CHEVY CHASE AUTO RECEIVABLES TRUST ______
_____% Auto Receivables Backed [Certificates/Notes]
UNDERWRITING AGREEMENT
[Date]
[Underwriters]
Dear Sirs:
1. INTRODUCTION. Chevy Chase Bank, F.S.B., a federally chartered stock
savings bank ("Chevy Chase"), has authorized the issuance and sale of _____%
Auto Receivables Backed [Certificates/Notes] (the "Securities"), evidencing
[interests in a trust/debt issued by a trust] (the "Trust") consisting, among
other things, of (i) a combination of simple interest retail installment sales
contracts and installment loans (the "Receivables") secured by new and used
automobiles, light duty trucks and vans (the "Vehicles") financed thereby, (ii)
amounts due or received thereunder on or after ____________ (the "Cut-Off
Date"), and (iii) security interests in the Vehicles financed thereby. The
Securities will be issued under a [Pooling and Servicing Agreement Indenture]
dated as of _____________ (the "Trust Agreement") between Chevy Chase as seller
and as servicer and ______________________, as trustee (the "Trustee").
The [Certificates will evidence fractional undivided interests in the Trust
[Notes will evidence debt issued by the Trust]. [The Trustee, on behalf of the
holders of the Securities (the "Securityholders"), will have the benefit of a
financial guaranty insurance policy (the Certificate Insurance Policy") from
_______ Insurance Corporation (the "Security Insurer"). The Trustee will also
have access to a Reserve Account to be established for the benefit of the
holders of the Securities and the Security Insurer. [Each Securityholder will
also purchase the right to receive a pro rata share of amounts payable under the
Yield Maintenance Account established pursuant to the Trust Agreement.] The
Certificates will be issued in an aggregate principal amount of $____________,
which is equal to the original pool balance of the Receivables, exclusive of
accrued interest, as of the opening of business on the Cut-Off Date. The forms
of the Trust Agreement, the Security Insurance Policy and the Indemnification
Agreement (as such term is hereinafter defined) have been timely filed as
exhibits to the Registration Statement (as such term is hereinafter defined).
Capitalized terms used but not defined herein shall have the meanings given to
them in the Pooling Agreement.
Chevy Chase hereby agrees with the several Underwriters named in Schedule 1
hereto (the "Underwriters") as follows:
2. REPRESENTATIONS AND WARRANTIES OF CHEVY CHASE. Chevy Chase represents
and warrants to, and agrees with, each of the Underwriters that:
(a) A Registration Statement on Form S-3 (Nos. __________________) relating
to the Certificates, including a form of Prospectus, has been filed with the
Securities and Exchange Commission (the "Commission") and either (i) has been
declared effective under the Act of 1933 (the "Act") and is not proposed to be
amended or (ii) is proposed to be amended by amendment or post-effective
amendment. If Chevy Chase does not propose to amend such Registration Statement
or if any post effective amendment to such Registration Statement has been filed
with the Commission prior to the execution and delivery of this Agreement, such
Registration Statement or such post-effective amendment, as the case may be, has
been declared effective by the Commission. For purposes of this Agreement,
"Effective Time" means (i) if Chevy Chase has advised _________________________,
as representative of the Underwriters (the "Representative"), that it does not
propose to amend such Registration Statement, the date and time as of which such
Registration Statement, or the most recent post-effective amendment thereto (if
any) filed prior to the execution and delivery of this Agreement, was declared
effective by the Commission, or (ii) if Chevy Chase has advised the
Representative that it proposes to file an amendment or post-effective amendment
to such Registration Statement, the date and time as of which such Registration
Statement, as amended by such amendment or post-effective amendment, as the case
may be, is declared effective by the Commission. "Effective Date" means the
date of the Effective Time. Such Registration Statement, as amended at the
Effective Time, including all material incorporated by reference therein and
including all information, if any, deemed to be a part of such Registration
Statement as of the Effective Time pursuant to Rule 430A(b) under the Act, is
referred to herein as the "Registration Statement", and the form of prospectus
relating to the Securities, as first filed with the Commission pursuant to and
in accordance with Rule 424(b) under the Act or, if no such filing is required,
as included in the Registration Statement, including all material incorporated
by reference in such prospectus, is herein after referred to as the
"Prospectus."
(b) If the Effective Time is prior to the execution and delivery of this
Agreement: (i) on the Effective Date, the Registration Statement conformed, and
on the date of this Agreement the Registration Statement
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conforms, in all material respects with the requirements of the Act and the
rules and regulations of the Commission ("Rules and Regulations") and did not
include 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
not misleading, and (ii) on the date of this Agreement, the Prospectus conforms,
and at the time of filing of the Prospectus pursuant to Rule 424(b) and at the
Closing Date, the Prospectus will conform, in all material respects to the
requirements of the Act and the Rules and Regulations, and the Prospectus does
not include and does not omit, and will not include, any untrue statement of a
material fact, and does not omit, to state any material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading. If the Effective Time is subsequent to the
execution and delivery of this Agreement on the Effective Date, the Registration
Statement and the Prospectus will conform in all material respects to the
requirements of the Act and the Rules and Regulations, and (i) the Registration
Statement will not include any untrue statement of a material fact or will not
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading and (ii) the Prospectus will not
include an untrue statement of a material fact or will not omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading. The two preceding
sentences do not apply to statements in or omissions from the Registration
Statement or Prospectus based upon written information furnished to Chevy Chase
by any Underwriters through the Representative specifically for use therein, it
being understood the only such information is that described as such in Section
8(b). The conditions to the use by Chevy Chase 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. There are no contracts or documents which are required to be filed
as exhibits to the Registration Statement pursuant to the Act or the Rules and
Regulations which have not been so filed on or prior to the Effective Date.
(c) Since the respective dates as of which information is given in the
Prospectus, or the Prospectus as amended and supplemented, there has not been
any material adverse change in the general affairs, management, or results of
operations of Chevy Chase or of its subsidiaries otherwise than as set forth or
contemplated in the Prospectus or the Prospectus as amended and supplemented,
nor has there been any adverse change in the general affairs, management, or
results of operations of any other affiliate of Chevy Chase which could have a
material adverse
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effect on the general affairs, management or results of operations of Chevy
Chase or its subsidiaries, otherwise than as set forth or contemplated in the
Prospectus or the Prospectus as amended and supplemented.
(d) Chevy Chase is a federally chartered stock savings bank duly organized
and validly existing under the laws of the United States of America, and has
full corporate power, authority and legal right to own its properties and
conduct its business as such properties are presently owned and such business is
presently conducted, and to execute, deliver and perform its obligations under
this Agreement, the Trust Agreement, the Indemnification Agreement, and to cause
the Securities to be issued. Chevy Chase has conducted and is conducting its
business so as to comply in all material respects with all applicable statutes
and regulations, including, without limitation, all regulations, decisions,
directives and orders of the Office of Thrift Supervision. Chevy Chase is duly
qualified to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of its
business requires such qualification.
