EXHIBIT 1
PEOPLE'S BANK CREDIT CARD MASTER TRUST
$343,000,000 Floating Rate Class A
Asset Backed Certificates, Series 1998-1
$27,000,000 Floating Rate Class B
Asset Backed Certificates, Series 1998-1
Underwriting Agreement
XXXXXXX, XXXXX & CO.,
as Representatives of
the Class A Underwriters and
as Class B Underwriters
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
March 24, 1998
Dear Sirs:
People's Structured Finance Corp., a Connecticut corporation ("PSFC")
and a wholly owned subsidiary of People's Bank, a Connecticut stock savings bank
(the "Bank"), proposes, subject to the terms and conditions stated herein, to
sell to the underwriters listed on Schedule A hereto (the "Underwriters"), an
aggregate of $343,000,000 principal amount of People's Bank Credit Card Master
Trust Floating Rate Class A Asset Backed Cer tificates, Series 1998-1 (the
"Class A Certificates") and $27,000,000 Floating Rate Class B Asset Backed
Certificates, Series 1998-1 (the "Class B Certificates" and, together with Class
A Certificates, the "Certificates"). We refer to you herein in your capacities
as Underwriters and as representatives of the Underwriters as the
"Representatives".
Each Certificate will represent an undivided interest in the People's
Bank Credit Card Master Trust (the "Trust") established pursuant to an Amended
and Restated Pooling and Servicing Agreement between the Bank, as Seller and as
Servicer of the credit card receivables transferred to the Trust, and Bankers
Trust Company, as trustee (the "Trustee"), dated as of March 18, 1997, as
further amended by an amendment thereto dated as of September 24, 1998 (the "P&S
Agreement"). Additional credit card receivables have been transferred to the
Trust
subsequent to the date of the P&S Agreement pursuant to Assignment No. 1 between
the Bank and the Trustee, dated as of October 4, 1994 ("Assignment No. 1"),
Assignment No. 2 between the Bank and the Trustee, dated as of July 14, 1995
("Assignment No. 2"), Assignment No. 3 between the Bank and the Trustee, dated
as of May 1, 1996 ("Assignment No. 3"), Assignment No. 4 between the Bank and
the Trustee, dated as of October 1, 1996 ("Assignment No. 4"), Assignment No. 5
between the Bank and the Trustee, dated as of May 1, 1997 ("Assignment No. 5"),
Assignment No. 6 between the Bank and the Trustee, dated as of August 1, 1997
("Assignment No. 6"), Assignment No. 7 between the Bank and the Trustee, dated
as of November 1, 1997 ("Assignment No. 7") and Assignment No. 8 between the
Bank and the Trustee, dated as of February 2, 1998 ("Assignment No. 8"). The
Bank assigned to PSFC all of the Bank's right, title and interest in, to and
under the Exchangeable Seller Certificate pursuant to the Assignment and
Assumption Agreement (the "Assignment"), dated as of December 15, 1995. The
Certificates will be issued pursuant to the P&S Agreement and the Series 1998-1
Supplement between People's Bank, as Transferor and Servicer, and Bankers Trust
Company as Trustee, dated as of April 1, 1998 (the "Series Supplement" and,
together with the P&S Agreement, Assignment No. 1, Assignment No. 2, Assignment
No. 3, Assignment No. 4, Assignment No. 5, Assignment No. 6, Assignment No. 7
and Assignment No. 8, the "Pooling and Servicing Agreement"). The property of
the Trust will include, among other things, receivables (the "Receivables")
generated from time to time in a portfolio of MasterCard and VISA credit card
accounts, all monies due or to become due in payment of the Receivables,
Recoveries and Interchange allocable to the Trust, the benefits of the funds and
securities on deposit in certain bank accounts with respect to the Certificates
and an interest rate cap agreement for the exclusive benefit of the Class A Cer
tificateholders and an interest rate cap agreement for the exclusive benefit of
the Class B Certificateholders. In addition, the Certificates will have the
exclusive benefit of an interest in the Trust to be issued simultaneously with
the Certificates in the initial principal amount of $30,000,000 (the "Collateral
Interest"), which is subordinate to the Class A Certificates and the Class B
Certificates. To the extent not de fined herein, capitalized terms used herein
have the meanings assigned in the Pooling and Servicing Agreement.
1. PSFC and the Bank, each only as to itself, repre sents and warrants
to, and agrees with, the Underwriters that:
(a) A registration statement in respect of the Certificates
has been filed with the Securities and Exchange Commission (the
"Commission"); such registration statement and any post-effective
amendment thereto, each in the form heretofore delivered to the
Underwriters, has been declared effective by the Commission in such
form; no other document
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with respect to such registration statement has heretofore been filed
with the Commission and no stop order suspending the effectiveness of
such registration statement has been issued and no proceeding for that
purpose has been initiated or, to PSFC's or the Bank's knowledge, as
applicable, threatened by the Commission (any preliminary prospectus
included in such registration statement or filed with the Commission
pursuant to Rule 424(a) of the rules and regulations of the Commission
under the Securities Act of 1933, as amended (the "Act"), being
hereinafter called a "Preliminary Prospectus"; the various parts of
such registration statement, including all exhibits thereto and
including the information contained in the form of final prospectus
filed with the Commission pursuant to Rule 424(b) under the Act in
accordance with Section 5(a) hereof and deemed by virtue of Rule 430A
under the Act to be part of the registration statement at the time it
was declared effective, each as amended at the time such part of the
registration statement became effective, being hereinafter called the
"Registration Statement"; and such final prospectus, in the form first
filed pursuant to Rule 424(b) under the Act, being hereinafter called
the "Prospectus");
(b) No order preventing or suspending the use of any
Preliminary Prospectus has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the Act and the rules and
regulations of the Commission thereunder, and did not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to either PSFC
or the Bank by the Representatives expressly for use therein;
(c) The Registration Statement conforms, and the Pro spectus
and any further amendments or supplements to the Registration Statement
or the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Regis tration Statement and any amendment thereto and as of
the applicable filing date as to the Prospectus and any amendment or
supplement thereto, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein with respect to the
Prospectus, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and
warranty shall not apply to any
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statements or omissions made in reliance upon and in conformity with
information furnished in writing to either PSFC or the Bank by the
Representatives expressly for use therein;
(d) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, (i) there has
not been any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general
affairs, business, management, financial position, stockholders' equity
or results of operations of either PSFC or the Bank and any of the
Bank's subsidiaries, on a consolidated basis, and (ii) neither PSFC nor
the Bank or any of the Bank's subsidiaries has entered into any
transaction or agreement (whether or not in the ordinary course of
business) material to PSFC or the Bank and the Bank's subsidiaries,
taken as a whole, that, in the case of either such clause (i) or (ii),
would reasonably be expected to materially adversely affect the
interests of the holders of the Certificates, otherwise than as set
forth or contemplated in the Prospectus;
(e) The Bank has been duly incorporated and is validly
existing as a Connecticut stock savings bank under the laws of the
State of Connecticut, with all power, authority and legal right
necessary to own its properties and conduct its business as described
in the Prospectus, and to enter into and perform its obligations under
this Agreement, the Pooling and Servicing Agreement, the Assignment and
the Loan Agreement, and had at all relevant times, and now has, the
power, authority and legal right to acquire, own and sell the
Receivables, and is duly qualified to do business and is in good
standing as a foreign corporation (or is exempt from such
requirements), and has obtained all necessary licenses and approvals
with respect to the Bank in each jurisdiction in which failure to
qualify or to obtain such licenses or approvals would render any
Receivable unenforceable by the Bank or the Trust or would have a
material adverse effect on the Certificateholders, or any Enhancement
Provider;
(f) PSFC has been duly incorporated and is validly existing as
