EXHIBIT 1.2
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PROVIDIAN FINANCIAL CORPORATION
EQUITY SECURITIES
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UNDERWRITING AGREEMENT
STANDARD PROVISIONS
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PROVIDIAN FINANCIAL CORPORATION
EQUITY SECURITIES
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UNDERWRITING AGREEMENT STANDARD PROVISIONS
From time to time, Providian Financial Corporation, a Delaware
corporation ("Providian"), may enter into one or more underwriting agreements
that provide for the sale of certain equity securities (the "Securities"), to
the purchaser or purchasers named therein (the "Underwriters"). The standard
provisions set forth herein may be incorporated by reference in any such
underwriting agreement (the "Underwriting Agreement"). The Underwriting
Agreement, including the provisions incorporated therein by reference, is herein
referred to as "this Agreement." Unless otherwise defined herein, terms defined
in the Underwriting Agreement are used herein as therein defined. Capitalized
terms not otherwise defined in this Agreement shall have the meaning ascribed
thereto in the Indenture (as hereinafter defined).
The terms governing of the issuance and sale of any particular series
of Securities shall be as provided in the applicable Underwriting Agreement
(with respect to each Underwriting Agreement, such series of Securities are
herein referred to as the "Designated Securities").
1. ISSUANCE OF DESIGNATED SECURITIES. Sales of the Designated
Securities may be made from time to time to the Underwriters of the Designated
Securities. Any firm or firms designated as the representative or
representatives, as the case may be, of the Underwriters of the Designated
Securities in the Underwriting Agreement relating thereto will act as the
representative or representatives (the "Representative"). The obligation of
Providian to issue and sell any of the Designated Securities and the obligation
of any Underwriters to purchase any of the Designated Securities shall be
evidenced by the Underwriting Agreement with respect to the Designated
Securities specified therein. Each Underwriting Agreement shall specify the
aggregate principal amount of the Designated Securities, the public offering
price of the Designated Securities, the purchase price to the Underwriters of
the Designated Securities, the names of the Underwriters of the Designated
Securities, the name of the Representative, if any, of such Underwriters, and
the principal amount of the Designated Securities to be purchased by each
Underwriter and shall set forth the date, time and manner of delivery of the
Designated Securities and payment therefor. The Underwriting Agreement shall
also specify, to the extent not set forth in the Registration Statement and
Prospectus (as hereinafter defined) with respect thereto, the general terms of
the Designated Securities. An Underwriting Agreement shall be in writing (which
may be in counterparts), and may be evidenced by an exchange of facsimile
transmissions. The obligations of the Underwriters under each Underwriting
Agreement shall be several and not joint.
2. REPRESENTATIONS AND COVENANTS. Providian represents to, and
covenants with, each Underwriter that:
(a) Providian meets the requirements for the use of Form S-3 and a
registration statement on Form S-3 (Registration No. 333-_____), including a
prospectus, relating to the Securities of Providian has been filed with the
Securities and Exchange Commission (the "Commission") in accordance with
applicable regulations of the Commission under the Securities Act of 1933, as
amended (the "Act"), and has been declared effective under the Act. Such
registration statement, as amended to the date of this Agreement, is hereinafter
referred to as the "Registration Statement," and such prospectus as proposed to
be supplemented by a prospectus supplement (the "Prospectus Supplement")
relating to the Designated Securities to be filed pursuant to Rule 424 under the
Act is hereinafter referred to as the "Prospectus." Any reference herein to the
Registration Statement or the Prospectus shall be deemed to refer to and include
the documents which were filed under the Securities Exchange Act of 1934 (the
"Exchange Act") on or before the date of this Agreement, and incorporated by
reference in the Prospectus pursuant to Item 12 of Form S-3,excluding any
documents or portions of such documents which are deemed under the rules
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and regulations of the Commission under the Act not to be incorporated by
reference; and any reference herein to the terms "amend," "amendment" or
"supplement" with respect to the Registration Statement or the Prospectus shall
be deemed to refer to and include the filing of any document under the Exchange
Act deemed to be incorporated therein by reference after the date of this
Agreement. For purposes of this Agreement, "Effective Time" with respect to the
Registration Statement means (i) if Providian has not advised the Representative
that is proposes to amend such registration statement, the date and time as of
which such registration statement, or the most recent post-effective amendment
thereto (if any) filed prior to the execution and delivery of this Agreement,
was declared effective by the Commission or has become effective upon filing
pursuant to Rule 462(c) under the Act, or (ii) if Providian has advised the
Representative that it proposes to file an amendment or post-effective amendment
to such registration statement, the date and time as of which such registration
statement, as amended by such amendment or post-effective amendment, as the case
may be, is declared effective by the Commission. "Effective Date" with respect
to the Registration Statement means the date of the Effective Time thereof.