(e) (i) There are no legal, governmental or regulatory proceedings pending
to which Chevy Chase is a party or to which any of its property is the subject,
which, if determined adversely to Chevy Chase, would individually or in the
aggregate have a material adverse effect on the performance by Chevy Chase of
this Agreement, the Trust Agreement, the Indemnification Agreement or the
consummation of the transactions contemplated hereunder or thereunder and (ii)
to the best of its knowledge, no such proceedings are threatened or contemplated
by governmental or regulatory authorities or threatened by others.
(f) This Agreement has been duly authorized and validly executed and
delivered by Chevy Chase and constitutes a valid and binding agreement of Chevy
Chase, enforceable against Chevy Chase in accordance with its terms, except to
the extent that (i) the enforceability hereof may be subject to insolvency,
reorganization, moratorium, receivership, conservatorship, or other similar
laws, regulations or procedures of general applicability now or hereafter in
effect relating to or affecting creditors' or other obligees' rights generally
or the rights of creditors or obligees of federally chartered stock savings
banks, the deposits of which are insured by the Federal Deposit Insurance
Corporation (the "FDIC"), (ii) the remedy of specific performance and injunctive
and other forms of equitable relief may be subject to equitable defenses and to
the discretion of the court before which any proceeding therefor may be brought
and (iii) rights to indemnification and contribution under this Agreement may be
limited by
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state or federal securities laws or the policies underlying such laws.
(g) The Trust Agreement and the Indemnification Agreement have been duly
authorized by Chevy Chase and, when executed and delivered by Chevy Chase and
assuming the due authorization, execution and delivery of the Trust Agreement
and the Indemnification Agreement by the other parties thereto, will constitute
valid and binding obligations of Chevy Chase enforceable against Chevy Chase in
accordance with their respective terms, except to the extent that (i) the
enforceability thereof may be subject to insolvency, reorganization, moratorium,
receivership, conservatorship, or other similar laws, regulations or procedures
of general applicability now or hereafter in effect relating to or affecting
creditors' or obligees' rights generally or the rights of creditors or obligees
of federally chartered stock savings banks, the deposits of which are insured by
the FDIC, and (ii) the remedy of specific performance and injunctive and other
forms of equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be brought.
(h) The issuance and delivery of the Securities, the consummation of any
other of the transactions contemplated herein in the Trust Agreement and the
Indemnification Agreement or the fulfillment of the terms of this Agreement, the
Trust Agreement or the Indemnification Agreement, do not and will not conflict
with or violate any term or provision of the Charter or By-laws of Chevy Chase,
any statute, order or regulation applicable to Chevy Chase of any court,
regulatory body, administrative agency or governmental body having jurisdiction
over Chevy Chase and do not and will not conflict with, result in a breach or
violation or the acceleration of or constitute a default under or result in the
creation or imposition of any lien, charge or encumbrance upon any of the
property or assets of Chevy Chase pursuant to the terms of, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which Chevy Chase is a party or by which Chevy Chase may be bound or to which
any of the property or assets of Chevy Chase may be subject except for
conflicts, violations, breaches, accelerations and defaults which would not,
individually or in the aggregate, be materially adverse to Chevy Chase or
materially adverse to the transactions contemplated by this Agreement.
(i) ____________________ is an independent public accountant with respect
to Chevy Chase as required by the Act and the Rules and Regulations.
(j) The direction by Chevy Chase to the Trustee to execute, countersign,
issue and deliver the Securities
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has been duly authorized by Chevy Chase, and, assuming the Trustee has been duly
authorized to do so, when executed, countersigned, issued and delivered by the
Trustee in accordance with the Trust Agreement, the Securities will be validly
issued and outstanding and will be entitled to the benefits of the Trust
Agreement.
(k) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the United
States is required for the issuance and sale of the Securities, or the
consummation by Chevy Chase of the other transactions contemplated by this
Agreement, the Trust Agreement or the Indemnification Agreement, except the
registration under the Act of the certificates and such consents, approvals,
authorizations, registrations or qualifications as may have been obtained or
effected or as may be required under securities or Blue Sky laws in connection
with the purchase and distribution of the Securities by the Underwriters.
(l) Chevy Chase possesses all material licenses, certificates,
authorizations or permits issued by the appropriate state, Federal or foreign
regulatory agencies or bodies necessary to conduct the business now conducted by
it and as described in the Prospectus and Chevy Chase has not received notice of
proceedings relating to the revocation or modification of any such license,
certificate, authorization or permit which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would materially and
adversely affect the conduct of its business, operations, financial condition or
income.
(m) At the time of execution and delivery of the Trust Agreement, Chevy
Chase (i) will not have assigned to any person any of its right, title or
interest in the Receivables or in the Trust Agreement or the Securities and (ii)
will have the power and authority to sell the Receivables to the Trustee and to
sell the Securities to the Underwriters, and upon execution and delivery of the
Trust Agreement by the Trustee, the Trustee will have acquired beneficial
ownership of all of Xxxxx Xxxxx'x right, title and interest in and to the
Receivables, and upon delivery to the Underwriters of the Securities the
Underwriters will have good and marketable title to the Securities.
(n) As of the Cut-Off Date, the Receivables will meet the eligibility
criteria described in the Prospectus.
(o) The Trust created by the Trust Agreement is not, and immediately
following the issuance and sale of the Securities will not be, required to be
registered as an "investment company" under the Investment Company Act of
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1940, as amended (the "1940 Act"), as in effect on the date hereof.
(p) Chevy Chase has authorized the conveyance of the Receivables to the
Trust, and Chevy Chase has authorized the Trust to issue the Securities.
(q) Each of the Securities, the Trust Agreement and the Security Insurance
Policy conforms in all material respects to the descriptions thereof contained
in the Prospectus.
(r) Any taxes, fees and other governmental charges in connection with the
execution, delivery and issuance of this Agreement, the Trust Agreement, the
Indemnification Agreement, the Security Insurance Policy and the Certificates
that are required to be paid by Chevy Chase at or prior to the Closing Date have
been paid or will be paid at or prior to the Closing Date.
(s) Chevy Chase will not apply the proceeds of the sale of the Securities
pursuant to this Agreement to purchase securities (which term does not include
the Receivables) within the meaning of Regulation T promulgated by the Federal
Reserve Board.
(t) As of the Closing Date, the representations and warranties of Chevy
Chase in the Trust Agreement and the Indemnification Agreement will be true and
correct.
