EXHIBIT 1.1
[FORM OF UNDERWRITING AGREEMENT]
CONSECO PRIVATE LABEL CREDIT CARD MASTER NOTE TRUST
$[o] CLASS A FLOATING RATE
ASSET-BACKED NOTES, SERIES 2001-[o]
$[o] CLASS B FLOATING RATE
ASSET-BACKED NOTES, SERIES 2001-[o]
$[o] CLASS C FLOATING RATE
ASSET-BACKED NOTES, SERIES 2001-[o]
UNDERWRITING AGREEMENT
__________, 2001
[Representative of Underwriters]
[Address]
Conseco Bank, Inc., a Utah industrial loan corporation (the
"Bank") and Conseco Finance Credit Card Funding Corp., a Minnesota corporation
("Funding Corp.," and together with the Bank, the "Transferors") have conveyed
receivables and propose to convey, from time to time, additional receivables
(collectively, the "Receivables") generated in a portfolio of private label
credit card accounts together with other rights and property to the Conseco
Private Label Credit Card Master Note Trust (the "Issuer"), and the Transferors
propose to cause the Issuer to sell to the underwriters named in Schedule I
hereto (the "Underwriters"), for whom you are acting as representative (the
"Representative"), $[o] Class A Floating Rate Asset Backed Notes, Series
2001-[o] (the "Class A Notes"), $[o] Class B Floating Rate Asset Backed Notes,
Series 2001-[o] (the "Class B Notes") and $[o] Class C Floating Rate Asset
Backed Notes, Series 2001-[o] (the "Class C Notes" and, together with the Class
A Notes and the Class B Notes, the "Notes"). The Receivables and other assets
and property will be transferred to the Issuer under the terms of a Transfer and
Servicing Agreement, dated as of May 1, 2001 (the "Transfer and Servicing
Agreement") among the Bank, as transferor and servicer, Funding Corp., as
transferor, and the Issuer. Certain Receivables will be conveyed to Funding
Corp. by Conseco Finance Servicing Corp., a Delaware corporation ("CFC")
pursuant to a Receivables Purchase Agreement, dated as of May 1, 2001 (the "CFC
Receivables Purchase Agreement"), between CFC and Funding Corp. Certain
Receivables have been, and will from time to time be,
conveyed to the Bank by Green Tree Retail Services Bank, Inc. ("Retail Services
Bank") under the terms of a Receivables Purchase Agreement, dated as of August
29, 2000 and amended and restated as of May __, 2001 (the "Retail Services
Receivables Purchase Agreement"), between Retail Services Bank and the Bank. The
Bank, Retail Services Bank, Funding Corp., CFC and Conseco Finance Corp., a
Delaware corporation ("Conseco Finance") are referred to herein collectively as
the "Conseco Entities."
The Issuer is a statutory business trust governed under a
Trust Agreement, dated as of May 1, 2001 (the "Trust Agreement"), between the
Transferors and Wilmington Trust Company, as owner trustee (the "Owner
Trustee").
The Notes will be issued pursuant to a Master Indenture, dated
as of May 1, 2001 (the "Master Indenture"), among the Issuer, Conseco Bank,
Inc., as servicer, and U.S. Bank Trust National Association, as indenture
trustee (the "Indenture Trustee"), as supplemented by the Series 2001-[o]
Indenture Supplement with respect to the Notes to be dated as of ____________,
____________, 2001 (the "Indenture Supplement," and together with the Master
Indenture, the "Indenture").
The Bank, pursuant to an Administration Agreement, dated as of
May 1, 2001 (the "Administration Agreement"), between the Bank, as administrator
(in such capacity, the "Administrator"), and the Issuer agreed to provide
notices and perform on behalf of the Issuer certain other administrative
obligations required of the Issuer by the Transfer and Servicing Agreement, the
Master Indenture and each indenture supplement for each series of Notes issued
by the Issuer. The Transfer and Servicing Agreement, the CFC Receivables
Purchase Agreement, the Retail Services Receivables Purchase Agreement, the
Master Indenture, the Indenture Supplement, the Trust Agreement and the
Administration Agreement are referred to herein, collectively, as the
"Transaction Documents."
The Notes will be sold pursuant to this Underwriting Agreement
(this "Agreement") and will be paid from and secured by the assets of the
Issuer.
The Issuer, the Bank and Funding Corp. have prepared and filed
with the Securities and Exchange Commission (the "Commission") in accordance
with the provisions of the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Act"), a shelf
registration statement on Form S-3 (having the registration numbers 333-______,
333-______ and 333-_____), including a form of prospectus, relating to the
Notes. The registration statement as amended has been declared effective by the
Commission. If any post-effective amendment has been filed with respect thereto,
prior to the execution and delivery of this Agreement, the most recent such
amendment has been declared effective by the Commission. Such registration
statement, as amended at the time of effectiveness, including all material
incorporated by reference therein and including all information (if any) deemed
to be part of the registration statement at the time of effectiveness pursuant
to Rule 430A under the Act, is referred to in this Agreement as the
"Registration Statement." The Issuer, the Bank and Funding Corp. propose to file
with the Commission pursuant to Rule 424(b) ("Rule 424(b)") under the Act a
supplement (the "Prospectus
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Supplement") to the prospectus included in the Registration Statement (such
prospectus, in the form it appears in the Registration Statement or in the form
most recently revised and filed with the Commission pursuant to Rule 424(b) is
hereinafter referred to as the "Basic Prospectus") relating to the Notes and the
method of distribution thereof. The Basic Prospectus and the Prospectus
Supplement, together with any amendment thereof or supplement thereto, is
hereinafter referred to as the "Prospectus."
Capitalized terms used herein without definition shall have
the meanings set forth in the Transaction Documents.
Each of the Bank, Funding Corp. and CFC hereby agrees with the
Underwriters as follows:
Section 1. Representations and Warranties of the Transferors,
CFC and Conseco Finance.
(a) Each of the Bank, Funding Corp., CFC and Conseco Finance,
each as to itself, represents and warrants to, and agrees with, each
Underwriter as set forth in this subsection 1(a).
(i) No stop order suspending the effectiveness on the
Registration Statement has been issued and no proceeding for
that purpose has been instituted or, to the knowledge of the
Bank, Funding Corp., CFC and Conseco Finance, threatened by
the Commission, and the Registration Statement and the
Prospectus, at the time the Registration Statement became
effective, did, and on the date of this Agreement does, comply
in all material respects with the requirements of the Act. The
Registration Statement, at the time it became effective, did
not, as of the date of this Agreement does not and as of the
Closing Date (as defined below) will not, contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading. The Prospectus, as
amended or supplemented at the time the Registration Statement
became effective, did not, and as amended or supplemented as
of both the date hereof and the Closing Date (as defined
below) will not, contain any untrue statement of a material
fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made,
not misleading; provided, however, that the representations
and warranties in this subsection shall not apply to
statements in, or omissions from, the Registration Statement
or Prospectus made in reliance upon and in conformity with
information furnished to the Bank, Funding Corp., CFC or
Conseco Finance in writing by the Underwriters expressly for
use in the Registration Statement or Prospectus. The Bank,
Funding Corp., CFC and Conseco Finance each acknowledges that
the statements set forth in the third and fourth paragraphs
under the heading "Underwriting" in the Prospectus Supplement,
constitute the
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only information furnished by the Underwriters or on behalf of
the Underwriters for use in connection with the preparation of
the Registration Statement or the Prospectus. The conditions
to the use by the Company and the Seller of a registration
statement on Form S-3 under the Act, as set forth in the
General Instructions to Form S-3, have been satisfied with
respect to the Registration Statement, as applicable, and the
Prospectus. There are no contracts or documents of the Bank,
Funding Corp., CFC or Conseco Finance which are required to be
filed as exhibits to the Registration Statement pursuant to
the Act which have not been so filed.
(b) Each of the Bank and Funding Corp., each as to itself,
represents and warrants to, and agrees with, each Underwriter as set
forth in this subsection 1(b).
