UNDERWRITING AGREEMENT
XXXXXXX, XXXXX & CO.
As Representatives of and on behalf of
the Underwriters
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
June 25,
1997
Dear Sirs:
Sears Xxxxxxx Acceptance Corp., a Delaware corporation (the
"Company"), proposes to issue and sell from time to time certain
of its debt securities registered under the registration
statement referred to in Section 2(a) (the "Securities"). The
Company intends to enter into one or more Pricing Agreements
(each a "Pricing Agreement") in the form of Annex I hereto, with
such additions and deletions as the parties thereto may
determine, and, subject to the terms and conditions stated herein
and therein, to issue and sell to the firms named in Schedule I
to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the
securities specified therein) certain of the Securities specified
in Schedule I I to such Pricing Agreement (with respect to such
Pricing Agreement, the "Designated Securities"). The Designated
Securities with respect to each Pricing Agreement shall be issued
under an indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made
from time to time to the Underwriters of such Securities, for
whom you will act as representatives. This Underwriting
Agreement shall not be construed as an obligation of the Company
to sell any of the Securities or as an obligation of any of the
Underwriters to purchase the Securities. The obligation of the
Company to issue and sell any of the Securities and the
obligation of any of the Underwriters to purchase any of the
Securities shall be evidenced by the Pricing Agreement with
respect to the Designated Securities specified therein. Each
Pricing Agreement shall specify the aggregate principal amount of
such Designated Securities, the public offering price of such
Designated Securities, the purchase price to the Underwriters of
such Designated Securities, the names of the Underwriters of such
Designated Securities, the principal amount of such Designated
Securities to be purchased by each Underwriter and the commission
payable to the Underwriters with respect thereto and shall set
forth the date, time and manner of delivery of such Designated
Securities and payment therefor. The Pricing Agreement shall
also describe, in a manner consistent with the Indenture and the
registration statement and prospectus with respect thereto, the
principal terms of such Designated Securities. A Pricing
Agreement shall be in the form of an executed writing (which may
be in counterparts), and may be evidenced by an exchange of
telegraphic communications or any other rapid transmission device
designed to produce a written record of communications
transmitted. The obligations of the Underwriters under this
Agreement and each Pricing Agreement shall be several and not
joint.
2. Each of the Company and Sears, Xxxxxxx and Co.
("Sears") represents and warrants to, and agrees with, each of
the Underwriters that:
(a) A registration statement in respect of the
Securities has been filed with the Securities and Exchange
Commission (the "Commission"); such registration statement and
any post-effective amendment thereto, each in the form heretofore
delivered or to be delivered to you and, excluding exhibits to
such registration statement, but including all documents
incorporated by reference in the prospectus included therein, to
you for each of the other Underwriters have been declared
effective by the Commission in such form (any preliminary
prospectus included in such registration statement being
hereinafter called a "Preliminary Prospectus"; the various parts
of such registration statement, including all exhibits thereto
except Form T-1, each as amended at the time such part became
effective, being hereinafter collectively called the
"Registration Statement"; the prospectus relating to the
Securities, in the form in which it has most recently been filed
with the Commission on or prior to the date of this Agreement,
being hereinafter called the "Prospectus"; any reference herein
to any Preliminary Prospectus or the Prospectus shall be deemed
to include the documents, if any, incorporated by reference
therein pursuant to the applicable form under the Securities Act
of 1933, as amended (the "Act"), as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary
Prospectus or the Prospectus shall be deemed to include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act
of 1934, as amended (the "Exchange Act") and so incorporated by
reference; and any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as
amended or supplemented in relation to the applicable Designated
Securities in the form in which it is first filed with the
Commission pursuant to Rule 424(b) of Regulation C under the Act,
including any documents incorporated by reference therein as of
the date of such filing);
(b) Except for statements in such documents which do
not constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or
superseding such excluded statements (i) the documents
incorporated by reference in the Prospectus, when they became
effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act
or the Exchange Act, as applicable, and the rules and regulations
of the Commission thereunder, and none of such documents, when
they became effective or were so filed, as the case may be,
contained, in the case of documents which became effective under
the Act, an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary
to make the statements therein not misleading, and, in the case
of documents which were filed under the Exchange Act with the
Commission, an untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading, and (ii) any further documents so filed and
incorporated by reference when they become effective or are filed
with the Commission, as the case may be, will conform in all
material respects to the requirements of the Act or the Exchange
Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain, in the case of
documents which become effective under the Act, an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, and, in the case of documents which are
filed under the Exchange Act with the Commission, an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light
of the circumstances under which they are made, not misleading;
provided, however, that this representation and warranty shall
not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the
Company by an Underwriter of Designated Securities through you
expressly for use therein; at the Time of Delivery (as defined in
Section 5 hereof), the Indenture will be duly qualified under,
and will conform in all material respects to the requirements of,
the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"); and
(c) Except for statements in documents incorporated
therein by reference which do not constitute part of the
Registration Statement or the Prospectus pursuant to Rule 412 of
Regulation C under the Act and after substituting therefor any
statements modifying or superseding such excluded statements, the
Registration Statement and the Prospectus conformed, and any
amendments or supplements thereto will, when they become
effective or are filed with the Commission, as the case may be,
conform, in all material respects to the requirements of the Act
and the Trust Indenture Act and the rules and regulations of the
Commission thereunder and do not and will not, as of the
applicable effective date as to the Registration Statement and as
of the applicable filing date as to the Prospectus, contain an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
of Designated Securities through you expressly for use in the
Prospectus as amended or supplemented relating to such
Securities.
