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EXHIBIT 1.1
[EXECUTION COPY]
UNDERWRITING AGREEMENT
April 7, 1998
Salomon Brothers Inc
as Representative of the
Underwriters set forth on Schedule A
Ladies and Gentlemen:
1. Introduction. Advanta Leasing Receivables Corp. IV ("ALRC IV") and
Advanta Leasing Receivables Corp. V ("ARLC V," together with ALRC IV, the
"Series Obligors") propose to cause the $72,000,000 aggregate principal amount
of Advanta Equipment Receivables Asset-Backed Notes, Series 1998-1, Class A-1
(the "Class A-1 Notes"), $190,000,000 aggregate principal amount of Advanta
Equipment Receivables Asset-Backed Notes, Series 1998-1, Class A-2 (the "Class
A-2 Notes"), $23,300,000 aggregate principal amount of Advanta Equipment
Receivables Asset-Backed Notes, Series 1998-1, Class A-3 (the "Class A-3
Notes"), $45,900,000 aggregate principal amount of Advanta Equipment Receivables
Asset-Backed Notes, Series 1998-1, Class A-4 (the "Class A-4 Notes" and together
with the Class A-1 Notes, the Class A-2 Notes and the Class A-3 Notes, the
"Class A Notes"), $18,938,000 aggregate principal amount of Advanta Equipment
Receivables Asset-Backed Notes, Series 1998-1, Class B (the "Class B Notes"),
the $9,862,000 aggregate principal amount of Advanta Equipment Receivables
Asset-Backed Notes, Series 1998-1, Class C (the "Class C Notes" and together
with the Class A Notes and Class B Notes, the "Offered Notes") and the
$15,000,304 aggregate principal amount of Advanta Equipment Receivables
Asset-Backed Notes, Series 1998-1, Class D (the "Class D Notes," together with
the Offered Notes, the "Notes") to be issued pursuant to a Master Business
Receivables Asset-Backed Financing Facility Agreement, dated as of May 1, 1997
(the "Master Agreement"), among Advanta Business Services Corp. ("ABS"), as
servicer (in such capacity, the "Servicer"), ALRC III, as the obligors' agent
(in such capacity, the "Obligors' Agent"), and The Chase Manhattan Bank, as
trustee (the "Trustee") and the Series 1998-1 Supplement, dated as of April 14,
1998 (the "Series 1998-1 Supplement," together with the Master Agreement, the
"Agreement"), among ABS, as servicer, the Series Obligors, the Obligors' Agent
and the Trustee. Any capitalized terms used herein but not defined shall have
the meaning set forth in the Agreement.
ABS and the Series Obligors hereby agrees with Salomon Brothers Inc (the
"Representative"), as representative of the underwriters attached on Schedule A
hereto (the "Underwriters") as follows:
2. Representations and Warranties of ALRC IV. ALRC IV represents and
warrants to, and agrees with, the Underwriters that:
(a) ALRC IV has all requisite corporate power, authority and legal
right to own its property 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
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underwriting agreement (the "Underwriting Agreement"), the Notes, the Sale
Agreement dated as of April 14, 1998 (the "Sale Agreement") among ALRC IV, ALRC
V, Advanta Leasing Receivables Corp. III ("ALRC III"), Advanta Business
Receivables LLC ("ABR LLC") and each of the Master Agreement, the Series 1998-1
Supplement, the Master Contribution Agreement, dated as of May 1, 1997 (the
"Master Contribution Agreement"), between ABS and the Obligors' Agent, and the
Series 1998-1 Contribution Agreement Supplement, dated as of April 14, 1998,
between ABS, ALRC IV and ALRC IV (the "Series 1998-1 Contribution Agreement
Supplement" and, together with the Master Agreement, the Series 1998-1
Supplement, the Sale Agreement and the Master Contribution Agreement, the
"Transaction Documents").
(b) The execution and delivery of the Underwriting Agreement, the
Notes and each of the Transaction Documents, the incurrence of the obligations
herein and therein set forth and the consummation of the transactions
contemplated hereunder and thereunder have been duly authorized by the Board of
Directors of ALRC IV and all other necessary action has been taken.
(c) The Underwriting Agreement has been duly authorized and validly
executed and delivered by ALRC IV.
(d) Each of the Transaction Documents will be executed and
delivered by ALRC IV on or before the Closing Date, and when executed and
delivered by the other parties thereto, will constitute a valid and binding
agreement of ALRC IV, enforceable against ALRC IV in accordance with its terms,
except to the extent that (i) the enforceability thereof may be subject to
insolvency, reorganization, moratorium, receivership or other similar laws now
or hereafter in effect relating to creditors' or other obligees' rights
generally, (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) certain remedial provisions of the Agreement may be unenforceable in whole
or in part under the Uniform Commercial Code (the "UCC"), but the inclusion of
such provisions does not render the other provisions of the Agreement invalid
and, notwithstanding that such provisions may be unenforceable in whole or in
part, the Trustee, on behalf of the Noteholders, will be able to enforce the
remedies of a secured party under the UCC.
