EXHIBIT 1.2
INDEMNIFICATION AGREEMENT
Indemnification Agreement dated [ ], (this "Agreement") between Ford Motor
Credit Company ("Ford Credit"), [ ], [ ] and [ ], in their individual capacities
and as Representatives (the "Representatives") of the several underwriters
(collectively, the "Underwriters") signing the underwriting agreement (the
"Underwriting Agreement") dated as of ________, 200_, among the Representatives
and Ford Credit Auto Receivables Two LLC, a Delaware limited liability company
(the "Depositor").
The Depositor proposes to sell the notes described in the Underwriting
Agreement to the Underwriters (the "Notes"). The Notes will be issued by a
Delaware statutory trust (the "Trust") identified in the Underwriting Agreement
and established under a trust agreement (the "Trust Agreement") between the
Depositor and an owner trustee (the "Owner Trustee"), and will be secured by a
pool of motor vehicle retail installment sale contracts for new and used
automobiles and trucks (the "Receivables") and certain other property of the
Trust. The Notes will be issued pursuant to an indenture (the "Indenture")
between the Trust and an indenture trustee (the "Indenture Trustee").
This Agreement is being entered into by the parties hereto as a condition
precedent to the obligation of the Underwriters under the Underwriting Agreement
and to induce the Underwriters to enter into the same. The provisions of this
Agreement relate solely to the Publicly Registered Notes and the Exempt Notes.
Capitalized terms used and not otherwise defined will have the meanings given
them in the Underwriting Agreement.
1. Indemnification and Contribution
(a) Ford Credit will indemnify and hold each Underwriter harmless
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter 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 any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, the Prospectus, the
Offering Memorandum, the Preliminary Prospectus, the Preliminary Offering
Memorandum, or any amendment or supplement to any of such documents, or any
Trust Free Writing Prospectus or the Time of Sale Information 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 in light of the circumstances under which they were made not
misleading, and will reimburse each Underwriter for any legal or other expenses
reasonably incurred by such Underwriter in connection with investigating or
defending any such action or claim; provided, however, that Ford Credit 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 an untrue statement or alleged untrue
statement in or omission or alleged omission from any of such documents in
reliance upon and in conformity with written information furnished to the
Depositor by any Underwriter through the Representatives specifically for use
therein; and provided further, that Ford Credit will not be liable to any
Underwriter or any person controlling any Underwriter under the
indemnity agreement in this subsection (a) with respect to any of such documents
to the extent that any such loss, claim, damage or liability results from the
fact that such Underwriter either (i) sold the Publicly Registered Notes to a
person to whom there was not sent or given, at or prior to the Time of Sale, a
copy of the Preliminary Prospectus or the Time of Sale Information, whichever is
more recent, if the Depositor has previously furnished copies thereof to such
Underwriter, or (ii) sold the Exempt Notes to a person to whom there was not
sent or given, at or prior to the Time of Sale, a copy of the Preliminary
Offering Memorandum (including the Prospectus attached thereto) and if more
recent, the Time of Sale Information, if the Depositor has previously furnished
copies thereof to such Underwriter.
The indemnity agreement in this subsection (a) will be in addition to any
liability which Ford Credit may otherwise have and will extend, upon the same
terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act.
(b) Each Underwriter, severally and not jointly, will indemnify and
hold harmless Ford Credit against any losses, claims, damages or liabilities to
which Ford Credit 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 any untrue statement or alleged untrue statement
of any material fact in the Registration Statement, the Prospectus, the Offering
Memorandum, the Preliminary Prospectus, the Preliminary Offering Memorandum, or
any amendment or supplement to any such documents, or any Free Writing
Prospectus or the Time of Sale Information, or arise out of or are based upon
the omission or the alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading
in light of the circumstances under which they were made 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 of such
documents (i) in reliance upon and in conformity with written information
furnished to the Depositor by such Underwriter through the Representatives
specifically for use therein or (ii) in an Underwriter Free Writing Prospectus
prepared by such Underwriter and is not Trust Information, and will reimburse
any legal or other expenses reasonably incurred by Ford Credit in connection
with investigating or defending any such action or claim.