(i) The Bank is a Utah industrial loan corporation,
duly organized, validly existing and in good standing under
the laws of the state of Utah and Funding Corp. is a
corporation duly organized, validly existing and in good
standing under the laws of the state of Minnesota. Each of the
Bank and Funding Corp. has all requisite power and authority
to own, lease and operate its properties and conduct its
business as presently conducted and as described in the
Prospectus and to enter into and perform its obligations under
this Agreement and the respective Transaction Documents; and
the Bank and Funding Corp. each is duly qualified as a foreign
corporation to transact business and is in good standing in
each jurisdiction which the ownership or lease of its
properties or the conduct of its business requires such
qualification.
(ii) Neither the Bank nor Funding Corp. is in
violation of its charter or articles of incorporation, by-laws
or other organizational documents or in default in the
performance or observance of any material obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other
instrument to which it is a party or by which it may be bound,
or to which any of the property or assets of the Bank or
Funding Corp., as the case may be, is subject, which default
might result in any material adverse change in the financial
condition, earnings, affairs or business of the Bank or
Funding Corp. or which might materially and adversely affect
the properties or assets thereof.
(iii) The execution, delivery and performance by the
Bank of each of this Agreement, the Retail Services
Receivables Purchase Agreement, the Transfer and Servicing
Agreement, the Indenture, the Administration Agreement and the
Trust Agreement, and the consummation of the transactions
contemplated hereby and thereby have been duly and validly
authorized by all necessary action or proceedings and will not
conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Bank pursuant
to, any contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which the Bank is a party or by
which it may be bound, or to which any of the property or
assets of the
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Bank is subject, nor will such action result in any violation
of the provisions of the articles of incorporation or by-laws
of the Bank or any applicable law, administrative regulation
or administrative or court decree.
(iv) The execution, delivery and performance by
Funding Corp. of each of this Agreement, the CFC Receivables
Purchase Agreement, the Transfer and Servicing Agreement and
the Trust Agreement and the consummation of the transactions
contemplated hereby and thereby have been duly and validly
authorized by all necessary action or proceedings and will not
conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of Funding Corp.
pursuant to, any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which Funding
Corp. is a party or by which it may be bound, or to which any
of the property or assets of Funding Corp. is subject, nor
will such action result in any violation of the provisions of
the articles of incorporation or by-laws of Funding Corp. or
any applicable law, administrative regulation or
administrative or court decree.
(v) This Agreement, the Retail Services Receivables
Purchase Agreement, the Transfer and Servicing Agreement, the
Indenture, the Administration Agreement and the Trust
Agreement have been duly executed and delivered by the Bank;
and this Agreement, the Retail Services Receivables Purchase
Agreement, the Transfer and Servicing Agreement, the
Indenture, the Administration Agreement and the Trust
Agreement each constitutes legal, valid and binding instrument
enforceable against the Bank in accordance with its respective
terms, subject as to the enforceability (A) to applicable
bankruptcy, reorganization, insolvency, moratorium or other
similar laws affecting creditors' rights generally and the
rights and remedies of creditors of thrifts, savings
institutions or national banking associations, (B) to general
principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (C) with
respect to rights of indemnity under this Agreement, to
limitations of public policy under applicable securities law.
(vi) This Agreement, the CFC Receivables Purchase
Agreement, the Transfer and Servicing Agreement and the Trust
Agreement have been duly executed and delivered by Funding
Corp.; and this Agreement, the CFC Receivables Purchase
Agreement, the Transfer and Servicing Agreement and the Trust
Agreement each constitutes a legal, valid and binding
instruments enforceable against Funding Corp. in accordance
with its respective terms, subject as to enforceability (A) to
applicable bankruptcy, reorganization, insolvency, moratorium
or other similar laws affecting creditors' rights generally,
(B) to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law) and
(C) with respect to rights of indemnity under this Agreement,
to limitations of public policy under applicable securities
laws.
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(vii) The Bank and Funding Corp. have authorized the
conveyance of the Receivables to the Issuer and have directed
the Issuer to issue and sell the Notes.
(viii) The Bank will, upon request by the
Representative, provide to the Representative complete and
correct copies of publicly available portions of the
Consolidated Reports of Condition and Income of the Bank for
the year ended December 31, ___, as submitted to [the
Comptroller of the Currency]. Except as set forth in the
Registration Statement and the Prospectus, there has been no
material adverse change in the consolidated condition
(financial or otherwise) of the Bank and its subsidiaries
taken as a whole since December 31, ____.
(ix) Any taxes, fees and other governmental charges
in connection with the execution, delivery and performance of
this Agreement, each of the Transaction Documents and the
Notes have been paid or will be paid by the Transferors at or
prior to the Closing Date.
(x) The Notes have been duly and validly authorized,
and, when validly executed, authenticated and delivered in
accordance with the Indenture and as provided herein will
conform to the description thereof contained in the Prospectus
and will be validly issued and outstanding and entitled to the
benefits of the Indenture.
(xi) Other than as set forth in the Prospectus, there
are no legal or governmental proceedings pending, or to the
knowledge of the Bank or Funding Corp. threatened, to which
the Bank or Funding Corp. or any affiliate of the Bank or
Funding Corp. is or may be a party or of which any property of
any of them is the subject which, if determined adversely to
the Bank, Funding Corp. or their affiliates could individually
or in the aggregate reasonably be expected to have a material
adverse effect on (i) the general affairs, business,
prospects, management, financial position, stockholders'
equity or results of operations of the Bank or Funding Corp.
or their affiliates, taken as a whole, and in the interests of
the holders of the Notes, or (ii) the interests of the holders
of the Notes; and there are no contracts or other documents of
a character required to be filed as an exhibit to the
Registration Statement or required to be described in the
Registration Statement or the Prospectus which are not filed
or described as required.
(xii) PricewaterhouseCoopers LLP is an independent
public accountant with respect to the Bank and Funding Corp.
(xiii) No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or
with any court or governmental agency or body of the United
States or of any state or local government is required for the
issue and sale of the Notes, or the consummation by the Bank
or Funding Corp. of the other transactions contemplated by
this Agreement or any Transaction Document to which it is a
party, except for (A) the registration under the Act of
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the Notes or (B) such consents, approvals, authorizations,
orders, registrations, qualifications, licenses or permits as
have been obtained or as may be required under state
securities or Blue Sky laws in connection with the purchase of
the Notes and the subsequent distribution of the Notes by the
Underwriters.
(xiv) Neither the Bank, Funding Corp. nor the Issuer
will be subject to registration as an "investment company"
under the Investment Company Act of 1940, as amended (the
"1940 Act").
(c) CFC and Conseco Finance each represents and warrants to,
and agrees with, each Underwriter as set forth in this Section 1(c).
(i) Each of CFC and Conseco Finance is a corporation
duly organized and validly existing and in good standing under
the laws of the state of Delaware. Each has all requisite
power and authority to own, lease and operate its properties
and conduct its business as presently conducted and as
described in the Prospectus and to enter into and perform its
obligations under this Agreement and each is duly qualified as
a foreign corporation to transact business and is in good
standing in each jurisdiction which the ownership or lease of
its properties or the conduct of its business requires such
qualification.
(ii) Neither CFC nor Conseco Finance is in violation
of its articles of incorporation, by-laws or other
organizational documents or in default in the performance or
observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which CFC or
Conseco Finance is a party or by which it may be bound, or to
which any of the property or assets of CFC or Conseco Finance
is subject which default might result in any material adverse
change in the financial condition, earnings, affairs or
business of CFC or Conseco Finance or which might materially
and adversely affect the properties or assets of CFC or
Conseco Finance.
(iii) The execution, delivery and performance by CFC
and Conseco Finance of this Agreement and by CFC of the CFC
Receivables Purchase Agreement and the consummation of the
transactions contemplated hereby and thereby have been duly
and validly authorized by all necessary action or proceedings
and will not conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or assets of CFC
or Conseco Finance pursuant to, any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to
which CFC or Conseco Finance is a party or by which it may be
bound, or to which any of the property or assets of CFC or
Conseco Finance is subject, nor will such action result in any
violation of the provisions of the articles of incorporation
or by-laws of CFC or Conseco Finance or any applicable law,
administrative regulation or administrative or court decree.
