UNDERWRITING AGREEMENT

 

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                                                                     Exhibit 1.2

 

                                                                  EXECUTION COPY

 

                       ADVANTA BUSINESS CARD MASTER TRUST

                AdvantaSeries Class A(2005-A5) Asset Backed Notes

 

                             UNDERWRITING AGREEMENT

 

                                November 29, 2005

 

Deutsche Bank Securities Inc.

60 Wall Street, 19th Floor

New York, New York 10005

 

Merrill Lynch, Pierce, Fenner & Smith Incorporated

4 World Financial Center, 10th Floor

New York, New York 10080

 

Ladies and Gentlemen:

 

     1. Introductory. Advanta Business Receivables Corp., a Nevada corporation

(the "Company"), proposes, subject to the terms and conditions stated herein, to

cause Advanta Business Card Master Trust, a Delaware common law trust (the

"Issuer"), to issue $200,000,000 aggregate principal amount of Advanta Business

Card Master Trust AdvantaSeries Class A(2005-A5) Asset Backed Notes (the

"Notes"). The Issuer is a common law trust formed pursuant to a Trust Agreement,

dated as of August 1, 2000 (the "Trust Agreement") between the Company and

Wilmington Trust Company, as owner trustee (the "Owner Trustee"). The Notes will

be issued pursuant to a Master Indenture, dated as of August 1, 2000 (the

"Master Indenture"), between the Issuer and Deutsche Bank Trust Company

Americas, as indenture trustee (the "Indenture Trustee"), as supplemented by the

AdvantaSeries Indenture Supplement with respect to the Notes dated as of

November 1, 2004 and, with respect to the Notes, as further supplemented by the

Class A(2005-A5) Terms Document dated as of December 6, 2005 (the "Indenture

Supplement" and together with the Master Indenture, the "Indenture").

 

     The assets of the Issuer will include Receivables and payments thereon in a

portfolio of MasterCard and VISA revolving business purpose credit card accounts

of Advanta Bank Corp.

 

     The Receivables are transferred to the Issuer pursuant to a Transfer and

Servicing Agreement, dated as of August 1, 2000 (the "Transfer and Servicing

Agreement"), between the Company, Advanta Bank Corp. ("Advanta"), as servicer

(in such capacity, the "Servicer"), and the Issuer. The Receivables transferred

to the Issuer by the Company are acquired by the Company from Advanta, pursuant

to a Receivables Purchase Agreement, dated as of August 1, 2000 (the

"Receivables Purchase Agreement"), between the Company and Advanta. Advanta

 

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granted a security interest in the Receivables to the Indenture Trustee for the

benefit of the Noteholders pursuant to a letter agreement dated as of August 1,

2000 (the "Security Agreement"), between Advanta and the Indenture Trustee.

 

     Advanta has agreed to provide notices and perform on behalf of the Issuer

certain other administrative obligations required by the Transfer and Servicing

Agreement, the Master Indenture and each indenture supplement for each series of

notes issued by the Issuer, pursuant to an Administration Agreement, dated as of

August 1, 2000 (the "Administration Agreement"), between Advanta, as

administrator (in such capacity, the "Administrator"), and the Issuer. The

Transfer and Servicing Agreement, the Receivables Purchase Agreement, the

Indenture, the Trust Agreement, the Security Agreement and the Administration

Agreement are referred to herein, collectively, as the "Transaction Documents."

 

     This Underwriting Agreement is referred to herein as this "Agreement." To

the extent not defined herein, capitalized terms used herein have the meanings

assigned in the Transaction Documents.

