Exhibit 1.2
USAA AUTO GRANTOR TRUST 2002-[ ]
Asset Backed Certificates
USAA ACCEPTANCE, LLC
(DEPOSITOR)
USAA FEDERAL SAVINGS BANK
(SELLER AND SERVICER)
UNDERWRITING AGREEMENT
----------------------
---------, ----
[Name of Representative],
as Representative of the
Several Underwriters named
on Schedule I hereto,
___________________________
___________________________
Dear Sirs:
USAA Acceptance, LLC, A Delaware limited liability company (the
"Depositor"), proposes to form a trust, USAA Auto Grantor Trust 2002-[ ] (the
"Issuer"), pursuant to a Pooling and Servicing Agreement (the "Pooling
Agreement") to be dated as of _________, ___ between the Depositor, USAA Federal
Savings Bank, a federally charted savings association (the "Bank"), as seller
and servicer (in such capacities, the "Seller" and the "Servicer",
respectively), and ___________, as trustee and collateral agent (the "Trustee").
The Issuer will issue (i) $_________ principal amount of its Class A ___% Asset
Backed Certificates (the "Class A Certificates"), and (ii) $_________ principal
amount of its Class B ___% Asset Backed Certificates (the "Class B
Certificates", and together with the Class A Certificates, the "Certificates").
The assets of the Issuer will include, among other things, a pool of motor
vehicle installment loans made by the Bank and secured by new and used cars and
light duty trucks (the "Receivables"), certain monies due or received thereunder
on or after _________, ___ (the "Cutoff Date"), security interests in the
vehicles financed thereby, certain accounts, and the proceeds thereof, and the
proceeds from claims on certain insurance policies. Pursuant to the Pooling
Agreement, the Receivables will be sold to the Trustee for the benefit of the
Certificateholders. The Servicer will service the Receivables pursuant to the
Pooling Agreement. Capitalized terms used and not otherwise defined herein shall
have the meanings given them in the Pooling Agreement.
This is to confirm the agreement concerning the purchase of the
Certificates from the Bank by the several Underwriters named in Schedule I
hereto (the "Underwriters").
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE DEPOSITOR AND THE
BANK. The Depositor and the Bank (each a "Representing Party" and collectively
the "Representing Parties"), jointly and severally, represent and warrant to and
agree with the several Underwriters that:
(a) A registration statement on Form S-3 (No. 333-[ ]) has been filed
by the Depositor with the Securities and Exchange Commission (the
"Commission") and has become effective under the Securities Act of 1933, as
amended (the "Securities Act"). Such registration statement may have been
amended or supplemented from time to time prior to the date hereof. Any
such amendment or supplement was filed with the Commission in accordance
with the Securities Act and the rules and regulations of the Commission
thereunder (the "Rules and Regulations") and any such amendment has become
effective under the Securities Act. The Depositor proposes to file with the
Commission pursuant to Rule 424(b) of the Rules and Regulations a
prospectus supplement (the "Prospectus Supplement") to the prospectus dated
___________, ___, relating to the Certificates and the method of
distribution thereof. Copies of such registration statement, any amendment
or supplement thereto, such prospectus and the Prospectus Supplement have
been delivered to you. Such registration statement, including exhibits
thereto and such prospectus, as amended or supplemented to the date hereof,
and as further supplemented by the Prospectus Supplement, are hereinafter
referred to as the "Registration Statement" and the "Prospectus,"
respectively. The conditions to the use of a registration statement on Form
S-3 under the Securities Act have been satisfied.
(b) The Registration Statement, at the time it became effective, any
post-effective amendment thereto, at the time it became effective, and the
Prospectus, as of the date of the Prospectus Supplement, complied in all
material respects with the applicable requirements of the Securities Act
and the Rules and Regulations and the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"), and the rules and regulations of the
Commission thereunder and did not include any untrue statement of a
material fact and, in the case of the Registration Statement and any
post-effective amendment thereto, did not omit to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading and, in the case of the Prospectus, did not 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; on
the Closing Date (as hereinafter defined), the Registration Statement and
the Prospectus, as amended or supplemented as of the Closing Date, will
comply in all material respects with the applicable requirements of the
Securities Act and the Rules and Regulations and the Trust Indenture Act
and the rules and regulations of the Commission thereunder and neither the
Prospectus nor any amendment or supplement thereto will include any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The representation and warranty
in the preceding sentence does not apply to that information contained in
or omitted from the Registration Statement or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with
the Underwriters' Information (as defined herein).
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(c) The Depositor is a limited liability company duly organized,
validly existing and in good standing under the laws of the State of
Delaware with the limited liability company power and authority to own its
properties and conduct its business as described in the Registration
Statement and the Prospectus, and now has, the power, authority and legal
right to acquire, own and sell the Receivables.