3. The Company represents and warrants to, and agrees with
each of the Underwriters that:
(a) Upon payment therefor as provided herein, the
Securities will have been duly and validly authorized and
(assuming their due authentication by the Trustee) will have been
duly and validly issued and will be valid, binding and
enforceable obligations of the Company in accordance with their
terms, except as the same may be limited by insolvency,
bankruptcy, reorganization, moratorium, liquidation, fraudulent
conveyance or transfer or other similar laws relating to or
affecting the enforcement of creditors' rights and by general
equity principles,including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing
(regardless of whether such enforceability is considered in
equity or at law) and will be entitled to the benefits of the
Indenture; and
(b) The issue and sale of the Securities pursuant to
any Pricing Agreement and the compliance by the Company with all
of the provisions of the Securities, the Indenture and this
Agreement will not conflict with or result in any breach which
would constitute a material default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of the Company material to the
Company pursuant to the terms of, any indenture, loan agreement
or other agreement or instrument for borrowed money to which the
Company is a party or by which the Company may be bound or to
which any of the property or assets of the Company, material to
the Company, is subject, nor will such action result in any
material violation of the provisions of the Certificate of
Incorporation, as amended or the By-Laws of the Company or, to
the best of its knowledge, any statute or any order, rule or
regulation applicable to the Company of any court or any Federal,
State or other regulatory authority or other governmental body
having jurisdiction over the Company, and no consent, approval,
authorization or other order of, or filing with, any court or any
such regulatory authority or other governmental body is required
for the issue and sale of the Designated Securities except as has
been obtained or effected under the Act, the Exchange Act and the
Trust Indenture Act or as may be required under the securities
laws of the various states and other jurisdictions in which the
Underwriters will offer and sell the Designated Securities.
4. Upon the execution of the Pricing Agreement applicable
to any Designated Securities and authorization by you of the
release of the Designated Securities, the several Underwriters
propose to offer the Designated Securities for sale upon the
terms and conditions set forth in the Prospectus as amended or
supplemented.
The Pricing Agreement applicable to any Designated
Securities may provide that the Company and any entity acting as
an underwriter with respect to such Designated Securities may
enter into a deferred pricing agreement in the form set forth in
a schedule attached to such Pricing Agreement.
5. Designated Securities to be purchased by each
Underwriter pursuant to the Pricing Agreement relating thereto,
in definitive certificates registered in the name of Cede & Co.,
as nominee for the Depository Trust Company, New York, New York
("DTC") (unless otherwise specified in the Pricing Supplement),
shall be delivered by or on behalf of the Company to you for the
account of such Underwriter, against payment by such Underwriter
or on its behalf of the purchase price therefor, by certified or
official bank check or checks or wire transfer, as specified in
such Pricing Agreement, payable to the order of the Company in
the funds specified in such Pricing Agreement, all at the place
and time and date specified in such Pricing Agreement or at such
other place and time and date as you and the Company may agree
upon in writing, such time and date being herein called the "Time
of Delivery" for such Securities.
The Designated Securities will be issued in the form of
fully registered global Notes, which will be deposited with, or
in accordance with the instructions of, DTC and registered in the
name of DTC's nominee. Except as provided in the Indenture,
beneficial owners of the Designated Securities represented by the
global Notes will not have the right to have Designated
Securities registered in their names, will not receive or be
entitled to receive physical delivery of such Designated
Securities, and will not be considered the owners or holders
thereof. Settlement for the Designated Securities will be made
in immediately available funds. Secondary market trading between
DTC participants will occur in accordance with DTC rules and will
be settled in immediately available funds using DTC's Same-Day
Funds Settlement System. All payments of interest and principal
on the Designated Securities will be made by the Company in
immediately available funds.