 

     Advanta and the Company hereby agree with the underwriters for the Notes

listed on Schedule A hereto (the "Underwriters") as follows:

 

     2. Representations and Warranties of the Company and Advanta. Each of the

Company and Advanta, jointly and severally, represents and warrants to, and

agrees with, each of the Underwriters that:

 

          (a) The Company and the Notes meet the requirements for use of Form

S-3 under the Securities Act of 1933, as amended (the "Act"); the Company has

filed with the Securities and Exchange Commission (the "Commission") a

registration statement on Form S-3 (No. 333-81788) which has been amended by

Post-Effective Amendment Number 1 filed with the Commission on August 4, 2004

and declared effective by the Commission on August 19, 2004. The registration

statement, as so amended, includes a representative form of prospectus

supplement, relating to the Notes and the offering thereof from time to time in

accordance with Rule 415 under the Act. Such registration statement, as amended,

has been declared effective by the Commission, and the Indenture has been

qualified under the Trust Indenture Act of 1939, as amended (the "Trust

Indenture Act"). The registration statement as amended at the date hereof is

hereinafter referred to as the "Registration Statement." The Company will

prepare and file with the Commission a prospectus supplement (together with any

later dated prospectus supplement relating to the Notes, the "Prospectus

Supplement") to the prospectus included in the Registration Statement (such

prospectus, in the form it appears in the Registration Statement or in the form

most recently revised and filed with the Commission pursuant to Rule 424(b), is

hereinafter referred to as the "Base Prospectus") specifically relating to the

Notes pursuant to Rule 424 under the Act. The term "Prospectus" means the Base

Prospectus together with the Prospectus Supplement. The term "Preliminary

Prospectus" means any preliminary prospectus supplement specifically relating to

the Notes, together with the Base Prospectus. As used herein, the terms

"Registration Statement," "Prospectus," "Base Prospectus" and "Preliminary

Prospectus" shall include in each case the documents, if any, incorporated by

reference therein. For purposes of this Agreement, all references to the

Registration Statement, any Preliminary

 

 

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Prospectus or the Prospectus or any amendment or supplement to any of the

foregoing shall be deemed to include the electronically transmitted copy thereof

filed with the Commission pursuant to its Electronic Data Gathering, Analysis

and Retrieval system ("EDGAR"). All references in this Agreement to financial

statements and schedules and other information that is "contained," "included"

or "stated" in the Registration Statement, any Preliminary Prospectus or the

Prospectus (or other references of like import) shall be deemed to mean and

include all such financial statements and schedules and other information that

is incorporated by reference in the Registration Statement, any Preliminary

Prospectus or the Prospectus, as the case may be; and all references in this

Agreement to amendments or supplements to the Registration Statement, any

Preliminary Prospectus or the Prospectus shall be deemed to mean and include the

filing of any document with the Commission pursuant to the Securities Exchange

Act of 1934, as amended (the "Exchange Act"), that is incorporated by reference

in the Registration Statement, such Preliminary Prospectus or the Prospectus, as

the case may be;

 

          (b) No stop order preventing or suspending the effectiveness or use of

the Registration Statement or the Prospectus has been issued by the Commission

and no proceeding for that purpose has been initiated or, to the knowledge of

the Company or Advanta, threatened by the Commission. The Registration

Statement, as of the date and time as of which the Registration Statement, or

the most recent post-effective amendment thereto was declared effective by the

Commission, conformed, in all material respects to the requirements of the Act,

and the rules and regulations of the Commission thereunder (the "Rules and

Regulations") and the Trust Indenture Act, 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 this 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 the Trust Indenture

Act 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; provided, however, that this representation and warranty shall not

apply to any statements or omissions made in reliance upon and in conformity

with written information furnished to the Company by any Underwriter

specifically for use therein, it being understood and agreed that the only

information provided by the Underwriters for inclusion in the Registration

Statement and the Prospectus is set forth on the cover page of the Prospectus

Supplement under the column "Class A(2005-A5) Notes" and on the line across from

"Price to Public," in the table listing the Underwriters and the Principal

Amount of Class A(2005-A5) Notes under the heading "Underwriting" in the

Prospectus Supplement, in the third paragraph after the tables under the heading

"Underwriting" in the Prospectus Supplement, and in the third paragraph from the

end of the section under the heading "Underwriting" in the Prospectus Supplement

(the "Underwriters' Information"). In addition, the statements in "Description

of the Notes," "The Indenture" and "Description of the Receivables Purchase

Agreement" in the Base Prospectus and "Description of Series and Tranche

Provisions" in the Prospectus Supplement, to the extent they constitute a

summary of the Notes or the Transaction Documents constitute a fair and accurate

summary thereof;