a Connecticut corporation in good standing under the laws of the State
of Connecticut, with all power, authority and legal right necessary to
own its properties and conduct its business as described in the
Prospectus, and to enter into and perform its obligations under this
Agreement and the Assignment and had at all relevant times, and now
has, the power, authori ty and legal right to acquire, own and exchange
the Exchange able Seller Certificate, and is duly qualified to do
business and is in good standing as a foreign corporation (or is exempt
from such requirements), and has obtained all necessary li censes and
approvals in each jurisdiction in which failure to
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qualify or to obtain such licenses or approvals would have a material
adverse effect on the Certificateholders or any En hancement Provider;
(g) The Certificates have been duly authorized and, when
executed, issued and delivered pursuant to the Pooling and Servicing
Agreement, duly authenticated by the Trustee and paid for by the
Underwriters in accordance with the terms of this Agreement, will have
been duly and validly executed, authenti cated, issued and delivered
and will be entitled to the benefits provided by the Pooling and
Servicing Agreement; the Pooling and Servicing Agreement has been duly
authorized by the Bank and, when executed and delivered by the Bank and
the Trustee, will constitute a valid and binding agreement of the Bank,
subject (x) to the effect of any applicable bankruptcy, insolvency,
reorganization, moratoriums, and other similar laws affecting
creditors' rights generally, (y) to the effect of general principles of
equity including (without limitation) concepts of materiality,
reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding in equity or at law), and (z) to the further
qualification that certain remedial provisions in the Pooling and
Servicing Agree ment may be limited or rendered ineffective by the
applicable laws of the State of New York or judicial decisions
governing such provisions or holding their enforcement to be
unreasonable under the then existing circumstances (but there exists in
the Pooling and Servicing Agreement or pursuant to applicable law
legally adequate remedies for a realization of the principal benefits
purported to be provided thereby); the Certificates and the Pooling and
Servicing Agreement conform to the descrip tions thereof in the
Prospectus in all material respects;
(h) The Assignment has been duly authorized, executed and
delivered by PSFC and the Bank, as applicable, and constitutes a valid
and binding agreement of PSFC and the Bank, subject to the effect of
(x) any applicable bankruptcy, insolvency, reorganization, moratoriums,
and other similar laws affecting creditors' rights generally and (y)
general principles of equity including (without limitation) concepts of
materiality, reasonableness, good faith and fair dealing (re gardless
of whether considered in a proceeding in equity or at law);
(i) The Loan Agreement has been duly authorized by the Bank
and when executed and delivered by the Bank, the Trustee, the
Collateral Interest Holder and the Agent, will constitute a valid and
binding agreement of the Bank, subject (x) to the effect of any
applicable bankruptcy, insolvency, reorganization, moratoriums, and
other similar laws affecting creditors' rights generally,(y) to the
effect of general principles of equity including (without limitation)
concepts of materiality,
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reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding in equity or at law), and (z) to the further
qualification that certain remedial provisions in the Loan Agreement
may be limited or rendered ineffec tive by the applicable laws of the
State of New York or judicial decisions governing such provisions or
holding their enforcement to be unreasonable under the then existing
circumstances (but there exists in the Loan Agreement or pursu ant to
applicable law legally adequate remedies for a realiza tion of the
principal benefits purported to be provided there by);
(j) This Agreement has been duly authorized, executed and
delivered by the Bank and PSFC;
(k) The issuance and sale of the Certificates and the
compliance by PSFC and the Bank, as applicable, with all of the
provisions of the Certificates, this Agreement, the Pooling and
Servicing Agreement, the Assignment and the Loan Agreement, as
applicable, and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, or
result in the creation of any lien, mortgage, pledge, charge, security
interest or encum brance (collectively, "Liens"), other than as
contemplated in or permitted by the Pooling and Servicing Agreement,
the Loan Agreement or the Assignment, upon any property or assets of
PSFC or the Bank, as applicable, pursuant to, any material indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument to which PSFC, the Bank or any of the Bank's other
subsidiaries is a party or by which any of them is bound or to which
any of the property or assets of PSFC, the Bank or any of the Bank's
other subsidiaries is sub ject, nor will such action result in any
violation of the provisions of the Certificate of Incorporation or
By-laws of PSFC, or of the Articles of Incorporation or By-laws of the
Bank, as applicable, or any statute or any order, rule or regu lation
of any court or governmental agency or body having jurisdiction over
PSFC, the Bank or any of the Bank's other subsidiaries or any of their
properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is re quired for the issue and sale of the Certificates
or the consummation by PSFC or the Bank, as applicable, of the
transactions contemplated by this Agreement, the Assignment, the Loan
Agreement or the Pooling and Servicing Agreement, except the filing of
Uniform Commercial Code financing state ments with respect to the
Receivables, the registration under the Act of the Certificates, and
such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky
laws in connection with the purchase and distribution of the
Certificates by the Underwriters;
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(l) Other than as set forth in the Prospectus, there are no
legal or governmental proceedings pending to which either PSFC or the
Bank, as applicable, is a party or of which any property of either PSFC
or the Bank is the subject which are reasonably probable of adverse
determination and which, if determined adversely to PSFC or the Bank,
as applicable, would have a material adverse effect on the financial
position, stockholders' equity or results of operations of PSFC or the
Bank or which could interfere with or adversely affect the consummation
of the transactions contemplated in this Agreement, the Pooling and
Servicing Agreement, the Loan Agreement or the Assignment; and, to the
best of PSFC's and the Bank's knowledge, as applicable, no such
proceedings are threatened or contemplated by governmental authorities
or threatened by others except as set forth in or contemplated by the
Prospectus;
(m) Neither PSFC nor the Bank or any of the Bank's other
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;
(n) KPMG Peat Marwick, which have reviewed the statistical
data included in the Registration Statement, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder;
(o) At the Time of Delivery (as specified in Section 4
hereof), the representations and warranties of the Seller and of the
Servicer, made in Sections 2.3 and 3.3, respectively, of the Pooling
and Servicing Agreement shall be true and correct; and the
representations and warranties of the Seller relating to the
Receivables made in Section 2.4 of the Pooling and Ser vicing Agreement
shall be true and correct; provided, however, that the breach of any
such representations and warranties in Section 2.4 of the Pooling and
Servicing Agreement shall not be deemed to be a breach hereunder unless
such breach materially adversely affects the interests of the holders
of either the Class A Certificates or the Class B Certificates;
(p) At the time of execution and delivery of the Pooling and
Servicing Agreement, the Bank had good and market able title to the
Receivables transferred to the Trustee pursu ant thereto, free and
clear of any Liens (other than as contemplated in the Pooling and
Servicing Agreement or the Assignment), and will not have assigned to
any Person any of its right, title or interest in the Receivables or in
such Pooling and Servicing Agreement (other than as contemplated in
7
the Pooling and Servicing Agreement or the Assignment) and PSFC will
not have assigned to any Person any of its right, title or interest in
the Certificates being issued pursuant to the Pooling and Servicing
Agreement (other than as contemplated in the Pooling and Servicing
Agreement); the Bank had at such time the power and authority to
transfer the Receivables to the Trustee; PSFC has on the date hereof