(d) The Bank has been duly organized and is validly existing as a
federally chartered savings association and is a member of the Federal Home
Loan Bank System. The Bank is in good standing with the Office of Thrift
Supervision and has the power and authority (corporate and other) to own,
lease and operate its properties and to conduct its business as such
properties are presently owned, leased and operated and as such business is
presently conducted, and had at all relevant times, and now has, the power,
authority and legal right to own and sell the Receivables.
(e) The representations of the Depositor in Section 7.01 of the
Pooling Agreement will be true and correct as of the Closing Date.
(f) The representations of the Servicer in Section 8.01 of the Pooling
Agreement will be true and correct as of the Closing Date.
(g) Each Representing Party has the power and authority to execute and
deliver this Agreement and to carry out the terms of this Agreement and the
execution, delivery and performance by each Representing Party of this
Agreement has been duly authorized by such Representing Party.
(h) This Agreement has been duly executed and delivered by each
Representing Party.
(i) When authenticated by the Trustee in accordance with the Pooling
Agreement and delivered and paid for pursuant to this Agreement, the
Certificates will be duly issued and entitled to the benefits and security
afforded by the Pooling Agreement.
(j) The execution, delivery and performance of this Agreement and the
consummation by each Representing Party of the transactions contemplated
hereby shall not conflict with, result in any breach of any of the terms
and provisions of or constitute (with or without notice or lapse of time) a
default under, the organizational documents of such Representing Party, or
any indenture, agreement or other instrument to which such Representing
Party is a party or by which such Representing Party is bound, or violate
any law or any order, rule or regulation applicable to such Representing
Party of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over such Representing Party or any of its properties; and,
except for the registration of the Certificates under the Securities Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and applicable state securities laws
in connection with the purchase and distribution of the Certificates by the
Underwriters, no permit, consent, approval of, or declaration to or filing
with, any governmental authority is required in connection with the
execution,
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delivery and performance of this Agreement or the consummation of the
transactions contemplated hereby.
(k) There are no proceedings or investigations pending or, to the
knowledge of each Representing Party, threatened before any court,
regulatory body, administrative agency or other tribunal or governmental
instrumentality having jurisdiction over such Representing Party or its
properties (i) asserting the invalidity of this Agreement or any of the
Certificates, (ii) seeking to prevent the issuance of any of the
Certificates or the consummation of any of the transactions contemplated by
this Agreement, (iii) seeking any determination or ruling that, if
determined adversely to such Representing Party, is reasonably likely to
materially and adversely affect the performance by such Representing Party
of its obligations under this Agreement, the validity of the Certificates
or the validity or enforceability of this Agreement, or (iv) that may
adversely affect the federal or state income, excise, franchise or similar
tax attributes of the Certificates.
(l) Each Representing Party (i) is not in violation of its
organizational documents, (ii) is not in default and no event has occurred
which, with notice or lapse of time or both, would constitute such a
default, in the due performance or observance of any term, covenant or
condition contained in any indenture, agreement, mortgage, deed of trust or
other instrument to which such Representing Party is a party or by which
such Representing Party is bound or to which any of such Representing
Party's property or assets is subject or (iii) is not in violation in any
respect of any law, order, rule or regulation applicable to such
Representing Party or any of such Representing Party's property of any
court or of any federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over it or any of
its property, except, in the case of clauses (ii) and (iii), for any
defaults or violations that would not, individually or in the aggregate,
have a material adverse effect on (A) the performance by such Representing
Party of its obligations under, or the validity or enforceability of, the
Certificates, the Basic Documents or this Agreement or (B) the condition
(financial or otherwise), results of operations, business or prospects of
such Representing Party.
(m) Neither the Issuer, the Depositor, nor the Bank is an "investment
company" or under the "control" of an "investment company" within the
meaning thereof as defined in the Investment Company Act of 1940, as
amended.
(n) Neither of the Bank nor the Depositor or anyone acting on their
behalf has taken any action that would require qualification of the Pooling
Agreement under the Trust Indenture Act.
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2. PURCHASE BY THE UNDERWRITERS. On the basis of the representations,
warranties and agreements contained herein, and subject to the terms and
conditions set forth herein, the Depositor agrees to cause the Issuer to sell to
each of the Underwriters, severally and not jointly, and each of the
Underwriters, severally and not jointly, agrees to purchase from the Depositor,
the respective principal amount of Certificates set forth opposite the name of
such Underwriter in Schedule 1 hereto at a purchase price equal to (i) with
respect to the Class A Certificates, ____% of the principal amount thereof, and
(ii) with respect to the Class B Certificates, ____% of the principal amount
thereof.
The Depositor shall not be obligated to deliver any of the Certificates
except upon payment in full for all the Certificates to be purchased as provided
herein.
3. DELIVERY OF AND PAYMENT FOR THE CERTIFICATES. Delivery of and payment
for the Certificates shall be made at the office of __________, or at such other
place as shall be agreed upon by [Name of Representative], as representative of
the Underwriters (the "Representative") and the Depositor, at 9:00 A.M., ______
time, on ________, ___, or at such other date or time, not later than five full
business days thereafter, as shall be agreed upon by the Representative and the
Depositor (such date and time being referred to herein as the "Closing Date").