 

 

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          (c) The documents incorporated or deemed to be incorporated by

reference in the Prospectus, when they became effective or were filed with the

Commission, as the case may be, conformed in all material respects to the

requirements of the Act or the Exchange Act, as applicable, and the Rules and

Regulations, and none of such documents 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; and any further

documents so filed and incorporated by reference in the Prospectus or any

further amendment or supplement thereto, when such documents become effective or

are filed with the Commission, as the case may be, will conform in all material

respects to the requirements of the Act or the Exchange Act, as applicable, and

the Rules and Regulations and will not contain an untrue statement of a material

fact or omit to state a material fact required to be stated therein or necessary

to make the statements therein not misleading;

 

          (d) Since the respective dates as of which information is given in the

Registration Statement and the Prospectus, there has not been any change, or any

development involving a prospective change, in or affecting the Company or

Advanta or any of their respective subsidiaries (other than as contemplated in

the Registration Statement or the Prospectus) which would be expected to have a

material adverse effect on either (1) the ability of such person to consummate

the transactions contemplated by, or to perform its respective obligations

under, this Agreement or any of the Transaction Documents to which it is a party

or (2) the Accounts or related Receivables considered in the aggregate;

 

          (e) The Company has been duly formed and is validly existing as a

corporation in good standing under the laws of Nevada; Advanta has been duly

incorporated and is validly existing as an industrial bank in good standing

under the laws of Utah; each of the Company and Advanta has the power and

authority (corporate and/or other) to own its properties and conduct its

business to the extent described in the Prospectus and to perform its

obligations under this Agreement and the Transaction Documents to which it is a

party; and each of the Company and Advanta has been duly qualified as a foreign

corporation for the transaction of business and is in good standing under the

laws of each other jurisdiction in which it owns or leases properties or

conducts any business so as to require such qualification, or is subject to no

material liability or disability by reason of the failure to be so qualified in

any such jurisdiction;

 

          (f) As of the Time of Delivery (as defined in Section 3), each

consent, approval, authorization or order of, or filing with, any court or

governmental agency or body that is required to be obtained or made by the

Company, Advanta, the Issuer or their subsidiaries for the consummation of the

transactions contemplated by this Agreement and the Transaction Documents shall

have been obtained or made, except for such consents, approvals, authorizations,

registrations or qualifications as may be required under Blue Sky laws;

 

          (g) Any taxes, fees and other governmental charges that are assessed

and due from the Company, Advanta, or the Issuer in connection with the issuance

of the Notes, the execution, delivery and issuance of this Agreement and each

Transaction Document shall have been paid or will be paid at or prior to the

Time of Delivery to the extent then due;

 

 

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          (h) This Agreement has been duly authorized, executed and delivered by

the Company and Advanta and constitutes a legal, valid and binding agreement of

the Company and Advanta enforceable in accordance with its terms, except as

enforceability may be limited by (i) bankruptcy, insolvency, liquidation,

receivership, moratorium, reorganization or other similar laws affecting the

enforcement of the rights of creditors and (ii) general principles of equity,

whether enforcement is sought in a proceeding in equity or at law;

 