the power and authority to transfer the Certificates to the
Underwriters, and, upon execu tion and delivery to the Trustee of the
Series Supplement and execution, authentication and delivery to the
Underwriters of the Certificates, the Trustee will have good and
marketable title to or a perfected security interest in the Receivables
and the Underwriters, upon payment of the purchase price of the
Certificates, will have good and marketable title to the Cer tificates,
in each case free and clear of any Liens (other than Liens created by
the Underwriters and other than as contemplat ed in the Pooling and
Servicing Agreement or the Assignment);
(q) Any taxes, fees and other governmental charges imposed
upon PSFC or the Bank or on the assets of the Trust in connection with
the execution, delivery and issuance by the Bank of this Agreement, the
Pooling and Servicing Agreement and the Certificates and which are due
at or prior to the Time of Delivery have been or will have been paid by
PSFC or the Bank, as applicable, at or prior to the Time of Delivery;
(r) The Receivables pledged by the Bank to the Trustee under
the Pooling and Servicing Agreement have an aggregate outstanding
balance determined as of December 31, 1997 ("the Series Cut-Off Date"),
in accordance with the Pooling and Servicing Agreement of not less than
$2,845,000,000 (after giving effect to the addition of Accounts on
February 2, 1998 and the removal of Accounts on March 2, 1998);
(s) The Trust is not an "investment company" or a company
"controlled by" an "investment company" within the meaning of the
Investment Company Act of 1940, as amended (the "1940 Act"); and
(t) The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended.
2. Subject to the terms and conditions herein set forth, PSFC agrees to
sell and deliver to the Underwriters, and the Underwriters agree, severally and
not jointly, to purchase from PSFC the number and type of Certificates set forth
in Schedule A opposite the name of each such Underwriter. The Class A
Certificates being purchased by the Underwriters hereunder are to be purchased
at a purchase price equal to 99.71% of the principal amount thereof. The Class B
Certificates being purchased
8
by the Underwriters hereunder are to be purchased at a purchase price equal to
99.71% of the principal amount thereof.
3. Upon the authorization by PSFC of the release of the Certificates,
the Underwriters propose to offer the Certificates for sale upon the terms and
conditions set forth in the Prospectus.
4. The Certificates to be purchased by the Under writers hereunder, in
definitive or book-entry form, and in such authorized denominations and
registered in such names as the Underwriters may request upon at least
forty-eight hours' prior notice to PSFC, shall be delivered by or on behalf of
PSFC to the Underwriters against payment by the Underwriters or on behalf of the
Underwriters of the purchase price therefor, in immediately available funds,
drawn to the order of PSFC, at the office of Xxxxx, Brown & Xxxxx, 0000
Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 a.m. on April 1, 1998, or at such
other place and time and date as the Underwriters and PSFC may agree upon in
writing, such time and date being herein called the "Time of Delivery" for such
Certificates. Such Certificates will be made available for checking at least
twenty-four hours prior to the Time of Delivery at the office of Xxxxx Xxxxx &
Xxxxx described above.
5. PSFC and the Bank each agrees with the Underwriters:
(a) To advise the Underwriters promptly of any proposal to
amend or supplement the Registration Statement as filed, or the
Prospectus, and will not effect such amendment or supplement without
the consent of the Representatives, which consent shall not be
unreasonably delayed or withheld; to pre pare and file the Prospectus
in a form approved by the Representatives and to file such Prospectus
pursuant to Rule 424(b) under the Act not later than the Commission's
close of business on the second business day following the execution
and delivery of this Agreement, or, if applicable, such earlier time as
may be required by Rule 430A(a)(3) under the Act; to advise the
Underwriters, promptly after it receives notice thereof, of the time
when the Registration Statement, or any amendment thereto, has been
filed or becomes effective or any supplement to the Prospectus or any
amended Prospectus has been filed and to furnish the Underwriters with
copies thereof; to advise the Underwriters, promptly after it receives
notice thereof, of the issuance by the Commission of any stop order or
of any order preventing or suspending the use of any Prelim inary
Prospectus or Prospectus, of the suspension of the quali fication of
the Certificates for offering or sale in any jurisdiction, of the
initiation or threatening of any proceed ing for any such purpose, or
of any request by the Commission for the amending or supplementing of
the Registration Statement
9
or Prospectus or for additional information; and, in the event of the
issuance of any stop order or any order preventing or suspending the
use of any Preliminary Prospectus or Prospectus or suspending any such
qualification, to use promptly its best efforts to obtain its
withdrawal;
(b) Promptly from time to time to take such action as the
Underwriters may reasonably request to qualify the Certif icates for
offering and sale under the securities laws of such jurisdictions as
the Underwriters 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 PSFC nor the Bank shall be required to qualify as a foreign
corporation or dealer in securities, or to file a general consent to
service of process, in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus
in such quantities as the Underwriters may from time to time reasonably
request, and, if the delivery of a pro spectus is required at any time
prior to the expiration of nine months after the time of issue of the
Prospectus in connection with the offering or sale of the Certificates
and if at such time 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 light of the
circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus
in order to comply with the Act, to notify the Underwriters and to
prepare and file with the Commission and furnish without charge to the
Underwriters and to any dealer in securities as many copies as the
Underwriters may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance; and in case the
Underwriters are required to deliver a prospectus in connection with
the sales of any of the Certificates at any time nine months or more
after the date of issue of the Prospectus, upon the request of the
Underwriters but at the expense of the Underwriters, to prepare and
deliver to the Underwriters as many copies as the Underwriters may
reasonably request of an amended or supplemented Prospectus complying
with Section 10(a)(3) of the Act;
(d) To make generally available to the Certificateholders, as
soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in
Rule 158(c)), an earnings
10
statement of the Trust (which need not be audited) complying with
Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including, at the option of the Bank, Rule 158);
(e) During the period beginning from the date hereof and
continuing to and including the earlier of (i) the termi nation of
trading restrictions on the Certificates, as notified to PSFC and the
Bank by the Representatives, and (ii) the Time of Delivery, not to
offer, sell, contract to sell or otherwise dispose of any securities of
PSFC or the Bank or a trust formed by the Bank which mature more than
one year after the Time of Delivery and which are substantially similar
to the Certifi xxxxx, without the prior written consent of the
Representatives;
(f) So long as any Certificates are outstanding, to furnish to
the Underwriters copies of all reports or other written communications
(financial or other) furnished to holders of the Certificates, and
deliver to the Underwriters as soon as they are available, copies of
any reports and financial statements furnished to or filed by PSFC or
the Bank with the Commission, or any national securities exchange on
which the Certificates or any class of securities of the Bank are
listed;
(g) So long as any Certificates are outstanding, to furnish to
the Underwriters copies of all such additional information concerning
the business and financial condition of the Trust as the Underwriters
may from time to time reasonably request; and
(h) To the extent, if any, that the rating provided with
respect to the Certificates by Standard & Poor's Ratings Services and
Xxxxx'x Investors Service, Inc. or the rating provided with respect to
the Collateral Interest by Fitch IBCA, Inc. is conditional upon the
furnishing of documents or the taking of any other actions by PSFC or
the Bank, PSFC or the Bank, as applicable, shall furnish such documents
and take any such other actions.