On the Closing Date, the Certificates shall be delivered to the Representative
for the account of each Underwriter against payment to or upon the order of the
Depositor of the purchase price in immediately available funds. Time shall be of
the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, each class of the Certificates shall be represented by
one or more global certificates registered in the name of Cede & Co., as nominee
of The Depository Trust Company ("DTC"). The interest of the beneficial owners
of the Certificates will be represented by book-entries on the records of DTC
and participating members thereof. Definitive certificates representing the
Certificates will be available only under limited circumstances as set forth in
the Pooling Agreement.
4. FURTHER AGREEMENTS OF THE DEPOSITOR. The Depositor agrees with each of
the several Underwriters:
(a) To file the Prospectus Supplement with the Commission pursuant to
and in accordance with Rule 424(b) of the Rules and Regulations within the
time period prescribed by such rule and provide evidence satisfactory to
the Representative of such timely filing.
(b) During any period in which a prospectus relating to the
Certificates is required to be delivered under the Securities Act: to
advise the Representative promptly of any proposal to amend the
Registration Statement or amend or supplement the Prospectus and not to
effect any such amendment or supplementation without the consent of the
Representative; to advise the Representative promptly of (i) the
effectiveness of any post-effective amendment to the Registration
Statement, (ii) any request by the Commission for any amendment of the
Registration Statement or the Prospectus or for any additional information,
(iii) the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation or
threatening of any proceedings for that purpose, (iv) the issuance by the
Commission of any order
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preventing or suspending the use of any prospectus relating to the
Certificates or the initiation or threatening of any proceedings for that
purpose and (v) the receipt by the Depositor of any notification with
respect to the suspension of the qualification of the Certificates for sale
in any jurisdiction or the initiation or threatening of any proceeding for
such purpose; and to use its reasonable best efforts to prevent the
issuance of any such stop order or of any order preventing or suspending
the use of any prospectus relating to the Certificates or suspending any
such qualification and, if any such stop order or order of suspension is
issued, to obtain the lifting thereof at the earliest possible time.
(c) If, during any period in which a prospectus relating to the
Certificates is required to be delivered under the Securities Act, any
event shall have occurred 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 when such Prospectus
is delivered to a purchaser, not misleading, or if for any other reason it
shall be necessary at such time to amend or supplement the Prospectus in
order to comply with the Securities Act, to notify the Representative
immediately thereof, and to promptly prepare and file with the Commission,
subject to paragraph (b) of this Section 4, an amendment or a supplement to
the Prospectus such that the statements in the Prospectus, as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading, or such that the
Prospectus will comply with the Securities Act.
(d) To furnish promptly to each of the Representative and counsel for
the Underwriters a signed copy of the Registration Statement as originally
filed with the Commission, and each amendment thereto filed with the
Commission, including all consents and exhibits filed therewith; and during
the period described in paragraph (c) of this Section 4, to deliver
promptly without charge to the Representative such number of the following
documents as the Representative may from time to time reasonably request:
(i) conformed copies of the Registration Statement as originally filed with
the Commission and each amendment thereto (in each case excluding exhibits
other than this Agreement and the Pooling Agreement) and (ii) any
preliminary prospectus supplement, the Prospectus and any amendment or
supplement thereto.
(e) During any period in which a prospectus relating to the
Certificates is required to be delivered under the Securities Act, to file
promptly with the Commission any amendment to the Registration Statement or
the Prospectus or any supplement to the Prospectus that may, in the
judgment of the Depositor or the Representative, be required by the
Securities Act or requested by the Commission.
(f) For so long as any of the Certificates are outstanding or until
such time as the Underwriters shall cease to maintain a secondary market in
the Certificates, to furnish to the Underwriters (i) copies of all
materials furnished by the Issuer to the holders of the Certificates and
all reports and financial statements furnished by the Issuer to the
Commission pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder and (ii) from time to time, such other information
concerning the Bank or the Depositor filed with any government or
regulatory authority or national securities
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exchange which is otherwise publicly available as the Representative may
reasonably request and such other information concerning the Issuer as the
Representative may reasonably request.
(g) Promptly from time to time to take such action as the
Representative may reasonably request to qualify the Certificates for
offering and sale under the securities laws of such jurisdictions as the
Representative may request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions for as long
as may be necessary to complete the distribution of the Certificates;
provided that in connection therewith neither the Bank nor the Depositor
shall be required to qualify to do business or to file a general consent to
service of process in any jurisdiction.
(h) During the period from the date of the Prospectus to and including
the business day after the Closing Date, to not offer for sale, sell,
contract to sell or otherwise dispose of, directly or indirectly, or file a
registration statement for, or announce any offering of, any securities
collateralized by, or evidencing an ownership interest in, a pool of
installment loans for new and used cars and light duty trucks without the
prior written consent of the Representative.