          (i) The Notes have been duly and validly authorized by the Company,

the direction by the Issuer to the Indenture Trustee to authenticate the Notes

has been duly authorized by the Company and, when issued pursuant to the

Indenture and delivered pursuant to this Agreement, the Notes will have been

duly executed, authenticated, issued and delivered and will constitute valid and

legally binding obligations of the Issuer, enforceable in accordance with their

terms, and entitled to the benefits provided by the Indenture under which they

are to be issued, which Indenture will be substantially in the form filed as an

exhibit to the Registration Statement; the Indenture has been duly authorized

and duly qualified under the Trust Indenture Act and, assuming the due

authorization, execution and delivery thereof by the other parties thereto, the

Indenture will constitute a valid and legally binding instrument of the Issuer,

enforceable in accordance with its terms, except as enforceability may be

limited by (i) bankruptcy, insolvency, liquidation, receivership, moratorium,

reorganization or other similar laws affecting the enforcement of the rights of

creditors and (ii) general principles of equity, whether enforcement is sought

in a proceeding in equity or at law; assuming the due authorization, execution

and delivery thereof by the other parties thereto, each of the other Transaction

Documents to which it is a party will constitute a valid and legally binding

obligation of the Company and Advanta, as applicable, enforceable in accordance

with its terms, except as enforceability may be limited by (i) bankruptcy,

insolvency, liquidation, receivership, moratorium, reorganization or other

similar laws affecting the enforcement of the rights of creditors and (ii)

general principles of equity, whether enforcement is sought in a proceeding in

equity or at law; the execution, delivery and performance by each of the Company

and Advanta of the Transaction Documents to which it is a party and the

consummation of the transactions contemplated thereby have been duly and validly

authorized by all necessary action and proceedings required of it; and the

Notes, the Indenture, the Receivables Purchase Agreement, the Transfer and

Servicing Agreement and the other Transaction Documents will conform in all

material respects to the descriptions thereof in the Prospectus;

 

          (j) The issue and sale of the Notes by the Issuer as contemplated

hereby and the compliance by the Company and Advanta with all of the provisions

of this Agreement, and the compliance by each of the Company and Advanta with

all of the provisions of all of the Transaction Documents to which it is a party

and the consummation of the transactions herein and therein contemplated will

not conflict with or result in a breach or violation of any of the terms or

provisions of, or constitute a default under, any indenture, mortgage, deed of

trust, loan agreement or other agreement or instrument to which the Company and

Advanta is a party or by which the Company or Advanta or any of their

subsidiaries is bound or to which any of the property or assets of the Company

or Advanta is subject, nor will such action result in any violation of the

provisions of the Articles of Incorporation or By-laws of the Company or

Advanta, as applicable, or any statute or any order, rule or regulation of any

court or governmental agency or body having jurisdiction over the Company or

Advanta or any of their

 

 

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properties; and no consent, approval, authorization, order, registration or

qualification of or with any such court or governmental agency or body is

required to be obtained by the Company or Advanta for the issue and sale of the

Notes by the Issuer, the consummation by the Company or Advanta of the

transactions contemplated by this Agreement or the Transaction Documents, except

the registration under the Act of the Notes and the qualification of the

Indenture under the Trust Indenture Act and such consents, approvals,

authorizations, registrations or qualifications as may be required under state

or foreign securities or Blue Sky laws in connection with the purchase and

distribution of the Notes by the Underwriters;

 

          (k) There are no legal or governmental proceedings to which the

Company or Advanta is a party or of which any property of the Company or Advanta

is the subject (i) asserting the invalidity of this Agreement, the Notes or any

other Transaction Documents, (ii) seeking to prevent the issuance of the Notes

or the consummation of any of the transactions contemplated by this Agreement or

any Transaction Document, (iii) which is reasonably expected to materially and

adversely affect the performance by the Company or Advanta, of their respective

obligations under, or the validity or enforceability of, this Agreement, the

Notes or the other Transaction Documents, as applicable, (iv) seeking to affect

adversely the federal income tax attributes of the Notes described in the

Prospectus or (v) which is reasonably expected to, individually or in the

aggregate, have a material adverse effect on the Accounts, the Receivables, the

Company, Advanta or the Issuer; and, to the best of the Company's and Advanta's

knowledge, no such proceedings are threatened or contemplated by governmental

authorities or threatened by others;

 

          (l) Neither the Company nor Advanta is in violation of its respective

Articles of Incorporation or By-laws, and neither the Company nor Advanta is in

default in the performance or observance of any material obligation, agreement,

covenant or condition contained in any indenture, mortgage, deed of trust, loan

agreement, lease or other agreement or instrument to which it is a party or by

which it or any of its properties may be bound;