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(iv) This Agreement and the CFC Receivables Purchase
Agreement have been duly executed and delivered by CFC; and
this Agreement and the CFC Receivables Purchase Agreement
constitute legal, valid and binding instruments enforceable
against CFC in accordance with their respective terms, subject
as to enforceability (A) to applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws
affecting creditors' rights generally, (B) to general
principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (C) with
respect to rights of indemnity under this Agreement, to
limitations of public policy under applicable securities laws.
(v) This Agreement and the Conseco Finance
Receivables Purchase Agreement have been duly executed and
delivered by Conseco Finance; and this Agreement and the
Conseco Finance Receivables Purchase Agreement constitute
legal, valid and binding instruments enforceable against
Conseco Finance in accordance with their respective terms,
subject as to enforceability (A) to applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws
affecting creditors' rights generally, (B) to general
principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (C) with
respect to rights of indemnity under this Agreement, to
limitations of public policy under applicable securities laws.
(vi) CFC and Conseco Finance will, upon request by
the Representative, provide to the Representative complete and
correct copies of all reports filed by it with the Commission
pursuant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), during 2000 and 2001. Except as set
forth in such reports, there has been no material adverse
change in the consolidated financial condition of CFC, Conseco
Finance and their subsidiaries taken as a whole since the
respective dates as of which information is incorporated in
the Prospectus.
(vii) Other than as set forth in the Prospectus,
there are no legal or governmental proceedings pending, or to
the knowledge of CFC or Conseco Finance threatened, to which
CFC or Conseco Finance is or may be a party or of which any of
its property is the subject which, if determined adversely to
CFC or Conseco Finance or an affiliate of CFC or Conseco
Finance could individually or in the aggregate reasonably be
expected to have a material adverse effect on (i) the general
affairs, business, prospects, management, financial position,
stockholders' equity or results of operations of CFC or
Conseco Finance or their affiliates, taken as a whole, and
(ii) the interests of the holders of the Notes; and there are
no contracts or other documents of a character required to be
filed as an exhibit to the Registration Statement or required
to be described in the Registration Statement or the
Prospectus which are not filed or described as required.
(viii) No consent, approval, authorization, order,
registration, filing, qualification, license or permit of or
with any court or governmental agency or
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body of the United States or of, any state or local government
is required for the consummation by CFC or Conseco Finance of
the transactions contemplated by this Agreement or the CFC
Receivables Purchase Agreement, except for (A) the
registration under the Act of the Notes or (B) such consents,
approvals, authorizations, orders, registrations, filings,
qualifications, licenses or permits as have been obtained or
as may be required under State securities or Blue Sky laws in
connection with the purchase of the Notes and the subsequent
distribution of the Notes by the Underwriters.
(ix) PricewaterhouseCoopers LLP is an independent
public accountant with respect to CFC and Conseco Finance.
(d) Any certificate signed by an officer on behalf of any of
the Conseco Entities and delivered to the Underwriters or counsel for
the Underwriters in connection with an offering of the Notes shall be
deemed, and shall state that it is, a representation and warranty as to
the matters covered thereby to each person to whom the representations
and warranties in this Section 1 are made.
Section 2. Purchase and Sale.
(a) Subject to the terms and conditions and in reliance upon
the covenants, representations and warranties herein set forth, the
Transferors agree to sell to the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the
Transferors the principal amount of Class A Notes set forth opposite
such Underwriter's name in Schedule I pursuant to the terms of this
Agreement at a purchase price equal to [o]% of the aggregate principal
amount represented by the Class A Notes.
(b) Subject to the terms and conditions and in reliance upon
the covenants, representations and warranties herein set forth, the
Transferors agree to sell to the Underwriters, and the Underwriters
agrees, severally and not jointly, to purchase from the Transferors the
principal amount of Class B Notes set forth opposite such Underwriter's
name in Schedule I pursuant to the terms of this Agreement at a
purchase price equal to [o]% of the aggregate principal amount
represented by the Class B Notes.
(c) Subject to the terms and conditions and in reliance upon
the covenants, representations and warranties herein set forth, the
Transferors agree to sell to the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the
Transferors the principal amount of Class C Notes set forth opposite
such Underwriter's name in Schedule I pursuant to the terms of this
Agreement at a purchase price equal to [o]% of the aggregate principal
amount represented by the Class C Notes.
Section 3. Delivery and Payment.
Delivery of and payment for the Notes to be purchased by the
Underwriters in accordance with this Agreement shall be made at 9:00 A.M. at the
offices of ________________, _____________ on _________, 2001 which date, time
or place may be postponed or changed by
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agreement between the Representative and the Transferors (such date and time of
delivery and payment for the Notes being herein referred to as the "Closing
Date"). Delivery of one or more global notes representing the Notes shall be
made to the accounts of the several Underwriters against payment by the several
Underwriters of the purchase price therefor, to or upon the order of the
Transferors by one or more wire transfers in immediately available funds. The
global notes to be so delivered shall be registered in the name of Cede & Co.,
as nominee for The Depository Trust Company ("DTC"). The interests of beneficial
owners of the Notes will be represented by book entries on the records of DTC
and participating members thereof. Definitive Notes representing the Notes will
be available only under limited circumstances as described in the Indenture.
The Transferors agree to have copies of the global notes
available for inspection by the Underwriters in New York, New York, not later
than 1:00 p.m., New York City time, on the business day prior to the Closing
Date.
Section 4. Offering by Underwriters.
It is understood that the Underwriters intend (i) to make a
public offering of their respective portions of the Notes as soon after the
Registration Statement and this Agreement have become effective as in the
judgment of the Representative is advisable and (ii) initially to offer the
Notes upon the terms set forth in the Prospectus.
Section 5. Agreements. Each of the Conseco Entities which is a
party to this Agreement, each as to itself, covenants and agrees with the
several Underwriters that:
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(a) Immediately following the execution of this Agreement, the
Issuer and the Transferors will prepare a Prospectus Supplement setting
forth the amount of Notes covered thereby and the terms thereof not
otherwise specified in the Basic Prospectus, the price at which such
Notes are to be purchased by the Underwriters, the initial public
offering price, the selling concessions and allowances, and such other
information as the Issuer and the Transferors deem appropriate. The
Issuer and the Transferors will transmit the Prospectus, including such
Prospectus Supplement, to the Commission pursuant to Rule 424(b) by a
means reasonably calculated to result in filing with the Commission
pursuant to Rule 424(b). The Transferors will promptly advise the
Representative (i) when the Registration Statement shall have become
effective, (ii) when any amendment thereof shall have become effective,
(iii) of any request by the Commission for any amendment or supplement
of the Registration Statement or the Prospectus or for any additional
information, (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose, and (v)
of the receipt by the Issuer or the Transferors of any notification
with respect to the suspension of the qualification of the Notes for
offer or sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose. The Transferors will not file any
amendment of the Registration Statement or supplement to the Prospectus
to which the Representative reasonably objects. The Transferors will
use their best efforts to prevent the issuance of any such stop order
or notification and, if issued, to obtain as soon as possible the
withdrawal thereof.
(b) If, at any time when a Prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of
which the Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein in the light of the
circumstances under which they were made not misleading, or if it shall
be necessary to supplement such Prospectus to comply with the Act, the
Transferors shall be required to notify the Representative and upon the
Representative's request to prepare and furnish without charge to each
Underwriter as many copies as such Underwriter may from time to time
reasonably request of an amended Prospectus or a supplement to the
Prospectus which shall correct such statement or omission or effect
such compliance.
(c) As soon as practicable, the Transferors will make
generally available to Noteholders and to the Representative an
earnings statement or statements of the Issuer which will satisfy the
provisions of Section 11(a) of the Act and Rule 158 under the Act.
(d) The Transferors will furnish to the Representative and
counsel for the Underwriters, without charge, copies of the
Registration Statement (including exhibits thereto) and, so long as
delivery of a prospectus by an Underwriter or dealer may be required by
the Act, as many copies of the Prospectus and any supplement thereto as
the Underwriters may reasonably request.