Any certificate signed by an officer of Chevy Chase and delivered to the
Underwriters or the Underwriters' counsel in connection with an offering of the
Certificates 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 2 are made.
3. PURCHASE, SALE, DELIVERY AND PAYMENTS. The Underwriters commitment to
purchase the Securities pursuant to this Agreement shall be deemed to have been
made on the basis of the representations and warranties herein contained and
shall be subject to the terms and conditions herein set forth. Chevy Chase
agrees to instruct the Trustee to issue and agrees to sell to the Underwriters,
and the Underwriters, severally and not jointly, agree, to purchase from Chevy
Chase at the purchase price for the Securities set forth opposite the names of
the Underwriters on Schedule 1 hereto, the respective principal amount of
Securities set forth on Schedule 1 hereto. Payment of the purchase price for,
and delivery of, any Securities to be purchased by the Underwriters shall be
made at the office of ____________________________________________, or at such
other place as
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shall be agreed upon by the Underwriters and Chevy Chase, at 10:00 a.m. New York
City time on ___________________ (the "Closing Date"), or at such other time or
date or time as shall be agreed upon in writing by the Representative and Chevy
Chase. On the Closing Date, payment shall be made to Chevy Chase by wire
transfer of same day funds payable to the account of Chevy Chase against
delivery to the Trustee as custodian for The Depository Trust Company ("DTC") of
the Securities in the form of one or more global securities in definitive form
(the "Global Securities") and registered in the name of Cede & Co., as nominee
for DTC. The Global Securities will be made available for checking at
___________________________ at least 24 hours prior to the Closing Date.
4. OFFERING BY UNDERWRITERS. It is understood that the Underwriters
propose to offer the Securities for sale to the public (which may include
selected dealers) as set forth in the Prospectus.
5. COVENANTS OF CHEVY CHASE. Chevy Chase covenants with the Underwriters
as follows:
(a) To prepare a Prospectus setting forth any price related information
previously omitted from the effective Registration Statement pursuant to Rule
430A under the Act within the time period prescribed by Rule 430A, and to
transmit such Prospectus to the Commission for filing pursuant to Rule 424(b)
under the Act within the prescribed time period, and prior to the Closing Date
to provide evidence satisfactory to the Underwriters of such timely filing, or
to prepare and timely file a post-effective amendment to the Registration
Statement providing such information, which post-effective amendment shall have
been declared effective in accordance with the requirements of Rule 430A under
the Act and to provide evidence satisfactory to the Underwriters of the
effectiveness thereof.
(b) If at any time when the Prospectus as amended or supplemented is
required by the Act to be delivered in connection with sales of the Securities
by the Underwriters, any event shall occur or condition exist as a result of
which it is necessary, in the opinion of the Underwriters' counsel or counsel
for Chevy Chase, further to amend or supplement the Prospectus as then amended
or supplemented in order that the Prospectus as amended or supplemented will not
include an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in the light of circumstances
existing at the time it is delivered to a purchaser, not misleading or if it
shall be necessary, in the opinion of any such counsel, at any such time to
amend or supplement the Registration Statement or the Prospectus as then amended
or supplemented
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in order to comply with the requirements of the Act or the Rules and
Regulations, or if required by such Rules and Regulations, including Rule 430A
thereunder, to file a post-effective amendment to such Registration Statement
(including an amended Prospectus), Chevy Chase will promptly notify the
Representative of such event and will prepare and file with the Commission
(subject to the Representative's prior review), at its own expense, such
amendment or supplement as may be necessary to correct such untrue statement or
omission or to make the Registration Statement comply with such requirements,
and within two Business Days will furnish to the Underwriters as many copies of
the Prospectus, as amended or supplemented, as the Underwriters shall reasonably
request. Neither the Representative's consent to, nor the Underwriters,
delivery of, any such amendment or supplement shall constitute a waiver of any
of the conditions set forth in Section 6 of this Agreement.
(c) Chevy Chase will give the Underwriters reasonable notice of its
intention to file any amendment to the Registration Statement, the Prospectus or
the Prospectus as amended or supplemented, pursuant to the Act, and will furnish
the Underwriters with copies of any such amendment or supplement proposed to be
filed a reasonable time in advance of filing, and will not file any such
amendment or supplement to which the Underwriters or the Underwriters, counsel
shall object.
(d) Chevy Chase will notify the Underwriters immediately, and confirm the
notice in writing, (i) of the effectiveness of any amendment to the Registration
Statement, (ii) of the mailing or the delivery to the Commission for filing of
any supplement to the Prospectus or the Prospectus as amended or supplemented,
(iii) of the receipt and contents of any comments from the Commission with
respect to the Registration Statement or the Prospectus or the Prospectus as
amended or supplemented, (iv) of any request by the Commission for any amendment
to the Registration Statement or any amendment or supplement to the Prospectus
or for additional information and (v) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose. Chevy Chase will make every
reasonable effort to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof at the earliest possible moment.
(e) Chevy Chase will deliver to the Underwriters as many signed and as many
conformed copies of the Registration Statement (as originally filed) and of each
amendment thereto (including exhibits filed therewith or incorporated by
reference therein and documents incorporated by reference in the Prospectus),
each related preliminary
9
prospectus, and so long as delivery of a Prospectus relating to the Securities
is required to be delivered under the Act in connection with sales by any
Underwriter or dealer, the Prospectus and all amendments and supplements to such
documents, in each case as soon as available and in such quantities as the
Underwriters may reasonably request. Chevy Chase will also furnish to the
Representative copies of any report on Form SR required by Rule 463 under the
Act.
(f) Chevy Chase will make generally available to holders of the Securities
as soon as practicable, but in any event not later than the Availability Date
(as defined below), earning statements of the Trust (which need not be audited)
complying with Section 11(a) of the Act and the Rules and Regulations (including
Rule 158) and covering a period of at least twelve consecutive months beginning
after the Effective Date which will satisfy the provisions of Section 11(a) of
the Act. For the purposes of the preceding sentence, the "Availability Date"
means the 45th day after the end of the Trust's fourth fiscal quarter following
the fiscal quarter that includes the Effective Date, except that, if such fourth
fiscal quarter is the last quarter of the Trust's fiscal year, "Availability
Date" means the 90th day after the end of such fourth fiscal quarter.
(g) Chevy Chase will endeavor, in cooperation with the Underwriters, to
qualify the Securities for sale and the determination of their eligibility for
investment under the applicable securities laws of such states and other
jurisdictions of the United States as the Representative may designate, and will
maintain or cause to be maintained such qualifications in effect for as long as
may be required for the distribution of the Securities. Chevy Chase will file
or cause the filing of such statements and reports as may be required by the
laws of each jurisdiction in which the Securities have been qualified as above
provided.