 

          (m) None of the Company, Advanta and the Issuer is and, after giving

effect to the offering and sale of the Notes and the application of proceeds

therefrom and other transactions contemplated hereby, will be, an "investment

company" or an entity "controlled" by an "investment company", as such terms are

defined in the Investment Company Act of 1940, as amended (the "Investment

Company Act");

 

           (n) The Receivables had an aggregate outstanding balance determined as

of the close of business on October 31, 2005 in the amount set forth in the

Prospectus Supplement;

 

          (o) No selection procedures materially adverse to the holders of the

Notes were utilized in selecting those Receivables transferred by Advanta to the

Company from those Receivables available therefor;

 

          (p) The Receivables have been acquired and will be acquired by the

Company under the Receivables Purchase Agreement and by the Issuer under the

Transfer and Servicing Agreement, the Company and the Issuer, respectively, will

acquire the Receivables, free and

 

 

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clear of any lien, charge or encumbrance (other than as contemplated by the

Transaction Documents), but subject to the rights of the related obligors;

 

          (q) As of the date hereof and as of the Time of Delivery, neither

Advanta nor the Company is obligated to repurchase Receivables in the Initial

Designated Accounts or in any Additional Designated Accounts (each as defined in

the Transfer and Servicing Agreement) constituting a material portion of the

aggregate Receivables in the Accounts (as defined in the Transfer and Servicing

Agreement) existing as of the Time of Delivery;

 

          (r) As of the date hereof, the Company is wholly-owned by Advanta and

the Issuer is wholly-owned by the Company;

 

          (s) In accordance with Generally Accepted Accounting Principles, as

currently in effect, each party to the Receivables Purchase Agreement and the

Transfer and Servicing Agreement will treat the transactions contemplated by the

Receivables Purchase Agreement and the Transfer and Servicing Agreement as

absolute assignments of the Receivables to the Company and to the Issuer,

respectively;

 

          (t) Advanta represents and warrants that it has made available to the

Underwriters copies of the consolidated financial statements of Advanta Corp.

for the year ended December 31, 2004 and the nine-month period ended September

30, 2005, as filed with the SEC. Except as set forth in or contemplated in the

Registration Statement and the Prospectus or as described by Advanta Corp. in

SEC filings or press releases of general distribution, copies of which have been

delivered to you, there has been no material adverse change in the condition

(financial or otherwise) of Advanta Corp., the Company or Advanta since

September 30, 2005;

 

          (u) Each of the Company and Advanta hereby makes and repeats each of

the respective representations and warranties expressly made by it in the

Transaction Documents. Such representations and warranties are incorporated by

reference in this Section 2 and the Underwriters may rely thereon as if such

representations and warranties were fully set forth herein;

 

          (v) Any taxes, fees and other governmental charges arising from the

execution and delivery by Advanta, the Company or the Issuer of this Agreement,

the Receivables Purchase Agreement, the Transfer and Servicing Agreement and the

Indenture and in connection with the execution, delivery and issuance of the

Notes and with the transfer of the Receivables have been paid or will be paid by

the Company prior to December 6, 2005 (the "Closing Date");

 

          (w) KPMG LLP is an independent public accountant with respect to

Advanta and the Company within the meaning of the Act and the rules and

regulations promulgated thereunder; and

 

          (x) The Indenture has been duly qualified under the TIA and complies

as to form with the TIA and the rules and regulations of the Commission

thereunder.

 

 

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     All representations, warranties and agreements made herein shall be deemed

made as of the date hereof and as of the Time of Delivery; provided, however,

that to the extent any representation or warranty relates to a specific date,

such representation and warranty shall be deemed to relate only to such date.

 

     3. Sale and Delivery to the Underwriters; Closing. Subject to the terms and

conditions herein set forth, the Company agrees to cause the Issuer to issue the

Notes and agrees to sell the Notes to each of the Underwriters, severally and

not jointly, and each of the Underwriters agrees, severally and not jointly, to

purchase from the Company, the principal amount of the Notes set forth opposite

the name of such Underwriter, and at the purchase price set forth, in Schedule A

hereto.