(e) The Notes will be issued pursuant to the terms of the Agreement
and, when executed by ALRC IV and ALRC V and authenticated by the Trustee in
accordance with the Agreement and, with respect to the Offered Notes only,
delivered pursuant to the Underwriting Agreement, will be validly issued and
outstanding and entitled to the benefits of the Agreement. The Notes will be in
all material respects in the form contemplated by the Agreement and will conform
to the description thereof contained in the Prospectus (as defined herein) and
Registration Statement (as defined herein), each as amended or supplemented.
(f) ALRC IV is not in violation of any requirement of law or in
default in the performance or observance of any obligation, agreement, covenant
or condition contained in any contract, indenture, mortgage, deed of trust,
lease or other instrument to which it is a party or by which it is bound or to
which any of its property is subject, which violations or defaults separately or
in the aggregate would have a material adverse effect on ALRC IV.
(g) Neither the issuance and sale of the Offered Notes, nor the
execution and delivery by ALRC IV of the Underwriting Agreement, the Notes or
the Transaction Documents, nor the incurrence by ALRC IV of the obligations
herein and therein set forth, nor the consummation of the transactions
contemplated hereunder or thereunder, nor the
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fulfillment of the terms hereof or thereof does or will (i) violate any
requirement of law presently in effect, applicable to it or its properties or by
which it or its properties are or may be bound or affected, (ii) conflict with,
or result in a breach of, or constitute a default under, any indenture,
contract, agreement, deed, lease, mortgage or instrument to which it is a party
or by which it or its properties are bound, or (iii) result in the creation or
imposition of any Lien upon any of its property or assets, except for those
encumbrances created under the Agreement.
(h) All consents, approvals, authorizations, orders, filings,
registrations or qualifications of or with any court or any other governmental
agency, board, commission, authority, official or body required in connection
with the execution and delivery by ALRC IV of the Underwriting Agreement, the
Notes or the Transaction Documents, or to the consummation of the transactions
contemplated hereunder and thereunder, or to the fulfillment of the terms hereof
and thereof have been or will have been obtained on or before the Closing Date.
(i) All actions required to be taken by ALRC IV as a condition to
the offer and sale of the Offered Notes as described herein or the consummation
of any of the transactions described in the Prospectus and Registration
Statement have been or, prior to the Closing Date, will be taken.
(j) The Agreement has been qualified under the Trust Indenture Act
of 1939.
(k) The representations and warranties made by ALRC IV in the
Agreement and made in any Officer's Certificate of ALRC IV delivered pursuant to
the Agreement will be true and correct at the time made and on and as of the
Closing Date as if set forth herein.
(l) ALRC IV agrees it has not granted, assigned, pledged or
transferred and shall not grant, assign, pledge or transfer to any Person a
security interest in, or any other right, title or interest in, the Contracts,
except as provided in the Agreement, and agrees to take all action required by
the Agreement in order to maintain the security interest in the Contracts
granted pursuant to the Agreement.
(m) A registration statement on Form S-1 (No. 333-38575,
000-00000-00, 333-38575-02), including a form of prospectus and such amendments
thereto as may have been required to the date hereof, relating to the Offered
Notes and the offering thereof in accordance with the Securities Act of 1933, as
amended (the "Act"), has been filed with, and has been declared effective by,
the Securities and Exchange Commission (the "Commission"). If any post-effective
amendment to such registration statement has been filed with the Commission
prior to the execution and delivery of the Underwriting Agreement, the most
recent such amendment has been declared effective by the Commission. For
purposes of the Underwriting Agreement, "Effective Time" means the date and time
as of which such registration statement, or the most recent post-effective
amendment thereto, if any, was declared effective by the Commission, and
"Effective Date" means the date of the Effective Time. Such registration
statement, as amended at the Effective Time, is hereinafter referred to as the
"Registration Statement." The Prospectus, together with any amendment thereof or
supplement thereto, are hereinafter referred to as the "Prospectus."
(n) On the Effective Date, the Registration Statement conformed in
all respects to the requirements of the Act and the rules and regulations of the
Commission thereunder (the "Rules and Regulations") and did not include any
untrue statement of a material
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fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, and on the date of the
Underwriting Agreement, the Registration Statement and the Prospectus conform,
and at the time of filing of the Prospectus pursuant to Rule 424(b) the
Registration Statement and the Prospectus will conform, in all respects with the
requirements of the Act and the Rules and Regulations, and neither of such
documents includes, or will include, any untrue statement of a material fact or
omits, or will omit, to state any material fact required to be stated therein or
necessary to make the statements therein not misleading, except that the
foregoing does not apply to statements in or omissions from either of such
documents based upon written information furnished to ALRC IV by the
Underwriters specifically for use therein.
(o) There has not been any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of ALRC IV
from February 18, 1998.
3. Representations and Warranties of ALRC V. ALRC V represents and
warrants to, and agrees with, the Underwriters that:
(a) ALRC V has all requisite corporate power, authority and legal
right to own its property 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 the Underwriting Agreement, the Notes
and each of the Transaction Documents.
(b) The execution and delivery of the Underwriting Agreement, the
Notes and each of the Transaction Documents, the incurrence of the obligations
herein and therein set forth and the consummation of the transactions
contemplated hereunder and thereunder have been duly authorized by the Board of
Directors of ALRC V and all other necessary action has been taken.