(e) The Conseco Entities, jointly and severally, agree to pay
all expenses incidental to the performance of their obligations under
this Agreement, including without limitation (i) expenses of preparing,
printing and reproducing the Registration Statement, the
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Prospectus, this Agreement, the Transaction Documents and the Notes,
(ii) any fees charged by any rating agency for the rating of the Notes,
(iii) any expenses (including reasonable fees and disbursements of
counsel) incurred by the Underwriters in connection with qualification
of the Notes for sale under the laws of such jurisdictions as the
Representatives designate, (iv) the fees and expenses of
PricewaterhouseCoopers LLP, (v) the fees and expenses of counsel to the
Underwriters related to the preparation of the Registration Statement,
the Prospectus, the Transaction Documents and the Notes, and (vi) the
fees and expenses of the Owner Trustee and the Indenture Trustee and
any agent of the Owner Trustee or the Indenture Trustee and the fees
and disbursements of counsel for the Owner Trustee and the Indenture
Trustee in connection with the Administration Agreement, the Indenture
and the Notes (it being understood that, except as provided in this
paragraph (e) and in Sections 7 and 8 hereof, the Underwriters will pay
their own expenses, including the expense of preparing, printing and
reproducing any agreement among underwriters, the fees and expenses of
counsel for the Underwriters, any transfer taxes on resale of any of
the Notes by them and advertising expenses connected with any offers
that the Underwriters may make).
(f) The Transferors will endeavor to qualify the Notes for
offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Representative shall reasonably request and will
continue such qualification in effect so long as reasonably required
for distribution of the Notes and to pay all fees and expenses
(including fees and disbursements of counsel to the Underwriters)
reasonably incurred in connection with such qualification and in
connection with the determination of the eligibility of the Notes for
investment under the laws of such jurisdictions as the Representative
may designate; provided, however, that the Transferors shall not be
obligated to qualify to do business in any jurisdiction in which they
are not currently so qualified; and provided further that the
Transferors shall not be required to file a general consent to service
of process in any jurisdiction.
(g) For so long as the Notes are outstanding, the Transferors
will furnish to the Representative copies of all reports or other
communications (financial or other) furnished to the holders of the
Notes, the Owner Trustee or the Indenture Trustee under the Indenture
or under the Transfer and Servicing Agreement, including, but not
limited to the monthly servicing report, the annual statements of
compliance delivered pursuant to Section ___ of the Transfer and
Servicing Agreement and the annual servicing reports of the independent
certified public accountants.
(h) For so long as the Notes are outstanding, the Conseco
Entities will furnish to the Representative as soon as practicable
after filing, any other information concerning the Notes or the Conseco
Entities filed with the Commission.
(i) To the extent, if any, that any rating provided with
respect to the Notes set forth in Sections 6(j) and (k) hereof is
conditional upon the furnishing of documents reasonably available to
the Conseco Entities, the Conseco Entities shall furnish such
documents.
Section 6. Conditions of Closing; Termination of Rights Under
Section 2. The obligations of the Underwriters to purchase and pay for the Notes
on the Closing Date shall
12
be subject to the accuracy of the representations and warranties of the Conseco
Entities contained herein as of the date of this Agreement and as of the Closing
Date, to the accuracy of the statements of the Conseco Entities made in any
certificates delivered pursuant to the provisions hereof, to the performance by
the Conseco Entities of their obligations hereunder and to the following
additional conditions:
(a) The Prospectus shall have been filed with the Commission
in accordance with the Act and Section 5(a) of this Agreement; and,
prior to the Closing Date (i) no stop order suspending the
effectiveness of the Registration Statement shall have been issued and
no proceedings for that purpose shall have been instituted or
threatened and (ii) there shall not have come to the attention of the
Underwriters any facts that would cause the Underwriters to believe
that the Basic Prospectus together with the Prospectus Supplement at
the time it was required to be delivered to a purchaser of the Notes,
contained an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in
light of the circumstances existing at such time, not misleading.
(b) Each of the Transferors, CFC and Conseco Finance shall
have delivered a certificate, dated the Closing Date, signed by its
President or any Vice President and its principal financial or
principal accounting officer or its Treasurer or any Assistant
Treasurer or its Secretary or any Assistant Secretary to the effect
that the signers of such certificate, on behalf of the named entity,
have carefully examined this Agreement, each of the Transaction
Documents, the Prospectus (and any supplements thereto) and the
Registration Statement, stating that:
(i) the representations and warranties of such
Conseco Entity in this Agreement and in the Transaction
Documents are true and correct at and as of the date of such
certificate as if made on and as of such date (except to the
extent they expressly relate to an earlier date);
(ii) such Conseco Entity has complied with all the
agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date;
(iii) the Prospectus, as of the Closing Date, does
not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the
statements therein, in the light of the circumstances under
which they were made, not misleading;
(iv) 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 knowledge of
the xxxxxx, threatened; and
(v) subsequent to the date of the Prospectus, there
has not been any material adverse change in the general
affairs, management, financial position, or results of
operation of such Conseco Entity or the Conseco private label
credit card business except as set forth in the Prospectus.
13
(c) Xxxxxx & Whitney, as counsel for the Conseco Entities,
shall have delivered to the Underwriters a favorable opinion dated the
Closing Date and satisfactory in form and substance to the
Representative and counsel for the Underwriters, to the effect that:
(i) the Bank has been duly chartered as a Utah
industrial loan corporation and is validly existing and in
good standing under the laws of Utah, is an institution the
deposits of which are insured by the Federal Deposit Insurance
Corporation, is duly qualified to do business and is in good
standing under the laws of each jurisdiction which requires
such qualification wherein it owns or leases material
properties or conducts material business, and has full power
and authority to own its properties, and to enter into and
perform its obligations under this Agreement, the Transfer and
Servicing Agreement, the Indenture, the Administration
Agreement, the Trust Agreement, the Retail Services
Receivables Purchase Agreement and the CFC Receivables
Purchase Agreement and to consummate the transactions
contemplated hereby and thereby except where failure to have
such power and authority or to be so qualified will not have a
material adverse effect on the business or financial condition
of the Bank and its subsidiaries taken as a whole and will not
have a material adverse effect on the transactions
contemplated by this Agreement and the Transaction Documents;
(ii) each of CFC, Conseco Finance and Funding Corp.