(b) At the Effective Time, the Registration Statement and the
Prospectus conformed, and any proposed amendments thereof and supplements
thereto relating to the Designated Securities will conform, in all material
respects to the requirements of the Act and the rules and regulations of the
Commission thereunder; each document filed pursuant to the Exchange Act and
incorporated by reference in the Prospectus complied when so filed as to form
with the Exchange Act and the rules and regulations thereunder; on the Effective
Date neither the Registration Statement nor the Prospectus as of the date
thereof and on the Closing Date included or will include any untrue statement of
a material fact or omitted or will omit to state any material fact required to
be stated therein or necessary to make the statements therein, in the case of
the Registration Statement, not misleading, or in the case of the Prospectus, in
light of the circumstances in which they were made, not misleading; provided,
however, that Providian makes no representations as to any statements or
omissions made in reliance upon and in conformity with information furnished to
Providian by or on behalf of any Underwriter for use in connection with the
preparation of such documents.
(c) Neither Providian nor any of its affiliates does business with
the government of Cuba or with any person or affiliate located in Cuba within
the meaning of Section 517.075, Florida Statutes.
3. DELIVERY PAYMENT. Delivery of and payment for the Designated
Securities shall be made at the office, on the date and at the time specified in
the Underwriting Agreement (the "Closing Date"), which Closing Date may be
postponed by agreement between the Underwriters, or the Representative, as the
case may be, and Providian. Delivery of the Designated Securities shall be made
to the Underwriters or, if appropriate, the Representative for the respective
accounts of the Underwriters, in either case, against payment by the
Underwriters directly or through the Representative of the purchase price
thereof to or upon the order of Providian by certified or official bank check or
checks payable in New York Clearing House funds, unless otherwise agreed in the
Underwriting Agreement. Certificates for the Designated Securities shall be
registered in such names and in such denominations as the Representative may
request in writing not less than one full business day in advance of the Closing
Date.
If so requested by the Underwriters or the Representative, as the
case may be, Providian agrees to have the Designated Securities available for
inspection, checking and packaging in New York, New York, at least one business
day prior to the Closing Date.
4. OFFERING BY UNDERWRITERS. It is understood that the Underwriters
propose to offer the Designated Securities for sale to the public upon the terms
and conditions set forth in the Prospectus.
5. AGREEMENTS. Providian agrees with the Underwriters that:
(a) Providian will cause the Prospectus Supplement to be filed
pursuant to Rule 424 under the Act and will promptly advise the Underwriters or
the Representative, as the case may be, when the Prospectus Supplement has been
so filed, and prior to the termination of the offering of the Designated
Securities will promptly advise such Underwriters or Representative (i) when any
amendment to the Registration Statement has been declared effective or has
become effective upon filing pursuant to Rule 462(c) under the Act or any
further supplement to the
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Prospectus has been filed, (ii) of any request by the Commission for any
amendment of the Registration Statement or the Prospectus or for any additional
information, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (iv) of the receipt by
Providian of any notification with respect to the suspension of the
qualification of the Designated Securities for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. Providian will use
its best efforts to prevent the issuance of any such stop order and, if issued,
to obtain as soon as possible the withdrawal thereof. Providian will not file
any amendment to the Registration Statement or supplement to the Prospectus
relating to the Designated Securities unless it has furnished the Underwriters
or the Representative, as the case may be, a copy prior to filing and will not
file any such proposed amendment or supplement to which such Underwriters or
Representative reasonably objects.