(c) The Underwriting Agreement has been duly authorized and validly
executed and delivered by ALRC V.
(d) Each of the Transaction Documents will be executed and
delivered by ALRC V on or before the Closing Date, and when executed and
delivered by the other parties thereto, will constitute a valid and binding
agreement of ALRC V enforceable against ALRC V in accordance with its terms,
except to the extent that (i) the enforceability thereof may be subject to
insolvency, reorganization, moratorium, receivership or other similar laws now
or hereafter in effect relating to creditors' or other obligees' rights
generally, (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) certain remedial provisions of the Agreement may be unenforceable in whole
or in part under the UCC, but the inclusion of such provisions does not render
the other provisions of the Agreement invalid and, notwithstanding that such
provisions may be unenforceable in whole or in part, the Trustee, on behalf of
the Noteholders, will be able to enforce the remedies of a secured party under
the UCC.
(e) The Notes will be issued pursuant to the terms of the Agreement
and, when executed by ALRC IV and ALRC V and authenticated by the Trustee in
accordance with the Agreement and, with respect to the Offered Notes only,
delivered pursuant to the Underwriting Agreement, will be validly issued and
outstanding and entitled to the benefits of the Agreement. The Notes will be in
all material respects in the form contemplated by the
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Agreement and will conform to the description thereof contained in the related
Prospectus (as defined herein) and Registration Statement (as defined herein),
each as amended or supplemented.
(f) ALRC V is not in violation of any requirement of law or in
default in the performance or observance of any obligation, agreement, covenant
or condition contained in any contract, indenture, mortgage, deed of trust,
lease or other instrument to which it is a party or by which it is bound or to
which any of its property is subject, which violations or defaults separately or
in the aggregate would have a material adverse effect on ALRC V.
(g) Neither the issuance and sale of the Offered Notes, nor the
execution and delivery by ALRC V of the Underwriting Agreement, the Notes or the
Transaction Documents, nor the incurrence by ALRC V of the obligations herein
and therein set forth, nor the consummation of the transactions contemplated
hereunder or thereunder, nor the fulfillment of the terms hereof or thereof does
or will (i) violate any requirement of law presently in effect, applicable to it
or its properties or by which it or its properties are or may be bound or
affected, (ii) conflict with, or result in a breach of, or constitute a default
under, any indenture, contract, agreement, deed, lease, mortgage or instrument
to which it is a party or by which it or its properties are bound, or (iii)
result in the creation or imposition of any Lien upon any of its property or
assets, except for those encumbrances created under the Agreement.
(h) All consents, approvals, authorizations, orders, filings,
registrations or qualifications of or with any court or any other governmental
agency, board, commission, authority, official or body required in connection
with the execution and delivery by ALRC V of the Underwriting Agreement, the
Notes or the Transaction Documents, or to the consummation of the transactions
contemplated hereunder and thereunder, or to the fulfillment of the terms hereof
and thereof have been or will have been obtained on or before the Closing Date.
(i) All actions required to be taken by ALRC V as a condition to
the offer and sale of the Offered Notes as described herein or the consummation
of any of the transactions described in the Prospectus and Registration
Statement have been or, prior to the Closing Date, will be taken.
(j) The Agreement has been qualified under the Trust Indenture Act
of 1939.
(k) The representations and warranties made by ALRC V in the
Agreement and made in any Officer's Certificate of ALRC V delivered pursuant to
the Agreement will be true and correct at the time made and on and as of the
Closing Date as if set forth herein.
(l) ALRC V agrees it has not granted, assigned, pledged or
transferred and shall not grant, assign, pledge or transfer to any Person a
security interest in, or any other right, title or interest in, the Contracts,
except as provided in the Agreement, and agrees to take all action required by
the Agreement in order to maintain the security interest in the Contracts
granted pursuant to the Agreement.
(m) The Registration Statement (No. 333-38575,000-00000-00,
333-38575-02), including a form of prospectus and such amendments thereto as may
have been required to the date hereof, relating to the Notes and the offering
thereof in accordance with the Act, has been filed with, and has been declared
effective by, the Commission. If any post-
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effective amendment to such registration statement has been filed with the
Commission prior to the execution and delivery of the Underwriting Agreement,
the most recent such amendment has been declared effective by the Commission.
(n) On the Effective Date, the Registration Statement conformed in
all respects to the requirements of the Act and the Rules and Regulations of the
Commission 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 on the date of the Underwriting
Agreement, the Registration Statement and the Prospectus conform, and at the
time of filing of the Prospectus pursuant to Rule 424(b) the Registration
Statement and the Prospectus will conform, in all respects with the requirements
of the Act and the Rules and Regulations, and neither of such documents
includes, or will include, any untrue statement of a material fact or omits, or
will omit, to state any material fact required to be stated therein or necessary
to make the statements therein not misleading, except that the foregoing does
not apply to statements in or omissions from either of such documents based upon
written information furnished to ALRC V by the Underwriters specifically for use
therein.
(o) There has not been any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of ALRC V
from February 18, 1998.