is duly incorporated and validly existing as a corporation in
good standing under the laws of its jurisdiction of
incorporation and is in good standing under the laws of each
jurisdiction which requires such qualification wherein it owns
or leases material properties or conducts material business
and each has full power and authority to own its properties
and to conduct its business, and to enter into and perform its
obligations under this Agreement and the Transaction Documents
to which it is a party and to consummate the transactions
contemplated hereby and thereby except where failure to have
such power and authority or to be so qualified will not have a
material adverse effect on the business or financial condition
of CFC, Conseco Finance and its subsidiaries, taken as a
whole, or on the business or financial condition of Funding
Corp., and will not have an material adverse effect on the
transactions contemplated by this Agreement and the
Transaction Documents;
(iii) this Agreement, each of the Transaction
Documents and the Registration Statement have each been duly
authorized, executed and delivered by the respective Conseco
Entities and, when executed by the Owner Trustee, the
Indenture Trustee or the Representative, as the case may be,
constitute the legal, valid and binding agreement of the
respective Conseco Entities each enforceable in accordance
with its terms subject, as to enforceability (A) to applicable
bankruptcy, reorganization, insolvency, moratorium or other
similar laws affecting creditors' rights generally and the
rights and remedies of creditors of thrifts, savings
institutions or national banking associations, (B) to general
principles of equity (regardless of whether enforcement is
sought in a proceedings
14
in equity or at law) and (C) with respect to rights of
indemnity under this Agreement, to limitations of public
policy under applicable securities laws;
(iv) the Notes have been duly authorized and executed
and when authenticated by the Indenture Trustee in accordance
with the terms of the Indenture and delivered to and paid for
by the Underwriters pursuant to this Agreement, will be
validly issued and outstanding and entitled to the benefits of
the Indenture, subject, as to enforceability (A) to applicable
bankruptcy, reorganization, insolvency, moratorium or other
similar laws affecting creditors' rights generally and (B) to
general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law);
(v) neither the execution nor the delivery of this
Agreement or any Transaction Document nor the issuance or
delivery of the Notes, nor the consummation of any of the
transactions contemplated contemplated herein or therein, nor
the fulfillment of the terms of the Notes, this Agreement or
any Transaction Document will conflict with or violate any
term or provision of the articles of incorporation, charter,
by-laws or other organizational documents of any of the
applicable Conseco Entities, as the case may be, or result in
a breach or violation of, or default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any property or assets of any of the applicable Conseco
Entities pursuant to, any material statute currently
applicable to any of them or any order or regulation known to
such counsel to be currently applicable to any of them of any
court, regulatory body, administrative agency or governmental
body having jurisdiction over the Issuer, CFC, Conseco
Finance, the Bank or Funding Corp., as the case may be, or the
terms of any indenture or other agreement or instrument known
to such counsel to which any of the applicable Conseco
Entities is a party or by which any of them or any of their
properties are bound, except where any such conflict, breach,
violation, default or encumbrance would not have a material
adverse effect on the transactions contemplated by this
Agreement;
(vi) the execution and delivery of this Agreement and
Transaction Documents - and the Registration Statement and the
issuance of the Notes and the distribution of the Prospectus
are valid and will not conflict with, result in a breach or
violation of any Federal, Utah or Minnesota rule, statute or
regulation;
(vii) there are no actions or proceedings or, to the
best of such counsel's knowledge, actions, proceedings or
investigations pending or overtly threatened against the
Issuer or any of the Conseco Entities before any court,
administrative agency or other tribunal (A) asserting the
invalidity of this Agreement, the Notes or any of the
Transaction Documents, (B) seeking to prevent the issuance of
the Notes or the consummation of any of the transactions
contemplated by this Agreement or the Transaction Documents,
(C) which is likely materially and adversely to affect the
performance by the Issuer or any of the Conseco Entities of
15
their obligations under, or the validity or enforceability of,
this Agreement, the Notes or any of the Transaction Documents,
or (D) seeking adversely to affect the federal income tax
attributes of the Notes described in the Prospectus Supplement
under the heading "Federal Income Tax Consequences;"
(viii) the Registration Statement has become
effective under the Act; any required filing of the Prospectus
or any supplement thereto pursuant to Rule 424 has been made
in the manner and within the time period required by Rule 424;
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 knowledge of such
counsel, are threatened; the Registration Statement and the
Prospectus (and any supplements thereto) (other than financial
statistical and numerical information contained therein as to
which such counsel need express no opinion) comply as to form
with the applicable requirements of the Act;
(ix) no consent, approval, authorization, order,
registration, filing, qualification, license or permit of or
with any court, federal, state or local governmental agency or
regulatory body is required for any Conseco Entity to
consummate the transactions contemplated in this Agreement or
the Transaction Documents, except such as have been made or
obtained or as may be required under the State securities or
blue sky laws of any jurisdiction in connection with the
purchase of the Notes by the Underwriters and the subsequent
distribution of the Notes by the Underwriters;
(x) the Indenture has been duly qualified under the
Trust Indenture Act of 1939, as amended, and complies as to
form with the TIA and the rules and regulations of the
Commission thereunder;
(xi) The conditions to the use by the Issuer and the
Transferors of a registration statement on Form S-3 under the
Act, as set forth in the General Instructions to Form S-3,
have been satisfied with respect to the Registration Statement
and the Prospectus, [except that such counsel need express no
opinion regarding any Computational Materials incorporated by
reference therein.] To the best of such counsel's knowledge,
there are no contracts or documents [(not including
Computational Materials)] of the Issuer or the Transferors
which are required to be filed as exhibits to the Registration
Statement pursuant to the Act which have not been so filed or
incorporated by reference;
(xii) the statements in the Prospectus Supplement
under the captions "Transaction Summary," "Prospectus
Supplement Summary," "Description of the Series Provisions"
and "The Glossary" and in the Basic Prospectus under the
captions " Prospectus Summary," "Description of the Notes,"
"Description of the Indenture," "Description of the Transfer
and Servicing Agreement," "Description of the Receivables
Purchase Agreements" and "Glossary" insofar as such statements
purport to summarize certain terms of the Notes, the
Transaction
16
Documents and this Agreement conform to the Notes and such
documents. The statements in the Prospectus Supplement under
the headings "Prospectus Supplement Summary--Material Federal
Income Tax Consequences," and "--ERISA Considerations," "ERISA
Considerations" and in the Basic Prospectus under the headings
"Material Legal Aspects of the Receivables," "Material Federal
Income Tax Consequences," and "ERISA Considerations" to the
extent that they constitute matters of law or legal
conclusions, are correct;
(xiii) neither the Issuer nor any of the Conseco
Entities is required to be or after the issuance of the Notes
will be registered as an "investment company" under the 1940
Act;
(xiv) the Retail Services Receivables Purchase
Agreement is effective to create, in favor of the Bank, a
valid and enforceable ownership or security interest in all of
Retail Services Bank's right, title and interest in and to the
Purchased Assets, as described in the Retail Services
Receivables Purchase Agreement and the proceeds thereof and
the ownership or security interest transferred to the Bank has
been perfected and has priority over any other security
interest in the Purchased Assets;
(xv) the [Bank] Receivables Purchase Agreement is
effective to create, in favor of CFC a valid and enforceable
ownership or security interest in all of the Bank's right,
title and interest in and to the [assets], as described in the
[Bank] Receivables Purchase Agreement and the proceeds thereof
and the ownership or security interest transferred to CFC has
been perfected and has priority over any other security
interest in the [assets];
(xvi) the CFC Receivables Purchase Agreement is
effective to create, in favor of Funding Corp. a valid and
enforceable ownership or security interest in all of CFC's
right, title and interest in and to the [assets], as described
in the CFC Receivables Purchase Agreement and the proceeds
thereof and the ownership or security interest transferred to
Funding Corp. has been perfected and has priority over any
other security interest in the [assets];
(xvii) the Transfer and Servicing Agreement is
effective to create, in favor of the Issuer a valid and
enforceable ownership or security interest in all of the
Bank's right, title and interest in and to the Trust Assets
(as defined in the Transfer and Servicing Agreement) and all
of Funding Corp.'s right, title and interest in the Trust
Assets and the ownership or security interest in the Trust
Assets transferred to the Issuer has been perfected and has
priority over any other security interest in the Trust Assets;
(xviii) the Transfer and Servicing Agreement is
effective to transfer and assign to the Issuer the security
interest of the Bank in the Purchased Assets described in the
Retail Services Receivables Purchase Agreement and the
assignment of such security interest has been perfected and is
of first priority;
17
(xix) the Indenture creates in favor of the Indenture
Trustee a security interest in the right, title and interest
of the Issuer in the Collateral, as defined in the Indenture,
and the Indenture Trustee's interest in the Collateral has
been perfected and has priority over any other security
interest in the Collateral;
(xx) the Indenture is effective to transfer and
assign to the Indenture Trustee the security interest of
Funding Corp. in the [assets] described in the CFC Receivables
Purchase Agreement and the assignment of such security
interest has been perfected and is of first priority;
(xxi) the Indenture is effective to transfer and
assign to the Indenture Trustee, the security interest of the
Issuer in the Purchased Assets described in the Retail
Services Receivables Purchase Agreement and the security
interest of the Issuer in the [assets];
(xxii) the transfer of the [assets] from CFC to
Funding Corp. and the transfer of Funding Corp.'s right, title
and interest in the Trust Assets to the Issuer, each
constitute a true sale and in the event of the bankruptcy of
CFC or its parent, the assets of Funding Corp. will not be
consolidated into the assets of CFC or its parent;
(xxiii) the Notes will be treated as debt of the
Issuer for federal income tax purposes and neither the Issuer
nor Funding Corp. will [tax opinion to be described]; and
(xxiv) No other filings or other actions, with
respect to the Indenture Trustee's interest in the Collateral,
are necessary to perfect the interest of the Indenture Trustee
in the Collateral, including the proceeds thereof, against
third parties, except that appropriate continuation statements
must be filed in accordance with the applicable state's
requirements, which is presently at least every five years;
(xxv) [state tax opinions for South Dakota, Utah,
Minnesota, Arizona;] and
(xxvi) [characterization opinions].