(i) For a period from the date of this Agreement until the retirement
of the Certificates, to deliver to you the annual statement of compliance
and the annual independent certified public accountants' report furnished
to the Trustee, pursuant to the Pooling Agreement, as soon as such
statements and reports are furnished to the Trustee.
(j) To the extent, if any, that the ratings provided with respect to
the Certificates by _________ ("____") and _________ ("____") are
conditional upon the furnishing of documents or the taking of any other
actions by the Bank or the Depositor, to furnish such documents and take
any such other actions.
5. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The respective obligations of
the several Underwriters hereunder are subject to the accuracy, when made and on
the Closing Date, of the representations and warranties of the Representing
Parties contained herein, to the accuracy of the statements of the Representing
Parties made in any certificates pursuant to the provisions hereof, to the
performance by the Representing Parties of their respective obligations
hereunder, and to each of the following additional terms and conditions:
(a) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and any request of the Commission for
inclusion of additional information in the Registration Statement or the
Prospectus or otherwise shall have been complied with to the reasonable
satisfaction of the Representative; and the Representing Parties shall have
filed the Prospectus Supplement with the Commission pursuant to Rule 424(b)
of the Rules and Regulations within the time period prescribed by such
rule.
(b) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Certificates, the
Pooling
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Agreement, the Registration Statement and the Prospectus, and all other
legal matters relating to such agreements and the transactions contemplated
hereby and thereby shall be satisfactory in all material respects to
counsel for the Underwriters, and the Representing Parties shall have
furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
(c) The Pooling Agreement shall have been duly executed and delivered
by the Depositor, the Seller, the Servicer and the Trustee and the
Certificates shall have been duly executed and delivered by the Trustee on
behalf of the Issuer and duly authenticated by the Trustee.
(d) The Representative shall have received evidence satisfactory to it
and its counsel that on or before the Closing Date, UCC-1 financing
statements required to be filed on or prior to the Closing Date pursuant to
the Pooling Agreement have been filed.
(e) [Xxxxxxx X. Broker], ______ of the Bank, shall have furnished to
the Representative his written opinion, addressed to the Underwriters and
dated the Closing Date, regarding the due organization and power and
authority of the Seller, the due authorization, execution and delivery by
the Seller of the Pooling Agreement, no conflicts or violations of its
charter or by-laws, contracts or law and other related matters, in form and
substance reasonably satisfactory to the Representative and its counsel.
(f) _____________, special Delaware counsel to the Depositor, shall
have furnished to the Representative their written opinion, as counsel to
the Depositor, addressed to the Underwriters and dated the Closing Date,
regarding (i) the due organization of the Depositor and (ii) other general
Delaware law matters with respect to the Depositor, including, without
limitation, the due authorization, execution and delivery of the Pooling
Agreement by the Depositor, in each case, in form and substance reasonably
satisfactory to the Representative and its counsel.
(g) _____________, special Delaware counsel to the Issuer, shall have
furnished to the Representative their written opinion, as counsel to the
Issuer, addressed to the Underwriters and dated the Closing Date, regarding
(i) the due organization of the Issuer, and (ii) other general Delaware law
matters with respect to the Issuer, including, without limitation, the due
authorization and issuance of the Certificates, in each case, in form and
substance reasonably satisfactory to the Representative and its counsel.
(h) Sidley Xxxxxx Xxxxx & Xxxx LLP shall have furnished to the
Representative their written opinion, addressed to the Underwriters and
dated the Closing Date, regarding (i) the enforceability of the Pooling
Agreement, (ii) the validity of the security interests created thereby,
(iii) the due authorization and issuance of the Certificates, (iv) no
violations of law, (v) compliance with applicable federal securities laws,
(vi) exemption of the Depositor, the Bank and the Issuer from registration
as an investment company under the Investment Company Act of 1940, (vii)
the conformity in all material respects of the Pooling Agreement to the
description thereof contained in the Registration Statement and the
Prospectus, (viii) negative assurances concerning the Prospectus and (ix)
the lack of qualification of the Pooling Agreement under the Trust
Indenture Act, in
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each case in form and substance reasonably satisfactory to the
Representative and its counsel.
(i) _____________, special Texas counsel to the Bank, shall have
furnished to the Representative their written opinion, addressed to the
Underwriters and dated the Closing Date, regarding the perfection and
priority of the security interests created by the Pooling Agreement.
(j) Sidley Xxxxxx Xxxxx & Xxxx LLP shall have furnished to the
Representative their written opinion, addressed to the Underwriters and
dated the Closing Date, with respect to certain matters relating to the
transfer of the Receivables to the Issuer, in form and substance reasonably
satisfactory to the Representative and its counsel.