6. PSFC and the Bank each covenants and agrees with the Underwriters
that together they will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the counsel and accountants of PSFC and the Bank,
as applicable, in connection with the registration of the Certificates under the
Act and all other expenses in connection with the preparation, printing and
filing of the Registration Statement, any Prelim inary Prospectus and the
Prospectus and amendments and supple ments thereto and the mailing and
delivering of copies thereof to the Underwriters and dealers; (ii) the cost of
printing or producing this Agreement, the Pooling and Servicing Agreement,
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the Blue Sky and Legal Investment Memoranda and any other docu ments in
connection with the offering, purchase, sale and delivery of the Certificates;
(iii) all expenses in connection with the qualification of the Certificates for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the fees and disbursements of counsel for the Underwriters in
connection with such qualification and in connection with the Blue Sky and legal
investment surveys; (iv) any fees charged by securities rating services for
rating the Certificates; (v) any cost of preparing the Certificates; (vi) the
fees and expenses of the Trustee and any agent of the Trustee and the fees and
disbursements of counsel for the Trustee in connection with the Pooling and
Servicing Agreement and the Certificates; and (vii) all other costs and expenses
incident to the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. It is understood, however, that,
except as provided in this Section, Section 8 and Section 11 hereof, the
Underwriters will pay all of its own costs and expenses, including the fees of
its counsel, transfer taxes on resale of any of the Certificates by it, and any
advertising expenses connected with any offers it may make.
7. The obligations of each of the Underwriters hereun der shall be
subject, in its discretion, to the condition that all representations and
warranties and other statements of each of PSFC and the Bank herein are, at and
as of the Time of Delivery, true and correct, the condition that each of PSFC
and the Bank shall have performed all of their respective obligations hereunder
theretofore to be performed, and the following additional conditions:
(a) The Prospectus shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed
for such filing by the rules and regulations under the Act and in
accordance with Section 5(a) hereof; 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, to the knowledge of PSFC, the Bank or the Underwriters,
threatened by the Commission; and all requests for additional
information on the part of the Commission shall have been complied with
to the reasonable satisfaction of the Representatives;
(b) Since the respective dates as of which information is
given in the Prospectus, there shall not have been any material adverse
change, or any development involving a prospective material adverse
change, in or affecting the general affairs, business, management,
financial position, stockholders' equity or results of operations of
either PSFC or the Bank and its subsidiaries on a consolidated basis
otherwise than as set forth or contemplated in the Prospectus, the
effect
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of which in the judgment of the Underwriters makes it impracticable to
proceed with the public offering or the delivery of the Certificates on
the terms and in the manner contemplated in the Registration Statement;
(c) At the Time of Delivery, each of PSFC and the Bank shall
have furnished to the Underwriters certificates of an executive officer
of PSFC or the Bank, as applicable, as to the accuracy of the
representations and warranties of PSFC or the Bank, as applicable,
herein at and as of the Time of Delivery, as to the performance by PSFC
or the Bank of all of their re spective obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set
forth in subsec tions (a) through (c) of this Section and as to such
other mat ters as the Underwriters may reasonably request;
(d) Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP, counsel for the
Underwriters, shall have furnished to the Underwriters such opinion or
opinions, dated the Time of Delivery, with respect to the validity of
the Pooling and Servicing Agreement, the Certificates, the Registration
Statement, the Prospectus, and other related matters as the
Underwriters may reasonably request, and such counsel shall have
received from PSFC or the Bank and their counsel such papers and
information as they may reasonably request from PSFC or the Bank and
their counsel to enable them to pass upon such matters;
(e) Xxxxx, Xxxxx & Xxxxx, counsel for PSFC and the Bank, shall
have furnished to the Underwriters their written opinion, addressed to
the Underwriters and dated the Time of Delivery, in form and substance
satisfactory to the Underwriters and their counsel, substantially to
the effect that:
(i) This Agreement has been duly autho rized,
executed and delivered by each of PSFC and the Bank;
(ii) The Certificates have been duly autho rized,
executed and delivered by the Bank and, when duly
authenticated in accordance with the terms of the Pooling and
Servicing Agreement and delivered to and paid for by the
Underwriters in accordance with the terms of this Agreement,
will be validly issued and entitled to the benefits provided
by the Pooling and Servicing Agreement;
(iii) The Pooling and Servicing Agreement has been
duly authorized, executed and delivered by the Bank and
constitutes the legal, valid and binding agreement of the Bank
enforceable against the Bank in
13
accordance with its terms, subject (x) to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium,
and other similar laws affecting creditors' rights generally,
(y) to the effect of general principles of equity including
(without limitation) concepts of materiality, reasonableness,
good faith and fair dealing (regardless of whether considered
in a proceeding in equity or at law), and (z) to the further
qualification that certain remedial provisions in the Pooling
and Servicing Agreement may be limited or ren dered
ineffective by the applicable laws of the State of New York or
judicial decisions governing such pro visions or holding their
enforcement to be unreasonable under the then existing
circumstances (but, in such counsel's opinion, there exists in
the Pooling and Ser vicing Agreement or pursuant to applicable
law legally adequate remedies for a realization of the
principal benefits purported to be provided thereby);
(iv) The Assignment has been duly authorized,
executed and delivered by each of PSFC and the Bank and
constitutes the legal, valid and binding agreement of each of
PSFC and the Bank enforceable against PSFC and the Bank in
accordance with its terms, subject (x) to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium,
and other similar laws affecting creditors' rights generally
and (y) to the effect of general principles of equity
including (without limitation) concepts of materiality,
reasonableness, good faith and fair dealing (regardless of
whether considered in a proceeding in equity or at law);
(v) The Loan Agreement has been duly authorized,
executed and delivered by the Bank and consti tutes the legal,
valid and binding agreement of the Bank enforceable against
the Bank in accordance with its terms, subject (x) to the
effect of any applicable bankruptcy, insolvency,
reorganization, moratorium, and other similar laws affecting
creditors' rights gener ally and (y) to the effect of general
principles of equity including (without limitation) concepts
of materiality, reasonableness, good faith and fair dealing
(regardless of whether considered in a proceed ing in equity
or at law), and (z) to the further qualification that certain
remedial provisions in the Loan Agreement may be limited or
rendered ineffective by the applicable laws of the State of
New York or judicial decisions governing such provisions or
holding their enforcement to be unreasonable under the then
existing circumstances (but there exists in the Loan
14
Agreement or pursuant to applicable law legally adequate
remedies for a realization of the principal benefits purported
to be provided thereby);
(vi) The Pooling and Servicing Agreement need not be
qualified under the Trust Indenture Act of 1939, as amended;
and the Trust is not now, and immediately following the sale
of the Certificates pursuant to this Agreement will not be,
required to register under the 1940 Act;
(vii) Such counsel has participated in the
preparation of the Registration Statement and Pro spectus.