Such counsel shall state that it has participated in conferences,
including telephone conferences, with officers and other representative
of the Conseco Entities and the Issuer, counsel for the Underwriters
and representative of the independent accountants for the Conseco
Entities at which conferences contents of the Registration Statement
and Prospectus were discussed and, although such counsel is not passing
upon and does not assume responsibility for, the factual accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, (except as stated in
paragraphs ( ) and ( ) above) and has made no independent check or
verification thereof for the purpose of rendering this opinion, on the
basis of the foregoing (relying as to materiality to a large extent
upon the certificates of officers and other
18
representative of the Conseco Entities), nothing has come to their
attention that leads such counsel to believe that the Registration
Statement, when it became effective, contained any untrue statement of
a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading or that the Registration Statement and the Prospectus on the
Closing Date contained, and the Prospectus as of its date and as of the
date of such opinion contains, any untrue statement of a material fact
or omitted or omits to state a material fact necessary in order to make
the statement therein, in light of the circumstances under which they
were made not misleading, except that such counsel need express no view
with respect to the financial statements, schedules and other financial
statistical and numerical data included in or incorporated by reference
into the Registration Statement or the Prospectus.
In rendering such opinions, counsel may rely with respect to
matters of South Dakota law, upon the opinion of other counsel of good
standing in the State of South Dakota believed by such counsel to be
reliable and acceptable to you and your counsel. References to the
Prospectus in this paragraph (c) include any supplements thereto.
(d) At the date of execution of this Agreement and at the
Closing Date, PricewaterhouseCoopers LLP shall have furnished to the
Representative a letter or letters, dated respectively as of the date
of this Agreement and the date of the Closing Date, in form and
substance satisfactory to the Representative and counsel for the
Underwriters, confirming that they are certified independent public
accountants within the meaning of the Act, the Exchange Act and the
rules and regulations promulgated thereunder and stating in effect that
they have performed certain specified procedures as a result of which
they determined that certain information of an accounting, financial or
statistical nature set forth in the Registration Statement and the
Prospectus (and any supplements thereto), agrees with the records as
agreed with the Representative, and (ii) they have performed certain
specified procedures with respect to the verification of certain
information related to the Accounts as agreed with the Representative.
(e) The Representative shall receive evidence satisfactory to
them that, on or before the Closing Date, UCC-1 financing statements
are being or have been filed in the offices of the Secretaries of State
of South Dakota, Utah, Minnesota and Delaware (and such other states as
may be necessary or desirable pursuant to applicable state law)
reflecting the interest of the Indenture Trustee in the Collateral
including the proceeds thereof.
(f) Counsel to the Indenture Trustee shall have delivered a
favorable opinion, dated the Closing Date, and satisfactory in form and
substance to the Representative and counsel for the Underwriters, the
Conseco Entities and their counsel, to the effect that:
(i) the Indenture Trustee is a national banking
association duly organized and validly existing under the laws
of the United States of America;
(ii) the Trustee has duly authorized, executed and
delivered the Indenture and the Series Supplement;
19
(iii) the Indenture Trustee has full power and
authority to execute and deliver the Indenture and the Series
Supplement and to perform its obligations thereunder;
(iv) To the best of such counsel's knowledge, there
are no actions, proceedings or investigations pending or
threatened against or affecting the Indenture Trustee before
or by any court, arbitrator, administrative agency or other
governmental authority which, if adversely decided, would
materially and adversely affect the ability of the Indenture
Trustee to carry out the transactions contemplated in the
Indenture and the Series Supplement;
(v) No consent, approval or authorization of, or
registration, declaration or filing with, any court or
governmental agency or body of the jurisdiction of
incorporation of the Indenture Trustee is required for the
execution, delivery or performance by the Indenture Trustee of
the Indenture and the Series Supplement; and
(vi) each of the Notes has been duly authenticated
and delivered by the Indenture constitute legal, valid and
binding agreements of the Indenture Trustee, enforceable
against the Indenture Trustee in accordance with its terms
(subject to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally).
(g) Counsel to the Owner Trustee shall have delivered a
favorable opinion, dated the Closing Date, and satisfactory in form and
substance to the Representative and counsel for the Underwriters to the
effect that:
(i) the Owner Trustee is duly incorporated and
validly existing as a banking corporation in good standing
under the laws of the State of Delaware and has the power and
authority to execute, deliver and perform the Trust Agreement
and to consummate the transactions contemplated thereby;
(ii) the Trust Agreement has been duly authorized,
executed and delivered by the Owner Trustee and constitutes a
legal, valid and binding obligation of the Owner Trustee,
enforceable against the Owner Trustee in accordance with its
terms;
(iii) each of the Indenture, the Trust Agreement and
the Transfer and Servicing Agreement (collectively referred to
in this subsection (h) as the "Trust Documents") has been duly
executed and delivered by the Owner Trustee, as Owner Trustee
on behalf of the Issuer;
(iv) neither the execution, delivery or performance
by the Owner Trustee, in its individual capacity or as Owner
Trustee, as the case may be, of the Trust Documents, nor the
consummation of the transactions by the Owner Trustee, in its
individual capacity or as Owner Trustee, as the case may be,
20
contemplated thereby, requires the consent or approval of, the
withholding of objection on the part of, the giving of notice
to, the filing, registration or qualification with, or the
taking of any other action in respect of, any governmental
authority or agency of the State of Delaware or the United
States of America governing the banking or trust powers of the
Owner Trustee (other than the filing of the certificate of
trust with the Delaware Secretary of State, which certificate
of trust has been duly filed);
(v) neither the execution, delivery and performance
by the Owner Trustee, in its individual capacity or as Owner
Trustee, as the case may be, of the Trust Documents, nor the
consummation of the transactions by the Owner Trustee, in its
individual capacity or as Owner Trustee, as the case may be,
contemplated thereby, is in violation of the charter or bylaws
of the Owner Trustee or of any law, governmental rule or
regulation of the State of Delaware or of the United States of
America governing the banking or trust powers of the Owner
Trustee or, to such counsel's knowledge, without independent
investigation, any indenture, mortgage, bank credit agreement,
note or bond purchase agreement, long-term lease, license or
other agreement or instrument to which it is a party or by
which it is bound or, to such counsel's knowledge, without
independent investigation, of any judgment or order applicable
to the Owner Trustee;
(vi) no consent, approval or other authorization of,
or registration, declaration or filing with, any court or
governmental agency or commission of the State of Delaware is
required by or with respect to the Owner Trustee, in its
individual capacity or as Owner Trustee, as the case may be,
for the valid execution and delivery of the Trust Documents,
or for the validity or enforceability thereof (other than the
filing of the certificate of trust, which certificate of trust
has been duly filed); and
(vii) to such counsel's knowledge, without
independent investigation, there are no pending or threatened
actions, suits or proceedings affecting the Owner Trustee
before any court or other governmental authority which, if
adversely determined, would materially and adversely affect
the ability of the Owner Trustee to carry out the transactions
contemplated by the Trust Agreement.