(k) Sidley Xxxxxx Xxxxx & Xxxx LLP shall have furnished to the
Representative their written opinion, addressed to the Underwriters and
dated the Closing Date, to the effect that (i) the Issuer will not be an
association (or a publicly trade partnership) taxable as a corporation for
federal income tax purposes and that the Issuer will be classified as a
grantor trust under subpart E, part 1, subchapter J, chapter 1 of subtitle
A of the Code, (ii) the holders of the Certificates will be treated as the
owners of undivided interests in the interest and principal portions of the
Issuer represented by the Certificates for federal income tax purposes and
(iii) the statements set forth in the Prospectus under the heading "Certain
Federal Income Tax Consequences", to the extent that they are statements of
law are true and correct in all material respects, in form and substance
reasonably satisfactory to the Representative and its counsel.
(l) The Representative shall have received from XxXxx Xxxxxx LLP,
counsel for the Underwriters, such opinion or opinions, dated the Closing
Date, with respect to such matters as the Representative may require, and
the Representing Parties shall have furnished to such counsel such
documents as they reasonably request for enabling them to pass upon such
matters.
(m) ____________, counsel to the Trustee, shall have furnished to the
Representative their written opinion, as counsel to the Trustee, addressed
to the Underwriters and dated the Closing Date, regarding the due
organization of the Trustee, the due authorization, execution and delivery
by the Trustee of the Pooling Agreement, no conflicts or violations of
organizational documents, contracts or law and other related matters, in
form and substance reasonably satisfactory to the Representative and its
counsel.
(n) The Representative shall have received a letter dated the date
hereof (the "Procedures Letter") from a firm of independent nationally
recognized certified public accountants acceptable to the Representative
verifying the accuracy of such financial and statistical data contained in
the Prospectus as the Representative shall deem advisable. In addition, if
any amendment or supplement to the Prospectus made after the date hereof
contains financial or statistical data, the Representative shall have
received a letter dated the Closing Date confirming the Procedures Letter
and providing additional comfort on such new data.
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(o) The Representative shall have received a certificate, dated the
Closing Date, of any of the Chairman of the Board, the President, any
Senior Vice President or the chief financial officer of the Depositor
stating that (A) the representations and warranties of the Depositor
contained in this Agreement and the Pooling Agreement are true and correct
on and as of the Closing Date, (B) the Depositor has complied with all
agreements and satisfied all conditions on its part to be performed or
satisfied hereunder and under the Pooling Agreement at or prior to the
Closing Date, (C) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been instituted or, to the best of his or her knowledge, are
contemplated by the Commission, and (D) since ______, ____, there has been
no material adverse change in the financial position or results of
operations of the Depositor or the Issuer or any change, or any development
including a prospective change, in or affecting the condition (financial or
otherwise), results of operations, business or prospects of the Depositor
or the Issuer except as set forth in or contemplated by the Registration
Statement and the Prospectus.
(p) The Representative shall have received a certificate, dated the
Closing Date, of any of the Chairman of the Board, the President, any
Senior Vice President or the Chief Financial Officer of the Bank stating
that (A) the representations and warranties of the Bank contained in this
Agreement and the Pooling Agreement are true and correct on and as of the
Closing Date, (B) the Bank has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied hereunder and under
the Pooling Agreement at or prior to the Closing Date, and (C) since
______, ____, there has been no material adverse change in the financial
position or results of operations of the Bank or the Issuer or any change,
or any development including a prospective change, in or affecting the
condition (financial or otherwise), results of operations, business or
prospects of the Bank or the Issuer except as set forth in or contemplated
by the Registration Statement and the Prospectus.
(q) The Representative shall have received a letter from ____ stating
that the Class A Certificates have received a rating of "___" from _____
and a letter from ____ stating that the Class A Certificates have received
a rating of "___" from _____.
(r) The Representative shall have received a letter from ____ stating
that the Class B Certificates have received a rating of "___" from _____
and a letter from ____ stating that the Class B Certificates have received
a rating of "___" from _____.
(s) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange, the American Stock Exchange or
the over-the-counter market shall have been suspended or limited, or
minimum prices shall have been established on either of such exchanges or
such market by the Commission, by such exchange or by any other regulatory
body or governmental authority having jurisdiction or (ii) a general
moratorium on commercial banking activities shall have been declared by
Federal or New York State authorities or (iii) an outbreak or escalation of
hostilities or a declaration by the United States of a national emergency
or war or any other substantial national or international calamity or
emergency as to make it, in the reasonable judgment of a
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majority in interest of the several Underwriters, impracticable or
inadvisable to proceed with the public offering or the delivery of the
Certificates on the terms and in the manner contemplated in the Prospectus.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
6. TERMINATION. The obligations of the Underwriters hereunder may be
terminated by the Representative, in its absolute discretion, by notice given to
and received by the Depositor and the Bank prior to delivery of and payment for
the Certificates if, prior to that time, any of the events described in Section
5(s) shall have occurred or any of the conditions described in Section 5(o),
5(q) or 5(r) shall not be satisfied.