6. Each of the Company and Sears agrees with each of the
Underwriters of Designated Securities:
(a) To make no further amendment or any supplement to
the Registration Statement or the Prospectus as amended or
supplemented after the date of the Pricing Agreement relating to
such Securities and prior to the Time of Delivery for such
Securities without first having furnished you with a copy of the
proposed form thereof and given you a reasonable opportunity to
review the same; to advise you promptly of any such amendment or
supplement after such Time of Delivery and furnish you with
copies thereof and to file promptly all reports and any
definitive proxy or information statements required to be filed
by the Company or Sears, respectively, with the Commission
pursuant to Section 13 or 14 of the Exchange Act for so long as
the delivery of a prospectus is required in connection with the
offering or sale of such Securities, and during such same period
to advise you, promptly after the Company or Sears receives
notice thereof, of the time when the Registration Statement, or
any amendment thereto, or any amended Registration Statement has
become effective or any supplement to the Prospectus or any
amended Prospectus has been filed, of the issuance by the
Commission of any stop order or of any order preventing or
suspending the use of any Prospectus, or the suspension of the
qualification of such Securities for offering or sale in any
jurisdiction, or the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or
Prospectus or for additional information; and in the event of the
issuance of any such stop order or of any such order preventing
or suspending the use of any such Prospectus or suspending any
such qualification, to use promptly its best efforts to obtain
its withdrawal;
(b) Promptly from time to time to take such action as
you may reasonably request to qualify such Securities for
offering and sale under the securities laws of such jurisdictions
within the United States as you may request and to comply with
such laws so as to permit the continuance of sales and dealings
therein in such jurisdictions for as long as may be necessary to
complete the distribution of such Securities, provided that in
connection therewith neither the Company nor Sears shall be
required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(c) To furnish the Underwriters with copies of the
Prospectus as amended or supplemented in such quantities as you
may from time to time reasonably request, and, if the delivery of
a prospectus is required at any time in connection with the
offering or sale of such Securities and if at such time any event
shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the
circumstances under which they were made when such Prospectus is
delivered, not misleading, or, if for any other reason it shall
be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply
with the Act, the Exchange Act or the Trust Indenture Act, to
notify you and to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many copies as you
may from time to time reasonably request of an amended Prospectus
or a supplement to the Prospectus which will correct such
statement or omission or effect such compliance; and
(d) To make generally available to its security
holders, in accordance with the provisions of Rule 158 under the
Act or otherwise, as soon as practicable, but in any event not
later than forty-five days after the end of the fourth full
fiscal quarter (ninety days in the case of the last fiscal
quarter in any fiscal year) following the fiscal quarter ending
after the latest of (x) the effective date of the Registration
Statement, (y) the effective date of the post-effective amendment
thereto hereinafter referred to, and (z) the date of the filing
of the report hereinafter referred to, earning statements of the
Company and Sears and its consolidated subsidiaries (which need
not be audited) complying with Section 11(a) of the Act and
covering a period of at least twelve consecutive months beginning
after the latest of (i) the effective date of such Registration
Statement, (ii) the effective date of the post-effective
amendment, if any, to such Registration Statement (within the
meaning of Rule 158) next preceding the date of the Pricing
Agreement relating to the Designated Securities and (iii) the
date of filing of the last report of the Company or Sears
incorporated by reference into the Prospectus (within the meaning
of Rule 158) next preceding the date of the Pricing Agreement
relating to the Designated Securities.
7. The Company agrees with each of the Underwriters of
Designated Securities:
(a) During the period beginning from the date of the
Pricing Agreement for such Designated Securities and continuing
to and including the earlier of (i) the termination of trading
restrictions for such Designated Securities, of which termination
you agree to give the Company prompt notice confirmed in writing,
and (ii) the Time of Delivery for such Designated Securities, not
to offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company which mature more than one year after
such Time of Delivery and which are substantially similar to such
Designated Securities, without your prior written consent, which
consent shall not be unreasonably withheld, except pursuant to
arrangements of which you have been advised by the Company prior
to the time of execution of such Pricing Agreement, which advice
is confirmed in writing to you by the end of the business day
following the date of such Pricing Agreement; and
(b) To pay or cause to be paid all expenses,
preapproved by the Company, incident to the performance of its
obligations hereunder and under any Pricing Agreement, including
the cost of all qualifications of the Securities under state
securities laws (including reasonable fees of counsel to the
Underwriters in connection with such qualifications and in
connection with legal investment surveys) and the cost of
printing this Agreement, any Pricing Agreement, and any blue sky
and legal investment memoranda.