4. Purchase, Sale, Payment and Delivery of the Offered Notes. (a) On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Series Obligors agree
to sell to the Underwriters, and the Underwriters agree to purchase from the
Series Obligors, the Offered Notes, each Underwriter to purchase the amounts
shown on Schedule A hereto at the prices set forth on such Schedule A. The
Offered Notes will settle without accrued interest.
(b) The Series Obligors will deliver the Offered Notes to you
against payment of the purchase price in immediately available funds, drawn to
the order of the Series Obligors, at the office of Xxxxx Xxxxxxxxxx LLP, 0000
Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 at 10:00 A.M., New York City
time, on April 14, 1998, or at such other time not later than seven full
business days thereafter as you and ABS determine, such time being herein
referred to as the "Closing Date". Each of the Offered Notes so to be delivered
shall be represented by one or more definitive Offered Notes registered in the
name of Cede & Co., as nominee for The Depository Trust Company. The Series
Obligors shall make such definitive Offered Notes representing the Offered Notes
available for inspection by the Underwriters at the office at which the Offered
Notes are to be delivered no later than five hours before the close of business
in New York City on the business day prior to the Closing Date.
5. Offering by Underwriters. It is understood that after the Effective
Date, the Underwriters propose to offer the Offered Notes for sale to the public
(which may include selected dealers) as set forth in the Prospectus.
6. Certain Agreements of the Series Obligors. The Series Obligors agree
with the Underwriters that:
(a) The Series Obligors will not file any amendment of the
Registration Statement with respect to the Offered Notes or supplement to the
Prospectus unless a copy has been furnished to you for your review a reasonable
time prior to the proposed filing thereof or to which you shall reasonably
object to in writing. The Series Obligors will advise you
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promptly of (i) the effectiveness of any amendment or supplementation of the
Registration Statement or Prospectus, (ii) any request by the Commission for any
amendment or supplementation of the Registration Statement or the Prospectus or
for any additional information, (iii) the receipt by the Series Obligors of any
notification with respect to the suspension of qualification of the Offered
Notes for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purposes and (iv) the institution by the Commission of any
stop order proceeding in respect of the Registration Statement, and will use
their best efforts to prevent the issuance of any such stop order and to obtain
as soon as possible its lifting, if issued.
(b) If, at any time when a prospectus relating to the Offered Notes
is required to be delivered under the Act, any event occurs 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 to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or if it is necessary at any time to amend the
Prospectus to comply with the Act, the Series Obligors promptly will prepare and
file with the Commission an amendment or supplement which will correct such
statement or omission or an amendment which will effect such compliance. Neither
your 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.
(c) As soon as practicable, the Series Obligors will make generally
available to the Noteholders an earnings statement or statements of the Series
Obligors covering a period of at least 12 months beginning after the Effective
Date which will satisfy the provisions of Section 11(a) of the Act and Rule 158
of the Commission promulgated thereunder.
(d) The Series Obligors will furnish to you copies of the
Registration Statement (one of which will be signed and will include all
exhibits), the Prospectus and all amendments and supplements to such documents,
in each case as soon as available and in such quantities as you reasonably
request.
(e) The Series Obligors will endeavor to qualify the Offered Notes
for sale under the securities or Blue Sky laws of such jurisdictions as you
shall reasonably request and the determination of the eligibility for investment
of the Offered Notes under the laws of such jurisdictions as you may designate
and will continue such qualifications in effect so long as required for the
distribution of the Offered Notes; provided, however, that none of ABS, ALRC IV
or ALRC V shall be obligated to qualify to do business in any jurisdiction where
such qualification would subject ABS, ALRC IV or ALRC V, as the case may be, to
general or unlimited service of process in any jurisdiction where it is not now
so subject.
(f) For a period from the date of the Underwriting Agreement until
the retirement of the Offered Notes, ABS, as Servicer, will furnish to you
copies of each certificate and the annual statements of compliance delivered to
the Trustee pursuant to Section 6.07 of the Master Facility Agreement and the
annual independent certified public accountant's servicing reports furnished to
the Trustee pursuant to Section 6.08 of the Master Facility Agreement, by first
class mail as soon as practicable after such Offered Notes, statements and
reports are furnished to the Trustee.
(g) So long as any Offered Note is outstanding, the Series Obligors
will furnish to you, by first-class mail as soon as practicable (i) all
documents concerning the Offered Notes distributed by ABS to Noteholders, or
filed with the Commission pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), (ii) any order of the
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Commission under the Act or the Exchange Act in regard to the Series Obligors or
to ABS, or pursuant to a "no-action" letter obtained from the staff of the
Commission by the Series Obligors or ABS and affecting the Series Obligors or
ABS and (iii) from time to time, such other information concerning the Series
Obligors as you may reasonably request.
(h) Whether or not the transactions contemplated by the
Underwriting Agreement are consummated or the Underwriting Agreement is
terminated for any reason, except a default by you hereunder, ABS will pay all
expenses incident to the performance of ABS's and the Series Obligors'
obligations under the Underwriting Agreement and will reimburse the Underwriters
for (x) one-half of any expenses of the Underwriters for such fees and
disbursements of counsel or such printing costs and expenses, incurred by them
in connection with qualification of the Offered Notes for sale and determination
of the eligibility of the Offered Notes for investment under the laws of such
jurisdictions as you designate (other than any expenses relating to the
jurisdictions of Connecticut, Illinois, Indiana, Louisiana, Massachusetts,
Michigan, Missouri, New Jersey, Ohio and Pennsylvania) and the printing of
memoranda relating thereto, and for expenses incurred in distributing the
Prospectus (including any amendments and supplements thereto) and (y) any fees
charged by investment rating agencies for the rating of the Offered Notes, and
for any filing fee of the National Association of Securities Dealers, Inc.
relating to the Offered Notes.