 

     The Notes shall be represented by one or more definitive global

certificates registered in the name of Cede & Co., as nominee for The Depository

Trust Company ("DTC"). The Company will cause the Issuer to transfer the Notes

in book-entry form to Deutsche Bank Securities Inc. and Merrill Lynch, Pierce,

Fenner & Smith Incorporated (the "Representatives"), for the account of each

Underwriter, against payment by the Representatives (by or on behalf of each

such Underwriter or otherwise) of the purchase price therefor by wire transfer

payable to the order of the Company in federal (same day) funds (to such account

or accounts as the Company shall designate), by causing DTC to credit the Notes

to the account of the Representatives at DTC. The time and date of such delivery

and payment shall be 10:00 a.m., New York City time, on December 6, 2005 or such

other time and date as the Representatives and the Company may agree upon in

writing. Such time and date are herein called the "Time of Delivery."

 

     The documents to be delivered at Time of Delivery by or on behalf of the

parties hereto pursuant to Section 7 hereof and the Notes will be delivered at

the offices of McKee Nelson LLP, One Battery Park Plaza, 34th Floor, New York,

New York 10004 (the "Closing Location"), all at the Time of Delivery. Final

drafts of the documents to be delivered pursuant to the preceding sentence will

be available for review by the parties hereto on the New York Business Day

preceding the time of Delivery. For the purposes of this Section 3, "New York

Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and Friday

which is not a day on which banking institutions in New York are authorized or

obligated by law or executive order to close. The Company will cause the global

certificates referred to above to be made available to the Representatives for

checking at least 24 hours prior to the Time of Delivery at the Closing

Location.

 

     4. Offering by Underwriters.

 

          (a) It is understood that upon the authorization by the

Representatives of the release of the Notes, the Underwriters propose and agree

to offer the Notes for sale upon the terms and conditions set forth in the

Prospectus.

 

          (b) Each of the Underwriters agrees that if it is a foreign broker or

dealer not eligible for membership in the National Association of Securities

Dealers, Inc. (the "NASD"), it will not effect any transaction in the Notes

within the United States or induce or attempt to

 

 

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induce the purchase of or sale of the Notes within the United States, except

that such Underwriter shall be permitted to make sales to the other Underwriters

or to their United States affiliates; provided that such sales are made in

compliance with an exemption of certain foreign brokers or dealers under Rule

15a-6 under the Exchange Act, and in conformity with the Rules of Fair Practice

of the NASD as such rules apply to non-NASD brokers or dealers.

 

          (c) Each Underwriter further represents that:

 

               (i) it has complied and will comply with all applicable

     provisions of the Financial Services and Markets Act 2000 ("FSMA") with

     respect to anything done by it in relation to the Notes in, from or

     otherwise involving the United Kingdom; and

 

               (ii) it has only communicated or caused to be communicated and it

     will only communicate or cause to be communicated any invitation or

     inducement to engage in investment activity (within the meaning of Section

     21 of the FSMA) received by it in connection with the issue or sale of any

     Notes in circumstances in which Section 21(1) of the FSMA does not apply to

     the issuer.

 

          (d) In relation to each Member State of the European Economic Area

(the European Union plus Ireland, Norway and Liechtenstein) which has

implemented the Prospectus Directive (each, a "Relevant Member State"), each

Underwriter has represented and agreed that with effect from and including the

date on which the Prospectus Directive is implemented in that Relevant Member

State (the "Relevant Implementation Date") it has not made and will not make an

offer of the Notes to the public in that Relevant Member State prior to the

publication of a prospectus in relation to the Notes which has been approved by

the competent authority in that Relevant Member State or, where appropriate,

approved in another Relevant Member State and notified to the competent

authority in the Relevant Member State, all in accordance with the Prospectus

Directive, except that it may, with effect from and including the Relevant

Implementation Date, make an offer of Notes to the public in that Relevant

Member State at any time:

