, Loan Purchase
Agreement, the letter agreement in the form of Exhibit A hereto (the "Letter
Agreement"), Insurance and Indemnity Agreement, Indemnification Agreement and
Note Depository Agreement.
2. Representations and Warranties of the Registrants and the
Representative. Each of the Seller and the Representative jointly and severally
and Franklin Receivables LLC with respect to the representations and warranties
appearing in clauses (a), (b), (d), (e) and (f) represents and warrants to and
agrees with the Underwriter that:
(a) A registration statement on Form S-3 (No. 333-56869),
including a prospectus, relating to the Notes has been filed with the Securities
and Exchange Commission (the "Commission") and has become effective. Such
registration statement, as amended as of the date of the Agreement is
hereinafter referred to as the "Registration Statement," and the prospectus
included in such Registration Statement, as supplemented to reflect the terms of
the Notes as first filed with the Commission after the date of this Agreement
pursuant to and in accordance with Rule 424(b) ("Rule 424(b)") under the
Securities Act of 1933, as amended (the "Act"), including all material
incorporated by reference therein, is hereinafter referred to as the
"Prospectus;" a "preliminary prospectus" means any form of prospectus, including
any prospectus supplement, relating to the Notes used prior to date of this
Agreement that is subject to completion.
(b) On the effective date of the registration statement
relating to the Notes, such registration statement conformed in all respects to
the requirements of the Act and the rules and regulations of the Commission
promulgated under the Act (the "Rules and Regulations") and did not include any
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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 preliminary
prospectus conform, and at the time of the filing of the Prospectus in
accordance with Rule 424(b), the Registration Statement and the Prospectus will
conform in all respects to the requirements of the Act and the Rules and
Regulations, 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. The preceding sentence does not apply to statements in or omissions
from such documents based upon (i) written information furnished to the Seller
by the Underwriter specifically for use therein, it being understood that the
only such information consists of the Underwriter's Information (as defined in
Section 7(i)) or (ii) the Derived Information (as defined in Section 7 below)
contained in the Current Report (as defined in Section 5(a) below) or in any
amendment thereof or supplement thereto, incorporated by reference in such
Registration Statement or such Prospectus (or any amendment thereof or
supplement thereto).
(c) The Notes are "asset backed securities" within the meaning
of, and satisfy the requirements for use of, Form S-3 under the Act.
(d) The documents incorporated by reference in the
Registration Statement and Prospectus, at the time they were or hereafter are
filed with the Commission, complied and will comply in all material respects
with the requirements of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the rules and regulations of the Commission thereunder.
(e) Each of the Registrants, the Representative and the
Guarantor is a corporation or limited liability company, as applicable, duly
organized, validly existing and in good standing under the laws of its
respective state of incorporation or formation, as applicable, is duly qualified
to transact business as a foreign corporation or limited liability company, as
applicable, in each jurisdiction in which it is required to be so qualified and
has all necessary licenses, permits and consents to conduct its business as
presently conducted and as described in the Prospectus and to perform its
obligations under the Basic Documents.
(f) This Agreement and each of the Basic Documents to which it
is a party has been duly authorized, executed and delivered by the Registrants,
the Representative and the Guarantor, constitutes a valid and binding agreement
of each of the Registrants, the Representative and the Guarantor, enforceable
against the Registrants, the Representative and the Guarantor in accordance with
its terms, subject as to the enforcement of remedies (x) to applicable
bankruptcy, insolvency, reorganization, moratorium, and other similar laws
affecting creditors' rights generally, (y) to general principles of equity
(regardless of and whether the enforcement of such remedies is considered in a
proceeding in equity or at law) and (z) with respect to rights of indemnity
under this Agreement the Letter Agreement and the Indemnification Agreement, to
limitations of public policy under applicable securities laws.
(g) None of the Seller, the Representative or the Guarantor is
in breach or violation of any credit or security agreement or other agreement or
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instrument to which it is a party or by which it or its properties may be bound,
or in violation of any applicable law, statute, regulation or ordinance or any
governmental body having jurisdiction over it, which breach or violation would
have a material and adverse effect on its ability to perform its obligations
under this Agreement or any of the Basic Documents, in each case, to which it is
a party.
(h) Other than as contemplated by this Agreement or as
disclosed in the Prospectus, there is no broker, finder or other party that is
entitled to receive from the Seller, the Representative or any affiliate thereof
or the Underwriter, any brokerage or finder's fee or other fee or commission as
a result of any of the transactions contemplated by this Agreement.
(i) Neither the Representative nor the Seller has entered
into, nor will it enter into, any contractual arrangement with respect to the
distribution of the Notes except for this Agreement
(j) The Trust is not an "investment company" and is not
required to be registered as an "investment company," as such term is defined in
the Investment Company Act of 1940, as amended (the "Investment Company Act").
(k) As of the Closing Date (as defined below), the
representations and warranties of the Seller, the Representative and the
Guarantor, in each of its capacities under each of the Basic Documents, to which
it is a party will be true and correct in all material respects and each such
representation and warranty is so incorporated herein by this reference.
(l) The Seller has filed the preliminary prospectus supplement
relating to the Notes pursuant to and in accordance with Rule 424(b).
(m) On or before the Closing Date, the Basic Documents will
have been duly authorized, executed and delivered by each of the parties
thereto.
(n) The Certificates, when duly and validly executed by the
Owner Trustee, authenticated and delivered in accordance with the Trust
Agreement, and delivered to and paid for pursuant hereto will be validly issued
and outstanding and entitled to the benefits of the Trust Agreement.
(o) The Trust's assignment of the Collateral to the Trustee
pursuant to the Indenture will vest in the Trustee, for the benefit of the
Noteholders, a first priority perfected security interest therein, subject to no
other outstanding Lien.
(p) The Notes, when duly and validly executed by the Trustee,
authenticated and delivered in accordance with the Indenture, and delivered and
paid for pursuant hereto will be enforceable in accordance with their terms,
subject as to enforceability to the effects of applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium and similar laws
now or hereafter in effect relating to creditors' rights generally and subject
to general principles of equity (whether in a proceeding at law or in equity).
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(q) Neither the execution, delivery or performance of any of
the Basic Documents by the Seller, or the Representative, nor the issuance, sale
and delivery of the Notes or Certificates, nor the fulfillment of the terms of
the Notes or Certificates, will conflict with, or result in a breach, violation
or acceleration of, or constitute a default under, any term or provision of the
organizational documents of the Seller, or the Representative, any material
indenture or other material agreement or instrument to which the Seller, or the
Representative is a party or by which either of them or their properties is
bound or result in a violation of or contravene the terms of any statute, order
or regulation applicable to the Seller, or the Representative of any court,
regulatory body, administrative agency, governmental body or arbitrator having
jurisdiction over the Seller, or the Representative, or will result in the
creation of any lien upon any material property or assets of the Seller, or the
Representative (other than pursuant to the Basic Documents).
(r) There are no legal or governmental proceedings pending to
which the Seller, the Representative or the Guarantor is a party or of which any
of its properties is the subject, which if determined adversely to the Seller,
the Representative or the Guarantor would individually or in the aggregate have
a material adverse effect on the financial position, shareholders' equity or
results of operations of any of them; and to the best of the Seller's,
Representative's or the Guarantor's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or others.
(s) No consent, license, approval, authorization or order of
or declaration or filing with any governmental authority is required for the
issuance of the Notes and Certificates or sale of the Notes or the consummation
of the other transactions contemplated by this Agreement or the Basic Documents,
except such as have been duly made or obtained.
(t) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been any
material adverse change, or any development which could reasonably be expected
to result in a material adverse change, in or affecting the financial position,
shareholders' equity or results of operations of the Seller, the Representative
or the Guarantor or the Seller's, the Representative's or the Guarantor's
ability to perform its obligations under this Agreement or any of the Basic
Documents to which it is a party.
(u) Any taxes, fees and other governmental charges due on or
prior to the Closing Date (including, without limitation, sales taxes) in
connection with the execution, delivery and issuance of this Agreement, the
Basic Documents and the Securities have been or will have been paid at or prior
to the Closing Date.