(h) Chevy Chase will not, directly or indirectly, without the Underwriters'
prior consent, publicly offer or sell or contract to sell or attempt to offer,
sell or dispose of any securities representing interests in or secured by the
Receivables for a period of 30 days following the commencement of the offering
of the Securities to the public.
(i) For a period from the date of this agreement until the retirement of
the Securities, Chevy Chase, as Servicer, will deliver to the Representative
and, upon request, to each of the other Underwriters, as soon as practicable,
copies of each security, report or notice and the annual statements of
compliance delivered by Chevy Chase, as Servicer, to the Trustee pursuant to
Section 4.10
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of the Trust Agreement, the annual statement of a firm of independent public
accountants furnished to the Trustee pursuant to Section 4.11 of the Trust
Agreement and such other information concerning the Receivables, Chevy Chase
(including in its capacities as the Seller and Servicer) or the Securities, as
the Representative may from time to time reasonably request.
(j) On or before the Closing Date, Chevy Chase shall furnish or make
available to the Underwriters or its counsel such additional documents and
information regarding Chevy Chase (including in its capacities as the Seller and
Servicer) and its affairs as the Underwriters may from time to time reasonably
request, including any and all documentation reasonably requested in connection
with their due diligence efforts regarding information in the Prospectus and in
order to evidence the accuracy or completeness of any of the conditions
contained in this Agreement.
(k) So long as any Security is outstanding, Chevy Chase shall furnish to
the Representative by first class mail as soon as practicable, all documents (A)
distributed, or caused to be distributed, by Chevy Chase to Securityholders, (B)
filed, or caused to be filed, by Chevy Chase with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), (C) any order
of the Commission under the Exchange Act or pursuant to a "no action" letter
from the staff of the Commission and (D) from time to time, such other
information in the possession of Chevy Chase concerning the Trust as the
Representative may reasonably request.
(l) Chevy Chase shall apply the net proceeds from the sale of the
Securities in the manner set forth in the Prospectus.
(m) If, between the date hereof or, if earlier, the dates as of which
information is given in the Prospectus and the Closing Date, to the knowledge of
Chevy Chase there shall have been any material change, or any development
involving a prospective material change in or affecting the general affairs,
management, financial position, shareholders' equity or results of operations of
Chevy Xxxxx, Xxxxx Xxxxx will give prompt written notice thereof to the
Underwriters.
(n) To the extent, if any, that any rating provided with respect to the
Securities set forth in Section 6(j) hereof is conditional upon the furnishing
of documents reasonably available to Chevy Chase or the taking of any other
reasonable actions by Chevy Xxxxx, Xxxxx Xxxxx shall furnish such documents or
take any such other actions.
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6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The obligations
of the Underwriters to purchase the Securities pursuant to this Agreement are
subject to the accuracy on and as of the Closing Date of the representations and
warranties on the part of Chevy Chase herein contained, to the accuracy of the
statements of officers of Chevy Chase made pursuant hereto, to the performance
by Chevy Chase of all of its obligations hereunder and to the following
conditions at the Closing Date:
(a) The Representative shall have received a letter, dated the date of
delivery thereof (which, if the Effective Time is prior to the execution and
delivery of this Agreement, shall be on or prior to the date of this Agreement
or, if the Effective Time is subsequent to the execution and delivery of this
Agreement, shall be prior to the filing of the amendment or post-effective
amendment to the Registration Statement to be filed shortly prior to the
Effective Time), from Xxxxxx Xxxxxxxx LLP, in form and substance satisfactory to
the Underwriters and counsel for the Underwriters, confirming that they are
independent public accountants within the meaning of the Act and the applicable
published Rules and Regulations thereunder and stating in effect that (i) they
have performed certain specified procedures as a result of which they have
determined that certain information of an accounting, financial or statistical
nature (which is limited to accounting, financial or statistical information
derived from the general accounting records of the Trust and Chevy Chase set
forth in the Registration Statement and the Prospectus), agrees with the
accounting records of the Trust and Chevy Chase, excluding any questions of
legal interpretation, and (ii) they have performed certain specified procedures
with respect to the computer programs used to select the Receivables and to
generate information with respect to the Receivables set forth in the
Registration Statement and the Prospectus.
For purposes of this subsection (a), if the Effective Time is
subsequent to the execution and delivery of this Agreement, "Registration
Statement" shall mean the registration statement as proposed to be amended by
the amendment or post-effective amendment to be filed shortly prior to the
Effective Time, and "Prospectus" shall mean the prospectus included in such
Registration Statement. All financial statements included in material
incorporated by reference into the Prospectus shall be deemed included in the
Registration Statement for purposes of this subsection (a).
(b) If the Effective Time is not prior to the execution and delivery
of this Agreement, the Effective Time
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shall have occurred not later than 10:00 p.m., New York time, on the date of
this Agreement or such later date as shall have been consented to by the
Representative. If the Effective Time is prior to the execution and delivery of
this Agreement, the Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 5 (a) of this Agreement.
(c) The Registration Statement shall have been declared effective by
the Commission and no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the Act or proceedings
therefor initiated or threatened by the Commission, any price related
information previously omitted from the effective Registration Statement
pursuant to Rule 430A under the Act shall have been included in the Prospectus
and transmitted to the Commission for filing pursuant to Rule 424 under the Act
within the prescribed time period, and Chevy Chase shall have provided evidence
satisfactory to the Underwriters of such timely filing, or a post-effective
amendment to the Registration Statement providing such information shall have
been promptly filed with the Commission and declared effective in accordance
with the requirements of Rule 430A under the Act, and prior to the Closing Date,
Chevy Chase shall have provided evidence satisfactory to the Underwriters of
such effectiveness and there shall not have come to the attention of the
Underwriters facts that would cause the Underwriters to believe that the
Prospectus, at the time it was required to be delivered to a purchaser of the
Certificates, 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 existing at such time, not misleading.
(d) The Underwriters shall have received the favorable opinion, dated
the Closing Date, of __________ ______________, counsel to Chevy Chase, or other
counsel to Chevy Chase, acceptable to the Underwriters and their counsel,
addressed to the Underwriters and in form and scope satisfactory to the
Underwriters counsel, to the effect that:
i) Chevy Chase has been duly chartered and is validly existing
as a federally chartered stock savings bank under the laws of the United States
of America and has full corporate power and authority to own its properties and
conduct its business as described in the Prospectus; Chevy Chase has full
corporate power and authority to execute, deliver, and perform its obligations
under this Agreement, the Trust Agreement, the Indemnification Agreement and the
Insurance Agreement and to cause the Securities to be issued and to consummate
the transactions contemplated hereby and thereby.