(b) If, at any time when a prospectus relating to the Designated
Securities is required to be delivered under the Act or any other applicable
securities law, any event occurs as a result of which the Prospectus as then
amended or supplemented would include any untrue statement of a material fact or
omit to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
shall be necessary to amend or supplement the Prospectus to comply with the Act
or the Exchange Act or the respective rules thereunder, Providian will promptly
notify the Underwriters or the Representative, as the case may be, and will
promptly prepare and file with the Commission, subject to paragraph (a) of this
Section 5, an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance.
(c) Providian will make generally available to its security holders
and to the Underwriters or the Representative, as the case may be, as soon as
practicable, but not later than 45 days after the end of the 12-month period
beginning at the end of the fiscal quarter of Providian during which the filing
of the Prospectus Supplement pursuant to Rule 424 under the Act first occurs
(except not later than 90 days if such filing date-is in the last fiscal
quarter), an earnings statement (which need not be audited) of Providian and its
consolidated subsidiaries, covering such 12-month period, which will satisfy the
provisions of Section 11 (a) of the Act.
(d) Providian will furnish to the Underwriters or the Representative,
as the case may be, and counsel for such Underwriters or for such Representative
copies of the Registration Statement (including, if requested, the exhibits
thereto and the documents incorporated by reference in the Prospectus) and each
amendment or supplement thereto relating to the Designated Securities which is
thereafter filed pursuant to paragraph (a) or (b) of this Section 5 and to each
Underwriter, so long as delivery of a prospectus by an Underwriter or dealer may
be required by the Act or other applicable securities laws, as many copies of
the Prospectus and any amendments thereof and supplements thereto, relating to
the Designated Securities, as such Underwriters or such Representative may
reasonably request.
(e) Providian will pay (i) all expenses incurred by it in the
performance of its obligations under this Agreement, (ii) reasonable fees
charged for rating the Designated Securities and for preparing a Blue Sky and
Legal Investment Memorandum with respect to the sale of the Designated
Securities and (iii)the expenses of printing or otherwise producing and
delivering the Designated Securities, the documents specified in paragraph (d)
of this Section 5 and any Blue Sky and Legal Investment Memorandum.
(f) Providian will use its best efforts to arrange and pay for the
qualification of the Designated Securities for sale under the laws of such
jurisdictions as the Underwriters or the Representative, as the case may be, may
designate and to maintain such qualifications in effect so long as required for
the distribution of the Designated Securities; provided, however, that Providian
shall not be required to qualify to do business in any jurisdiction where it is
not now qualified or to take any action which would subject it to general or
unlimited service of process in any jurisdiction where it is not now so subject.
(g) If the sale of the Designated Securities provided for in an
Underwriting Agreement is not consummated by reason of any failure, refusal or
inability on the part of Providian to perform any agreement on its part to be
performed (except for any failure so to perform on the part of Providian
engendered by a failure, refusal or inability on the part of the Underwriters or
any Representative to perform any agreement on their part to be performed) or
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the failure of any condition set forth in Section 6, Providian will reimburse
the several Underwriters who are named in such Underwriting Agreement for all
reasonable out-of-pocket disbursements incurred by the Underwriters in
connection with their investigation, marketing and preparing to market the
Designated Securities, and upon such reimbursement Providian shall have no
further liability to the Underwriters except as provided in Section 7.
(h) During the period beginning on the date of this Agreement and
terminating on the later of (i) the Closing Date or (ii) the date of notice to
Providian by the Representative or the Underwriters, (which shall not exceed
forty-five days from the date of this Agreement), Providian will not offer,
sell, contract to sell or otherwise dispose of any Designated Securities of
Providian, or securities convertible into or exchangeable for Designated
Securities, without the prior written consent of such Representative or such
Underwriters.