8. The obligations of the Underwriters of any Designated
Securities under the Pricing Agreement relating to such
Designated Securities shall be subject, in their discretion, to
the condition that all representations and warranties and other
statements of the Company or Sears herein are, at and as of the
Time of Delivery for such Designated Securities, true and
correct, the condition that each of the Company and Sears shall
have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding
for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the
part of the Commission shall have been complied with to your
reasonable satisfaction.
(b) All corporate proceedings and related matters in
connection with the organization of the Company, the validity of
the Indenture and the registration, authorization, issue, sale
and delivery of the Designated Securities shall have been
satisfactory to counsel to the Underwriters, and such counsel
shall have been furnished with such papers and information as
they may reasonably have requested to enable them to pass upon
the matters referred to in this subdivision (b).
(c) Counsel to the Company and Sears shall have
furnished to you such counsel's written opinion, dated the Time
of Delivery for such Designated Securities, in form and substance
satisfactory to you in your reasonable judgment, to the effect
that:
(i) Each of the Company and Sears has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of its respective state of incorporation;
(ii) All of the outstanding shares of capital
stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable. The authorized
capital stock of the Company consists of 500,000 shares of common
stock, par value $100.00 per share, all of the issued and
outstanding shares of which are owned by Sears, and the
authorized capital stock of Sears is as set forth or incorporated
by reference in the Registration Statement;
(iii) The Company is not an "investment company"
within the meaning of the Investment Company Act of 1940, as
amended;
(iv) This Agreement and the Pricing Agreement
with respect to the Designated Securities have been duly
authorized, executed and delivered on the part of the Company and
Sears;
(v) The issue and sale of the Designated
Securities and the compliance by the Company with all of the
provisions of the Designated Securities, the Indenture, this
Agreement and the Pricing Agreement with respect to the
Designated Securities will not (a) conflict with or result in any
breach which would constitute a material default under, or result
in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of the Company material to the
Company, pursuant to the terms of, any indenture, loan agreement
or other agreement or instrument for borrowed money known to such
counsel to which the Company is a party or by which the Company
may be bound or to which any of the property or assets of the
Company material to the Company is subject, (b) result in any
violation of the provisions of the Certificate of Incorporation,
as amended or the By-Laws of the Company or (c) to the best of
the knowledge of such counsel, result in any material violation
of any statute or any order, rule or regulation applicable to the
Company of any court or any federal, state or other regulatory
authority or other governmental body having jurisdiction over the
Company, other than the securities laws of the various states or
other jurisdictions which are applicable to the issue and sale of
the Designated Securities as to which such counsel need express
no opinion; and, to the best knowledge of such counsel, no
consent, approval, authorization or other order of, or filing
with, any court or any such regulatory authority or other
governmental body is required for the issue and sale of the
Designated Securities except as has been obtained or effected
under the Act, the Exchange Act and the Trust Indenture Act or as
may be required under the securities laws of the various states
or other jurisdictions which are applicable to the issue and sale
of the Designated Securities;
(vi) The Fixed Charge Coverage and Ownership
Agreement dated May 15, 1995 and the Extension Agreement dated
August 22, 1996, each between the Company and Sears, have been
duly authorized, executed and delivered by the parties thereto
and are valid and binding instruments in accordance with their
terms except as the same may be limited by insolvency,
bankruptcy, reorganization or other laws relating to or affecting
the enforcement of creditors' rights or by general equity
principles;
(vii) The Indenture has been duly authorized,
executed and delivered on the part of the Company and, as to the
Company, is a valid, binding and enforceable instrument in
accordance with its terms except as the foregoing may be limited
by insolvency, bankruptcy, reorganization, moratorium,
liquidation, fraudulent conveyance and transfer or other similar
laws relating to or affecting the enforcement of creditors'
rights generally and by general equity principles, including,
without limitation, concepts of materiality, reasonableness, good
faith and fair dealing (regardless of whether such enforceability
is considered in a proceeding in equity or at law) and has been
qualified under the Trust Indenture Act; the Designated
Securities have been duly authorized and (assuming their due
authentication by the Trustee) have been duly executed, issued
and delivered on the part of the Company and constitute valid,
binding and enforceable obligations of the Company in accordance
with their terms, entitled to the benefits of the Indenture,
except as the same may be limited by insolvency, bankruptcy,
reorganization, moratorium, liquidation, fraudulent conveyance
and transfer or other similar laws relating to or affecting the
enforcement of creditors' rights generally and by general equity
principles, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing