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ii) Chevy Chase has duly authorized and executed this Agreement,
the Trust Agreement and the Indemnification Agreement, and each such agreement
constitutes the valid, legal and binding obligation of Chevy Chase enforceable
against Chevy Chase in accordance with its terms.
iii) The execution, delivery and performance of this Agreement,
the Trust Agreement and the Indemnification Agreement the transfer of the
Receivables to the Trust, the issuance and sale of the Securities and
consummation of any other of the transactions contemplated herein or in the
Trust Agreement do not conflict with or result in a violation of (a) any law or
regulation of the United States of America or the State of New York or Maryland
(b) the Charter or By-laws of Chevy Chase, (c) any order, writ, judgment or
decree known to such counsel to which Chevy Chase is a party or is subject or
(d) result in any lien, charge or encumbrance upon any of the properties or
assets of Chevy Chase.
iv) The Securities have been duly authorized and, when executed
and authenticated in accordance with the terms of the Trust Agreement and
delivered to and paid for by the Underwriters pursuant to this Agreement, will
be duly and validly issued and outstanding and will be entitled to the benefits
of the Trust Agreement.
v) No consent, approval or authorization of, or registration,
declaration or filing with, any court or governmental agency or body of the
United States of America is required for the issuance of the Securities and the
sale of the Securities to the Underwriters or the consummation of the other
transactions contemplated by this Agreement, the Trust Agreement or the
Indemnification Agreement, except for (x) the filing of a Uniform Commercial
Code financing statement in the State of Maryland with respect to the transfer
of the Receivables to the Trust, (y) such as have been obtained and made under
the Act and (z) such as may be required under state securities laws.
vi) The Registration Statement was declared effective under the
Act as of the date and time specified in such opinion, the Prospectus either was
filed with the Commission pursuant to the subparagraph of Rule 424 (b) specified
in such opinion on the date specified therein or was included in the
Registration Statement (as the case may be), and, to the best of the knowledge
of such counsel, no stop order suspending the effectiveness of the Registration
Statement or any part thereof has been instituted or is pending or contemplated
under the Act, and the Registration Statement and the Prospectus, and each
amendment or supplement thereof, as of their respective effective or
14
issue dates, complies as to form in all material respects with the requirements
of the Act and the Rules and Regulations; such counsel have no reason to believe
that the Registration Statement or any amendment thereto, as of its Effective
Date, contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading or that the Registration Statement as of the Closing
Date, or the Prospectus, as of its issue date or as of such Closing Date,
contained any untrue statement of a material fact or omitted 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; it being
understood that such counsel need express no opinion as to the financial
statements or other financial data contained in the Registration Statement or
the Prospectus.
vii) The conditions to the use by Chevy Chase 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. There are no contracts or documents of Chevy Chase which are
required to be filed as exhibits to the Registration Statement pursuant to the
Act or the Rules and Regulations thereunder which have not been so filed.
viii) There are no actions, proceedings or investigations pending
or threatened before any court, administrative agency or other tribunal to which
Chevy Chase is a named party or to which its assets are subject (A) asserting
the invalidity of the Trust Agreement, the Indemnification Agreement, this
Agreement or the Securities, (B) seeking to prevent the issuance of the
Securities or the consummation by Chevy Chase of any of the transactions
contemplated by the Trust Agreement, the Indemnification Agreement, or this
Agreement, (C) that might adversely affect the validity or enforceability of the
Trust Agreement, the Indemnification Agreement, this Agreement or the
Securities, or (D) seeking to adversely affect the federal income tax attributes
of the Securities as described in the Prospectus under the heading "Certain
Federal Income Tax Consequences."
ix) The Registration Statement at the time it became effective,
and any amendment thereto at the time such amendment became effective, complied
as to form in all material respects with the applicable requirements of the Act
and the Rules and Regulations.
x) The Pooling Agreement is not required to be qualified under
the Trust Indenture Act of 1939, as amended.
15
xi) The Trust is not required to be registered under the 1940
Act, and immediately following the issuance and sale of the Securities in the
manner contemplated by the Trust Agreement and this Agreement, the Trust will
not be required to be so registered.
xii) The Securities, this Agreement, the Trust Agreement and the
Security Insurance Policy conform in all material respects to the respective
descriptions thereof in the Registration Statement and the Prospectus.
xiii) The statements in the Prospectus under the heading "Certain
Legal Aspects of the Receivables," "SUMMARY OF TERMS -- Certain Legal Aspects of
the Receivables," "SUMMARY OF TERMS -- Certain Federal Tax Considerations,"
"Certain Federal Income Tax Consequences," "ERISA Considerations," and "SPECIAL
CONSIDERATIONS -- Certain Legal Aspects," to the extent that they constitute
matters of law or legal conclusions with respect thereto, have been prepared or
reviewed by such counsel and are correct in all material respects.
xiv) No filing or other action, except the filing of a Uniform
Commercial Code financing statement on Form UCC-1 with the Maryland State
Department of Assessments and Taxation naming Chevy Chase as "debtor" and the
Trustee as "secured party," is necessary to perfect the transfer of the
Receivables and proceeds (as defined in Section 9-306 of the Maryland Uniform
Commercial Code) thereof against the claims of creditors of, and transferees
from, Chevy Chase. Such security interest would be enforceable notwithstanding
the insolvency of Chevy Chase or a receivership or conservatorship of Chevy
Chase in which the Federal Deposit insurance Corporation ("FDIC") or the
Resolution Trust Corporation ("RTC") is appointed a receiver or conservator for
Chevy Chase.
xv) The Receivables constitute "chattel paper" as defined in
Section 9-105 of the Uniform Commercial Code as in effect in the State of
Maryland.
In addition, such counsel shall state that nothing has come to their
attention that would lead them to believe that the Registration Statement, at
the time it became effective, contained 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, or that the Prospectus, as of its
date and as of the Closing Date, contains an untrue statement of a material fact
or omits 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.
16
(e) The Underwriters shall have received the favorable opinion of
counsel to the Trustee, dated the Closing Date, addressed to the Underwriters
and in form and scope satisfactory to the Underwriters, counsel, to the effect
that:
i) The Trustee has duly authorized, executed and delivered the
Trust Agreement.
ii) The Trustee has been duly organized and is validly existing
as a national banking corporation in good standing under the laws of the United
States of America and has full power and authority to execute and deliver the
Trust Agreement and to perform its obligations thereunder and each such
Agreement constitutes the valid, legal and binding obligation of the Trustee,
enforceable against the Trustee in accordance with its terms.
iii) The Securities have been duly executed and countersigned by
the Trustee.
iv) The execution and delivery by the Trustee of the Trust
Agreement and the performance by the Trustee of its duties thereunder do not
conflict with or result in a violation of (a) any law or regulation of the
United States of America or the State of Minnesota, (b) the charter or by-laws
of the Trustee, (c) any order, writ, judgment or decree or (d) any agreement,
instrument, order, writ, judgment or decree known to such counsel to which the
Trustee is a party or is subject.
v) No consent, approval or authorization of, or registration,
declaration or filing with, any court or governmental agency or body of the
United States of America or any state thereof is required for the execution,
delivery or performance by the Trustee of the Trust Agreement.