(i) To the extent, if any, that any of the ratings provided with
respect to the Offered Notes by Fitch IBCA, Inc., Xxxxx'x Investors Service,
Inc. or Standard & Poor's Ratings Group are conditional upon the furnishing of
documents or the taking of any other actions by the Series Obligors, the Series
Obligors shall furnish such documents and take any such other actions.
7. Conditions of the Obligations of the Underwriters. The obligation of
the Underwriters to purchase and pay for the Offered Notes will be subject to
the accuracy of the representations and warranties on the part of the Series
Obligors herein, to the accuracy of the statements of officers of the Series
Obligors made pursuant to the provisions hereof, to the performance by the
Series Obligors of their obligations hereunder and to the following additional
conditions precedent:
(a) On or prior to the date of the Underwriting Agreement, you
shall have received a letter, dated the date of the Underwriting Agreement, of
Xxxxxx Xxxxxxxx LLP, confirming that they are independent public accountants
within the meaning of the Act and the applicable published Rules and Regulations
thereunder, substantially in the form heretofore agreed to and otherwise in form
and in substance satisfactory to you and your counsel.
(b) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 6(a) of the Underwriting
Agreement; and, prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the knowledge of
the Series Obligors or you, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of the Underwriting
Agreement, there shall not have occurred (i) any change, or any development
involving a prospective change, in or affecting particularly the business or
properties of the Series Obligors, ABS or Advanta Corp. which, in your judgment,
materially impairs the investment quality of the Offered Notes; (ii) any
downgrading in the rating of any debt securities of the Series Obligors, ABS or
Advanta Corp. by any "nationally recognized statistical rating organization" (as
defined
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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
such debt securities (other than an announcement with positive implications of a
possible upgrading, and no implication of a possible downgrading, of such
rating), (iii) 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 any suspension of trading of any securities of the Series
Obligors, ABS or Advanta Corp. on any exchange or in the over-the-counter
market; (iv) any banking moratorium declared by Federal, Delaware or New York
authorities; 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 or emergency if, in your
judgment, the effect of any such outbreak, escalation, declaration, calamity or
emergency makes it impractical or inadvisable to proceed with completion of the
sale of and payment for the Offered Notes.
(d) You shall have received an opinion, dated the Closing Date, of
Xxxx Silver, General Counsel for ABS and/or Xxxxxxxx and Wedge, special Nevada
counsel, to the effect that:
(i) ABS is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware. Such opinion
shall be based solely upon the review of a certificate issued by the
Secretary of State of the State of Delaware.
(ii) ABS is an active corporation authorized to do business and
in good standing in the State of New Jersey. Such opinion shall be based
solely upon the review of a "Short Form Standing" certificate issued by
the Secretary of State of the State of New Jersey.
(iii) Each of ALRC III, ALRC IV and ALRC V is a corporation, and
ABR LLC is a limited liability company, duly organized, validly existing
and in good standing under the laws of the State of Nevada. Such opinion
shall be based solely upon the review of a "Certificate of Existence
with Status in Good Standing" issued by the Secretary of State of the
State of Nevada.
(iv) Each of ABS, ALRC IV, ALRC III, ABR LLC and ALRC V has
taken all necessary corporate action to authorize the execution and
delivery of each of the Transaction Documents to which it is a party and
the performance of its obligations thereunder.
(v) The execution and delivery of each of the Transaction
Documents to which ABS, ALRC IV, ALRC III, ABR LLC or ALRC V is a party,
and its respective performance of its obligations thereunder, will not
(i) contravene, or constitute a default under, any provision of
applicable law or regulation or of its certificate (or articles) of
incorporation or bylaws or of any agreement, judgment, injunction,
order, decree or other instrument binding upon such company. Such
opinion shall be based upon actual knowledge.
(vi) Based on actual knowledge, there is no action, suit or
other proceeding against ABS, ALRC IV, ALRC III, ABR LLC or ALRC V that
would materially adversely affect the business or financial condition of
such party or that would materially adversely affect the ability of such
company to perform its obligations under the Transaction Documents to
which it is a party.
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(vii) Each of ABS, ALRC IV, ALRC III, ABR LLC and ALRC V has the
corporate power and authority to own its properties and to conduct its
business as presently conducted.
(e) You shall have received an opinion dated the closing date, of
Xxxxx Xxxxxxxxxx LLP, special counsel to ALRC III, ABR LLC, ALRC IV, ALRC V and
ABS, to the effect that
(i) Each of the respective Transaction Documents constitutes the
legal, valid and binding agreement of ABS, the Obligors' Agent, the
Servicer, ALRC III, ABR LLC, ALRC IV and ALRC V and each is enforceable
against each such party in accordance with its terms.