(regardless of whether such enforceability is considered in a
proceeding in equity or at law);
(viii)Such counsel does not know of any pending
legal or governmental proceedings required to be described in the
Prospectus as amended or supplemented (including documents
incorporated by reference therein) which are not described as
required;
(ix) Except for statements in such documents
which do not constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or
superseding such excluded statements, the documents incorporated
by reference in the Prospectus as amended or supplemented (other
than the financial statements and related schedules, the analyses
of operations and financial condition and other financial,
statistical and accounting data therein, as to which such counsel
need express no opinion), when they were filed with the
Commission complied as to form in all material respects with the
requirements of the Exchange Act and the rules and regulations of
the Commission thereunder;
(x) Except for statements in such documents
which do not constitute part of the Registration Statement or the
Prospectus pursuant to Rule 412 of Regulation C under the Act and
after substituting therefor any statements modifying or
superseding such excluded statements, the Registration Statement
and the Prospectus as amended or supplemented (excluding the
documents incorporated by reference therein) (other than the
financial statements and related schedules, the analyses of
operations and financial condition and other financial,
statistical and accounting data therein as to which such counsel
need express no opinion) comply as to form in all material
respects with the requirements of the Act and the rules and
regulations thereunder; the answers in the Registration Statement
to Item 9 and Item 10 (insofar as it relates to such counsel) of
Form S-3 are to the best of such counsel's knowledge accurate
statements or summaries of the matters therein set forth and
fairly present the information called for with respect to those
matters by the Act and the rules and regulations thereunder; and
(xi) Such counsel does not know of any contract
or other document to which the Company or Sears is a party
required to be filed as an exhibit to the Registration Statement
or required to be incorporated by reference into the Prospectus
as amended or supplemented or required to be described in the
Prospectus as amended or supplemented which has not been so
filed, incorporated by reference or described.
In rendering such opinion, such counsel may rely to the
extent such counsel deems appropriate upon certificates of
officers or other executives of the Company, Sears and its
business groups and subsidiaries and of public officials as to
factual matters and upon opinions of other counsel. Such counsel
shall also state that: (a) nothing has come to such counsel's
attention which has caused such counsel to believe that any of
the documents referred to in subdivision (ix) above (other than
the financial statements and related schedules, the analyses of
operations and financial condition and other financial,
statistical and accounting data therein, as to which such counsel
need express no belief), in each case after excluding any
statement in any such document which does not constitute part of
the Registration Statement or the Prospectus as amended or
supplemented pursuant to Rule 412 of Regulation C under the Act
and after substituting therefor any statement modifying or
superseding such excluded statement, when such documents were so
filed contained an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading, and (b) nothing has come to such
counsel's attention which has caused such counsel to believe that
the Registration Statement or the Prospectus as amended or
supplemented (other than the financial statements and the related
schedules, the analyses of operations and financial condition and
other financial, statistical and accounting data therein, as to
which such counsel need express no belief) contains an untrue
statement of a material fact or omits to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading.
(d) At the Time of Delivery for such Designated
Securities, Deloitte & Touche LLP, certified auditors, shall have
furnished you a letter or letters, dated the date of delivery
thereof in form and substance satisfactory to you as to such
matters as you may reasonably request.
(e) (i) The Company shall not have sustained, since
the date of the latest audited financial statements included or
incorporated by reference in the Prospectus as amended or
supplemented, any material loss or interference with its business
from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree and (ii) since the
respective dates as of which information is given in the
Prospectus as amended or supplemented there shall not have been
any material change in the capital stock accounts or long-term
debt of the Company or any material adverse change in the general
affairs, financial position, stockholders' equity or results of
operations of the Company, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented, the
effect of which in any such case described in clause (i) or (ii),
in your judgment makes it impracticable or inadvisable to proceed
with the public offering or the delivery of the Designated
Securities on the terms and in the manner contemplated in the
Prospectus as amended or supplemented.
(f) Subsequent to the date of the Pricing Agreement
relating to the Designated Securities, no downgrading shall have
occurred in the rating accorded to the Company's or Sears senior
debt securities by Xxxxx'x Investors Service, Inc. or Standard &
Poor's; provided, however, that this subdivision (f) shall not
apply to any such rating agency which shall have notified you of
the rating of the Designated Securities prior to the execution of
the Pricing Agreement.