From time to time, such counsel has had discussions with the
officers and employees of PSFC and the Bank, the independent
accountants of PSFC and the Bank, and employees and
representatives of the Underwriters concerning the information
contained in the Registration Statement and Prospectus. Based
thereupon such counsel is of the opinion that the Registration
Statement and the Prospectus (except for the operating
statistics, financial statements, financial schedules and
other financial and operating data included therein, as to
which it expresses no view) comply as to form with the Act and
the rules and regulations thereunder;
(viii) The statements in the Prospectus under
"Certain Legal Aspects of the Receivables," insofar as such
statements constitute a summary of the legal matters,
documents or proceedings referred to therein, have been
reviewed by such counsel and are correct in all material
respects. Furthermore, insofar as the statements contained in
the Registration State ment purport to summarize certain
provisions of the Certificates and the Pooling and Servicing
Agreement, such statements present summaries of such
provisions that are accurate in all material respects;
(ix) The Registration Statement has become effective
under the Act, and the Prospectus has been filed with the
Commission pursuant to Rule 424(b) thereunder in the manner
and within the time period required by Rule 424(b). To the
best of such counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceedings for that purpose are pending or threatened
by the Commission. Such counsel does not know of any contracts
or documents of a character required to be described in the
Registration Statement or Prospectus
15
or to be filed as exhibits to the Registration Statement that
are not described and filed as required;
(x) Such counsel has not independently verified and
is not passing upon, and does not assume any responsibility
for, the accuracy, completeness or fairness (except as set
forth in paragraph (viii) above and under the headings
"Prospectus Summary--Tax Status," "Prospectus Summary--ERISA
Considerations," "Certain Federal Income Tax Consequences" and
"Certain Employee Benefit Plan Considerations") of the
information contained in the Registration Statement and
Prospectus. Based upon the participation and discussions
described above, no facts have come to such counsel's
attention that cause it to believe that the Registration
Statement, as of its effective date (except for the financial
statements, financial schedules and other financial and
operating data included therein as to all of which such
counsel expresses no view), contained any untrue statement of
a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the
statements therein not misleading, or that the Prospectus, as
of its date and as of the Closing Date (except for the
financial statements, financial sched ules, and other
financial and operating data included therein as to which such
counsel expresses no view) contained or contains any untrue
statement of a mate rial fact or omitted or omits to state a
material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circum
stances under which they were made, not misleading; and
(xi) The Receivables are accounts or general
intangibles as defined in the Uniform Commercial Code.
In rendering such opinion, such counsel shall be entitled to rely as to
matters of fact upon such certificates or other assurances of public
officials and such certificates of one or more officers of PSFC, the
Bank and/or the Bank's other subsid iaries or the legal opinion of the
general counsel of PSFC and/or the Bank as such counsel shall
reasonably deem neces sary.
(f) Xxxxx, Xxxxx & Xxxxx, counsel for PSFC and the Bank, shall
have furnished to the Underwriters their opinion or opinions, dated the
Time of Delivery and satisfactory in form and substance to the
Underwriters and its counsel, with respect to certain matters relating
to the transfer of the Receivables to the Trust, and the Financial
Institutions Reform, Recovery and Enforcement Act with respect to the
effect of receivership
16
of the Bank and with respect to other related matters in a form
previously approved by the Underwriters and its counsel;
(g) Xxxxx, Brown & Xxxxx, special tax counsel for the Bank,
shall have furnished to the Underwriters their opinion or opinions,
dated the Time of Delivery and satisfactory in form and substance to
the Underwriters, to the effect that for federal and New York State
income tax purposes the Certificates will be characterized as
indebtedness that is secured by the Receivables, and that the Trust
will be treated as a mere security device for Federal and New York
State income tax purposes, and the statements set forth in the
Prospectus under the headings "Prospectus Summary -- Tax Status,"
"Prospectus Summary -- ERISA Considerations," "Certain Federal Income
Tax Consequences" and "Certain Employee Benefit Plan Consider ations"
are a fair and accurate summary of the material tax consequences of the
issuance and holding of the Certificates;
(h) Pullman & Xxxxxx, LLC, special Connecticut tax counsel for
the Bank, shall have furnished to the Underwriters their opinion, dated
the Time of Delivery and satisfactory in form and substance to the
Underwriters and its counsel, to the effect that for Connecticut state
income tax purposes the Cer tificates will be characterized as
indebtedness that is secured by the Receivables and that the Trust will
be treated as a mere security device for Connecticut state tax
purposes;
(i) Pullman & Xxxxxx, LLC, special Connecticut counsel for
PSFC and the Bank, shall have furnished to the Underwriters their
opinion or opinions, dated the Time of Delivery and satisfactory in
form and substance to the Underwriter and its counsel, with respect to
the perfection of the Trust's interest in the Receivables and with
respect to the applicability of certain provisions of Connecticut state
banking law with respect to the effect of receivership of the Bank and
with respect to other related matters in a form previously approved by
the Underwriters and its counsel;
(j) Xxxxxxx X. Xxxxxxxx, general counsel of each of PSFC and
the Bank, shall have furnished to the Underwriters his written opinion,
addressed to the Underwriters and dated the Time of Delivery, in form
and substance satisfactory to the Underwriters and their counsel,
substantially to the effect that:
17
(i) The Bank has been duly incorporated and is
validly existing as a Connecticut stock savings bank under the
laws of the State of Connecticut, with power, authority and
legal right necessary to own its properties and to conduct its
business as described in the Prospectus and to enter into and
perform its obli gations under this Agreement, the Pooling and
Servicing Agreement, the Loan Agreement and the Assignment and
had at all relevant times, and now has, the power, authority
and legal right to acquire, own and sell the Receivables, and
is duly qualified to do business and is in good standing as a
foreign corporation (or is exempt from such requirements), and
has obtained all necessary licenses and approvals with respect
to the Bank in each jurisdiction in which failure to qualify
or to obtain such licenses or approvals would render any
Receivable unenforceable by the Bank or the Trust or would
have a material adverse effect on the Certifi cateholders or
any Enhancement Provider;
(ii) PSFC has been duly incorporated and is validly
existing as a Connecticut corporation in good standing under
the laws of the State of Connecticut, with all power,
authority and legal right necessary to own its properties and
conduct its business as de scribed in the Prospectus, and to
enter into and perform its obligations under this Agreement
and had at all relevant times, and now has, the power,
authority and legal right to acquire, own and exchange the
Exchangeable Seller Certificate, and is duly qualified to do
business and is in good standing as a foreign corporation (or
is exempt from such requirements), and has obtained all
necessary licenses and approvals in each jurisdiction in which
failure to qualify or to ob tain such licenses or approvals
would have a material adverse effect on the Certificateholders
or any Enhancement Provider;
(iii) This Agreement, the Pooling and Servicing
Agreement, the Certificates, the Assignment and the Loan
Agreement have been duly authorized, exe cuted and delivered
by the Bank;
(iv) This Agreement and the Assignment have been duly