The indemnity agreement in this subsection (b) will be in addition to any
liability which each Underwriter may otherwise have and will extend, upon the
same terms and conditions, to each person, if any, who controls Ford Credit
within the meaning of the Act.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) of written notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under subsection (a) or (b) above, notify the indemnifying party of the
commencement thereof, and in the event that such indemnified party does not so
notify the indemnifying party within 30 days following receipt of any such
notice by such
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indemnified party, the indemnifying party will have no further liability under
such subsection to such indemnified party unless the indemnifying party has
received other notice addressed and delivered in the manner provided in Section
3 hereof of the commencement of such action; but the omission so to notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action is brought against any indemnified party and it notifies the indemnifying
party of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party in its reasonable judgment, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under such subsection for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
(d) If the indemnification provided for in this Section 1 is
unavailable 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 will 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 proportion as is appropriate to reflect the
relative benefits received by the Depositor on the one hand and the Underwriters
on the other from the offering of the Underwritten Notes. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law, then each indemnifying party will contribute to such amount paid
or payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Depositor 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 the Depositor on the
one hand and the Underwriters on the other will be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Depositor bear to the total underwriting discounts and
commissions received by the Underwriters, in each case (i) as set forth in the
table on the cover page of the Prospectus as amended or supplemented with
respect to the Publicly Registered Notes and (ii) with respect to the Exempt
Notes, measured by the excess of the price to investors over the price to the
underwriters of the Exempt Notes. The relative fault will 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 Depositor and its affiliates or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission,
including, with respect to any Underwriter, the extent to which such losses,
claims, damages or liabilities (or actions in respect thereof) result from the
fact that such Underwriter either (x) sold the Publicly Registered Notes to a
person to whom there was not sent or given, at or prior to the Time of Sale, a
copy of the Preliminary Prospectus or the Time of Sale Information, whichever is
more
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recent, if the Depositor has previously furnished copies thereof to such
Underwriter, or (y) sold the Exempt Notes to a person to whom there was not sent
or given, at or prior to the Time of Sale, a copy of the Preliminary Offering
Memorandum (including the Prospectus attached thereto) and if more recent, the
Time of Sale Information, if the Depositor has previously furnished copies
thereof to such Underwriter.
Ford Credit and the Underwriters, severally and not jointly, 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 (or actions in respect thereof) referred
to above in this subsection (d) will 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, claim, damage or liability.
Notwithstanding the provisions of this subsection (d), no Underwriter will be
required to contribute any amount pursuant to this Agreement and the
Underwriting Agreement (collectively) in excess of either (A) the amount by
which the total price at which the Publicly Registered Notes underwritten by it
and distributed to the public were offered to the public, or (B) the amount by
which the total price at which the Exempt Notes underwritten by it and
distributed to investors as described in the Offering Memorandum were offered to
investors, 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) will be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The obligations of the Underwriters of the Underwritten Notes
in this subsection (d) to contribute are several in proportion to their
respective underwriting obligations with respect to such Underwritten Notes as
set forth in the Underwriting Agreement and not joint.
2. Payment of Expenses. Ford Credit will pay all expenses incident to the
performance of the obligations of the Depositor pursuant to Sections 5(d), 5(h)
and 10 of the Underwriting Agreement.
3. Notices. All notices, requests, demands, consents, waivers or other
communications to or from the parties to this Agreement must be in writing and
will be deemed to have been given and made:
(a) upon delivery or, in the case of a letter mailed by registered
first class mail, postage prepaid, 3 days after deposit in the mail,
(b) in the case of a fax, when receipt is confirmed by telephone,
reply email or reply fax from the recipient,
(c) in the case of an email, when receipt is confirmed by telephone or
reply email from the recipient.
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Communications to the Representatives or the Underwriters will be given to
the Representatives at:
(i) [ ],
(ii) [ ], and
(iii) [ ].
Communications to Ford Credit will be given to:
Ford Motor Credit Company
Xxx Xxxxxxxx Xxxx
Xxxxx 0000, Xxxxxx 000-000
Xxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Secretary
Telephone: (000) 000-0000
Fax: (000) 000-0000
4. Successors. This Agreement will inure to the benefit of and be binding
upon the Underwriters and Ford Credit and their respective successors and the
officers and directors and controlling persons referred to in Section 1, and no
other person will have any right or obligations hereunder.
5. GOVERNING LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
6. Submission to Jurisdiction. The parties submit to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York State Court sitting in New York, New York for
purposes of all legal proceedings arising out of or relating to this Agreement.
The parties irrevocably waive, to the fullest extent they may do so, any
objection that they may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
7. WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT IRREVOCABLY WAIVES,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY
JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
8. Severability. If any of the covenants, agreements or terms of this
Agreement is held invalid, illegal or unenforceable, then it will be deemed
severable from the remaining covenants, agreements or terms of this Agreement
and will in no way affect the validity, legality or enforceability of the
remaining Agreement.
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9. Counterparts. This Agreement may be executed in any number of
counterparts. Each counterpart will be an original, and all counterparts will
together constitute one and the same instrument.
EXECUTED:
FORD MOTOR CREDIT COMPANY
By:___________________________
Name:
Title:
[ ]
By:___________________________
Name:
Title:
[ ]
By:___________________________
Name:
Title:
[ ]
By:___________________________
Name:
Title:
Acting on behalf of themselves
and as Representatives of the
several Underwriters