6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The obligations
of the Underwriters to purchase the Designated Securities shall be subject to
the accuracy of the representations on the part of Providian contained herein as
of the date hereof and the Closing Date, to the performance by Providian of its
obligations hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted and be pending or threatened as of the Closing Date;
(b) Pillsbury Madison & Sutro LLP, counsel for Providian, shall have
furnished to the Representative their opinion, dated the Closing Date,
substantially in the form attached hereto as Exhibit A;
(c) The Underwriters or the Representative, as the case may be, shall
have received from counsel for the Underwriters such opinion or opinions, dated
the Closing Date, with respect to such matters as such Underwriters or
Representative may reasonably require;
(d) Providian shall have furnished to the Underwriters or the
Representative, as the case may be, a certificate, dated the Closing Date, of
Providian, signed by any executive officer of Providian, to the effect that the
signer of such certificate has carefully examined the Registration Statement,
the Prospectus and this Agreement and that:
(i) The representations of Providian in this Agreement are
true and correct in all material respects on and as of the Closing
Date with the same effect as if made on the Closing Date, and
Providian has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied at or prior to
the Closing Date;
(ii) No stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted and are pending or, to his or her
knowledge, threatened as of such date; and
(iii) Since the date of the most recent financial
statements included in or incorporated by reference into the
Prospectus, there has been no material adverse change in the
condition (financial or otherwise) of Providian and its consolidated
subsidiaries, taken as a whole.
(e) The Underwriters or the Representative, as the case may be, shall
have received from Ernst & Young LLP a letter, dated the Closing Date, which
letter shall be in form as may be agreed upon among such Underwriters or
Representative, Providian and Ernst & Young LLP, and shall cover such matters as
may be reasonably requested by such Underwriters or Representative.
(f) Prior to the Closing Date, Providian shall have furnished to the
Underwriters or the Representative, as the case may be, such further
information, certificates and documents as they may reasonably request.
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(g) Subsequent to the date hereof, there shall not have occurred any
change, or any development involving a prospective change, in or affecting the
business or properties of Providian and its subsidiaries considered as a whole
which the Underwriters or the Representative, as the case may be, concludes, in
its judgment, after consultation with Providian, materially impairs the
investment quality of the Designated Securities so as to make it impractical or
inadvisable to proceed with the public offering or the delivery of the
Designated Securities as contemplated by the Prospectus and there shall not have
been any decrease in the ratings of any of Providian's debt securities by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act).
7. INDEMNIFICATION AND CONTRIBUTION.
(a) Providian agrees to indemnify and hold harmless each Underwriter,
the directors, officers, employees and agents of each Underwriter, and each
person, if any, who controls any Underwriter within the meaning of either the
Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law 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 a material fact contained in
the Registration Statement or the Prospectus, or in any amendment thereof or
supplement thereto relating to the Designated Securities, 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 not
misleading, and agrees to reimburse each such indemnified party for any legal or
other expenses reasonably incurred by them, as so incurred, in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that Providian will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with
information furnished in writing to Providian by or on behalf of any Underwriter
through the Representative or the Underwriters, as the case may be, for use in
connection with the preparation thereof. This indemnity agreement will be in
addition to any liability which Providian may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless
Providian, each of its directors, officers, employees and agents, and each
person who controls Providian within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from Providian to
each Underwriter, but only with reference to information furnished in writing to
Providian by or on behalf of such Underwriter directly or through any
Representative for use in the preparation of the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section
7 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 this
Section 7, notify the indemnifying party in writing of the commencement thereof;
but the omission so to notify the indemnifying party will not relieve the
indemnifying party from any liability which it may have to any indemnified party
otherwise than under this Section 7. In case any such action is brought against
any indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent that it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof, with counsel satisfactory to
such indemnified party; provided that, if the defendants in any such action
include both the indemnified party and the indemnifying party, and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel, to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 7 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next