(f) The Underwriters shall have received the favorable opinion or
opinions, dated the Closing Date, of the Underwriters' counsel,
_____________________________, with respect to the issuance and sale of the
Securities, the Registration Statement, this Agreement, the Prospectus and such
other related matters as the Underwriters may require.
(g) The Underwriters shall have received an opinion, dated the Closing
Date, of ___________________, counsel to Chevy Chase, addressed to, and
satisfactory to, Standard & Poor's Corporation ("S&P"), Xxxxx'x Investors
Service, Inc. ("Xxxxx'x), Fitch Investors Service, Inc. ("Fitch") and the
Underwriters' counsel, relating to the sale of the Receivables to the Trustee,
and such counsel to Chevy Chase shall have consented to reliance by the
17
Underwriters on such opinion as though such opinion had been addressed to the
Underwriters.
(h) Chevy Chase shall have furnished to the Underwriters a certificate
signed on behalf of Chevy Chase by any two of the chairman of the board, the
president, any vice chairman of the board, any executive vice president, any
senior vice president, any vice president, the treasurer, or the controller of
the Seller or the Servicer, as appropriate, dated the Closing Date, as to (i)
the accuracy of the representations and warranties of Chevy Chase herein and in
the Trust Agreement at and as of the Closing Date, (ii) the performance by Chevy
Chase of all of its obligations hereunder to be performed at or prior to the
Closing Date and (iii) such other matters as the Underwriters may reasonably
request.
(i) The Trustee shall have furnished to the Underwriters a certificate
of the Trustee, signed by one or more duly authorized officers of the Trustee,
dated the Closing Date, as to the due acceptance of the Trust Agreement by the
Trustee and the due execution and delivery of the Securities by the Trustee
thereunder and such other matters as the Underwriters shall reasonably request.
(j) The Securities shall have been rated "AAA" by S&P, "Aaa" by
Moody's and "AAA" by Fitch, and such ratings shall not have been rescinded.
(k) The Underwriters shall have received from _____________________,
or other independent certified public accountants acceptable to the
Underwriters, a letter, dated as of the date of the Closing Date, delivered at
such time in form satisfactory to the Underwriters.
(l) Prior to the Closing Date the Underwriters' counsel,
____________________________, shall have been furnished with such documents and
opinions as they may reasonably require for the purpose of enabling them to pass
upon the issuance and sale of the Securities as herein contemplated and related
proceedings or in order to evidence the accuracy and completeness of any of the
representations and warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by Chevy Chase in connection with
the issuance and sale of the Securities as herein contemplated shall be
satisfactory in form and substance to the Underwriters and
_______________________.
(m) Since the respective dates as of which information is given in the
Prospectus, there shall not have been any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, shareholders, equity or results of
18
operations of Chevy Chase or the Security Insurer otherwise than as set forth in
the Prospectus, the effect of which is in the Underwriters, judgment so material
and adverse as to make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Securities on the terms and in the manner
contemplated in the Prospectus or which, in the judgment of the Underwriters,
materially impairs the investment quality of the Securities or the ability of
the Servicer to service the Receivables.
(n) Subsequent to the execution and delivery of this Agreement, there
shall not have occurred (i) any change, development or event involving a
prospective change, in the condition (financial or other), business, properties
or results of operations of Chevy Chase or its automobile loan business or the
Security Insurer which, in the judgment of the Underwriters, is material and
adverse and makes it impracticable or inadvisable to proceed with the completion
of the public offering or the sale of and payment for the Securities, (ii) any
banking moratorium declared by Federal, New York, Minnesota or Maryland
authorities; or (iii) any downgrading in the rating of any securities of Chevy
Chase or the Security Insurer 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 securities of Chevy Chase or the Security Insurer (other than
an announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); or (iv) any suspension
or limitation of trading in securities generally on the New York Stock Exchange,
or any setting of minimum prices for trading on such exchange; or (v) any
outbreak or escalation of major hostilities in which the United States is
involved, any declaration of war by Congress or any other substantial national
or international calamity, emergency or change in financial markets if, in the
Representatives' judgment, the effect of any such outbreak, escalation,
declaration, calamity, emergency or change makes it impractical or inadvisable
to proceed with completion of the sale of and payment for the Securities.
(o) The Underwriters shall have received evidence satisfactory to the
Underwriters and its counsel that (i) on or before the Closing Date, UCC-1
financing statements have been filed in the offices of the Maryland State
Department of Assessments and Taxation, reflecting the interest of the Trust in
the Receivables and the proceeds thereof and (ii) the Trust will have a first
priority perfected security interest in the amounts on deposit from time to time
in the Reserve Account and the Yield Maintenance Account.
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(p) Chevy Chase will provide or cause to be provided to the
Representative such conformed copies of such opinions, certificates, letters and
documents being provided pursuant hereto and such further information,
certificates and documents as the Representative may reasonably request.
_______________ may in its sole discretion waive on behalf of the Underwriters
compliance with any conditions to the obligations of the Underwriters hereunder.
(q) The Security Insurance Policy shall have been duly executed and
issued at or prior to the Closing Date and shall conform in all material
respects to the description thereof in the Prospectus.
(r) The Underwriters shall have received the favorable opinion, dated
the Closing Date, of counsel for the Security Insurer, in form and scope
satisfactory to your counsel, to the effect that:
i) The Security Insurer is duly organized as a New York stock
insurance corporation and is validly existing under the laws of New York, and
has the full power and authority (corporate and other) to issue, and to take all
action required of it under, the Security Insurance Policy.
ii) The execution, delivery and performance by the Certificate
Insurer of the Security Insurance Policy and the Indemnification Agreement dated
as of December __, 1996 (the "Indemnification Agreement") among the Security
Insurer, Chevy Chase and the Underwriters have been duly authorized by all
necessary corporate action on the part of the Security Insurer.
iii) The execution, delivery and performance by the Security
Insurer of the Security Insurance Policy and the Indemnification Agreement do
not require the consent or approval of, the giving of notice to, the
registration with, or the taking of any other action in respect of any state or
other governmental agency or authority which has not previously been effected.
iv) The Security Insurance Policy and the Indemnification
Agreement have been duly authorized, executed and delivered by the Security
Insurer and constitute legal, valid and binding obligations of the Security
Insurer, enforceable against the Security Insurer in accordance with their terms
(subject, as to enforcement, to bankruptcy, reorganization, insolvency,
moratorium and other laws affecting creditors, rights generally and to general
equity principles).
v) The Security Insurance Policy is not required to be
registered under the Securities Act.