7. DEFAULTING UNDERWRITERS.
(a) If, any one or more of the Underwriters shall fail to purchase and
pay for any of the Certificates agreed to be purchased by such Underwriter
hereunder on the Closing Date, and such failure constitutes a default in
the performance of its or their obligations under this Agreement, the
Representative may make arrangements for the purchase of such Certificates
by other persons satisfactory to the Depositor and the Representative,
including any of the Underwriters, but if no such arrangements are made by
the Closing Date, then each remaining non-defaulting Underwriter shall be
severally obligated to purchase the Certificates which the defaulting
Underwriter or Underwriters agreed but failed to purchase on the Closing
Date in the respective proportions which the principal amount of
Certificates set forth opposite the name of each remaining non-defaulting
Underwriter in Schedule 1 hereto bears to the aggregate principal amount of
Certificates set forth opposite the names of all the remaining
non-defaulting Underwriters in Schedule 1 hereto; provided, however, that
the remaining non-defaulting Underwriters shall not be obligated to
purchase any of the Certificates on the Closing Date if the aggregate
principal amount of Certificates which the defaulting Underwriter or
Underwriters agreed but failed to purchase on such date exceeds
one-eleventh of the aggregate principal amount of the Certificates to be
purchased on the Closing Date, and any remaining non-defaulting Underwriter
shall not be obligated to purchase in total more than 110% of the principal
amount of the Certificates which it agreed to purchase on the Closing Date
pursuant to the terms of Section 2. If the foregoing maximums are exceeded
and the remaining Underwriters or other underwriters satisfactory to the
Representative and the Depositor and the Bank do not elect to purchase the
Certificates which the defaulting Underwriter or Underwriters agreed but
failed to purchase, this Agreement shall terminate without liability on the
part of any non-defaulting Underwriter, the Depositor or the Bank, except
that the Representing Parties will continue to be liable for the payment of
expenses to the extent set forth in Sections 8 and 12 and except that the
provisions of Sections 9 and 10 shall not terminate and shall remain in
effect. As used in this Agreement, the term "Underwriter" includes, for all
purposes of this Agreement unless the context otherwise requires, any party
not listed in Schedule 1 hereto who, pursuant to this Section 7, purchases
Certificates which a defaulting Underwriter agreed but failed to purchase.
11
(b) Nothing contained herein shall relieve a defaulting Underwriter of
any liability it may have for damages caused by its default. If other
underwriters are obligated or agree to purchase the Certificates of a
defaulting Underwriter, either the Representative, the Depositor or the
Bank may postpone the Closing Date for up to seven full business days in
order to effect any changes that in the opinion of counsel for the
Depositor, opinion of counsel for the Bank or counsel for the Underwriters
may be necessary in the Registration Statement, the Prospectus or in any
other document or arrangement, and the Representing Parties agree to file
promptly any amendment or supplement to the Registration Statement or the
Prospectus that effects any such changes.
8. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If (a) notice shall have been
given pursuant to Section 6 terminating the obligations of the Underwriters
hereunder, (b) the Depositor shall fail to tender the Certificates for delivery
to the Underwriters for any reason permitted under this Agreement or (c) the
Underwriters shall decline to purchase the Certificates for any reason permitted
under this Agreement, the Representing Parties shall reimburse the Underwriters
for the fees and expenses of their counsel and for such other out-of-pocket
expenses as shall have been reasonably incurred by them in connection with this
Agreement and the proposed purchase of the Certificates, and upon demand the
Representing Parties shall pay the full amount thereof to the Representative. If
this Agreement is terminated pursuant to Section 7 by reason of the default of
one or more Underwriters, the Representing Parties shall not be obligated to
reimburse any defaulting Underwriter on account of those expenses.
9. INDEMNIFICATION.
(a) The Representing Parties, jointly and severally, agree to
indemnify and hold harmless each Underwriter and each person, if any, who
controls any Underwriter within the meaning of Section 15 of the Securities
Act (collectively referred to for the purposes of this Section 9 and
Section 10 as the Underwriter) against any loss, claim, damage or
liability, joint or several, to which that Underwriter may become subject,
under the Securities Act or otherwise, insofar as such loss, claim, damage
or liability (or any action in respect thereof) arises out of or is based
upon (i) any untrue statement or alleged untrue statement of a material
fact contained in any preliminary prospectus supplement, the Registration
Statement or the Prospectus or in any amendment or supplement thereto or
(ii) the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they are made, not misleading,
and shall reimburse each Underwriter for any legal or other expenses
reasonably incurred by that Underwriter directly in connection with
investigating or preparing to defend or defending against or appearing as a
third party witness in connection with any such loss, claim, damage or
liability (or any action in respect thereof) as such expenses are incurred;
provided, however, that the Representing Parties shall not be liable in any
such case to the extent that any such loss, claim, damage or liability (or
any action in respect thereof) arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged omission
from any preliminary prospectus supplement, the Registration Statement or
the Prospectus or any such amendment or supplement in reliance upon and in
conformity with the Underwriters' Information; provided, further that such
indemnity with respect to any preliminary prospectus supplement or any
amendment or supplement thereto shall not
12
inure to the benefit of any Underwriter from whom the person asserting any
such loss, claim, damage or liability purchased the Certificates which are
the subject thereof (or to the benefit of any person controlling such
Underwriter) if at or prior to the written confirmation of the sale of such
Certificates a copy of the Prospectus (or the Prospectus as amended or
supplemented) was not sent or delivered to such person and the untrue
statement or omission of a material fact contained in such preliminary
prospectus supplement was corrected in the Prospectus (or the Prospectus as
amended or supplemented) unless the failure is the result of noncompliance
by the Depositor with Section 4(d).