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preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel, approved
by the representatives representing the indemnified parties who are parties to
such action), (ii) the indemnifying- party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii). An indemnifying party will not, without
the prior written consent of each indemnified party, settle or compromise or
consent to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such claim, action, suit or proceeding.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 7 is due
in accordance with its terms but is for any reason held by a court to be
unavailable from Providian or the Underwriters on grounds of policy or
otherwise, Providian and the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) to which
Providian or one or more of the Underwriters may be subject in such proportion
so that the Underwriters are responsible for that portion represented by the
percentage that the underwriting discount appearing on the cover page of the
Prospectus bears to the public offering price appearing thereon and Providian is
responsible for the balance; provided that (y) in no case shall any Underwriter
(except as may be provided in any agreement among underwriters relating to the
offering of the Designated Securities) be responsible for any amount in excess
of the underwriting discount applicable to the Designated Securities purchased
by such Underwriter hereunder and (z) 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. For purposes of this Section 7, each person who controls an
Underwriter within the meaning of either the Act or the Exchange Act shall have
the same rights to contribution as such Underwriter, and each person who
controls Providian within the meaning of either the Act or the Exchange Act,
each officer of Providian who shall have signed the Registration Statement and
each director of Providian shall have the same rights to contribution as
Providian, subject in each case to clause (y) of this paragraph (d). Any party
entitled to contribution will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a claim
for contribution may be made against another party or parties under this
paragraph (d), notify such party or parties from whom contribution may be
sought, but the omission to so notify in writing such party or parties shall not
relieve the party or parties from whom contribution may be sought from any other
obligation it or they may have hereunder or otherwise than under this paragraph
(d).
8. TERMINATION. This Agreement shall be subject to termination in the
absolute discretion of the Underwriters or the Representative, as the case may
be, by written notice given to Providian prior to delivery of and payment for
the Designated Securities, if prior to such time (i) trading in Providian's
Common Stock or securities generally on the New York Stock Exchange shall have
been suspended or materially limited, (ii) a general moratorium on commercial
banking activities in New York shall have been declared by either Federal or New
York State authorities or (iii) there shall have occurred any material outbreak
or escalation of hostilities or other calamity or crisis the effect of which on
the financial markets of the United States is such as to make it, in the
reasonable judgment of such Underwriters or such Representative, impracticable
or inadvisable to proceed with the offering or delivery of the Designated
Securities as contemplated by the Prospectus and Prospectus Supplement.
9. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, indemnities and other statements of Providian, or
its officers and of the Underwriters and/or any Representative set forth in or
made pursuant to this Agreement will remain in full force and effect, regardless
of any investigation made by or on behalf of any Underwriter, Providian or any
of the officers, directors or controlling persons referred to in Section 7
hereof, and will survive delivery of and payment for the Securities. The
provisions of Sections S(e) and 7 hereof shall survive the termination or
cancellation of this Agreement.
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10. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters shall
fail to purchase and pay for any Designated Securities agreed to be purchased by
such Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take up
and pay for (in the respective proportions which the amount of Designated
Securities set forth opposite their names in the appropriate schedule of the
Underwriting Agreement bears to the aggregate amount of Designated Securities
set forth opposite the names of all the remaining Underwriters) the Designated
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate amount of
Designated Securities which the defaulting Underwriter or Underwriters agreed
but failed to purchase shall exceed 10% of the amount of Designated Securities
set forth in the appropriate schedule of the Underwriting Agreement, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Designated Securities, and if such
nondefaulting Underwriters do not purchase all the Designated Securities, this
Agreement will terminate without liability to any nondefaulting Underwriter or
Providian. In the event of a default by any Underwriter as set forth in this
Section 10, the Closing Date shall be postponed for such period, not exceeding
seven days, as the Representative or Underwriters, as the case may be, shall
determine in order that the required changes in the Registration Statement and
the Prospectus or in any other documents or arrangements may be effected.