 

               (i) to legal entities which are authorized or regulated to

     operate in the financial markets or, if not so authorized or regulated,

     whose corporate purpose is solely to invest in securities;

 

               (ii) to any legal entity which has two or more of (1) an average

     of at least 250 employees during the last financial year; (2) a total

     balance sheet of more than (euro)43,000,000 and (3) an annual net turnover

     of more than (euro)50,000,000, as shown in its last annual or consolidated

     accounts; or

 

               (iii) in any other circumstances which do not require the

     publication by the Company of a prospectus pursuant to Article 3 of the

     Prospectus Directive.

 

For the purposes of the above paragraph, the expression an "offer of Notes to

the public" in relation to any Notes in any Relevant Member State means the

communication in any form and by any means of sufficient information on the

terms of the offer and the Notes to be offered so as

 

 

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to enable an investor to decide to purchase or subscribe the Notes in that

Member State and the expression "Prospectus Directive" means Directive

2003/71/EC and includes any relevant implementing measure in each Relevant

Member State.

 

          (e) Each of the Underwriters agrees with and represents and warrants

to the Company and Advanta that with respect to each potential investor to which

it sends an electronic copy of any Preliminary Prospectus or the Prospectus it

will also promptly send a printed copy of the Preliminary Prospectus or the

Prospectus, as the case may be. The Representatives agree with the Company and

Advanta that they shall provide notice to the Company and Advanta of any

electronic dissemination by the Underwriters to potential investors of any

Preliminary Prospectus or the Prospectus before such dissemination.

 

     5. Certain Agreements of the Company and Advanta. The Company and Advanta,

jointly and severally, agree with each of the Underwriters that:

 

          (a) The Company will prepare the Prospectus in a form approved by the

Representatives (which approval will not be unreasonably withheld) and will file

such Prospectus pursuant to Rule 424(b) under the Act not later than the date

required by Rule 424; make no further amendment or any supplement to the

Registration Statement (including any post-effective amendment and any filing

under Rule 462(b) under the Act) or Prospectus which shall be reasonably

disapproved by the Representatives promptly after reasonable notice thereof;

will advise the Representatives, promptly after it receives notice thereof, of

the time when any amendment to the Registration Statement has been filed or

becomes effective or any supplement to the Prospectus or any amended Prospectus

has been filed and to furnish the Representatives with copies thereof, will file

promptly all reports and any definitive proxy or information statements required

to be filed by the Company with the Commission pursuant to Section 13(a), 13(c),

14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus and for

so long as the delivery of a prospectus is required in connection with the

offering or sale of the Notes; to advise the Representatives, promptly after it

receives notice thereof, of the issuance by the Commission of any stop order or

of any order preventing or suspending the use of the Prospectus, of the

suspension of the qualification of the Notes for offering or sale in any

jurisdiction, of the initiation or threatening of any proceeding for any such

purpose, or of any request by the Commission for the amending or supplementing

of the Registration Statement or Prospectus or for additional information; and,

in the event of the issuance of any stop order or of any order preventing or

suspending the use of the Prospectus or suspending any such qualification, will

promptly use its best efforts to obtain the withdrawal of such order.

 

          (b) The Company will promptly from time to time take such action as

the Representatives may reasonably request to qualify the Notes for offering and

sale under the securities laws of such states as the Representatives may request

and to comply with such laws so as to permit the continuance of sales and

dealings therein in such states for as long as may be necessary to complete the

distribution of the Notes, provided that in connection therewith neither the

Company nor the Issuer shall be required to qualify as a foreign corporation or

entity or to file a general consent to service of process in any state.

 

 

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          (c) If at any time when a prospectus relating to the Notes is required

to be delivered under the Act, any event occurs as a result of which the

Prospectus, as then 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 Company 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 and will furnish the

Representatives with copies thereof. Neither the Underwriters' 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 7.