(g) Subsequent to the date of the Pricing Agreement
relating to the Designated Securities none of (i) the United
States shall have become engaged in the outbreak or escalation of
hostilities involving the United States or the United States
shall have made a declaration of a national emergency or a
declaration of war, (ii) a banking moratorium shall have been
declared by either Federal or New York State authorities, or
(iii) trading in securities generally on the New York Stock
Exchange shall have been suspended or limited or minimum prices
shall have been established by such Exchange, any of which
events, in your judgment, renders it inadvisable to proceed with
the public offering or the delivery of the Designated Securities.
(h) Each of the Company and Sears shall have furnished
or caused to be furnished to you at the Time of Delivery for the
Designated Securities certificates satisfactory to you as to the
accuracy at and as of such Time of Delivery of the
representations, warranties and agreements of the Company and
Sears, respectively, herein and as to the performance by each of
the Company and Sears of all its obligations hereunder to be
performed at or prior to such Time of Delivery and the Company
shall have also furnished you similar certificates satisfactory
to you as to the matters set forth in subdivision (a) of this
Section 8.
9. (a) Each Underwriter represents and warrants that (i)
it has not offered or sold, and, prior to the date six months
after the date of issue of the Designated Securities, will not
offer or sell any Designated Securities to persons in the United
Kingdom, except to persons whose ordinary activities involve them
in acquiring, holding, managing or disposing of investments (as
principal or agent) for the purposes of their businesses or
otherwise in circumstances that have not resulted and will not
result in an offer to the public in the United Kingdom within the
meaning of the Public Offers of Securities Regulations 1995; (ii)
it has complied and will comply with all applicable provisions of
the Financial Services Xxx 0000 with respect to anything done by
it in relation to the Designated Securities in, from or otherwise
involving the United Kingdom; and (iii) it has only issued or
passed on and will only issue or pass on in the United Kingdom
any document received by it in connection with the issue of the
Designated Securities to a person who is of a kind described in
Article 11(3) of the Financial Services Xxx 0000 (Investment
Advertisements)(Exemptions) Order 1996 or is a person to whom the
document may otherwise lawfully be issued or passed on.
(b) Each of the Underwriters agrees that it will not
offer, sell or deliver any of the Designated Securities in any
jurisdiction outside the United States except under circumstances
that will result in compliance with the applicable laws thereof.
10. (a) The Company will indemnify and hold harmless each
Underwriter 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 an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary
Prospectus, the Registration Statement, any prospectus relating
to the Securities or the Prospectus as amended or supplemented,
or any amendment or supplement thereto furnished by the Company
or Sears, 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 (in the case of the Registration Statement or
the Prospectus as amended or supplemented, or any amendment or
supplement thereto) necessary to make the statements therein not
misleading or (in the case of any Preliminary Prospectus)
necessary to make the statements therein, in the 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 the Company shall 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 or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, the Prospectus or the
Prospectus as amended or supplemented or any such amendment or
supplement in reliance upon and in conformity with written
information furnished to the Company by any Underwriter of
Designated Securities through you expressly for use in the
Prospectus as amended or supplemented relating to such
Securities; and provided, further, that the Company shall not be
liable to any Underwriter or any person controlling such
Underwriter under the indemnity agreement in this subdivision (a)
with respect to the Preliminary Prospectus or the Prospectus or
the Prospectus as amended or supplemented, as the case may be, to
the extent that any such loss, claim, damage or liability of such
Underwriter or controlling person results solely from the fact
that such Underwriter sold Designated Securities to a person to
whom there was not sent or given, at or prior to the written
confirmation of such sale, a copy of the Prospectus (excluding
documents incorporated by reference) or of the Prospectus as then
amended or supplemented (excluding documents incorporated by
reference) if the Company has previously furnished copies thereof
to such Underwriter.
(b) Each Underwriter will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to
which the Company may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus or the Prospectus as amended or
supplemented, or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or
(in the case of the Registration Statement or the Prospectus or
the Prospectus as amended or supplemented, or any amendment or
supplement thereto) necessary to make the statements therein not
misleading or (in the case of any Preliminary Prospectus)
necessary to make the statements therein, in the 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 Preliminary Prospectus, the Registration
Statement, the Prospectus or the Prospectus as amended or
supplemented, or any such amendment or supplement in reliance
upon and in conformity with written information furnished to the
Company by such Underwriter through you expressly for use
therein; and will reimburse the Company for any legal or other
expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim.