(ii) The Offered Notes, assuming the due and valid execution,
authentication and delivery by the Trustee in accordance with the terms
of the Master Facility Agreement and Series 1998-1 Supplement and
payment pursuant to the Underwriting Agreement, are validly issued and
outstanding and is entitled to the benefits of the Master Facility
Agreement and Series 1998-1 Supplement.
(iii) The Registration Statement and the Prospectus (other than
the financial and statistical data included therein), at the time the
Registration Statement became effective, as of the date of execution of
the Underwriting Agreement and as of the date hereof comply as to form
in all material respects with the requirements of the Act and the rules
and regulations thereunder, and the Exchange Act and the rules and
regulations thereunder, and to the best of counsel's knowledge there is
no amendment to the Registration Statement required to be filed, or of
any contracts, indentures or other documents of a character required to
be filed as an exhibit to the Registration Statement or required to be
described in the Registration Statement or the Prospectus, which has not
been filed or described as required.
(iv) The Registration Statement is effective, and to the best of
counsel's knowledge, the Commission has not issued any stop order
suspending the effectiveness of the Registration Statement or any order
directed to any prospectus relating to the Offered Notes (including the
Prospectus), and has not initiated or threatened any proceeding for that
purpose. The statements under the caption "Description of the Notes" in
the Prospectus Supplement provide a fair and adequate summary of the
Offered Notes, the Master Facility Agreement, the Series 1998-1
Supplement, the Contribution Agreement and the Contribution Agreement
Supplement. The statements under the caption "Material Federal Income
Tax Consequences" and "ERISA Considerations" in the Prospectus, insofar
as such statements purport to summarize certain provisions of Federal or
of New York State law, provide a fair and accurate summary of such
provisions.
(v) The Agreement has been duly qualified under the Trust
Indenture Act of 1939, as amended.
(vi) None of ABS, the Servicer, ALRC IV, ALRC V nor the
Obligors' Agent is an "investment company" or a company "controlled" by
an "investment company" within the meaning of the Investment Company
Act.
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(vii) For federal income tax purposes the Offered Notes will be
treated as indebtedness of the Series Obligors.
(viii) You shall have received from Xxxxx Xxxxxxxxxx LLP,
special counsel, a "true sale" and security interest opinion,
satisfactory in form to the Rating Agencies and dated the Closing Date.
(f) You shall have received from Xxxxx Xxxxxxxxxx LLP counsel for
the Underwriters, such opinion or opinions, dated the Closing Date, with respect
to such matters relating to this transaction as you may require, and ABS shall
have furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
(g) You shall have received a certificate from ALRC IV, dated the
Closing Date, of a Vice President or senior officer in which such officer, to
the best of his or her knowledge after reasonable investigation, shall state
that (v) the representations and warranties of ALRC IV in the Underwriting
Agreement are true and correct in all material respects on and as of the Closing
Date, (w) ALRC IV has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at or prior to the Closing
Date, (x) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are threatened by the Commission, (y) nothing has come to such
officers' attention that would lead such officers to believe that the
Registration Statement or the Prospectus, and any amendment or supplement
thereto, as of its date and as of the Closing Date, contained an 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, and (z) subsequent to the date of the
Prospectus, there has been no material adverse change in the financial position
or results of operation of ALRC IV business except as set forth in or
contemplated by the Prospectus or as described in such certificate.
(h) You shall have received a certificate from ALRC V, dated the
Closing Date, of a Vice President or senior officer in which such officer, to
the best of his or her knowledge after reasonable investigation, shall state
that (v) the representations and warranties of ALRC V in the Underwriting
Agreement are true and correct in all material respects on and as of the Closing
Date, (w) ALRC V has complied with all agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at or prior to the Closing
Date, (x) no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are threatened by the Commission, (y) nothing has come to such
officers' attention that would lead such officers to believe that the
Registration Statement or the Prospectus, and any amendment or supplement
thereto, as of its date and as of the Closing Date, contained an 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, and (z) subsequent to the date of the
Prospectus, there has been no material adverse change in the financial position
or results of operation of ALRC V business except as set forth in or
contemplated by the Prospectus or as described in such certificate.
(i) You shall have received an opinion of Xxxxxxx Xxxxxxxx & Wood,
counsel to the Trustee, addressed to you, dated the Closing Date, satisfactory
in form and substance to you and your counsel and substantially to the effect
that:
(i) The Trustee is a New York banking corporation and is
authorized thereunder to transact the business of banking and to
exercise fiduciary powers.
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(ii) Each of the Transaction Documents has been duly and validly
authorized, executed and delivered by the Trustee, and constitutes the
legal, valid, binding and enforceable obligations of the Trustee, except
as enforceability may be limited by (a) bankruptcy, insolvency,
liquidation, receivership, moratorium, reorganization, arrangement, or
other similar laws relating to bank insolvency (including the Federal
Deposit Insurance Act) and affecting the enforcement of the rights of
creditors generally, whether now or hereinafter in effect, and (b)
general principles of equity, whether enforcement is sought in a
proceeding in equity or at law.