authorized, executed and delivered by PSFC;
(v) No consent, approval, authorization or order of
any governmental agency or body is required for (A) the
performance by the Bank of its obligations under the Pooling
and Servicing Agreement or the Loan Agreement, or (B) the
issuance and sale of the Certificates or of the Collateral
Interest, except such as have been obtained under the Act and
as may be re quired under state securities or Blue Sky laws in
connection with the purchase and distribution of the
Certificates by the Underwriters;
18
(vi) Neither the execution and delivery of this
Agreement or the Assignment by PSFC and the Bank, or the
Certificates, the Pooling and Servicing Agree ment or the Loan
Agreement by the Bank, nor the perfor xxxxx by PSFC or the
Bank of the transactions therein contemplated will result in
any material violation of any statute or regulation or any
order or decree known to such counsel of any court or
governmental authority binding upon PSFC or the Bank, as
applicable, or their respective property, or conflict with, or
result in a breach or violation of any term or provision of,
or re xxxx in a default under any of the terms and provisions
of, the Certificate of Incorporation of PSFC, the Arti cles of
Incorporation of the Bank, the By-laws of PSFC or the Bank, as
applicable, or any material indenture, loan agreement or other
material agreement of PSFC or the Bank known to such counsel
by which PSFC or the Bank is bound, or result in a violation,
or contravene the terms, of any statute or regulation or, to
the knowledge of such counsel, order applicable to PSFC or the
Bank of any court, regulatory body, administrative agency or
governmental body having jurisdiction over PSFC or the Bank,
except such counsel need express no opinion as to any statute,
order or regulation the violation of which would not have any
material adverse effect on PSFC or the Bank or their
respective activi ties or to which PSFC or the Bank may be
subject as a result of the legal or regulatory status of the
addressees of the opinion or as a result of such Persons'
involvement in the transactions contemplated by this
Agreement, the Pooling and Servicing Agreement or the Loan
Agreement;
(vii) There are no proceedings or investigations
pending or, to the best knowledge of such counsel, threatened
against PSFC or the Bank, before any governmental authority
(i) asserting the invalidity of this Agreement, the Pooling
and Servicing Agreement, the Loan Agreement, the Certificates
or the Assignment, (ii) seeking to prevent the issuance of the
Certificates or of the Collateral Interest or the consummation
of any of the transactions contemplated by this Agre ement,
the Pooling and Servicing Agreement, the Loan Agreement, the
Certificates or the Assignment, (iii) seeking any
determination or ruling that would materi ally and adversely
affect the performance by PSFC or the Bank of their respective
obligations under this Agreement, the Pooling and Servicing
Agreement, the Loan Agreement or the Assignment (iv) seeking
any de termination or ruling that would materially and ad
versely affect the validity or enforceability of this
19
Agreement, the Pooling and Servicing Agreement, the Loan
Agreement, the Certificates or the Assignment, or (v) seeking
to assert any tax liability against the Trust under the United
States Federal, New York State or Connecticut State income tax
systems;
(viii) The statements in the Prospectus concerning
PSFC and the Bank and conduct of their respective business
have been reviewed by such counsel and are correct in all
material respects; and
(ix) Such counsel has not independently verified and
is not passing upon, and does not assume any responsibility
for, the accuracy, completeness or fairness (except as set
forth in paragraph (viii) above) of the information contained
in the Registration Statement and Prospectus. Based upon the
participation and discussions described in subsection
7(e)(vii) above, no facts have come to such counsel's
attention that cause him to believe that the Registration
Statement, as of its effective date (except for the financial
statements, financial schedules and other fi nancial and
operating data included therein as to all of which such
counsel expresses no view), contained any untrue statement of
a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the
statements therein not misleading, or that the Prospectus, as
of its date and as of the Closing Date (except for the
financial state ments, financial schedules, and other
financial data included therein as to which such counsel
expresses no view) contained or contains any untrue statement
of a material fact or omitted or omits to state a material
fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances
under which they were made, not mis leading.
(k) On the effective date of the Registration Statement and
the effective date of the most recently filed post-effective amendment
to the Registration Statement and also at the Time of Delivery, KPMG
Peat Marwick shall have furnished to the Underwriters letters, dated
the respective dates of delivery thereof, in form and substance
satisfactory to the Underwriters, containing statements and information
of the type customarily included in accountants' "comfort letters" and
"specified procedures letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectus;
20
(l) At the Time of Delivery, the Underwriters shall have
received an opinion of Xxxxxx & Xxxxxx, counsel to the Trustee, dated
the Time of Delivery, and satisfactory in form and substance to the
Underwriters and their counsel, to the effect that:
(i) the Trustee is a banking corporation duly
incorporated and validly existing under the laws of the State
of New York;
(ii) the Trustee has full power and authority to
execute and deliver, and to perform its obligations under the
Pooling and Servicing Agreement and the Loan Agreement and to
carry out the trans actions contemplated by the Pooling and
Servicing Agreement and the Loan Agreement;
(iii) each of the P&S Agreement, the Assignment, the
Series Supplement and the Loan Agreement has been duly
authorized, executed and delivered by the Trustee;
(iv) assuming the due execution and delivery by the
Bank of each of the Pooling and Servicing Agree ment and the
Loan Agreement and that each of the Pool ing and Servicing
Agreement and the Loan Agreement is the legal, valid and
binding obligation of the Bank, each of the Pooling and
Servicing Agreement and the Loan Agreement constitutes a
legal, valid and binding obligation of the Trustee,
enforceable against the Trustee in accordance with its terms,
except as the en forceability thereof may be limited by
applicable bankruptcy, reorganization, insolvency, moratorium,
liquidation and other similar laws affecting the
enforceability of creditors' rights generally, and general
principles of equity (regardless of whether the enforcement of
such remedies is considered in a proceeding at law or in
equity) as well as concepts of reasonableness, good faith and
fair dealing;
(v) the Certificates have been duly authenticated by
the Trustee pursuant to the Pooling and Servicing Agreement;
(vi) no approval, authorization or other action by or
filing with, any governmental authority of the United States
of America or the State of New York having jurisdiction over
the banking or trust powers of the Trustee is required in
connection with the execution and delivery by the Trustee of
the Pooling
21
and Servicing Agreement or the Loan Agreement or the
performance by the Trustee thereunder; and
(vii) the execution and delivery of the Pooling and
Servicing Agreement and the Loan Agreement and the performance
by the Trustee of their respective terms do not conflict with
or result in a violation of (A) any United States of America
or State of New York law or regulation governing the banking
or trust powers of the Trustee or (B) the Articles of
Incorporation or By-laws of the Trustee;
(m) At the Time of Delivery, the Underwriters shall have
received the favorable written opinions of Xxxxxxxxxx Brocas Xxxxxx &
Associes., French counsel to Credit Lyonnais and of Cadwalader,
Xxxxxxxxxx & Xxxx, counsel to Credit Lyonnais New York Branch (the
"Collateral Interest Holder"), as to the due authorization, execution
and delivery of the Loan Agreement by the Collateral Interest Holder
and the enforce ability of the Loan Agreement, in each case in form and
sub stance satisfactory to the Underwriters and their counsel.