(c) Within a reasonable period after receipt by an
indemnified party under subdivision (a) or (b) above of notice of
the commencement of any action with respect to which
indemnification is sought under such subdivision or contribution
may be sought under subdivision (d) below, such indemnified party
shall notify the indemnifying party in writing of the
commencement thereof. In case any such action shall be brought
against any indemnified party, the indemnifying party shall be
entitled to participate in, and, to the extent that it shall
wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party shall not
be liable to such indemnified party 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 10
is unavailable to an indemnified party under subdivision (a) or
(b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid
or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions in respect thereof) in
such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the
Underwriters of the Designated Securities on the other from the
offering of the Designated Securities to which such loss, claim,
damage or liability (or action in respect thereof) relates and
also the relative fault of the Company and Sears on the one hand
and the Underwriters of the Designated Securities 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 Company on
the one hand and such Underwriters on the other shall be deemed
to be in the same proportion as the total net proceeds from such
offering (before deducting expenses) received by the Company bear
to the total underwriting discounts and commissions received by
such Underwriters, in each case as set forth on the cover page of
the Prospectus as amended or supplemented. 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 Company or Sears on the one hand or
the Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or
prevent such statement or omission of the Company or Sears on the
one hand and the Underwriters, directly or through you, on the
other hand. With respect to any Underwriter, such relative fault
shall also be determined by reference to the extent (if any) to
which such losses, claims, damages or liabilities (or actions in
respect thereof) with respect to any Preliminary Prospectus
result from the fact that such Underwriter sold Designated
Securities to a person to whom there was not sent or given, at or
prior to the written confirmation of such sale, a copy of the
Prospectus (excluding documents incorporated by reference) or of
the Prospectus as then amended or supplemented (excluding
documents incorporated by reference) if the Company has
previously furnished copies thereof to such Underwriter. The
Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subdivision (d) were
determined by per capita allocation among the indemnifying
parties (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 subdivision (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in
this subdivision (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this subdivision (d),
no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the
applicable Designated Securities 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
obligations of the Underwriters of Designated Securities in this
subdivision (d) to contribute are several in proportion to their
respective underwriting obligations with respect to such
securities and not joint.
(e) The obligations of the Company under this Section 10
shall be in addition to any liability which the Company may
otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the
Underwriters under this Section 10 shall be in addition to any
liability which the respective Underwriters may otherwise have
and shall extend, upon the same terms and conditions, to each
officer and director of the Company or Sears and to each person,
if any, who controls the Company within the meaning of the Act.
11. (a) If any Underwriter shall default in its obligation
to purchase the Designated Securities which it has agreed to
purchase under the Pricing Agreement relating to such Securities,
you may in your discretion arrange for yourselves or another
party or other parties to purchase such Designated Securities on
the terms contained herein. If within thirty-six hours after
such default by any Underwriter you do not arrange for the
purchase of such Designated Securities, then the Company shall be
entitled to a further period of thirty-six hours within which to
procure another party or other parties to purchase such
Designated Securities on such terms. In the event that, within
the respective prescribed periods, you notify the Company that
you have so arranged for the purchase of such Designated
Securities, or the Company notifies you that it has so arranged
for the purchase of such Designated Securities, you or the
Company shall have the right to postpone the Time of Delivery for
such Designated Securities for a period of not more than seven
days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus as
amended or supplemented, or in any other documents or
arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the
Prospectus which may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person
had originally been a party to the Pricing Agreement with respect
to such Designated Securities.
(b) If, after giving effect to any arrangements for the
purchase of the Designated Securities of a defaulting Underwriter
or Underwriters by you and the Company as provided in subdivision
(a) above, the aggregate principal amount of such Designated
Securities which remains unpurchased does not exceed one-eleventh
of the aggregate principal amount of the Designated Securities,
then the Company shall have the right to require each non-
defaulting Underwriter to purchase the principal amount of
Designated Securities which such Underwriter agreed to purchase
under the Pricing Agreement relating to such Designated
Securities and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the
principal amount of Designated Securities which such Underwriter
agreed to purchase under such Pricing Agreement) of the
Designated Securities of such defaulting Underwriter or
Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Designated Securities of a defaulting Underwriter
or Underwriters by you and the Company as provided in subdivision
(a) above, the aggregate principal amount of Designated
Securities which remains unpurchased exceeds one-eleventh of the
aggregate principal amount of the Designated Securities, as
referred to in subdivision (b) above, or if the Company shall not
exercise the right described in subdivision (b) above to require
non-defaulting Underwriters to purchase Designated Securities of
a defaulting Underwriter or Underwriters, then the Pricing
Agreement relating to such Designated Securities shall thereupon
terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 7(b)
hereof and the indemnity and contribution agreements in Section
10 hereof; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
12. The respective indemnities, agreements,
representations, warranties and other statements of the Company,
Sears and the several Underwriters, as set forth in this
Agreement or made by or on behalf of them, respectively, pursuant
to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the
results thereof) made by or on behalf of any Underwriter or any
controlling person of any Underwriter, the Company, Sears or any
officer or director or controlling person of the Company or
Sears, and shall survive delivery of and payment for the
Securities.