(j) You shall have received evidence satisfactory to you that the
Class A Notes shall be rated "AAA" by Fitch IBCA, Inc., "Aaa" by Xxxxx'x
Investors Service, Inc. and "AAA" by Standard & Poor's Ratings Group, the Class
B Notes shall be rated no lower than "A" by Fitch IBC, Inc., no lower than "A2"
by Xxxxx'x Investors Service, Inc. and no lower than "A" by Standard & Poor's
Ratings Group and the Class C Notes shall be rated no lower than "BBB" by Fitch
IBCA, Inc., no lower than "Baa2" by Xxxxx'x Investors Service, Inc. and no lower
than "BBB" by Standard & Poor's Ratings Group.
(k) The Series Obligors will furnish you with such conformed copies
of such opinions, Offered Notes, letters and documents as you reasonably
request. Indemnification and Contribution. ABS will indemnify and hold harmless
the Underwriters against any losses, claims, damages or liabilities, joint or
several, to which the Underwriters may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or 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 arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Underwriters for any legal or other expenses
reasonably incurred by the Underwriters in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the foregoing indemnity shall not inure to the
benefit of any Underwriter (or to the benefit of any person controlling such
Underwriter) from whom the person asserting any such losses, claims, damages or
liabilities purchased Offered Notes if such untrue statement or omission or
alleged untrue statement or omission made in the Preliminary Prospectus is
eliminated or remedied in the Prospectus (as amended or supplemented if the
Series Obligors and ABS shall have furnished any amendments or supplements
thereto) and, if required by law, a copy of the Prospectus (as so amended or
supplemented) shall not have been furnished to such person at or prior to the
written confirmation of the sale of such Offered Notes to such person; provided
further, however, that ABS will not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with written
information furnished to the Series Obligors and ABS by the Underwriters
specifically for use therein.
(b) The Underwriters agree, severally and not jointly, to indemnify
and hold harmless the Series Obligors and ABS against any losses, claims,
damages or liabilities to which the Series Obligors or ABS may become subject,
under the Act or otherwise and will reimburse any legal or other expenses
reasonably incurred by the Series Obligors or ABS in connection with
investigating or defending any such loss, claim, damage, liability or action as
such expenses are incurred, 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
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supplement thereto, 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 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 reliance upon and in
conformity with written information furnished to the Series Obligors or ABS by
the Underwriters specifically for use therein, and will reimburse any legal or
other expenses reasonably incurred by the Series Obligors or ABS in connection
with investigating or defending any such loss, claim, damage, liability or
action as such expenses are incurred.
(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 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 reasonably
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.If the indemnification
provided for in this section is unavailable or insufficient to hold harmless an
indemnified party under subsection (a) or (b) above, then each indemnifying
party shall contribute to the amount paid or payable by such indemnified party
as a result of the losses, claims, damages or liabilities referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to reflect
the relative benefits received by the Series Obligors or ABS on the one hand and
the Underwriters on the other from the offering of the Offered Notes, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of Series Obligors
and ABS on the one hand and the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The relative
benefits received by Series Obligors and ABS 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) of the Offered
Notes received by the Series Obligors and ABS bear to the total underwriting
discounts and commissions received by the Underwriters with respect to the
Offered Notes. 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 Series Obligors and ABS or the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission with respect to the Offered
Notes. The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any
action or claim which is the subject of this subsection (d). Notwithstanding the
provisions of this subdivision (d), the Underwriters shall not be required to
contribute any amount in excess of the amount by which the total price at which
the Offered Notes 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
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required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission with respect to the Offered Notes. 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 Series Obligors and ABS
under this Section shall be in addition to any liability which the Series
Obligors and ABS may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls the Underwriters within the
meaning of the Act; and the obligations of the Underwriters under this section
shall be in addition to any liability which the Underwriters may otherwise have
and shall extend, upon the same terms and conditions, to each director of the
Series Obligors and ABS, to each officer of the Series Obligors and ABS who has
signed the Registration Statement and to each person, if any, who controls
either Bank within the meaning of the Act.
9. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements of the
Series Obligors and ABS or their officers and of the Underwriters set forth in
or made pursuant to the Underwriting 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 the Underwriters, the Series Obligors and ABS or any of
their respective representatives, officers or directors or any controlling
person, and will survive delivery of and payment for the Offered Notes. If the
Underwriting Agreement is terminated or if for any reason other than default by
the Underwriters the purchase of the Offered Notes by the Underwriters is not
consummated, the Series Obligors and ABS shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 6 and the respective
obligations of the Series Obligors and ABS and the Underwriters pursuant to
Section 8 shall remain in effect. If for any reason the purchase of the Offered
Notes by the Underwriters is not consummated other than solely because of the
occurrence of any event specified in clause (iii), (iv) or (v) of Section 7(c),
the Series Obligors and ABS will reimburse the Underwriters for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel
and reasonable costs and expenses of printing to the extent set forth in Section
6(h)) reasonably incurred by them in connection with the offering of the Offered
Notes.