(v) The Receivables transferred by the Representative to the
Seller are chattel paper as defined in the Uniform Commercial Code as in effect
in the State of Utah. The Receivables transferred by the Seller to the Trust are
chattel paper as defined in the Uniform Commercial Code as in effect in the
State of [Utah].
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(w) Under generally accepted accounting principles, (i) the
Representative will report its transfer of the Receivables transferred by it to
the Seller pursuant to the Loan Purchase Agreement and (ii) the Seller will
report its transfer of the Receivables to the Trustee pursuant to the Sale and
Servicing Agreement as a sale of the Receivables for financial accounting
purposes.
(x) Immediately prior to the transfer thereof to the Seller
pursuant to the Loan Purchase Agreement, the Representative is the sole owners
of all right, title and interest in, and have good and marketable title to the
Receivables and the other property to be transferred to the Seller. The
Representative, pursuant to the Loan Purchase Agreement, is transferring to the
Seller ownership of the Receivables, the security interest in the Financed
Vehicles securing the Receivables and the proceeds of each of the foregoing,
and, immediately prior to the transfer thereof to the Trust, the Seller will be
the sole owner of all right, title and interest in, and will have good and
marketable title to, the Receivables and the other property to be transferred by
it to the Trust. The assignment of the Receivables, all documents and
instruments relating thereto and all proceeds thereof to the Trust, pursuant to
the Loan Purchase Agreement and the Sale and Servicing Agreement, vests in the
Trust all interests which are purported to be conveyed thereby, free and clear
of any liens, security interests or encumbrances.
(y) Immediately prior to the transfer of the Receivables to
the Seller, the Representative's interest in the Receivables and the proceeds
thereof shall be perfected upon the filing of UCC-1 financing statements (the
"Financing Statements") in the offices specified in Schedule I and there shall
be no unreleased statements affecting the Receivables filed in such offices
other than the Financing Statements. If a court concludes that the transfer of
the Receivables from the Representative to the Seller is a sale, the interest of
the Seller in the Receivables and the proceeds thereof will be perfected upon
the filing of the Financing Statements in the office of the Secretary of State
of the State of Utah. If a court concludes that such transfer is not a sale, the
Loan Purchase Agreement and the transactions contemplated thereby constitute a
grant by the Representative to the Seller of a valid security interest in the
Receivables and the proceeds thereof, which security interest will be perfected
upon the filing of the Financing Statements in the office of the Secretary of
State of the State of Utah. No filing or other action, other than the filing of
the Financing Statements in the office of the Secretary of State of the State of
Utah referred to above, is necessary to perfect and maintain the interest or the
security interest of the Seller in the Receivables and the proceeds thereof
against third parties.
(z) Immediately prior to the transfer of the Receivables to
the Trust, the Seller's interest in the Receivables and the proceeds thereof
shall be perfected upon the filing of the Financing Statements and there shall
be no unreleased statements affecting the Receivables filed in such offices
other than the Financing Statements. If a court concludes that the transfer of
the Receivables from the Seller to the Trust is a sale, the interest of the
Trust in the Receivables and the proceeds thereof will be perfected upon the
filing of the Financing Statements in the office of the Secretary of State of
the State of [Utah]. If a court concludes that such transfer is not a sale, the
Sale and Servicing Agreement and the transactions contemplated thereby
constitute a grant by the Seller to the Trust of a valid security interest in
the Receivables and the proceeds thereof, which security interest will be
perfected upon the filing of the Financing Statements in the office of the
Secretary of State of the State of [Utah]. No filing or other action, other than
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the filing of the Financing Statements in the office of the Secretary of State
of the State of [Utah] referred to above, is necessary to perfect and maintain
the interest or the security interest of the Trust in the Receivables and the
proceeds thereof against third parties.
(aa) Neither the Trust Agreement nor the Indenture need be
qualified under the Trust Indenture Act of 1939, as amended and the Trust is not
required to register under the Investment Company Act of 1940, as amended.
(bb) As of the Closing Date, each of the respective
representations and warranties of the Seller and the Representative set forth in
the Basic Documents will be true and correct, and the Underwriter may rely on
such representations and warranties as if they were set forth herein in full.
(cc) In connection with the offering of the Notes in the State
of Florida, the Seller hereby certifies that it has complied with all provisions
of Section 5.17.075 of the Florida Securities and Investor Protection Act.
3. Purchase, Sale and Delivery of the Notes. On the basis of
the representations, warranties and agreements herein contained, but subject to
the terms and conditions herein set forth, the Seller agrees to cause the Trust
to sell to the Underwriter, and the Underwriter agrees, to purchase from the
Trust, the principal amount of each class of Notes set forth on Schedule II
hereto at a purchase price equal to "Price %" as specified on Schedule II
hereto.
The Seller will deliver the Notes to the Underwriter, against
payment of the purchase price to or upon the order of the Seller by wire
transfer or check in Federal (same day) Funds, at the office of [Stroock &
Stroock & Xxxxx LLP, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000], at 10:00 a.m.,
New York time on _________, 1998, or at such other time not later than seven
full business days thereafter as the Underwriter and the Seller determine, such
time being herein referred to as the "Closing Date." The Notes to be so
delivered will be initially represented by one or more Notes registered in the
name of Cede & Co., the nominee of The Depository Trust Company ("DTC"). The
interests of beneficial owners of the Notes will be represented by book entries
on the records of DTC and participating members thereof. Definitive Notes will
be available only under the limited circumstances specified in the Basic
Documents.
4. Offering by Underwriter. It is understood that, after the
Registration Statement becomes effective, the Underwriter proposes to offer the
Notes for sale to the public (which may include selected dealers), on the terms
set forth in the Prospectus.
5. Covenants of the Seller and the Representative. Each of the
Seller and the Representative, jointly and severally, covenants and agrees with
the Underwriter that:
(a) The Seller will file the Prospectus, properly completed,
with the Commission pursuant to and in accordance with subparagraph (2) (or, if
applicable and if consented to by the Underwriter, subparagraph (5)) of Rule
424(b) no later than the second business day following the earlier of the date
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of determination of the offering price or the date it is first used. The Seller
and the Representative will advise the Underwriter promptly of any such filing
pursuant to Rule 424(b). Subject to the Underwriter's compliance with its
obligations set forth in Section 7(h) hereof, the Seller shall file with the
Commission a current report on Form 8-K (the "Current Report") including any
Derived Information (as defined herein) provided to it by the Underwriter
pursuant to Section 7(h) hereof (i) no later than the date that the Prospectus
Supplement is filed with respect to "computational materials" and "structural
terms sheets" (as such terms are interpreted in the No-Action letters addressed
to Xxxxxx, Xxxxxxx Acceptance Corporation I, et al. and the Public Securities
Association dated May 20, 1994 and February 17, 1995, respectively
(collectively, the "PSA Letters")) or (ii) no later than two days following
their date of first use with respect to "collateral term sheets" (as such term
is interpreted in the PSA Letters).
(b) The Seller and the Representative will advise the
Underwriter promptly of any proposal to amend or supplement the Registration
Statement or the Prospectus and will not effect such amendment or
supplementation without the consent of the Underwriter, which consent shall not
be unreasonably withheld or delayed; and the Seller and the Representative will
advise the Underwriter promptly of any amendment or supplementation of the
Registration Statement or the Prospectus and of the institution by the
Commission of any stop order proceedings 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.
(c) If, at any time when a prospectus relating to the Notes is
required to be delivered by an Underwriter or dealer either (i) 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 in order to make the statements therein, in the light of the
circumstances under which they were made not misleading, or (ii) for any other
reason it shall be necessary to amend or supplement the Prospectus to comply
with the Act, the Seller and the Representative promptly will notify the
Underwriter of such event and promptly will prepare, at their own expense, an
amendment or supplement which will correct such statement or omission. Neither
the Underwriter's consent to, nor the Underwriter's distribution of any
amendment or supplement to the Prospectus shall constitute a waiver of any of
the conditions set forth in Section 6 hereof.