(n) The Underwriters shall have received evidence satisfactory
to the Underwriters that the Class A Certificates have received the
rating of AAA by Standard & Poor's Ratings Services and the rating of
Aaa by Xxxxx'x Investors Service, Inc., the Class B Certificates shall
have received the rating of A from Standard and Poor's Ratings Services
and a rating of A2 from Moody's Investor's Service, Inc. and the
Collateral Interest shall have received the rating of BBB from Fitch
IBCA, Inc. and such ratings shall not have been rescinded or lowered,
or at the Time of Delivery be under surveillance or review;
(o) At the Time of Delivery, the Underwriters shall have
received one or more opinions of counsel to Xxxxxx Brothers Financial
Products Inc. (the "Interest Rate Cap Provider"), addressed to you, in
form and substance satisfactory to the Underwriters and their counsel
regarding the due autho rization, execution, delivery and
enforceability by or against the Interest Rate Cap Provider of the
interest rate cap agree ments, to be dated on or prior to April 1,
1998, between the Trustee and the Interest Rate Cap Provider (the
interest rate cap agreements are collectively referred to herein as the
"In terest Rate Cap"), and such other matters as the Underwriters or
their counsel may reasonably request regarding the Interest Rate Cap.
(p) On or after the date hereof there shall not have occurred
any of the following: (i) a suspension or material limitation in
trading in securities generally on the New York Stock Exchange; (ii) a
general moratorium on commercial banking
22
activities in New York declared by either Federal or New York State
authorities; or (iii) the outbreak or escalation of hostilities
involving the United States or the declaration by the United States of
a national emergency or war if the effect of any such event specified
in this clause (iii) in the reasonable judgment of the Representatives
makes it impractica ble 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;
(q) The Underwriters shall have received evidence satisfactory
to the Underwriters that, on or before the Time of Delivery, UCC-1
financing statements have been filed in the appropriate filing offices
of the State of Connecticut and such other jurisdictions as counsel to
PSFC and the Bank deems appropriate to reflect the interest of the
Trustee in the Receivables;
(r) At the Time of Delivery, the Underwriters shall have
received any and all opinions of counsel and other memo xxxxx prepared
by any such counsel to PSFC and the Bank which have been addressed to
or supplied to each Rating Agency rating the Certificates or the
Collateral Interest relating to, among other things, the security
interest of the Trustee in the Receivables and certain monies due or to
become due with respect thereto, certain bankruptcy issues and certain
matters with respect to the Certificates. Any such opinions or
memoranda shall be addressed to the Underwriters or shall indicate that
the Underwriters may rely on such opinions as though they were
addressed to the Underwriters, and shall be dated the Time of Delivery;
(s) No Pay Out Event or other event or condition, which event
or condition with notice, the passage of time or both would result in a
Pay Out Event, shall have occurred or shall exist with respect to the
Certificates at the Time of Delivery; and
(t) All proceedings in connection with the transac tions
contemplated by this Agreement and all documents incident hereto and
thereto shall be satisfactory in form and substance to the
Representatives and their counsel and the Underwriters and their
counsel shall have received such information, certificates or documents
as the Underwriters or their counsel may reasonably request.
8. (a) PSFC and the Bank will jointly and severally indemnify and hold
harmless the Underwriters against any losses, claims, damages or liabilities,
joint or several, to which the Underwriters may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or
23
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse the Underwriters for any legal or other expenses reasonably incurred
by the Underwriters in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that neither
PSFC nor the Bank shall be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
any Preliminary Prospectus, the Regis tration Statement or the Prospectus or any
such amendment or supplement in reliance upon and in conformity with written
information furnished to either PSFC or the Bank by the Under writers for use
therein; provided further that with respect to any untrue statement or omission
or alleged untrue statement or omission made in any Preliminary Prospectus, or
in the Prospec tus, the indemnity agreement contained in this subsection (a)
shall not inure to the benefit of any of the Underwriters to the extent that
such loss, claim, damage or liability of such Underwriters results from the fact
that such Underwriter sold Certificates to a person as to whom it shall be
established that there was not sent or given to such person, at or prior to the
written confirmation of the sale of such Securities to such person, a copy of
the Prospectus or of the Prospectus as then amended or supplemented, if such
delivery of such Prospectus or such amended or supplemented Prospectus was
required under the Act, and if the Underwriters consented to and approved any
such amendment or supplement to such Prospectus pursuant to Section 5(a) of this
Agreement and if either PSFC or the Bank had previously furnished copies thereof
to such Underwriters and the untrue statement or omission or alleged untrue
statement or omission contained in such Preliminary Prospectus or the Pro
spectus was corrected in the Prospectus or the Prospectus as then amended or
supplemented.
(b) The Underwriters will indemnify and hold harmless PSFC and the Bank
against any losses, claims, damages or liabilities to which either PSFC or the
Bank may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to
24
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in any Preliminary Prospectus, the Registration
Statement or the Prospectus, or any such amendment or supplement in reliance
upon and in conformity with written information furnished to either PSFC or the
Bank by the Underwriters expressly for use therein; and will reimburse PSFC and
the Bank for any legal or other expenses reasonably incurred by PSFC or the Bank
in connection with investigating or defending any such action or claim as such
expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemni fying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other indem
nifying party similarly notified, to assume the defense there of, with counsel
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party, be counsel to the indemnifying party), and, after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party shall not be liable to
such indemnified party under such subsection for any legal expenses of other
counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. Any indemnifying party against whom indemnity may be
sought shall not be liable to indemnify any indemnified party under this Section
8 if any settlement of any such action is effected without such indemnifying
party's consent, which consent shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such
25
proportion as is appropriate to reflect the relative benefits received by PSFC
and the Bank on the one hand and the Underwriters on the other from the offering
of the Certificates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only the
relative benefits but also the relative fault of PSFC and the Bank on the one
hand and the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by PSFC and the Bank on the one
hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total net proceeds from such offering (before deducting
expenses) received by PSFC bear to the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table
on the cover page of the Prospectus. 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 PSFC or the Bank on the one hand or the
Underwriters on the other and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
PSFC, the Bank and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equita ble considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwith standing the provisions of this
subsection (d), the Underwriters shall not be required to contribute any amount
in excess of the amount by which the total price at which the Certificates
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which the Underwriters has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrep resentation (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.
26
(e) The obligations of PSFC and the Bank under this Section 8 shall be
in addition to any liability which PSFC and the Bank may otherwise have and
shall extend, upon the same terms and conditions, to each person, if any, who
controls the Underwriters within the meaning of the Act; and the obligations of
the Underwriters under this Section 8 shall be in addition to any liability
which the Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each officer and director of PSFC or the Bank and to each
person, if any, who controls PSFC or the Bank within the meaning of the Act.