10. Computational Materials and ABS Term Sheets.
(a) Each Underwriter agrees to provide to the Series Obligors and
ABS, not less than two Business Days prior to the date on which the Series
Obligors and ABS are required to file the Prospectus pursuant to Rule 424(b),
any information used by it (in such written or electronic format as required by
the Series Obligors and ABS) with respect to the offering of the Offered Notes
that constitutes "Computational Materials," as defined in the Commission's
No-Action Letter, dated May 20, 1994, addressed to Xxxxxx, Peabody Acceptance
Corporation I, Xxxxxx, Xxxxxxx & Co. Incorporated and Xxxxxx Structured Asset
Corporation (as made generally applicable to registrants, issuers and
underwriters by the Commission's response to the request of the Public
Securities Association dated May 27, 1994 (the "Xxxxxx/PSA Letter")), that is
not contained in the Prospectus or the Preliminary Prospectus (without taking
into account information incorporated therein by reference).
(b) Each Underwriter agrees to provide to the Series Obligors and
ABS, not less than two Business Days prior to the date on which the Series
Obligors and ABS is required to file the Prospectus pursuant to Rule 424(b), any
information used by it (in such written or electronic format as required by the
Series Obligors and ABS) with respect to the offering of the Offered Notes that
constitutes "ABS Term Sheets", as defined in the Commission's No-Action Letter,
dated February 17, 1995, addressed to the Public Securities
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Association, that is not contained in the Prospectus or the Preliminary
Prospectus (without taking into account information incorporated therein by
reference).
(c) Each Underwriter severally agrees, assuming all information
provided by the Series Obligors and ABS is accurate and complete in all material
respects, to indemnify and hold harmless the Series Obligors and ABS, each of
the officers and directors of the Series Obligors and ABS and each person who
controls the Series Obligors and ABS within the meaning of Section 15 of the Act
against any and all losses, claims, damages or liabilities, joint or several, to
which they 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 of a material fact contained in the
Computational Materials or ABS Term Sheets, if any, provided by the Underwriter,
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 such indemnified party 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 Underwriter under this Section 10(c) shall be in addition to
any liability that the Underwriter may otherwise have.
The procedures set forth in Sections 8(c) and 8(d) shall be equally
applicable to this Section 10(c).
11. Notices. All communications hereunder will be in writing and, if
sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed
to the Representative.
12. Counterparts. The Underwriting Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but all
such counterparts shall together constitute one and the same Agreement.
13. Applicable Law. THE UNDERWRITING AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
14. Financial Services Act. Each Underwriter represents and warrants to,
and agrees with, the Series Obligors and ABS that (w) it has complied and shall
comply with all applicable provisions of the Financial Services Xxx 0000 and the
Public Offers of Securities Regulations 1995 (the "Regulations") with respect to
anything done by it in relation to the Offered Notes in, from or otherwise
involving the United Kingdom; (x) it has only issued or passed on and shall only
issue or pass on in the United Kingdom any document received by it in connection
with the issue of the Offered Notes to a person who is of a kind described in
Article 9(3) of the Financial Services Xxx 0000 (Investment Advertisements)
(Exemptions) Order 1995 or who is a person to whom the document may otherwise
lawfully be issued or passed on; (y) it has not offered or sold and, during the
period of six months from the date hereof, will not offer or sell any Offered
Notes 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 which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Regulations.
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If you are in agreement with the foregoing, please sign two counterparts
hereof and return one to the Series Obligors and ABS whereupon this letter and
your acceptance shall become a binding agreement among the Series Obligors and
ABS and the Underwriters.
Very truly yours,
ADVANTA BUSINESS SERVICES CORP.
By /s/ XXXX SILVER
-------------------------------------
Name: Xxxx Silver
Title: Senior Vice President
ADVANTA LEASING RECEIVABLES CORP. IV
By /s/ XXXXX XxXXXXX
-------------------------------------
Name: Xxxxx XxXxxxx
Title: Chief Financial Officer
ADVANTA LEASING RECEIVABLES CORP. V
By /s/ XXXXX XxXXXXX
-------------------------------------
Name: Xxxxx XxXxxxx
Title: Chief Financial Officer
The foregoing Agreement is
hereby confirmed and accepted
as of the date hereof
SALOMON BROTHERS INC
as Representative of the
Underwriters set forth herein
By /s/ XXXXXX X. XXXXX
-------------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
17
SCHEDULE A
Principal Amount
of
Underwriters Class A-1 Notes Price
------------ --------------- -----
Salomon Brothers Inc $36,000,000 99.77095%
Prudential Securities $36,000,000 99.77095%
Incorporated
Principal Amount
of
Underwriters Class A-2 Notes Price
------------ --------------- -----
Salomon Brothers Inc $90,000,000 99.69447%
Barclays Capital Inc. $10,000,000 99.69447%
Xxxxxx Brothers Inc. $90,000,000 99.69447%
Principal Amount
of
Underwriter Class A-3 Notes Price
------------- --------------- -----
Salomon Brothers Inc $23,300,000 99.59181%
18
Principal Amount
of
Underwriters Class A-4 Notes Price
------------ --------------- -----
Salomon Brothers Inc $22,950,000 99.59384%
Prudential Securities $22,950,000 99.59384%
Incorporated
Principal Amount
of
Underwriter Class B Notes Price
------------- --------------- -----
Salomon Brothers Inc $18,938,000 99.58953%
Principal Amount
of
Underwriter Class C Notes Price
------------- --------------- -----
Salomon Brothers Inc $9,862,000 99.49598%