(d) The Seller and the Representative will furnish to the
Underwriter copies of any preliminary prospectus, the Prospectus, the
Registration Statement and all amendments and supplements to such documents, in
each case as soon as available and in such quantities as the Underwriter
reasonably requests.
(e) The Seller and the Representative will take all actions
which are reasonably necessary to arrange for the qualification of the Notes for
offering and sale under the laws of such jurisdictions as the Underwriter
designates and will continue such qualifications in effect so long as required
under such laws for the distribution of the Notes; provided, however, that in no
event shall the Seller be obligated to qualify as a foreign corporation or to
execute a general or unlimited consent to service of process in any such
jurisdiction.
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(f) The Seller and the Representative shall furnish or make
available to the Underwriter or its counsel such additional documents and
information regarding the Seller and the Representative and their respective
affairs as the Underwriter may from time to time reasonably request, including
any and all documentation reasonably requested in connection with its due
diligence efforts regarding information in the Registration Statement and the
Prospectus and in order to evidence the accuracy or completeness of any of the
conditions contained in this Underwriting Agreement; and all actions taken by
the Seller to authorize the sale of the Notes shall be reasonably satisfactory
in form and substance to the Underwriter.
(g) The Seller and the Representative shall, at all times upon
request of the Underwriter or its advisors, or both, from the date hereof
through the Closing Date, (i) make available to the Underwriter or its advisors,
or both, prior to acceptance of its purchase, such information (in addition to
that contained in the Registration Statement and the Prospectus) concerning the
offering, the Seller and any other relevant matters as they possess or can
acquire without unreasonable effort or expense and (ii) provide the Underwriter
or its advisors, or both, prior to acceptance of its subscription, the
opportunity to ask questions of, and receive answers from, the Seller and the
Representative with respect to such matters.
(h) The Seller and the Representative will cause the Trust to
make generally available to Noteholders, as soon as practicable, but no later
than sixteen months after the date hereof, an earnings statement of the Trust
covering a period of at least twelve consecutive months beginning after the
later of (i) the effective date of the registration statement relating to the
Notes and (ii) the effective date of the most recent post-effective amendment to
the Registration Statement to become effective prior to the date of this
Agreement and, in each case, satisfying the provisions of Section 11(a) of the
Act (including Rule 158 promulgated thereunder).
(i) Until the retirement of the Notes, the Seller will deliver
to the Underwriter the annual statements of compliance and the annual
independent certified public accountants' reports furnished to the Trustee
pursuant to the Basic Documents, as soon as such statements and reports are
furnished to the Trustee.
(j) So long as any of the Notes are outstanding, the Seller
will furnish to the Underwriter (i) as soon as practicable after the end of the
fiscal year all documents required to be distributed to Noteholders or filed
with the Commission on behalf of the Trust pursuant to the Exchange Act, or any
order of the Commission thereunder and (ii) from time to time, any other
information concerning the Seller or the Representative as the Underwriter may
reasonably request only insofar as such information reasonably relates to the
Registration Statement or the Prospectus or the transactions contemplated by the
Basic Documents.
(k) On or before the Closing Date, the Seller and the
Representative shall cause the computer records of the Seller and the
Representative relating to the Receivables to show the absolute ownership by the
Owner Trustee on behalf of the Trust of the Receivables, and from and after the
Closing Date neither the Seller nor the Representative shall take any action
inconsistent with the ownership by the Owner Trustee on behalf of the Trust of
such Receivables, other than as permitted by the Sale and Servicing Agreement.
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(l) To the extent, if any, that any of the ratings provided
with respect to the Notes by the rating agency or agencies that initially rate
any of the Notes are conditional upon the furnishing of documents or the taking
of any other actions by the Seller or the Representative on or prior to the
Closing Date none of the Seller and the Representative shall furnish such
documents and take any such other actions. A copy of any such document shall be
provided to the Underwriter at the time it is delivered to the rating agencies.
(m) The Representative will pay all expenses incident to the
performance of its obligations under this Agreement, including (i) the printing
and filing of the documents (including the Registration Statement and the
Prospectus), (ii) the preparation, issuance and delivery of the Notes to the
Underwriter, (iii) the fees and disbursements of the Representative's and the
Seller's counsel (including without limitation, local counsel in the State of
Utah) and accountants, (iv) the qualification of the Notes under state
securities laws, including filing fees and the fees and disbursements of counsel
for the Underwriter in connection therewith and in connection with the
preparation of any blue sky or legal investment survey, if any is requested, (v)
the printing and delivery to the Underwriter of copies of the Registration
Statement and the Prospectus and each amendment thereto, (vi) the fees and
expenses of the Underwriter and its counsel, (vii) any fees charged by rating
agencies for the rating of the Notes, (viii) the fees and expenses of the
Trustee and its counsel, (ix) the fees and expenses of the Owner Trustee and its
counsel, (x) the fees and expenses of the Note Insurer and its counsel and (xi)
the fees and expenses of [Xxxxxxxx, Xxxxxx & Finger].
6. Conditions of the Obligations of the Underwriter. The
obligations of the Underwriter to purchase and pay for the Notes will be subject
to the accuracy, as of the date hereof and as of the Closing Date, of the
representations and warranties on the part of the Seller and the Representative
herein, to the accuracy of the written statements of officers of the Seller and
the Representative made pursuant to the provisions of this Section, to the
performance by the Seller and the Representative of its obligations hereunder
and to the following additional conditions precedent:
(a) The Underwriter shall have received a letter, dated the
date hereof, of ______________, confirming that such accountants are independent
public accountants within the meaning of the Act and the Rules and Regulations,
and substantially in the form of the drafts to which the Underwriter has
previously agreed and otherwise in form and substance reasonably satisfactory to
the Underwriter and counsel for the Underwriter (i) regarding certain numerical
information contained in the Prospectus and (ii) relating to certain agreed-upon
procedures.
(b) The Prospectus shall have been filed with the Commission
in accordance with the Rules and Regulations and Section 5(a) hereof. On or
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 Seller or the
Representative, shall be contemplated by the Commission.
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(c) Subsequent to the execution and delivery of this
Agreement, there shall not have occurred (i) any change, or any development
involving a prospective change, in or affecting the Receivables or particularly
the business or properties of (x) the Trust, the Seller, the Representative or
the Guarantor or (y) the Note Insurer which, in the reasonable judgment of the
Underwriter, materially impairs the investment quality of the Notes; (ii) any
downgrading in the rating of (x) any [debt] securities of the Guarantor by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act), or any public announcement that any such
organization has under surveillance or review its rating of any such debt
securities (other than an announcement with positive implications of a possible
upgrading, and no implication of a possible downgrading, of such rating) or (y)
the claims-paying ability of the Note Insurer by any "nationally recognized
statistical rating organization" or if the claims-paying ability of the Note
Insurer has been put on the "watch list" of any such rating organization with
negative implications; (iii) any suspension or limitation of trading in
securities generally on the New York or American Stock Exchanges, or any setting
of minimum prices for trading on such exchange; (iv) any suspension of trading
of any securities of the Guarantor on any exchange, the NASDAQ National Market
or in the over-the-counter market; (v) any banking moratorium declared by
Federal, New York or Florida authorities; or (vi) any outbreak or escalation of
major hostilities in which the United States is involved, any declaration of war
by Congress, or any other substantial national or international calamity or
emergency if, in the judgment of a the Underwriter, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it impractical or
inadvisable to proceed with completion of the sale of and payment for the Notes.
(d) On the Closing Date, each of the Basic Documents and the
Securities shall have been duly authorized, executed and delivered by the
parties thereto, shall be in full force and effect and no default shall exist
thereunder, and the Owner Trustee shall have received a fully executed copy
thereof or, with respect to the Notes, a conformed copy thereof. The Basic
Documents and the Securities shall be substantially in the forms heretofore
provided to the Underwriter.