 

          (d) As soon as practicable, the Company will make generally available

to Noteholders and to the Underwriters an earnings statement or statements of

the Company which will satisfy the provisions of Section 11(a) of the Act and

Rule 158 under the Act. The Company will comply with the periodic reporting

requirements under the Exchange Act.

 

          (e) During the period beginning on the date hereof and continuing to

and including the Business Day following the Closing Date, neither the Company

nor Advanta will offer, sell, contract to sell or otherwise dispose of any

credit card backed securities with the same term and other characteristics

identical to the Notes without the prior written consent of the Representatives.

 

          (f) So long as any Notes shall be outstanding, Advanta will deliver or

cause to be delivered to the Representatives the annual statement as to

compliance to be delivered by Advanta to the Owner Trustee, the Indenture

Trustee and each Rating Agency pursuant to Section 3.05 of the Transfer and

Servicing Agreement and the independent certified public accountant's

agreed-upon procedures report furnished to the Owner Trustee, the Indenture

Trustee, the Servicer and each Rating Agency pursuant to Section 3.06 of the

Transfer and Servicing Agreement in each case as soon as such statement is

furnished to the Owner Trustee, the Indenture Trustee or the Rating Agencies, as

the case may be.

 

          (g) The Company and Advanta will cooperate with the Underwriters and

use their best efforts to permit the Notes to be eligible for clearance and

settlement through DTC.

 

          (h) The Company will furnish such information, execute such

instruments and take such actions, if any, as the Representatives may reasonably

request in connection with any filing with the NASD relating to the Notes should

the Representatives determine that such filing is required or appropriate.

 

          (i) So long as any of the Notes are outstanding, the Company will

furnish to the Representatives as soon as practicable (i) all documents required

to be distributed to the holders of the Notes or filed with the Commission

pursuant to the Exchange Act or any order of the Commission thereunder, (ii) all

monthly reports required to be delivered to or filed with the Indenture Trustee,

(iii) all notices or requests to or from the Rating Agencies with respect to the

Notes that have been delivered to or received by the Company, (iv) any order of

the Commission under the Act or the Exchange Act applicable to the Issuer or to

the Company, or pursuant to a

 

 

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"no-action" letter obtained from the staff of the Commission by the Company and

affecting the Issuer or the Company and (v) from time to time, any other

publicly available information concerning the Company filed with any government

or regulatory authority, as the Representatives may reasonably request.

 

          (j) At the Time of Delivery, the electronic ledger used by Advanta as

a master record of the Receivables conveyed by Advanta to the Company and, in

turn, conveyed by the Company to the Issuer, shall be marked in such a manner as

shall clearly indicate the Issuer's absolute ownership of such Receivables, and

from and after the Time of Delivery, neither the Company nor Advanta nor any of

their affiliates shall take any action inconsistent with the Issuer's ownership

of such Receivables, other than as permitted by the Transaction Documents.

 

          (k) To the extent, if any, that the rating provided with respect to

the Notes by any of the Rating Agencies that initially rate the Notes is

conditional upon the furnishing of documents or the taking of any other

reasonable actions by the Company or Advanta, the Company and Advanta will use

their best efforts to furnish, as soon as practicable, such documents and take

(or cause the taking of) any such other actions.

 

          (l) Each of the Company and Advanta will use the net proceeds received

by it from the issuance of the Notes in the manner specified in the Prospectus

Supplement and Prospectus under the caption "Use of Proceeds."

 

          (m) The Company will file with the Commission within four days of the

issuance of the Notes a current report on Form 8-K setting forth specific

information concerning the Notes and the Receivables to the extent that such

information is not set forth in the Prospectus.

 

     6. Computational Materials and ABS Term Sheets.

 

          (a) Each Underwriter, severally, represents and warrants to the

Company and Advanta that it has not and will not use any information that

constitutes "Computational Materials," as defined in the Commission's No-Action

Letter, dated May 20, 1994, addressed to Kidder, Peabody Acceptance Corporation

I, Kidder, Peabody & Co. Incorporated and Kidder 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