20
vi) The information set forth under the captions "The Security
Insurance Policy" and "the Security Insurer" in the Prospectus, insofar as such
statements constitute a description of the Security Insurance Policy, accurately
summarizes the Security Insurance Policy.
In rendering this opinion, such counsel may rely, as to matters of
fact, on certificates of responsible officers of the Security Insurer and public
officials. Such opinion may assume the due authorization, execution and
delivery of the instruments and documents referred to therein by the parties
thereto other than the Security Insurer.
The Security Insurer shall have furnished to you and Chevy Chase a
certificate of the Security Insurer, signed by one or more duly authorized
officers of the Security Insurer, dated the Closing Date, certifying (i) the
information relating to the Security Insurer in the Prospectus is true and
correct in all material respects as of the dates specified therein, (ii) there
has been no change in the financial condition of the Security Insurer since
______________ which could have a material adverse effect on the Security
Insurer's ability to meet its obligations under the Security Insurance Policy
and (iii) such other matters as you may reasonably request.
(s) The Security Insurance Policy shall have been issued by the
Security Insurer pursuant to the Insurance Agreement.
If any condition specified in this Section 6 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to Chevy Chase at any time at or prior to the
Closing Date, and such termination shall be without liability of any party to
any other party except as provided in Section 7.
7. PAYMENT OF EXPENSES. Chevy Chase agrees to pay all expenses
incident to the performance of its obligations under this Agreement, and will
reimburse the Underwriters (if and to the extent incurred by them) for any
filing fees and other expenses (including fees and disbursements of counsel),
including, without limitation, those related to (i) the filing of the
Registration Statement and all amendments thereto, (ii) the duplication and
delivery to the Underwriters, in such quantities as the Underwriters may
reasonably request, of copies of this Agreement, (iii) the preparation, issuance
and delivery of the Securities and the determination of their eligibility for
investment under the laws of such jurisdictions as the Representative
designates, (iv) __% of the fees and
21
disbursements of _________________________, and the fees and disbursements of
__________________, accountants of Chevy Chase, (v) the qualification of the
Securities under securities and Blue Sky laws and the determination of the
eligibility of the Certificates for investment in accordance with the provisions
of Section 5(g), including filing fees and disbursements and __% of the fees of
__________________, in connection therewith and in connection with the
preparation of any Blue Sky Survey, (vi) the printing and delivery to the
Underwriters, in such quantities as the Underwriters may reasonably request,
hereinabove stated, of copies of the Registration Statement and Prospectus and
all amendments and supplements thereto, and of any Blue Sky Survey, (vii) for
the filing fee of the National Association of Securities Dealers, Inc., (viii)
the duplication and delivery to the Underwriters in such quantities as the
Underwriters may reasonably request, of copies of the Trust Agreement, (ix) the
fees charged by nationally recognized statistical rating agencies for rating the
Securities, (x) the fees and expenses of the Trustee and its counsel, and (xi)
the fees and expenses of the Security Insurer and its counsel. The Underwriters
agree to pay (i) __% of the fees and disbursements of
________________________________ and (ii) other expenses of Chevy Chase relating
to the transactions contemplated hereby in an amount equal to $____________.
8. INDEMNIFICATION. Chevy Chase agrees to indemnify and hold
harmless each Underwriter and each person, if any, who controls each Underwriter
within the meaning of the Act or the Exchange Act, as follows:
(a) Chevy Chase will indemnify and hold harmless the Underwriters
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriters 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, or
any amendment or supplement thereto, or any related preliminary prospectus, 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 the case of the Prospectus or any
amendment or supplement thereto, in the light of the circumstances under which
they were made) and will reimburse the Underwriters for any legal or other
expenses reasonably incurred by such Underwriters in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred; provided, however, that Chevy Chase will not be
liable in any such case to the extent that any such loss,
22
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 Chevy Chase by any Underwriters through the Representative specifically for
use therein, it being understood and agreed that the only such information
furnished by any Underwriters consists of the information described as such in
subsection (b) below.
(b) Each Underwriter will severally and not jointly indemnify and hold
harmless Chevy Chase against any losses, claims, damages or liabilities to which
Chevy Chase 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, or any
amendment or supplement thereto, or any related preliminary prospectus, 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 the case of the Prospectus, in the light of the
circumstances under which they were made), in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or mission
or alleged omission was made in reliance upon and in conformity with written
information furnished to Chevy Chase by such Underwriter through the
Representative specifically for use therein, and will reimburse any legal or
other expenses reasonably incurred by Chevy Chase in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, it being understood and agreed that the only such
information furnished by any Underwriters consists of the following information
in the Prospectus furnished on behalf of the Underwriters: the last paragraph
at the bottom of the cover page concerning the terms of the offering by the
Underwriters, the legend concerning overallotments and stabilizing on the inside
front cover page and the concession and reallowance figures appearing in the
third paragraph under the caption "Underwriting."
(c) Promptly after receipt by an indemnified party under this Section
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
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; 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 subsection (a) or (b) above. In case any such action is brought against
any indemnified party and
23
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 (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. 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 includes an unconditional release of such
indemnified party from all liability on any claims that are the subject matter
of such action.
9. CONTRIBUTION. (a) If the indemnification provided for in Section
8 is unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) of Section 8 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 such subsection (a)
or (b) (i) in such proportion as is appropriate to reflect the relative benefits
received by Chevy Chase on the one hand and each of the Underwriters on the
other from the offering of the Securities 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 Chevy Chase on the one hand and each of 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 Chevy
Chase 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 Chevy Chase bear 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 Chevy Chase or the
Underwriters and the parties, relative
24
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. 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 Section 9 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
Section 9. 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 Section 9 to contribute are several in proportion to their
respective underwriting obligations and not joint.
(b) The obligations of Chevy Chase under this Section 9 shall be in
addition to any liability which Chevy Chase 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 9 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 director of Chevy Chase, to each officer of Chevy
Chase who has signed the Registration Statement and to each person, if any, who
controls Chevy Chase within the meaning of the Act.
Each Underwriter, with respect to the Securities, agrees that it will
not prepare or distribute to any proposed purchaser of any Securities any
Derived Information (as such term is hereinafter defined), unless it shall have
provided to the Servicer a copy of such Derived Information a sufficient time
prior to its proposed distribution to permit the Servicer to review and comment
upon such Derived Information, and such Underwriters shall have obtained the
prior written consent of the Servicer thereto following its review. In
addition, such Underwriters agree to provide the Servicer, no later than the
date on which the Prospectus is required to be filed pursuant to Rule 424, with
a definitive copy of its Derived Information with respect to such Securities
provided by the Underwriters for filing with the Commission on Form 8-K.