(e) The Underwriter shall have received an opinion of Xxxx,
Gotchal & Xxxxxx, special counsel to the Representative, the Seller and the
Guarantor, dated the Closing Date, satisfactory in form and substance to the
Underwriter, to the effect that:
(i) The Seller has been duly formed and is validly existing
as a limited liability company in good standing under the laws
of the state of its incorporation, with full corporate power
and authority to own its properties and conduct its business,
and is duly qualified to transact business and is in good
standing in each jurisdiction in which its failure to qualify
would have a material adverse effect upon the business or the
ownership of its property. Each of FCC Receivables Corp. and
the Guarantor has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the state of its incorporation, with full corporate power and
authority to own its properties and conduct its business, and
is duly qualified to transact business and is in good standing
in each jurisdiction in which its failure to qualify would
have a material adverse effect upon the business or the
ownership of its property.
11
(ii) This Agreement has been duly authorized, executed and
delivered by each of the Registrants. The Basic Documents to
which it is a party have been duly authorized, executed and
delivered by each of the Seller and the Guarantor.
(iii) The Seller has full power and authority to sell and
assign the property to be sold and assigned to the Trust by it
pursuant to the Sale and Servicing Agreement and has duly
authorized such sale and assignment to the Trust by all
necessary corporate action. The Guarantor has full power and
authority to enter into the Basic Documents to which it is a
party and has duly authorized entering into such documents by
all necessary corporate action.
(iv) Assuming that this Agreement and the Basic Documents
have been duly authorized, executed and delivered by the
Representative, this Agreement and the Basic Documents to
which each of the Representative, the Guarantor and the
Registrants is a party are the legal, valid and binding
obligation of the Representative, the Guarantor and the
Registrants, enforceable against the Representative, the
Guarantor and the Registrants in accordance with their terms,
subject as to enforceability to the effects of applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and similar laws now or hereafter in effect
relating to creditors' rights generally and subject to general
principles of equity (whether in a proceeding at law or in
equity).
(v) The Seller has duly authorized, executed and delivered
the written order to the Owner Trustee to execute and deliver
the Issuer Order to the Trustee.
(vi) The Seller has duly authorized, executed and delivered
the written order to the Owner Trustee to execute and deliver
the Certificates.
(vii) When the Notes have been executed, authenticated and
delivered in accordance with the Indenture and paid for
pursuant to this Agreement, the Notes will be validly issued
and outstanding and enforceable in accordance with their
terms, subject as to enforceability to the effects of
applicable bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium and similar laws now or hereafter in
effect relating to creditors' rights generally and subject to
general principles of equity (whether in a proceeding at law
or in equity).
(viii) Neither the transfer of certain of the Receivables by
the Seller to the Trustee on behalf of the Trust, nor the
assignment by the Seller of the Trust Estate to the Trust, nor
the grant by the Trust of the security interest in the
Collateral to the Owner Trustee pursuant to the Indenture, nor
the execution, delivery and performance by the Seller of the
Basic Documents to which it is a party, nor the consummation
by the Seller of the transactions contemplated thereby will
conflict with or result in a breach of any of the terms or
12
provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of the Seller, pursuant to the
terms of the formation documents of the Seller or any statute,
rule, regulation or order of any governmental agency or body,
or any court having jurisdiction over the Seller or its
properties, or any agreement or instrument known to me after
due investigation to which the Seller is a party or by which
the Seller or any of its properties is bound.
(ix) Neither the execution, delivery and performance by the
Guarantor of the Basic Documents to which it is a party, nor
the consummation by the Guarantor of the transactions
contemplated thereby will conflict with or result in a breach
of any of the terms or provisions of, or constitute a default
under, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the property or assets of
the Guarantor, pursuant to the terms of the certificate of
incorporation or the by-laws of the Guarantor or any statute,
rule, regulation or order of any governmental agency or body,
or any court having jurisdiction over the Guarantor or its
properties, or any agreement or instrument known to me after
due investigation to which the Seller is a party or by which
the Seller or any of its properties is bound.
(x) No authorization, license, approval, consent or order
of, or filing with, any court or governmental agency or
authority is necessary in connection with the execution,
delivery and performance of this Agreement and each of the
Basic Documents to which it is a party by the Representative,
the Seller or the Guarantor.
(xi) To the best of the knowledge of such counsel, there are
no legal or governmental proceedings pending to which the
Representative or the Seller is a party or of which any
property of the Representative, the Seller or the Guarantor is
the subject, and no such proceedings are known to such counsel
to be threatened or contemplated by governmental authorities
or threatened by others (i) asserting the invalidity of all or
any part of this Agreement or any of the Basic Documents or
(ii) that could materially adversely affect the ability of the
Representative, the Seller or the Guarantor to perform their
obligations under any of the Basic Documents to which either
is a party.
(xii) Such counsel is familiar with the Representative's
standard operating procedures relating to the acquisition of a
perfected first priority security interest in the vehicles
financed by the Representative pursuant to retail installment
sale contracts in the ordinary course of their business.
Assuming that these standard procedures are followed with
respect to the perfection of security interests in the
Financed Vehicles, the Representative has acquired or will
acquire a perfected first priority security interests in the
Financed Vehicles with respect to which it has originated
Receivables sold by it to the Seller.
13
(xiii) Immediately prior to the transfer of certain of the
Receivables by the Representative pursuant to the Loan
Purchase Agreement, the Representative was the sole owner of
all right, title and interest in the Receivables and the other
property transferred by it to the Seller. Immediately prior to
the transfer of certain of the Receivables by the Seller
pursuant to the Sale and Servicing Agreement, the Seller was
the sole owner of all right, title and interest in the
Receivables and the other property transferred by it to the
Trust.
(xiv) The Representative has all necessary licenses required
by law in connection with its performance as Servicer pursuant
to the Sale and Servicing Agreement.
(xv) To such counsel's knowledge, there are no material
legal or governmental proceedings pending or threatened
against the Representative, the Seller or the Guarantor other
than those disclosed in the Registration Statement and the
Prospectus.
(xvi) To the best of such counsel's knowledge, there are no
contracts or documents of the Registrants which are required
to be filed as exhibits to the Registration Statement pursuant
to the Act or the Rules or Regulations which have not been so
filed.
(xvii) The Registration Statement became effective under the
Act as of _______, 1998 and, to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement or any part thereof or any amendment
thereto has been issued under the Act and no proceeding for
that purpose has been instituted or threatened by the
Commission.
(xviii) The Seller is not, and will not as a result of the
offer and sale of the Notes as contemplated in the Prospectus
and this Agreement become, an "investment company" as defined
in the Investment Company Act of 1940, as amended (the
"Investment Company Act"), or a company "controlled by" an
"investment company" within the meaning of the Investment
Company Act.
(xix) Neither the Trust Agreement nor the Indenture need be
qualified under the Trust Indenture Act and the Trust is not
required to register under the Investment Company Act.
(xx) The statements in the Prospectus under the headings
"Summary of Terms -- Tax Status," "Certain Federal Income Tax
Consequences," "Federal Income Tax Consequences," "Summary of
Terms -- ERISA Considerations," and "ERISA Considerations," to
the extent that they constitute statements of matters of law
or legal conclusions with respect thereto, have been reviewed
by such counsel and accurately describe the material
consequences to holders of the Notes under the Code and ERISA.
14
(xxi) The documents incorporated by reference in the
Registration Statement and Prospectus, at the time they were
or hereafter are filed with the Commission, complied and will
comply in all material respects with the requirements of the
Exchange Act and the Rules and Regulations, except as to the
financial statements and other financial and statistical data
included therein, to which such counsel need not express any
opinion.
(xxii) The Registration Statement relating to the Notes as
of its effective date and the Prospectus as of the date of
this Agreement, and any amendment or supplement thereto, as of
its date, complied as to form in all material respects with
the requirements of the Act and the applicable Rules and
Regulations. Such counsel need express no opinion with respect
to the financial statements, the exhibits, annexes and other
financial, statistical, numerical or portfolio data, economic
conditions or financial condition of the portfolio information
included in or incorporated by reference into the Registration
Statement relating to the Notes, the Prospectus or any
amendment or supplement thereto.