Anything herein to the contrary notwithstanding, the
indemnity agreement of the Company in subdivisions (a) and (e) of
Section 10 hereof, the representations and warranties in
subdivisions (b) and (c) of Section 2 hereof and any
representation or warranty as to the accuracy of the Registration
Statement or the Prospectus as amended or supplemented contained
in any certificate furnished by the Company or Sears pursuant to
subdivision (h) of Section 8 hereof, insofar as they may
constitute a basis for indemnification for liabilities (other
than payment by the Company of expenses incurred or paid in the
successful defense of any action, suit or proceeding) arising
under the Act, shall not extend to the extent of any interest
therein of an Underwriter or a controlling person of an
Underwriter if a director, officer or controlling person of the
Company or Sears when the Registration Statement becomes
effective or a person who, with his consent, is named in the
Registration Statement as being about to become a director of the
Company or Sears, is a controlling person of such Underwriter,
except in each case to the extent that an interest of such
character shall have been determined by a court of appropriate
jurisdiction as not against public policy as expressed in the
Act. Unless in the opinion of counsel for the Company or Sears
the matter has been settled by controlling precedent, the Company
or Sears will, if a claim for such indemnification is asserted,
submit to a court of appropriate jurisdiction the question
whether such interest is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
13. If any Pricing Agreement shall be terminated pursuant
to Section 11 hereof, the Company shall not then be under any
liability to any Underwriter with respect to the Designated
Securities covered by such Pricing Agreement except as provided
in Section 7(b) and Section 10 hereof; but, if for any other
reason Designated Securities are not delivered by or on behalf of
the Company as provided herein, the Company will reimburse the
Underwriters through you for all out-of-pocket expenses approved
in writing by you, including fees and disbursements of counsel,
reasonably incurred by the Underwriters in making preparations
for the purchase, sale and delivery of such Designated
Securities, but the Company shall then be under no further
liability to any Underwriter with respect to such Designated
Securities except as provided in Section 7(b) and Section 10
hereof.
14. In all dealings hereunder, you shall act on behalf of
each of the Underwriters of Designated Securities, and the
parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any
Underwriter made or given by you or by Xxxxxxx, Sachs & Co.,
representing you.
All statements, requests, notices and agreements hereunder
shall be in writing or by telegram if promptly confirmed in
writing and if to the Underwriters shall be sufficient in all
respects, if delivered or sent by registered mail to you as the
Representatives at 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: New Issues, Syndicate Desk; and if to the Company
shall be sufficient in all respects if delivered or sent by
registered mail to the Company at 0000 Xxxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxx 00000, Attention: Xxxxx X. Xxxxxx, Secretary; and if to
Sears shall be sufficient in all respects if delivered or sent by
registered mail to Sears at 0000 Xxxxxxx Xxxx, Xxxxxxx Xxxxxxx,
Xxxxxxxx, Attention: Xxxxxxx X. Xxxxx, Senior Vice President,
General Counsel and Secretary.
15. This Agreement and each Pricing Agreement shall be
binding upon, and inure solely to the benefit of, the
Underwriters, the Company, Sears and, to the extent provided in
Section 10 and Section 12 hereof, the officers and directors of
the Company and Sears and each person who controls the Company or
any Underwriter, and their respective heirs, executors,
administrators, successors and assigns, and no other person shall
acquire or have any right under or by virtue of this Agreement or
any such Pricing Agreement. No purchaser of any of the
Securities from any Underwriter shall be deemed a successor or
assign by reason merely of such purchase.
16. Time shall be of the essence of each Pricing Agreement.
17. This Agreement and each Pricing Agreement shall be
governed by, and construed in accordance with, the internal laws
of the State of New York.
18. This Agreement and each Pricing Agreement may be
executed by any one or more of the parties hereto and thereto in
any number of counterparts, each of which shall be deemed to be
an original, but all such respective counterparts shall together
constitute one and the same instrument.
If the foregoing is in accordance with your understanding,
please sign and return two counterparts hereof.
Very truly yours,
Sears Xxxxxxx Acceptance Corp.
By: /S/ XXXXX X. XXXXX
Sears, Xxxxxxx and Co.
By: /S/ XXXXX X. XXXXXXX
Accepted as of the date hereof:
/S/ XXXXXXX, XXXXX & CO.
.....................................
Xxxxxxx, Sachs & Co.
As Representatives of and on behalf of
the Underwriters