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless each Representing Party, each of its directors, each officer
of the Depositor who signed the Registration Statement and each person, if
any, who controls a Representing Party within the meaning of Section 15 of
the Securities Act (collectively referred to solely for the purposes of
this Section 9(b) as the "Representing Party Indemnified Parties"), against
any loss, claim, damage or liability, joint or several, to which the
Representing Party Indemnified Parties may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage or
liability (or any action in respect thereof) arises out of or is based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus supplement, the Registration
Statement or the Prospectus or in any amendment or supplement thereto or
(ii) the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they are made, not misleading,
but in each case only to the extent that the untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon
and in conformity with the written information furnished to the
Representing Parties by or on behalf of such Underwriter specifically for
use therein, and shall reimburse the Representing Party Indemnified Parties
for any legal or other expenses reasonably incurred by the Representing
Party Indemnified Parties in connection with investigating or preparing to
defend or defending against or appearing as third party witness in
connection with any such loss, claim, damage or liability (or any action in
respect thereof) as such expenses are incurred. The parties acknowledge and
agree that the written information furnished to the Representing Parties
through the Representative by or on behalf of the Underwriters (the
"Underwriters' Information") consists solely of the ______ paragraphs of
text and the following table under the caption "Underwriting" in the
Prospectus Supplement.
(c) Promptly after receipt by an indemnified party under this Section
9 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 9, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have under this Section 9 except to the extent
it has been materially prejudiced (through the forfeiture of substantive
rights or defenses) by such failure; and, provided, further, that the
failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under
this Section 9. If any such claim or action shall be brought against an
indemnified
13
party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying
party to the indemnified party of its election to assume the defense of
such claim or action, the indemnifying party shall not be liable to the
indemnified party under this Section 9 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation; provided,
however, an indemnified party shall have the right to employ its own
counsel in any such action, but the fees, expenses and other charges of
such counsel for the indemnified party will be at the expense of such
indemnified party unless (1) the employment of counsel by the indemnified
party has been authorized in writing by the indemnifying party, (2) the
indemnified party has reasonably concluded (based upon advice of counsel
to the indemnified party) that there may be legal defenses available to
it or other indemnified parties that are different from or in addition to
those available to the indemnifying party, (3) a conflict or potential
conflict exists (based upon advice of counsel to the indemnified party)
between the indemnified party and the indemnifying party (in which case
the indemnifying party will not have the right to direct the defense of
such action on behalf of the indemnified party) or (4) the indemnifying
party has not in fact employed counsel reasonably satisfactory to the
indemnified party to assume the defense of such action within a
reasonable time after receiving notice of the commencement of the action,
in each of which cases the reasonable fees, disbursements and other
charges of counsel will be at the expense of the indemnifying party or
parties. It is understood that the indemnifying party or parties shall
not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees, disbursements and other
charges of more than one separate firm of attorneys (in addition to any
local counsel) at any one time for all such indemnified party or parties.
Each indemnified party, as a condition of the indemnity agreements
contained in Sections 9(a) and 9(b), shall use all reasonable 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, but if settled with its
written consent or if there be a final judgment of 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. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of
any pending or threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceedings.
The obligations of the Representing Parties and the Underwriters in this
Section 9 and in Section 10 are in addition to any other liability which the
Representing Parties or the Underwriters, as the case may be, may otherwise
have.
10. CONTRIBUTION. If the indemnification provided for in Section 9 is
unavailable or insufficient to hold harmless an indemnified party under Section
9(a) or (b), then each
14
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability (i) in such proportion as shall be
appropriate to reflect the relative benefits received by the Representing
Parties on the one hand and the Underwriters on the other from the offering of
the Certificates or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Representing Parties on the one hand and the Underwriters on the
other with respect to the statements or omissions which resulted in such loss,
claim, damage or liability, as well as any other relevant equitable
considerations. The relative benefits received by the Representing Parties on
the one hand and the Underwriters on the other with respect to such offering
shall be deemed to be in the same proportion as the total net proceeds from the
offering of the Certificates purchased under this Agreement (before deducting
expenses) received by the Representing Parties bear to the total underwriting
discounts and commissions received by the Underwriters with respect to the
Certificates purchased under this Agreement, in each case as set forth in the
table on the cover page of the Prospectus Supplement. 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 Representing Parties on
the one hand or the Underwriters on the other, the intent of the parties and
their relative knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission.