(xxiii) Such counsel shall state that they have participated
in the preparation of the Registration Statement and the
Prospectus, and that no facts have come to their attention
which cause them to believe that the Registration Statement
relating to the Notes as of its effective date, and the
Prospectus, as of the date of this Agreement, and any
amendment or supplement thereto, as of its date when it became
effective, contained any untrue statement of a material fact
or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading or that the Prospectus on its date contained or on
the Closing Date contains, any untrue statement of a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading; provided that such counsel need not express any
view with respect to the financial, statistical or
computational material included in or incorporated by
reference into the Registration Statement relating to the
Notes, the Prospectus or any amendment or supplement thereto.
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Underwriter. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the federal law of the United States of America and the
laws of the State of New York.
[(f) The Underwriter shall have received the opinion of Xxxx,
Gotchal & Xxxxxx, special counsel to the Trust, dated the Closing Date,
satisfactory in form and substance to the Underwriter and counsel for the
Underwriter, regarding the creation, attachment and perfection of a first
priority security interest in the Receivables and the property held in the
Spread Account in favor of the Trustee on behalf of the Noteholders. Such
15
opinion may contain such assumptions, qualifications and limitations as are
customary in opinions of this type and are reasonably acceptable to counsel to
the Underwriter. In rendering such opinion, such counsel may state that they
express no opinion as to the laws of any jurisdiction other than the federal law
of the United States of America and the laws of the State of New York. To the
extent any portion of such opinion is governed by the laws of the State of
Delaware, such opinion will be given by Xxxxxxxx, Xxxxxx & Xxxxxx. To the extent
any portion of such opinion is governed by the laws of the State of Utah, such
opinion will be given by ______________.]
(g) The Underwriter shall have received the opinion of
Xxxxxxxxx, Xxxxxxx & XxXxxxxxxx, counsel to the Representative or such other
counsel acceptable to the Underwriter and counsel for the Underwriter, dated the
Closing Date, satisfactory in form and substance to the Underwriter and counsel
for the Underwriter to the effect that:
(i) The Representative has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the state of its incorporation, with full corporate
power and authority to own its properties and conduct its
business, and is duly qualified to transact business and is in
good standing in each jurisdiction in which its failure to
qualify would have a material adverse effect upon the business
or the ownership of its property.
(ii) The Representative has full power and authority to sell
and assign the property to be sold and assigned to the Seller
by it pursuant to the Loan Purchase Agreement and has duly
authorized such sale and assignment to the Trust by all
necessary corporate action.
(iii) This Agreement and each of the Basic Documents to
which it is a party have been duly authorized, executed and
delivered by the Representative.
(iv) Neither the transfer of the Receivables by the
Representative to the Seller or the Seller to the Trustee on
behalf of the Trust, nor the assignment by the Seller of the
Trust Estate to the Trust, nor the grant by the Trust of the
security interest in the Collateral to the Trustee pursuant to
the Indenture, nor the execution, delivery and performance by
the Registrants or the Representative of this Agreement and
the Basic Documents to which it is a party, nor the
consummation of the transactions contemplated thereby will
conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of the Representative, pursuant
to the terms of the certificate of incorporation or the
by-laws of the Representative or any statute, rule, regulation
or order of any governmental agency or body, or any court
having jurisdiction over the Representative or the Seller or
their properties, or any agreement or instrument known to me
after due investigation to which the Representative is a party
or by which the Representative or any of its properties is
bound.
16
(v) The statements in the Prospectus under the headings
"Summary of Terms -- State Tax Considerations " and "State Tax
Considerations," to the extent that they constitute statements
of matters of law or legal conclusions with respect thereto,
have been reviewed by such counsel and accurately describe the
material consequences to holders of the Notes under Utah law.
(vi) Such counsel shall deliver an opinion regarding Utah
state tax consequences in form and substance reasonably
acceptable to the Underwriter and counsel to the Underwriter.
(vii) The Receivables conveyed by the Representative to the
Seller are chattel paper as defined in the Uniform Commercial
Code as in effect in the State of Utah.
(viii) If the transfer of Receivables from the
Representative to the Seller is considered a sale, such sale
will be perfected upon the filing of financing statements with
the Secretary of State of the State of Utah and ______ County,
Utah. If the transfer of Receivables from the Representative
to the Seller is considered a financing, such financing will
create a first priority perfected interest upon the filing of
financing statements with the Secretary of State of the State
of Utah and _____ County, Utah.
(ix) The Receivables conveyed by the Seller to the Trust are
chattel paper as defined in the Uniform Commercial Code as in
effect in the State of Utah.
(x) If the transfer of Receivables from the Seller to the
Trust is considered a sale, such sale will be perfected upon
the filing of financing statements with the Secretary of State
of the State of Utah and _____ County, Utah. If the transfer
of Receivables from the Seller to the Trust is considered a
financing, such financing will create a first priority
perfected interest upon the filing of financing statements
with the Secretary of State of the State of Utah and _____
County, Utah.
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Underwriter. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the federal law of the United States of America and the
laws of the State of New York.
(h) The Underwriter shall have received an opinion addressed
to it of Xxxx Xxxxxxx & Xxxxxx, in its capacity as counsel to the Seller, dated
the Closing Date, with respect to (i) the consolidation of the assets and
liabilities of the Seller with those of the Representative under the doctrine of
substantive consolidation, (ii) the creation of (x) a "true sale" with respect
to the transfers of the Receivables from the Representative to the Seller and
the Seller to the Trust and (y) with respect to the transfer of the Receivables
to the Trust, a valid and binding first priority security interest in the
Receivables and (iii) such other related matters as the Underwriter shall
reasonably require and the Seller shall have furnished or caused to be furnished
17
to such counsel such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters. Such opinions shall be limited to the
laws of the State of New York and United States federal law.
(i) The Underwriter shall have received an opinion of
__________, counsel to the Trustee, dated the Closing Date and satisfactory in
form and substance to the Underwriter and counsel for the Underwriter, to the
effect that:
(i) The Trustee has been duly organized as a ___________ and
is validly existing as a ________ in good standing under the
laws of the __________.
(ii) The Trustee has the requisite power and authority to
execute, deliver and perform its obligations under the
Indenture and has taken all necessary action to authorize the
execution, delivery and performance by it of the Indenture.
(iii) The Indenture has been duly executed and delivered by
the Trustee and constitutes a legal, valid and binding
obligation of the Trustee, enforceable against the Trustee in
accordance with its respective terms, except that such
enforcement may be limited by bankruptcy, insolvency,
reorganization, moratorium, or other similar laws affecting
the enforcement of creditors' rights generally, and by general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
(iv) The Notes have been duly authenticated by the Trustee
in accordance with the terms of the Indenture.
[(v) Assuming a valid security exists in the property held
in the Spread Account in favor of the Trustee, on behalf of
the Noteholders, such security interest is perfected.]
(j) The Underwriter shall have received an opinion of
___________, counsel to the Owner Trustee, dated the Closing Date and
satisfactory in form and substance to the Underwriter and counsel for the
Underwriter, to the effect that:
(i) The Owner Trustee is a _________ duly incorporated and
organized and validly existing under the laws of the ________.
(ii) The Owner Trustee has the full corporate trust power to
accept the office of owner trustee under the Trust Agreement
and to enter into and perform its obligations under the Trust
Agreement, the Indenture and the Sale and Servicing Agreement.
(iii) The execution and delivery of the Trust Agreement, the
Indenture and the Sale and Servicing Agreement, and the
performance by the Owner Trustee of its obligations under the
Trust Agreement, the Sale and Servicing Agreement and the
Indenture have been duly authorized by all necessary action of
the Owner Trustee and each has been duly executed and
delivered by the Owner Trustee.
18
(iv) The Trust Agreement constitutes the valid and binding
obligations of the Owner Trustee enforceable against the Owner
Trustee in accordance with its terms.
(v) The execution and delivery by the Owner Trustee of the
Trust Agreement, the Indenture and the Sale and Servicing
Agreement do not require any consent, approval or
authorization of, or any registration or filing with, any
applicable governmental authority.
(vi) Each of the Notes and Certificates has been duly
executed and delivered by the Owner Trustee, on behalf of the
Trust.