9. The respective indemnities, agreements, representa tions, warranties
and other statements of PSFC, the Bank and the Underwriters, as set forth in
this Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of the Underwriters or any controlling person of the Underwriters, PSFC, or the
Bank, or any officer or director or controlling person of PSFC or the Bank, and
shall survive deliv ery of and payment for the Certificates.
10. (a) If any Underwriter shall default in its obligation to purchase
the Class A Certificates which it has agreed to purchase hereunder, the
non-defaulting Underwriters may in their discretion arrange for themselves as
they may agree or another party or other parties to purchase such Class A
Certifi xxxxx on the terms contained herein. If within thirty-six hours after
such default by any Underwriter the Underwriters do not ar range for the
purchase of such Class A Certificates, then PSFC shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties satisfactory to the Underwriters to purchase such Class A Certificates
on such terms. In the event that, within the respective periods, the
Underwriters notify PSFC that the Underwriters have so arranged for the purchase
of such Class A Certificates or PSFC notifies the Underwriters that it has so
arranged for the purchase of such Certificates, the Underwriters or PSFC shall
have the right to postpone the Time of Delivery for a period of not more than
seven days, in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus, or in any other documents or
arrangements, and PSFC and the Bank agree to file promptly any amendments to the
Registration Statement or the Prospectus which in the opinion of the
Underwriters may thereby be made necessary. The term "Underwriter" as used in
this Agreement shall include any person substituted under this Section with like
effect as if such person had originally been a party to this Agreement with
respect to such Class A Certificates.
27
(b) If, after giving effect to any arrangements for the purchase of the
Class A Certificates of a defaulting Underwriter by the non-defaulting
Underwriters and PSFC as pro vided in subsection (a) above, the aggregate
principal amount of such Class A Certificates which remains unpurchased does not
exceed one-eleventh of the aggregate principal amount of all the Class A
Certificates, then PSFC shall have the right to require each non-defaulting
Underwriter to purchase the principal amount of Class A Certificates which such
Underwriter agreed to purchase hereunder and, in addition, to require each
non-defaulting Underwriter to purchase a pro rata portion of the Class A Certif
icates of the defaulting Underwriter or Underwriters for which such arrangements
have not been made; but nothing herein shall relieve the defaulting Underwriter
from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Class A Certificates of a defaulting Underwriter by the non-defaulting
Underwriters and PSFC as pro vided in subsection (a) above, the aggregate
principal amount of Class A Certificates which remains unpurchased exceeds
one-elev enth of the aggregate principal amount of all the Class A Certif
icates, or if PSFC shall not exercise the right described in sub section (b)
above to require each non-defaulting Underwriter to purchase Securities of the
defaulting Underwriter, then this Agreement shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter, PSFC or the Bank,
except for the expenses to be borne by PSFC, the Bank and the Underwriters as
provided in Section 6 hereof and the indemnity and contribution agreements in
Section 8 hereof; but nothing herein shall relieve the defaulting Underwriter
from liability for its default.
11. If either the Class A Certificates or the Class B Certificates are
not delivered by or on behalf of PSFC for any reason as provided herein, PSFC or
the Bank will reimburse the Underwriters for all out-of-pocket expenses approved
in writing by you, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Certificates, but neither PSFC nor the Bank shall then have any
further liability to the Underwriters except as provided in Section 6 and
Section 8 hereof.
12. All statements, requests, notices and agreements hereunder shall be
in writing, and if to the Underwriters shall be delivered or sent by mail, telex
or facsimile transmission to Xxxxxxx, Xxxxx & Co., at 00 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Registration Department; if to PSFC shall be
delivered or sent by mail, telex or facsimile transmission to 000 Xxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxxxxx 00000, Attention: Xxxxxxx
28
X. Xxxxxxxx, Esq; and if to the Bank shall be delivered or sent by mail, telex
or facsimile transmission to the address of the Bank set forth in the
Registration Statement, Attention: Xxxxxxx X. Xxxxxxxx, Esq. Any such
statements, request notices or agreements shall take effect upon receipt
thereof.
13. This Agreement shall be binding upon, and inure solely to the
benefit of, the Underwriters, PSFC the Bank and, to the extent provided in
Section 8 and Section 9 hereof, the officers and directors of PSFC and the Bank
and each person who controls PSFC, the Bank or the Underwriters, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement. No purchaser of any of the Certificates from the Underwriters shall
be deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence in this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
16. This Agreement may be executed by any one or more of the parties
hereto in any number of counterparts, each of which shall be deemed to be an
original, but all such respective counterparts shall together constitute one and
the same instrument.
17. Any covenant, provision, agreement or term of this Agreement that
is prohibited or is held to be void or unenforceable in any jurisdiction shall,
as to such jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof.
18. Each Underwriter represents and agrees that (a) it has only issued
or passed on and shall only issue or pass on in the United Kingdom any document
received by it in connection with the issue of the Certificates to a person who
is of a kind described in Article 11(3) of the Financial Services Act 1986
(Investment Advertisements)(Exemptions) Order 1996 or who is a person to whom
the document may otherwise lawfully be issued or passed on; (b) it has complied
and shall comply with all applicable provisions of the Financial Services Act
1986 of Great Britain with respect to anything done by it in relation to the
Certificates in, from or otherwise involving the United Kingdom; and (c) if such
Underwriter is an authorized person under the Financial Services Act 1986, it
has only promoted and shall only promote (as that term is defined in Regulation
1.02 of the
29
Financial Services (Promotion of Unregulated Schemes) Regulations 1991) to any
person in the United Kingdom the scheme described in the Prospectus if that
person is of a kind described either in Section 76(2) of the Financial Services
Act 1986 or in Regulation 1.04 of the Financial Services (Promotion of
Unregulated Schemes) Regulations 1991.
30
If the foregoing is in accordance with your understand ing, please sign
and return two counterparts hereof, and upon the acceptance hereof by you, this
letter and such acceptance hereof shall constitute a binding agreement among the
Underwriters, the Bank and PSFC.
Very truly yours,
PEOPLE'S STRUCTURED FINANCE CORP.
By: _/s/Xxxxxxx X. Xxxxxxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President
PEOPLE'S BANK
By:_/s/Xxxxxxx X. Xxxxxxxxxx
----------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Vice President
Accepted as of the date hereof:
_/s/Xxxxxxx, Xxxxx & Co.
XXXXXXX, XXXXX & CO.,
as Representatives on
behalf of the Class A
Underwriters and as
Class B Underwriters
SCHEDULE A
Aggregate
Principal
Amount of the
Class A
Underwriter Certificates
----------- ------------
Xxxxxxx, Xxxxx & co............ $85,750,000
X.X. Xxxxxx Securities Inc..... $85,750,000
Xxxxxx Brothers Inc............ $85,750,000
Salomon Brothers Inc........... $85,750,000
$343,000,000
Aggregate
Principal
Amount of the
Class B
Underwriter Certificates
----------- ------------
Xxxxxxx, Xxxxx & Co............ $27,000,000
32