(h) Special Delaware counsel to the Issuer shall have
delivered a favorable opinion, dated the Closing Date, and satisfactory
in form and substance to the Representatives and counsel for the
Underwriters, the Conseco Entities and their counsel, to the effect
that;
(i) the Issuer has been duly formed and is validly
existing in good standing as a business trust under the
Delaware Business Trust Act, 12 Del. C3801 et seq.(referred to
in this subsection (h) as the "Act");
21
(ii) the Trust Agreement constitutes a legal, valid
and binding obligation of the Owner Trustee and the
Transferors, enforceable against the Owner Trustee and the
Transferors, in accordance with its terms;
(iii) under the Trust Agreement, the execution and
delivery of the Transfer and Servicing Agreement and the
Indenture, the issuance of the Notes and the Transferor
Certificate and the granting of the Collateral to the
Indenture Trustee as security for the Notes has been duly
authorized by all necessary trust action on the part of the
Issuer;
(iv) the Issuer has the power and authority, pursuant
to the Trust Agreement and the Act, to execute, deliver and
perform its obligations under the Administration Agreement,
the Indenture and the Transfer and Servicing Agreement
(collectively referred to in this subsection (h) as the "Trust
Documents"), the Notes and the Transferor Certificates and has
duly authorized, executed and delivered such agreements and
obligations;
(v) when the Transferor Certificates have been duly
executed and issued by the Issuer and duly authenticated by
the Owner Trustee in accordance with the Trust Agreement, the
Transferor Certificates will be validly issued and entitled to
the benefits of the Trust Agreement;
(vi) neither the execution, delivery and performance
by the Issuer of the Trust Documents, the Notes or the
Transferor Certificates, nor the consummation by the Issuer of
any of the transactions by the Issuer contemplated thereby,
requires the consent or approval of, the withholding of
objection on the part of, the giving of notice to, the filing,
registration or qualification with, or the taking of any other
action in respect of, any governmental authority or agency of
the State of Delaware, other than the filing of the
certificate of trust with the Delaware Secretary of State
(which certificate has been duly filed) and the filing of any
financing statements with the Delaware Secretary of State in
connection with the Trust Documents;
(vii) neither the execution, delivery and performance
by the Issuer of the Trust Documents, nor the consummation by
the Issuer of the transactions contemplated thereby, is in
violation of the Trust Agreement or of any law, rule or
regulation of the State of Delaware applicable to the Issuer;
(viii) under Section 3805(b) of the Act, no creditor
of the Transferors shall have any right to obtain possession
of, or otherwise exercise legal or equitable remedies with
respect to, the property of the Issuer except in accordance
with the terms of the Trust Agreement;
(ix) under Section 3808(a) and (b) of the Act, the
Issuer may not be terminated or revoked by the Transferors,
and the dissolution, termination or
22
bankruptcy of the Transferors shall not result in the
termination or dissolution of the Issuer, except to the extent
otherwise provided in the Trust Agreement;
(x) the Owner Trustee is not required to hold legal
title to the owner trust estate in order for the Issuer to
qualify as a business trust under the Act;
(xi) with respect to the Issuer and the Receivables:
(A) there is no document, stamp, excise or other similar tax
imposed by the State of Delaware upon the perfection of a
security interest in the Receivables, in the transfer of the
Receivables to or from the Issuer, or upon the issuance of the
Notes; (B) there is no personal property tax imposed by the
State of Delaware upon or measured by the corpus of the
Issuer; (C) the characterization of the Issuer for federal
income tax purposes will be determinative of the
characterization of the Issuer for Delaware income tax
purposes and assuming that the Issuer will be taxed as a
partnership for federal income tax purposes, the Issuer will
not be subject to Delaware income tax and Noteholders who are
not otherwise subject to Delaware income tax will not be
subject to tax by reason of their ownership of the Notes and
the receipt of income therefrom; and (D) any income tax
imposed by the State of Delaware that might be applicable to
the Issuer would be based upon "federal taxable income," and
for the purposes of determining such income, the
characterization of such income for federal income tax
purposes will be determinative, whether the characterization
of the transaction is that of a sale or a loan; and
(xii) the Transferors are the sole beneficial owners
of the Issuer.
(i) The Class A Notes shall be rated at least "______" or its
equivalent by Xxxxx'x Investors Service, Inc. ("Moody's"), "______" or
its equivalent by Standard & Poor's Ratings Services ("S&P") and
"______" or its equivalent by Fitch, Inc. ("Fitch") and none of
Moody's, S&P or Fitch shall have placed the Class A Notes under review
with possible negative implications.
(j) The Class B Notes shall be rated at least "______" or its
equivalent by Moody's, "______" or its equivalent by S&P and "______"
or its equivalent by Fitch and none of Moody's, S&P or Fitch shall have
placed the Class B Notes under review with possible negative
implications.
(k) The Class C Notes shall be rated at least "______" or its
equivalent by Moody's, "______" or its equivalent by S&P and "______"
or its equivalent by Fitch and none of Moody's, S&P or Fitch shall have
placed the Class C Notes under review with possible negative
implications.
(l) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus, there shall
not have been any change, or any development involving a prospective
change, in or affecting the business or properties of the Issuer or any
of the Conseco Entities other than as set forth in the Registration
Statement or
23
Prospectus, the effect of which, in any case referred to above, is, in
the judgment of the Representative, so material and adverse as to make
it impractical or inadvisable to proceed with the offering or the
delivery of the Notes as set forth in the Registration Statement and
the Prospectus.
(m) All proceedings in connection with the transactions
contemplated by this Agreement and all documents incident hereto shall
be reasonably satisfactory in form and substance to the Representative
and counsel for the Underwriters, and the Representative and counsel
for the Underwriters shall have received such opinions, information,
certificates and documents as the Representatives or counsel for the
Underwriter may reasonably request.
If any of the conditions specified in this Section 6 shall not
have been fulfilled when and as provided in this Agreement, or if any of the
opinions and certificates mentioned above or elsewhere in this Agreement shall
not be reasonably satisfactory in form and substance to the Representative and
counsel for the Underwriters, this Agreement and all obligations of the
Representative and the Underwriters hereunder may be canceled at, or at any time
prior to, the Closing Date by the Representative. Notice of such cancellation
shall be given to the Indenture Trustee and the Transferor in writing or by
telephone or telegraph confirmed in writing.
Section 7. Reimbursement of Expenses. If the sale of the Notes
provided for herein is not consummated because any condition to the
Representative's obligations set forth in Section 6 hereof is not satisfied,
because of any termination pursuant to Section 10 hereof or because of any
refusal, inability or failure on the part of the Indenture Trustee or the
Conseco Entities to perform any agreement herein or comply with any provision
hereof other than by reason of a default by the Representative or the
Underwriters, CFC, Conseco Finance and the Transferors, jointly and severally,
will reimburse the Underwriters severally upon demand for all out-of-pocket
expenses (including reasonable fees and disbursements of counsel) that shall
have been incurred by them in connection with the proposed purchase and sale of
the Notes.
Section 8. Indemnification and Contribution.
(a) As an inducement to the Underwriters to participate in the
public offering of the Notes, the Bank and Funding Corp., jointly and
severally and CFC and Conseco Finance with respect to any information
that it has provided in connection with the preparation of the
Prospectus and, with respect to the breach of any of its
representations and warranties under Section 1 hereunder, agree to
indemnify and hold harmless each Underwriter and each person who
controls any Underwriter within the meaning of either Section 15 of the
Act or Section 20 of the Exchange Act against any and all losses,
claims, damages or liabilities or actions arising out of or based upon
any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, or in the Prospectus, or in
any amendment thereof or supplement thereto, or arising out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim,
damage, liability or action;
24
provided, however that the Conseco Entities will not be liable in any
such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to
the Conseco Entities by or on behalf of any Underwriter through the
Representative specifically for use in connection with the preparation
thereof it being agreed and understood that the only such information
furnished by any Underwriter consists of the information described as
such in subsection (b) below; and provided, further, that with respect
to any untrue statement or alleged untrue statement in or omission or
alleged omission from any preliminary prospectus the indemnity
agreement contained in this subsection (a) shall not inure to the
benefit of any Underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased the Notes concerned,
to the extent that a prospectus relating to such Notes was required to
be delivered by such Underwriter under the Act in connection with such
purchase and any such loss, claim, damage or liability of such
Underwriter results from the fact that there was not sent or given to
such person, at or prior to the written confirmation of the sale of
such Notes to such person, a copy of the Prospectus (exclusive of
material incorporated by reference) if a Conseco Entity had previously
furnished copies thereof to such Underwriter. This indemnity agreement
will be in addition to any liability which the Conseco entities may
otherwise have.
(b) Each Underwriter, severally, agrees to indemnify and hold
harmless each of the Bank, Funding Corp., Conseco Finance and CFC, each
of their directors, each of the officers who signs the Registration
Statement, and each person who controls the Bank, Funding Corp.,
Conseco Finance or CFC within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, to the same extent as the foregoing
indemnities from the Conseco Entities to each Underwriter as provided
in (a) above, but only with reference to written information relating
to such Underwriter furnished to the Conseco Entities by or on behalf
of such Underwriter specifically for use in the preparation of the
documents referred to in the foregoing indemnity. This indemnity
agreement will be in addition to any liability which any Underwriter
may otherwise have. The Conseco Entities acknowledge that the
statements relating to the Underwriters set forth in the Prospectus
Supplement under the heading "Risk Factors-Ability to Resell Series
2001-__ Notes Not Assured" and set forth in the Prospectus Supplement
under the heading "Underwriting" [in the _________, __________,
_______, and ______ paragraphs] constitute the only information
furnished in writing by the Underwriters or on behalf of the
Underwriters for inclusion in the Prospectus and Prospectus Supplement.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party
in writing of the commencement thereof; but the failure so to notify
the indemnifying party will not relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying
party shall be entitled to appoint counsel of the indemnifying party's
choice at the indemnifying party's expense to represent the indemnified
party in any action for which indemnification is sought (in which case
the indemnifying party shall not thereafter be responsible for the fees
and expenses of any separate counsel retained by the indemnified party
25
or parties except as set forth below); provided, however, that such
counsel shall be satisfactory to the indemnified party. Notwithstanding
the indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have the
right to employ separate counsel (including local counsel), and the
indemnifying party shall bear the reasonable fees, costs and expenses
of such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present
such counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses
available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, (iii)
the indemnifying party shall not have employed counsel satisfactory to
the indemnified party to represent the indemnified party within a
reasonable time after notice of the institution of such action or (iv)
the indemnifying party shall authorize the indemnified party to employ
separate counsel at the expense of the indemnifying party. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
action 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 (i) includes an unconditional
release of such indemnified party from all liability on any claims that
are the subject matter of such action and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to
act by or on behalf of an indemnified party.