(vii) Neither the consummation by the Owner Trustee of the
transactions contemplated in the Sale and Servicing Agreement,
the Indenture or the Trust Agreement nor the fulfillment of
the terms thereof by the Owner Trustee will conflict with,
result in a breach or violation of, or constitute a default
under any law of the United States of America or the State of
New York governing its banking or trust powers or the charter,
by-laws or other organizational documents of the Owner
Trustee.
(viii) 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 Owner Trustee is required
in connection with the execution and delivery by the Owner
Trustee of the Trust Agreement, the Indenture or the Sale and
Servicing Agreement.
(k) The Underwriter shall have received an opinion of
[Xxxxxxxx, Xxxxxx & Finger], special Delaware counsel for the Trust, dated the
Closing Date, satisfactory in form and substance to the Underwriter and counsel
for the Underwriter, to the effect that:
(i) The Trust Agreement constitutes the valid and binding
obligation of the Owner Trustee and the Seller enforceable
against the Owner Trustee and the Seller in accordance with
its terms subject to (i) applicable bankruptcy, insolvency,
moratorium, receivership, reorganization, fraudulent
conveyance and similar laws relating to and affecting the
rights and remedies of creditors generally, and (ii)
principles of equity (regardless of whether considered and
applied in a proceeding in equity or at law).
(ii) The Indenture and the Sale and Servicing Agreement
constitute the valid and binding obligations of the Trust
enforceable against the Trust in accordance with their terms.
19
(iii) The Certificate of Trust has been duly filed with the
Secretary of State. The Trust has been duly formed and is
validly existing as a business trust under the Delaware
Business Trust Act. The Trust has the power and authority
under the Trust Agreement and the Act to execute and deliver
the Indenture and the Sale and Servicing Agreement, to issue
the Notes and the Certificates and to pledge the Trust Estate
to the Trustee as security for the Notes.
(iv) Assuming that the Certificates have been duly executed
and issued by the Trust and duly authenticated by the Owner
Trustee in accordance with the Trust Agreement and delivered
to and paid for pursuant to the Initial Purchaser Agreement,
the Certificates have been validly issued and are entitled to
the benefits of the Trust Agreement.
(v) To the extent that Article 9 of the Uniform Commercial
Code as in effect in the State of Delaware (the "Delaware
UCC") is applicable (without regard to conflicts of laws
principles), and assuming that the security interest created
by the Indenture in the Receivables has been duly created and
has attached, upon the filing of a UCC-1 financing statement
with the Secretary of State of the State of Delaware the
Trustee will have a perfected security interest in such
Receivables and the proceeds thereof, and such security
interest will be prior to any other security interest that is
perfected solely by the filing of financing statements under
the Delaware UCC, excluding purchase money security interests
under ss. 9-312(4) of the UCC and temporarily perfected
security interests in proceeds under ss. 9-306(3) of the
Delaware UCC.
(vi) No re-filing or other action is necessary under the
Delaware UCC in order to maintain the perfection of such
security interest except for the filing of continuation
statements at five year intervals.
(vii) Under ss. 3805(b) of the Business Trust Act, no
creditor of any Certificateholder shall have any right to
obtain possession of, or otherwise exercise legal or equitable
remedies with respect to, the property of the Trust except in
accordance with the terms of the Trust Agreement.
(viii) Under ss. 3805(c) of the Business Trust Act, and
assuming that the Sale and Servicing Agreement conveys good
title to the Receivables to the Trust as a true sale and not
as a security arrangement, the Trust rather than the
Certificateholders is the owner of the Receivables.
(ix) The execution and delivery by the Owner Trustee of the
Trust Agreement and, on behalf of the Trust, the Indenture and
the Sale and Servicing Agreement do not require any consent,
approval or authorization of, or any registration or filing
with, any governmental authority of the State of Delaware,
except for the filing of the Certificate of Trust with the
Secretary of State.
20
(x) Neither the consummation by the Owner Trustee of the
transactions contemplated in the Trust Agreement or, on behalf
of the Trust, the transactions contemplated in the Indenture
and the Sale and Servicing Agreement nor the fulfillment of
the terms thereof by the Owner Trustee will conflict with or
result in a breach or violation of any law of the State of
Delaware.
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Initial Purchaser. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the federal law of the United States of America and the
laws of the State of Delaware.
(l) The Note Policy shall have been duly executed and issued
at or prior to the Closing Date and shall conform in all material respects to
the description thereof in the Prospectus.
(m) The Underwriter shall have received an opinion of
__________________, counsel for the Note Insurer, dated the Closing Date,
satisfactory in form and substance to the Underwriter and counsel for the
Underwriter, to the effect that:
(i) The Note Insurer is a stock insurance company duly
organized, validly existing and authorized to transact
financial guaranty insurance business under the laws of the
State of New York. The Note Insurer is validly licensed and
authorized to issue the Note Policy and perform its
obligations under the Note Policy in accordance with the terms
thereof, under the laws of the State of New York.
(ii) The Note Policy, the Indemnification Agreement and the
Insurance and Indemnity Agreement have been duly authorized,
executed and delivered by the Note Insurer.
(iii) The Note Policy, the Indemnification Agreement and the
Insurance and Indemnity Agreement constitute valid and binding
obligations of the Note Insurer, enforceable against the Note
Insurer in accordance with their terms, subject, as to the
enforcement of remedies, to bankruptcy, insolvency,
reorganization, rehabilitation, moratorium and other similar
laws affecting the enforceability of creditors' rights
generally applicable in the event of the bankruptcy or
insolvency of the Note Insurer and to the application of
general principles of equity and subject, in the case of the
Indemnification Agreement, to principles of public policy
limiting the right to enforce the indemnification provisions
contained therein insofar as such provisions relate to
indemnification for liabilities arising under the securities
law.
(iv) The Note Policy is exempt from registration under the
Securities Act.
21
(v) Neither the execution nor the delivery by the Note
Insurer of the Note Policy, the Indemnification Agreement or
the Insurance and Indemnity Agreement, nor the performance by
it of its obligations thereunder, will conflict with any
provision of the certificate of incorporation or the by-laws
of the Note Insurer or, to the best of such counsel's
knowledge, result in a breach of, or constitute a default
under, any agreement or other instrument to which the Note
Insurer is a party or by which it or any of its property is
bound or, to the best of such counsel's knowledge, violate any
judgment, order or decree applicable to the Note Insurer of
any governmental or regulatory body, administrative agency,
court or arbitrator having jurisdiction over the Note Insurer
(except that in the published opinion of the Securities and
Exchange Commission the indemnification provisions of the
Indemnification Agreement, insofar as they relate to
indemnification for liabilities arising under the Securities
Act, are against public policy as expressed in the Securities
Act and are therefore unenforceable).
(vi) The statements set forth in the Prospectus as of the
date thereof and as of the Closing Date under the captions
"______" (other than the financial statements and other
financial and statistical data contained or incorporated
therein, as to which such counsel need express no opinion) is
correct and true in all material respects.
In rendering this opinion, such counsel may rely, as to
matters of fact, on certificates of responsible officers of the Seller, the
Representative, the Trustee, the Note Insurer and public officials. Such opinion
may assume the due authorization, execution and delivery of the instruments and
documents referred to therein by the parties thereto other than the Note
Insurer.
(n) On or prior to the Closing Date there shall not have
occurred any downgrading, nor shall any notice have been given of (A) any
intended or potential downgrading or (B) any review or possible change in rating
the direction of which has not been indicated, in the rating accorded the Note
Insurer's claims paying ability by any "nationally recognized statistical rating
organization."