Nothing contained in this Agreement shall relieve any defaulting Underwriter of
its liability, if any, to Providian and any nondefaulting Underwriter for
damages occasioned by its default hereunder.
11. SUCCESSORS. This Agreement will 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 hereof, and no
other person will have any right or obligation hereunder.
12. APPLICABLE LAW. This Agreement will be governed by and construed
in accordance with the laws of the State of New York.
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EXHIBIT A
[FORM OF PILLSBURY MADISON & SUTRO LLP OPINION]
[Date]
Underwriter(s)
Gentlemen and Mesdames:
We have acted as counsel to Providian Financial Corporation
("Providian") in connection with your purchase from Providian of $000,000,000 of
its Securities (the "Securities"). Such purchase is made pursuant to the
Underwriting Agreement dated , 19_ (the "Underwriting Agreement") between
Providian and you, the Underwriter[s]. This opinion is furnished pursuant to
Section 6(b) of the Underwriting Agreement. Terms defined in the Indenture have
the same meanings when used in this opinion.
We have examined executed copies of the Securities, the Underwriting
Agreement, the Registration Statement (as hereinafter defined) and the
Prospectus (as hereinafter defined). We have also examined such other documents
and certificates of public officials and representatives of Providian as we have
deemed necessary as a basis for the opinions expressed herein. As to questions
of fact material to such opinions, we have, when relevant facts were not
independently established, relied upon certificates of officers or authorized
representatives of Providian.
We have assumed the genuineness of all signatures and documents
submitted to us as originals, that all copies submitted to us conform to the
originals, the legal capacity of all natural persons, and as to documents
executed by entities other than Providian, that each of such entities has the
power to enter into and perform its respective obligations thereunder, and that
such documents have been duly authorized, executed and delivered by, and are
binding upon and enforceable against, each of such entities.
We express no opinion as to the laws of any jurisdiction other than
California, New York and the general corporate law of Delaware and the Federal
laws of the United States of America, and, with respect to questions of New York
law, we have relied, with your permission, solely upon the opinion of [_____].
Based upon the foregoing and subject to the qualifications set forth
below, it is our opinion that:
1. Providian is validly existing and in good standing under the laws
of the State of Delaware and is duly qualified and in good standing to do
business in each other state identified in Attachment I hereto and possesses the
requisite corporate power and authority to own its properties and conduct its
business consistent with any description thereof in the prospectus dated _____
and the prospectus supplement dated _____, filed with the Securities and
Exchange Commission (the "Commission") pursuant to Rule 424(b)(2) of Regulation
C under the Securities Act of 1933, as amended (the "Act") (the prospectus and
the prospectus supplement, including the documents incorporated by reference
therein, are herein collectively referred to as the "Prospectus").
2. The Underwriting Agreement has been duly authorized, executed and
delivered by Providian.
3. The [Common/Preferred] Stock has been duly authorized and validly
issued, and when paid for in accordance with the terms of the Underwriting
Agreement, will be fully paid and nonassessable and/or the [Securities] have
been duly authorized, executed and delivered by Providian and constitute valid
and binding obligations of Providian, enforceable in accordance with their
terms.
4. The Registration Statement of Form S-3 (File No. _______) filed by
Providian with the Commission under Rule 415 of the Act on _________, 1995 (such
Registration Statement including the documents incorporated
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by reference therein being herein collectively referred to as the "Registration
Statement") has become effective under the Act, and, to the best of our
knowledge, no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are pending or contemplated under the Act, and, except as may be
otherwise indicated in the Prospectus or required by the blue sky or securities
laws of jurisdictions in which the Securities are offered or Securities or the
offer and sale of the Securities as described in the Prospectus, and the
execution, delivery and performance of the terms of the Underwriting Agreement,
the Indenture and the Securities by Providian will not contravene any provision
of the Restated Certificate of Incorporation, as amended, or By-Laws of
Providian, any Federal law or regulation or, to the best of our knowledge, any
applicable state law or any material agreement or instrument binding upon
Providian.