(d) If the indemnification provided for in this Section 8 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a
result of the losses, claims, damages or liabilities referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to
reflect the relative benefits received by the Conseco Entities on the
one hand and the Underwriters on the other from the offering of the
Notes or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above
but also the relative fault of the Conseco Entities on the one hand and
the Underwriters on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities
as well as any other relevant equitable considerations. The relative
benefits received by the Conseco Entities on the one hand and the
Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering (before deducting expenses)
received by the Conseco Entities bears to the total underwriting
discounts and commissions received by the Underwriters. 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 Conseco Entities or the Underwriters and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission.
The Underwriters agree that it would not be just and equitable if
contribution pursuant to this subsection (d) were 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 account of the equitable considerations referred to above in this
subsection (d). The amount paid by an indemnified party as a result of
the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d)
26
shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any action or claim which is the subject of this subsection
(d). Notwithstanding the provisions of this subsection (d), no
Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Notes underwritten by it
and distributed to the public were offered to the public exceeds the
amount of any damages which such Underwriter 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
misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Underwriters' obligations in
this subsection (d) to contribute are several in proportion to their
respective underwriting obligations and not joint.
Section 9. Default by an Underwriter. If any one or more
Underwriters shall fail to purchase and pay for any of the Notes agreed to be
purchased by such Underwriter or Underwriters hereunder on the Closing Date and
such failure to purchase shall constitute a default in the performance of its or
their obligations under this Agreement, the remaining Underwriters shall be
obligated severally to take up and pay for (in the respective proportions which
the amount of Notes set forth opposite their names in Schedule I with respect to
the Closing Date hereto bears to the aggregate amount of Notes set forth
opposite the names of all the remaining Underwriters) the Notes which the
defaulting Underwriter or Underwriters agreed but failed to purchase; provided,
however, that in the event that the aggregate amount of Notes which the
defaulting Underwriter or Underwriters agreed but failed to purchase shall
exceed 10% of the aggregate amount of Notes set forth in Schedule I hereto, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Notes, and if such nondefaulting
Underwriters do not purchase all the Notes, the obligations will terminate
without liability of any nondefaulting Underwriter, the Issuer, or any Conseco
Entity. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
seven days, as the Underwriters shall determine in order that the required
changes in the Registration Statement and the Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this Agreement
shall relieve any defaulting Underwriter of its liability, if any, to Conseco
Finance, CFC, Funding Corp., the Bank and any nondefaulting Underwriter for
damages occasioned by its default hereunder.
Section 10. Termination. This Agreement shall be subject to
termination in the absolute discretion of the Representative, by notice given to
Conseco Finance, CFC and the Transferors if after the Execution Time and prior
to delivery of and payment for the Notes on the Closing Date, (i) any change, or
any development or event involving a prospective change, in the condition
(financial or other), business, properties or results of operations of Conseco,
Inc. and its subsidiaries taken as one enterprise which, in the judgment of a
majority in interest of the Underwriters including the Representative, is
material and adverse and makes it impractical or inadvisable to proceed with
completion of the public offering or the sale of and payment for the Notes; (ii)
any downgrading in the rating of any debt securities or preferred stock of a
Conseco Entity by any "nationally recognized statistical rating organization"
(as defined for purposes of Rule 436(g) under the Act), or any public
announcement that any such organization has under surveillance or review its
rating of any debt securities or preferred stock of a Conseco Entity
27
(other than an announcement with positive implications of a possible upgrading,
and no implication of a possible downgrading, of such rating); (iii) trading in
the Common Stock of Conseco, Inc. shall have been suspended by the Commission or
the New York Stock Exchange or trading in securities generally on the New York
Stock Exchange shall have been suspended or limited or minimum prices shall have
been established on such Exchange, (iv) a banking moratorium shall have been
declared by Federal or State of New York authorities or (v) there shall have
occurred any outbreak or escalation of hostilities involving the United States
of America, declaration by the United States of a national emergency or war or
the occurrence of any other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in the reasonable
judgment of the Representatives, impractical or inadvisable to proceed with the
offering or delivery of the Notes as set forth in the Prospectus.
Section 11. Representations and Indemnities to Survive. The
respective agreements, representations, warranties, indemnities and other
statements of the Conseco Entities or the officers of each of them and of the
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation made by or on behalf of the
Underwriters, the Conseco Entities or any of the officers, directors or
controlling persons referred to in Section 8 hereof, and will survive delivery
of and payment for the Notes. The provisions of Sections 7 and 8 hereof shall
survive the termination or cancellation of this Agreement.
Section 12. Notices. All communications hereunder shall be in
writing and effective only on receipt, and, if sent to the Underwriters, will be
mailed, delivered or telegraphed and confirmed to the Representative at
____________________, Attention: _____________; if sent to the Bank, will be
mailed, delivered or telegraphed and confirmed to Conseco Bank, Inc., 0000 X.
Xxxxxxxxxx Xxxxxxx, Xxxxx 000, Xxxx Xxxx Xxxx, Xxxx 00000, Attention:
_____________; if sent to Funding Corp., will be mailed, delivered or
telegraphed and confirmed to Conseco Finance Credit Card Funding Corp.,
_____________, _____________; provided, however, that any notice to an
Underwriter pursuant to Section 8 will be mailed, delivered or telegraphed and
confirmed to such Underwriter.
Section 13. APPLICABLE LAW. THIS AGREEMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES UNDER THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
Section 14. Successors. This Agreement will inure to the
benefit of and be binding upon the parties hereto and their respective
successors and the officers, directors and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder.
Section 15. Counterparts. This Agreement may be executed by
one or more parties to this Agreement on any number of separate counterparts,
and all of said counterparts taken together shall be deemed to constitute one
and the same instrument.
28
Section 16. Miscellaneous. This agreement supersedes all prior
agreements and understandings relating to the subject matter hereof. Neither
this Agreement nor any term hereof may be changed, waived, discharged or
terminated orally, but only by an instrument in writing signed by the party
against whom enforcement of the change, waiver, discharge or termination is
sought. The headings in this Agreement are for purposes of reference only and
shall not limit or otherwise affect the meaning hereof.
If you are in agreement with the foregoing, please sign three
counterparts hereof and return one to each of the Bank, the Transferor, Conseco
Finance and CFC whereupon this letter and your acceptance shall become a binding
agreement among Conseco Finance, CFC, the Bank, Funding Corp. and the several
Underwriters.
Very truly yours,
CONSECO BANK, INC.
By:
------------------------------------
Name:
Title:
CONSECO FINANCE CREDIT CARD
FUNDING CORP.
By:
------------------------------------
Name:
Title:
CONSECO FINANCE SERVICING CORP.
By:
------------------------------------
Name:
Title:
CONSECO FINANCE CORP.
By:
------------------------------------
Name:
Title:
29
The foregoing Agreement
is hereby confirmed and
accepted as of the date hereof.
By:
------------------------------------
Name:
Title:
For themselves and the
other several Underwriters
named in Schedule I to the
foregoing Agreement.
SCHEDULE I
----------
CLASS A NOTES
-------------
Principal
Amount
---------
CLASS B NOTES
-------------
Principal
Amount
---------
CLASS C NOTES
-------------
Principal
Amount
---------