(o) The Representative shall have received from the Insurer a
certificate, signed by the President, a senior vice president or a vice
president of the Insurer, dated the Closing Date, to the effect that the signer
of such certificate has carefully examined the Policy and the related documents
and that, to the best of his or her knowledge based on reasonable investigation:
(i) The information in the Prospectus Supplement as of the
date hereof under the caption "______________" (the "Note
Insurer Information") is true and correct in all material
respects and does not contain any untrue statement of a fact
that is material to the Note Insurer's ability to perform its
obligations under the Note Policy. There has been no material
adverse change in the financial condition of the Insurer since
____________.
22
(ii) There are no actions, suits, proceedings or
investigations pending or, to the best of the Note Insurer's
knowledge, threatened against it at law or in equity or before
or by any court, governmental agency, board or commission or
any arbitrator which, if decided adversely, would materially
and adversely affect its condition (financial or otherwise) or
operations of it or would materially and adversely affect its
ability to perform its obligations under the Note Policy or
the Insurance Agreement.
(iii) The execution and delivery of the Insurance Agreement,
the Indemnification Agreement and the Note Policy and the
compliance with the terms and provisions thereof will not
conflict with, result in a breach of, or constitute a default
under any of the terms, provisions or conditions of, the
Restated Charter or By-Laws of the Note Insurer, or any
agreement, indenture or other instrument to which the Note
Insurer is a party;
(iv) The issuance of the Note Policy and the execution,
delivery and performance of the Indemnification Agreement and
the Insurance Agreement have been duly authorized by all
necessary corporate proceedings. No further approvals or
filings of any kind, including, without limitation, any
further approvals of or further filing with any governmental
agency or other governmental authority, or any approval of the
Note Insurer's board of directors or stockholders, are
necessary for the Note Policy, the Indemnification Agreement
and the Insurance Agreement to constitute the legal, valid and
binding obligations of the Note Insurer.
(p) The Underwriter shall have received copies of each opinion
of counsel delivered to either rating agency or the Note Insurer, together with
a letter addressed to the Underwriter, dated the Closing Date, to the effect
that the Underwriter may rely on each such opinion to the same extent as though
such opinion was addressed to each as of its date.
(q) The Underwriter shall have received a certificate dated
the Closing Date of the Seller, executed by any two of the Chairman of the
Board, the President, any Executive Vice President, Senior Vice President or
Vice President, the Treasurer, any Assistant Treasurer, the Secretary, the
principal financial officer or the principal accounting officer of the Seller,
in which such officer shall state that, to the best of its knowledge after
reasonable investigation, (i) the representations and warranties of the Seller,
contained in this Agreement and the Basic Documents to which it is a party are
true and correct in all material respects, (ii) that the Seller, has complied
with all agreements and satisfied all conditions on its part to be performed or
satisfied under such agreements at or prior to the Closing Date, and (iii) since
the date of its incorporation, except as may be disclosed in the Prospectus or
in such certificate, no material adverse change, or any development involving a
prospective material adverse change, in or affecting particularly the business
or properties of the Trust, the Representative or the Seller, has occurred.
23
(r) The Underwriter shall have received a certificate dated
the Closing Date of the Representative, executed by any two of the Chairman of
the Board, the President, any Executive Vice President, Senior Vice President or
Vice President, the Treasurer, any Assistant Treasurer, the Secretary, the
principal financial officer or the principal accounting officer of the
Representative in which such officer shall state that, to the best of its
knowledge after reasonable investigation, (i) the representations and warranties
of the Representative contained in this Agreement, the Loan Purchase Agreement
and the Sale and Servicing Agreement are true and correct in all material
respects, (ii) that the Representative has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied under such
agreements at or prior to Closing Date the and (iii) since December 31, 1997,
except as may be disclosed in the Prospectus or in such certificate, no material
adverse change, or any development involving a prospective material adverse
change, in or affecting particularly the business or properties of the Trust,
the Representative or the Seller, has occurred.
(s) The Underwriter shall have received evidence satisfactory
to it and counsel for the Underwriter that, on or before the Closing Date, UCC-1
financing statements shall have been submitted to the Owner Trustee or Trustee,
as the case may be, for filing in the appropriate filing offices reflecting (1)
the transfer of the interest in the Receivables, certain other property and the
proceeds thereof (A) from the representative to the Seller and (B) from the
Seller to the Trust, and (2) the grant of the security interest by the Trust in
the Receivables, certain other property and the proceeds thereof to the Trustee.
(t) The Class A-1 Notes shall be rated in the highest short
term rating category, and the Class A-2 Notes shall be rated at least "AAA" or
its equivalent, in each case by Xxxxx'x and S&P and neither corporation shall
have placed the Notes under surveillance or review with possible negative
implications.
The Seller will provide or cause to be provided to the
Underwriter such conformed copies of such of the foregoing opinions,
certificates, letters and documents as the Underwriter shall reasonably request.
7. Indemnification and Contribution.
(a) The Seller and the Representative, jointly and severally,
agree to indemnify and hold harmless the Underwriter against any and all losses,
claims, damages or liabilities, joint or several, or any action in respect
thereof (including but not limited to, any loss, claim, damage or liability (or
action relating to purchases and sales of the Notes)), to which the Underwriter
may become subject, under the Act, the Exchange 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 or incorporated in the Registration Statement,
the Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, 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
in which they were made, not misleading, and will reimburse the Underwriter for
24
any legal or other expenses reasonably incurred by the Underwriter in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred; provided, however, that neither the Seller
nor the Representative shall 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 Underwriter's
Information or the Derived Information.
(b) The Underwriter severally agrees to indemnify and hold
harmless the Seller and the Representative against any losses, claims, damages
or liabilities to which the Seller or the Representative may become subject,
under the Act, the Exchange 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 or incorporated in the Registration Statement, the Prospectus, or any
amendment or supplement thereto or any related preliminary prospectus, 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
such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with the Underwriter's
Information, and will reimburse any legal or other expenses reasonably incurred
by the Representative or the Seller 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 or (e) below, notify the indemnifying party of
the commencement thereof; but the omission to so notify the indemnifying party
will not relieve it from any liability which it may have to any indemnified
party under subsection (a) or (b) above or (e) below, except to the extent it
has been materially prejudiced by such failure and, provided further, that the
failure to notify any indemnifying party shall not relieve it from any liability
which it may have to any indemnified party otherwise that under this Section. 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 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,
except to the extent provided in the next following paragraph, 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.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
25
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel; or (iii) the
indemnifying party has failed to assume the defense of such action and employ
counsel reasonable satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties, which
firm shall be designated in writing by the Underwriter, if the indemnified
parties under this Section 7 consist of the Underwriter, or by the Seller and
the Representative, if the indemnified parties under this Section 7 consist of
the Seller and the Representative.
Each indemnified party, as a condition of the indemnity agreements
contained in Section 7 (a), (b) and (e) hereof, shall use its best efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.
(d) The Underwriter agrees to provide the Seller with a copy
of any Derived Information (as defined in Section 7(h) below) no later than the
date preceding the date such Derived Information is required to be filed with
the Commission on a Current Report pursuant to the PSA Letters.
(e) The Underwriter agrees, assuming all
Representative-Provided Information is accurate and complete in all material
respects, to indemnify and hold harmless the Seller and the Representative
against any losses, claims, damages or liabilities to which the Seller or the
Representative may become subject, under the Act, the Exchange 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 any material
fact contained in the Derived Information, 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, in the light of the
circumstances under which they were made, not misleading, and will reimburse any
legal or other expenses reasonably incurred by the Representative or the Seller
in connection with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred.
(f) If the indemnification provided for in this Section is
unavailable or insufficient to hold harmless the indemnified party under
26
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
the Seller and the Representative on the one hand and the Underwriter 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 or if the indemnified party
failed to give the notice required under subsection (c) above, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Seller or the
Representative on the one hand and the Underwriter 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 the Seller and the Representative on the one hand
and the Underwriter on the other shall be deemed to be in such proportion that
the Underwriter shall be responsible for that portion represented by the
underwriting discounts and commissions received by the Underwriter (the
"Spread"); and the Seller and the Representative shall be responsible for the
balance. 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 the Seller or the Representative or the Underwriter and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The Seller, the Representative and
the Underwriter agree that it would not be just and equitable if contributions
pursuant to this subsection (f) were to be determined by pro rata allocation or
by any other method of allocation which does not take into account the equitable
considerations referred to herein.