5. No consent, approval, authorization or order of, or filing with,
any governmental agency or body or any federal or state court is required to be
obtained or made by Providian for the consummation of the transactions
contemplated by this Agreement in connection with the sale of the Designated
Securities, except (i) such as have been obtained and made under the Act or the
Exchange Act, or the rules and regulations thereunder, the bylaws and rules of
the National Association of Securities Dealers, Inc. and (ii) such as may be
required under state or foreign securities laws.
6. To the best of our knowledge, there is no pending or threatened
action, suit or proceeding before any court or governmental agency, authority or
body or any arbitrator involving Providian or any of its subsidiaries of a
character required to be disclosed in the Registration Statement which is not
adequately disclosed in the Prospectus or supplement relating thereto.
7. The Registration Statement and the Prospectus comply as to form in
all material respects with the requirements of the Act and the rules and
regulations of the Commission thereunder; each document filed by Providian under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in the Prospectus complied as to form in all material
respects when so filed with the requirements of the Exchange Act and the rules
and regulations of the Commission thereunder; the statements in the Prospectus
with respect to the terms of the Securities fairly summarize the terms of such
instruments and to the best of our knowledge there are no other agreements or
instruments required to be described or referred to in the Registration
Statement which have not been described or referred to therein; and while we
have not ourselves checked the accuracy or completeness of, or otherwise
verified the information furnished in the Registration Statement, we have
considered the information required to be furnished therein and have generally
reviewed and had discussions with certain officers and employees of Providian
concerning the information so furnished, whether or not subject to our checking
and verification, and on the basis of such consideration, review and
discussions, but without independent checking or verification, we have no reason
to believe that the Registration Statement or any amendment thereto at the time
the Registration Statement or amendment became effective, contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or the
Prospectus or any supplement thereto at the time it was filed pursuant to Rule
424(b) of the Act, or on such Closing Date, contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances in which they were made, not misleading; it being understood that
with respect to the matters covered by this paragraph 7, we express no opinion
as to the financial statements and related schedules and other financial,
statistical or numerical data contained in the Registration Statement or the
Prospectus.
The opinions set forth in the foregoing are subject to the following
qualifications:
(a) Our opinions in paragraph 3 are subject to and limited by: (i)
the effect of bankruptcy, insolvency, reorganization, receivership,
conservatorship, arrangement, moratorium or other laws affecting or relating to
the rights of creditors generally; (ii) the rules governing the availability of
specific performance, injunctive relief or other equitable remedies and general
principles of equity, regardless of whether considered in a proceeding in equity
or at law; (iii) to the extent applicable, the effect of court decisions
invoking statutes or principles of equity, which have held that certain
covenants and provisions of agreements are unenforceable where the breach of
such covenants or provisions imposes restrictions or burdens is necessary for
the protection of the creditor, or which have held that the
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creditor's enforcement of such covenants or provisions under the circumstances
would have violated the creditor's covenants of good faith and fair dealing
implied under California law, and (iv) to the extent applicable, the effect of
California statutes and rules of law which cannot be waived prospectively by a
borrower.
(b) Whenever a statement herein is qualified by "known to us", "to
our knowledge" or similar phrase, it indicates that in the course of our
representation of Providian no information that would give us current actual
knowledge of the inaccuracy of such statement has come to the attention of the
attorneys in this firm who have rendered legal services in connection with this
transaction, including the principal partners of this firm who are familiar with
matters relating to Providian. We have not made any independent investigation to
determine the accuracy of such statement, except as expressly described herein.
No inference as to our knowledge of any matters bearing on the accuracy of such
statement should be drawn from the fact of our representation of Providian in
other matters in which such attorneys are not involved.
This opinion is rendered by us as counsel for Providian solely for
your benefit in connection with the transaction referred to herein and may not
be relied upon by you in connection with any other transaction and may not be
relied upon by any other person without our prior written consent.
Very truly yours,
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