The Underwriters agree, assuming all Companies-Provided Information
(as such term is hereinafter defined) provided by Chevy Chase is accurate and
complete in all material respects, to indemnify and hold harmless Chevy Chase,
each of Xxxxx Xxxxx'x officers and directors and each person who controls Chevy
Chase within the meaning of the Act against any and all losses, claims, damages
or liabilities, joint or several, to which they may become
25
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 of a material fact contained in the Derived Information
provided by such Underwriters, 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, in the light of the circumstances
under which they were made, not misleading, and agrees to reimburse each such
indemnified party for any legal or other expenses reasonably incurred by him,
her or it in connection with investigating or defending or preparing to defend
any such loss, claim, damage, liability or action as such expenses are incurred.
The obligations of the Underwriters under this Section 9 shall be in addition to
any liability which the Underwriters may otherwise have.
For purposes of this Section 9, the term "Derived Information" means
such portion, if any, of the information delivered to Chevy Chase for filing
with the Commission on Form 8-K as:
i) is not contained in the Prospectus without taking into
account information incorporated therein by reference;
ii) does not constitute Companies-Provided Information; and
iii) is not information provided by the Security Insurer.
"Companies-Provided Information" means any computer tape furnished to the
Underwriters by Chevy Chase concerning the Receivables assigned to the Trust.
Notwithstanding the provisions of Sections 8 and 9, the Underwriters
shall not be required to contribute any amount in excess of the amount by which
the total price at which the Securities underwritten by the Underwriters and
distributed to the public were offered to the public exceeds the amount of any
damages which the Underwriters have otherwise been required to pay in respect of
such losses, liabilities, claims, damages and expenses. For purposes of this
Section 9, each person, if any, who controls the Underwriters within the meaning
of the Act or the Exchange Act shall have the same rights to contribution as
each of the Underwriters and each director of Chevy Chase, each officer of Chevy
Chase who signed the Registration Statement, and each person, if any, who
controls Chevy Chase within the meaning of the Act or the Exchange Act shall
have the same rights to contribution as Chevy Chase.
26
10. DEFAULT OF UNDERWRITERS. If any Underwriter defaults in its
obligations to purchase Securities hereunder on the Closing Date and the
aggregate principal amount of Securities that such defaulting Underwriter or
Underwriters have agreed but failed to purchase does not exceed 10% of the total
principal amount of Securities that the Underwriters are obligated to purchase
on such Closing Date, the Representative may make arrangements satisfactory to
Chevy Chase for the purchase of such Securities by other persons, including any
of the Underwriters, but if no such arrangements are made by such Closing Date,
the nondefaulting Underwriters shall be obligated severally, in proportion to
their respective commitments hereunder, to purchase the Securities that such
defaulting Underwriters agreed but failed to purchase on such Closing Date. If
any Underwriters so default and the aggregate principal amount of Securities
with respect to which such default or defaults occur exceeds 10% of the total
principal amount of Securities that the Underwriters are obligated to purchase
on such Closing Date and arrangements satisfactory to the Representative and
Chevy Chase for the purchase of such Securities by other persons are not made
within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or Chevy Chase, except
as provided in Section 11. As used in this Agreement, the term "Underwriter"
includes any person substituted for an Underwriter under this Section 10.
Nothing herein will relieve a defaulting Underwriter from liability for its
default.
11. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective indemnities, agreements, representations, warranties and other
statements of Chevy Chase or its officers and of the several Underwriters set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results thereof,
made by or on behalf of any Underwriter, Chevy Chase or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Securities. If this Agreement is
terminated or if for any reason the purchase of the Securities by the
Underwriters is not consummated, Chevy Chase shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 7 and the respective
obligations of Chevy Chase and the Underwriters pursuant to Section 8 and 9
shall remain in effect, and if any Securities have been purchased hereunder the
representations and warranties in Section 2 and all obligations under Section 5
and 6 shall also remain in effect). If the purchase of the Securities by the
Underwriters is not consummated for any reason other than solely because of the
termination of this Agreement pursuant to Section 10 or the occurrence of any
event specified in
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clause (ii), (iv) or (v) of Section 6(n), Chevy Chase will reimburse the
Underwriters for all out-of-pocket expenses (including fees and disbursements of
____________________, Underwriters' counsel) reasonably incurred by them in
connection with the offering of the Securities.
12. NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed to have been duly given if mailed or transmitted
by any standard form of telecommunications Notices to ____________ shall be
directed to the address set forth on the first page hereof, or sent by facsimile
machine which produces an electronic confirmation of receipt to ________,
attention: ___________. Notices to Chevy Chase shall be directed to Chevy
Chase Bank, F.S.B., 0000 Xxxxxxxxxxx Xxxxxx, Xxxxx Xxxxx, Xxxxxxxx 00000, or
sent by facsimile machine which produces an electronic confirmation of receipt
to _____________, attention: ____________________.
13. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the Underwriters and Chevy Chase, and their respective successors.
Nothing expressed or mentioned in this Agreement is intended nor shall it be
construed to give any person, firm or corporation, other than the parties hereto
or thereto and their respective successors and the controlling persons and
officers and directors referred to in Sections 8 and 9 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or with
respect to this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties and their respective successors and such
controlling persons and officers and directors and their heirs and legal
representatives (to the extent of their rights as specified herein and therein)
and except as provided above for the benefit of no other person, firm or
corporation. No purchaser of Securities from the Underwriters shall be deemed
to be a successor by reason merely of such purchase.
14. REPRESENTATIONS OF UNDERWRITERS. The Representative will act for
the several Underwriters in connection with the transactions contemplated by
this Agreement, and any action under this Agreement taken by the Representative
will be binding upon all the Underwriters.
15. GOVERNING LAW AND TIME; CONSENT TO JURISDICTION. THIS AGREEMENT
SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED IN
ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
CHEVY CHASE HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE FEDERAL AND
STATE COURTS IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN ANY SUIT
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OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
16. COUNTERPARTS. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but together they shall
constitute but one instrument.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument along with all counterparts will become a binding agreement between
you and Chevy Chase in accordance with its terms.
Very truly yours,
CHEVY CHASE BANK, F.S.B.
By:_____________________________
_______________
Vice President
CONFIRMED AND ACCEPTED, as of
the date first above written:
[Underwriter]
By:________________________
Name:_________________
Title:________________
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Schedule 1
Purchase Proceeds to Chevy
Price Principal Chase (includes
Underwriters Percentage Amount accrued interest)
------------ ---------- ------ ---------
31