The Representing Parties and the Underwriters agree that it would not be
just and equitable if contributions pursuant to this Section 10 were to be
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability referred to above in this Section 10 shall be deemed to include,
subject to the limitations on the fees and expenses of separate counsel set
forth in Section 9, for purposes of this Section 10, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such claim or any action in respect thereof. Notwithstanding
the provisions of this Section 10, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Certificates underwritten by it and distributed to the public were offered
to the public less the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Underwriters' obligations to indemnify as
provided in Section 9 and contribute as provided in this Section 10 are several
in proportion to their respective underwriting obligations and not joint.
11. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement shall inure to
the benefit of and be binding upon the Underwriters and the Representing Parties
and their respective successors. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any person, firm or
corporation, other than the Underwriters and the Representing Parties and their
respective successors and the controlling persons and officers and directors
referred to in Sections 9 and 10 and their heirs and legal representatives, any
legal or
15
equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
12. EXPENSES. The Representing Parties agree with the Underwriters to pay
(a) the costs incident to the authorization, issuance, sale, preparation and
delivery of the Certificates and any taxes payable in that connection; (b) the
costs incident to the preparation, printing and filing under the Securities Act
of the Registration Statement and any amendments and exhibits thereto; (c) the
costs of distributing the Registration Statement as originally filed and each
amendment thereto and any post-effective amendments thereof (including, in each
case, exhibits), any preliminary prospectus supplement, the Prospectus and any
amendment or supplement to the Prospectus, including, without limitation, the
Prospectus Supplement, all as provided in this Agreement; (d) the costs of
printing, reproducing and distributing this Agreement and any other underwriting
and selling group documents by mail, telex or other means of communications; (e)
the fees and expenses of qualifying the Certificates under the securities laws
of the several jurisdictions as provided in Section 4(g) and of preparing,
printing and distributing Blue Sky Memoranda (including related fees and
expenses of counsel to the Underwriters); (f) any fees charged by _____ and
_____ for rating the Certificates; (g) all fees and expenses of the Trustee and
its counsel; and (h) all other costs and expenses incident to the performance of
the obligations of the Representing Parties under this Agreement; provided that,
except as otherwise provided in this Section 12 and in Section 8, the
Underwriters shall pay their own costs and expenses, including the costs and
expenses of their counsel, any transfer taxes on the Certificates which they may
sell and the expenses of advertising any offering of the Certificates made by
the Underwriters.
13. SURVIVAL. The respective indemnities, rights of contribution,
representations, warranties and agreements of the Representing Parties and the
Underwriters contained in this Agreement or made by or on behalf on them,
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Certificates and shall remain in full force and effect,
regardless of any (i) termination or cancellation of this Agreement, (ii) any
investigation made by or on behalf of any of them or any person controlling any
of them or (iii) acceptance of and payment for the Certificates.
14. NOTICES, ETC. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) if to the Underwriters, shall be delivered or sent by mail or
facsimile transmission and confirmed to c/o the Representative at ________,
Attention: ___________, with a copy to the Legal Department;
(b) if to the Depositor, shall be delivered or sent by mail or
facsimile transmission and confirmed to the address of the Depositor set
forth in the Registration Statement, Attention: [ ];
(c) if to the Bank, shall be delivered or sent by mail or facsimile
transmission and confirmed to the address of the Bank set forth in the
Registration Statement, Attention: General Counsel;
16
provided, however, that any notice to an Underwriter pursuant to Section 9(c)
shall be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its acceptance telex to the
Representative, which address will be supplied to any other party hereto by the
Representative upon request. Any such statements, requests, notices or
agreements shall take effect at the time of receipt thereof. The Representing
Parties shall be entitled to act and rely upon any request, consent, notice or
agreement given or made on behalf of the Underwriters by the Representative.
15. DEFINITIONS OF CERTAIN TERMS. For purposes of this Agreement, "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading.
16. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
17. 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 instrument.
18. HEADINGS. The headings herein are inserted for convenience of reference
only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
17
If the foregoing is in accordance with your understanding of the agreement
between the Depositor, the Bank and the several Underwriters, kindly indicate
your acceptance in the space provided for that purpose below.
Very truly yours,
USAA FEDERAL SAVINGS BANK
By____________________________
Name:
Title:
USAA ACCEPTANCE, LLC
By____________________________
Name:
Title:
Accepted:
[Name of Representative],
For Itself and as Representative
of the Several Underwriters
By_______________________________
Authorized Signatory
18
SCHEDULE I
Principal Amount of Principal Amount of
Underwriters Class A Certificates Class B Certificates
------------ -------------------- --------------------
[Name of Representative] $ $
19