The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (f) shall be deemed to include any legal or 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 (f). Notwithstanding
the provisions of this subsection (f), in no case shall the Underwriter (except
(x) with respect to any Derived Information incorporated by reference into the
Registration Statement or Prospectus at the request of the Underwriter (i) which
had not been approved by the Seller for use by the Underwriter or (ii) for which
the Seller have not received a letter from _________________ in form and
substance satisfactory to them be responsible for any amount (not including the
fees and expenses of its counsel) in excess of the Spread received by the
Underwriter, as set forth on the cover page of the Prospectus. 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.
(g) The obligations of the Seller and the Representative under
this Section shall be in addition to any liability which the Seller and the
Representative may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls the Underwriter within the
meaning of the Act or the Exchange Act. The obligations of the Underwriter shall
be in addition to any liability which the Underwriter may otherwise have and
shall extend, upon the same terms and conditions, to each director of the
Seller, and each of its officers that signed the Registration Statement.
27
(h) For purposes of this Section 7, the term "Derived
Information" means such portion, if any, of the information delivered to the
Seller by the Underwriter pursuant to subsection (d) hereof for filing with the
Commission in the Current Report as:
(i) is not contained in the Prospectus without taking into
account information incorporated therein by reference;
(ii) does not constitute Representative-Provided Information
(as defined below); and
(iii) is of the type of information defined as
"computational materials," "structural term sheets" or
"collateral term sheets" (as such terms are interpreted in
the PSA Letters).
"Representative-Provided Information" means any computer tape furnished to the
Underwriter by the Representative concerning the assets comprising the Trust.
(i) The Underwriter confirms that the information set forth in
the last paragraph on the cover page of the Prospectus and in the _____
paragraph under the caption "Underwriting" in the Prospectus (together, the
"Underwriter's Information") is correct, and together with the Derived
Information, constitutes the only information furnished in writing to the Seller
by or on behalf of the Underwriter specifically for inclusion in the
Registration Statement and the Prospectus.
(j) (i) The Underwriter represents and warrants to, and
covenants with, the Seller and the Representative that all Derived Information
provided to the Seller pursuant to this Section 7, as of the date such
information is so provided and as of the date such information is filed by the
Seller with the Commission will not include any untrue statement of a material
fact, when considered in conjunction with the Prospectus, and will not omit to
state any material fact necessary, when considered in conjunction with the
Prospectus, to make the statements contained therein, in the light of the
circumstances under which they were made, not misleading.
(ii) The Underwriter further covenants with the Seller that
if any Derived Information required to be provided to the
Seller pursuant to subsection (d) above is determined to
contain any information that is inaccurate or misleading, the
Underwriter (whether or not such Derived Information was
provided to the Seller or filed by the Seller with the
Commission) shall promptly prepare and deliver to the Seller
and each prospective investor which received such Derived
Information corrected Derived Information. All information
provided to the Seller pursuant to this Section 7(i) shall be
provided within the time periods set forth in subsection (d)
above.
(iii) The Underwriter covenants with the Seller that all
Derived Information delivered by it to prospective investors
shall contain a legend satisfactory in substance to the
Seller.
28
8. Survival of Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Seller or its officers and of the Underwriter set forth in or made pursuant to
this Agreement or contained in certificates of officers of the Seller submitted
pursuant hereto shall remain operative and in full force and effect, regardless
of any investigation or statement as to the results thereof, made by or on
behalf of the Underwriter, the Seller or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Notes. If for any reason the purchase of
the Notes by the Underwriter is not consummated, the Representative shall remain
responsible for the expenses to be paid or reimbursed by the Representative
pursuant to Section 5(l) and the respective obligations of the Seller, the
Representative and the Underwriter pursuant to Section 7 shall remain in effect.
If for any reason the purchase of the Notes by the Underwriter is not
consummated (other than because of a failure to satisfy the conditions set forth
in items (i)(y), (ii)(y), (iii), (v) and (vi) of Section 6(c)), the
Representative will reimburse the Underwriter for all out-of-pocket expenses
reasonably incurred by it in connection with the offering of the Notes.
9. Notices. Any written request, demand, authorization,
direction, notice, consent or waiver shall be personally delivered or mailed
certified mail, return receipt requested (or in the form of telex or facsimile
notice, followed by written notice as aforesaid) and shall be deemed to have
been duly given upon receipt, if sent to the Underwriter, when delivered to the
Underwriter at 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxx
Xxxxxxxxx (fax # (000) 000-0000), if sent to the Representative when delivered
to 00 Xxxx 000 Xxxxx, Xxxxx 000, Xxxx Xxxx Xxxx, XX 00000, Attention: _________
(Fax # (000) 000-0000) and if sent to the Seller when delivered to 00 Xxxx 000
Xxxxx, Xxxxx 000, Xxxx Xxxx Xxxx, XX 00000, Attention: _________ (Fax # (801)
_________).
10. Successors. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 7, and no
other person will have any right or obligations hereunder.
11. 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.
12. Applicable Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without regard
to the choice of law provisions thereof.
29
If the foregoing is in accordance with your understanding of
our agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement among the Registrants, the
Representative and the Underwriter in accordance with its terms.
Very truly yours,
FRANKLIN RECEIVABLES LLC
By:__________________________
Name:
Title:
FCC RECEIVABLES CORP.
By:__________________________
Name:
Title:
FRANKLIN CAPITAL CORPORATION
By:__________________________
Name:
Title:
The foregoing Underwriting Agreement
is hereby confirmed and accepted as of the
date first written above.
XXXXXXX, XXXXX AND CO.
By:____________________________
30
SCHEDULE I
OFFICES
SCHEDULE II
Original
Principal Investor Investor
Security Balance $ Price % Price $ Price % Price $ Rate %
-------- --------- ------- ------- ------- ------- ------
Class A-1 Notes
Class A-2 Notes
Class A-3 Notes
Class A-4 Notes
Class A-5 Notes
Total Price to Public: $
Total Price to Seller:
Underwriting Discounts
and Commissions: $
2
EXHIBIT A
________, 1998
Xxxxxxx, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Underwriting Agreement for Franklin Auto Trust 1998-1, dated _____,
1998 the "Underwriting Agreement") among FCC Receivables Corp., Franklin
Receivables LLC, Franklin Capital Corporation ("Franklin Capital") and Xxxxxxx,
Xxxxx & Co. (the "Underwriter").
Ladies and Gentlemen:
Pursuant to the Underwriting Agreement, Franklin Capital has undertaken
certain financial obligations with respect to the indemnification of the
Underwriter with respect to the Registration Statement, and the Prospectus
described in the Underwriting Agreement. Any financial obligations of Franklin
Capital under the Underwriting Agreement, whether or not specifically enumerated
in this paragraph, are hereinafter referred to as the "Joint and Several
Obligations;" provided, however, that "Joint and Several Obligations" shall mean
only the financial obligations of Franklin Capital under the Underwriting
Agreement (including the payment of money damages for a breach of any of
Franklin Capital's obligations under the Underwriting Agreement, whether
financial or otherwise) but shall not include any obligations not relating to
the payment of money.
As a condition of its execution of the Underwriting Agreement, the
Underwriter has required the undersigned, Franklin Resources, Inc. (the
"Guarantor"), the parent corporation of Franklin Capital, to acknowledge its
joint and several liability with Franklin Capital for the payment of the Joint
and Several Obligations under the Underwriting Agreement.
Now, therefore, the Underwriter and the Guarantor do hereby agree that:
1. The Guarantor hereby agrees to be absolutely and unconditionally jointly and
severally liable with Franklin Capital to the Underwriter for the payment of the
Joint and Several Obligations under the Underwriting Agreement.
2. The Guarantor may honor its obligations hereunder either by direct payment of
any Joint and Several Obligations or by causing any Joint and Several
Obligations to be paid to the Underwriter by Franklin Capital or another
affiliate of the Guarantor.
Capitalized terms used herein and not defined herein shall have their
respective meanings as set forth in the Underwriting Agreement.
Very truly yours,
FRANKLIN RESOURCES, INC.
By:_____________________
Name:
Title:
XXXXXXX, XXXXX & CO.
By:______________________
Name:
Title:
2
