EXHIBIT 1.3
EXECUTION COPY
Onyx Acceptance Owner Trust 2003-C
$80,000,000 1.08% Auto Loan Backed Notes, Class A-1
$100,000,000 1.34% Auto Loan Backed Notes, Class A-2
$100,000,000 1.87% Auto Loan Backed Notes, Class A-3
$120,000,000 2.66% Auto Loan Backed Notes, Class A-4
UNDERWRITING AGREEMENT
July 23, 2003
Credit Suisse First Boston LLC
as Representative of the Underwriters
Xxxxxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
1. Introductory. Onyx Acceptance Financial Corporation (the "Company")
proposes to cause Onyx Acceptance Owner Trust 2003-C (the "Trust") to sell to
Credit Suisse First Boston LLC (the "Representative") and Xxxxxxx Lynch, Xxxxxx,
Xxxxxx & Xxxxx Incorporated (together with the Representative, the
"Underwriters") $80,000,000 aggregate principal amount of 1.08% Auto Loan Backed
Notes, Class A-1 (the "Class A-1 Notes"), $100,000,000 aggregate principal
amount of 1.34% Auto Loan Backed Notes, Class A-2 (the "Class A-2 Notes"),
$100,000,000 aggregate principal amount of 1.87% Auto Loan Backed Notes, Class
A-3 (the "Class A-3 Notes"), and $120,000,000 aggregate principal amount of
2.66% Auto Loan Backed Notes, Class A-4 ("the Class A-4 Notes" and together with
the Class A-1 Notes, Class A-2 Notes and Class A-3 Notes, the "Notes").
The Notes will be issued pursuant to an Indenture dated as of July 1,
2003 (the "Indenture"), between the Trust and JPMorgan Chase Bank, as Indenture
Trustee (the "Indenture Trustee"). Certain securities representing the "Residual
Interest Instruments" of the Trust (as defined in the Servicing Agreement) will
be issued pursuant to a Trust Agreement dated as of July 1, 2003 (the "Trust
Agreement") among the Company, The Bank of New York (Delaware) as Owner Trustee
(the "Owner Trustee") and JPMorgan Chase Bank as Trust Agent (the "Trust
Agent").
Pursuant to a Sale and Servicing Agreement dated as of July 1, 2003
(the "Servicing Agreement") among the Trust, the Company as Seller (the
"Seller"), Onyx Acceptance Corporation as Servicer and Custodian ("Onyx" or in
such capacity, the "Servicer" or the "Custodian"), JPMorgan Chase Bank, in its
capacity as Indenture Trustee and the Trust Agent, the Seller will sell and
assign to the Trust, without recourse, the Seller's entire interest in the
Contracts (as hereinafter defined) and Onyx will act as Servicer of the
Contracts. Pursuant to an Administration Agreement dated as of July 1, 2003 (the
"Administration Agreement") among the Trust, Onyx, the Company, the Indenture
Trustee and the Trust Agent, Onyx will serve as
administrator of the Trust. Pursuant to a Second Amended and Restated Sale and
Servicing Agreement dated as of November 30, 2001 (the "Purchase Agreement"), as
amended, Onyx has sold or will sell the Funded Contracts (as hereinafter
defined) and may sell certain Prefunded Contracts (as hereinafter defined) to
the Company. Pursuant to an insurance and indemnity agreement (the "Insurance
Agreement") among the Company, Onyx (in its individual capacity and as Servicer)
and XL Capital Assurance Inc. (the "Insurer") and an insurer indemnification
agreement (the "XL Indemnification Agreement" and together with the Insurance
Agreement, the "Insurance Agreements") by and among Onyx, the Company, the
Representative and the Insurer, the Insurer will issue its financial guarantee
insurance policy (the "Guarantee") to the Indenture Trustee for the benefit of
the holders of the Notes (the "Noteholders") guaranteeing timely payment of
interest and ultimate payment of principal at maturity on the Notes.
As of the Closing Date (as hereinafter defined), the Trust's assets
(the "Trust Property") will include: (i) a pool of fixed rate motor vehicle
retail installment sales contracts and installment loan agreements (the
"Contract Pool"), all of which were purchased from the Seller pursuant to the
Servicing Agreement and secured by new and used automobiles, light-duty trucks
and vans (the "Financed Vehicles"), (ii) certain documents relating to the
Funded Contracts (as hereinafter defined), (iii) with respect to contracts (the
"Initial Contracts") originated as of July 1, 2003 (the "Initial Cut-Off Date")
certain monies received with respect to the Initial Contracts on or after the
Initial Cut-off Date, (iv) with respect to contracts (the "Subsequent Contracts"
and together with the Initial Contracts, the "Funded Contracts"), originated or
purchased on or after the Initial Cut-Off Date and on or about July 29, 2003
(the "Subsequent Cut-Off Date"), certain monies received with respect to the
Subsequent Contracts on or after the Subsequent Cut-Off Date, (v) security
interests in the Financed Vehicles and the rights to receive proceeds from
claims on certain insurance policies covering the Financed Vehicles or the
individual obligors under each related Funded Contract, (vi) all amounts on
deposit in the Collection Account, the Payment Account, the Note Distribution
Account, the Spread Account, the Prefunding Account, the Capitalized Interest
Account, and the Payahead Account including all Eligible Investments credited
thereto (but excluding any investment income from Eligible Investments credited
to the Collection Account, which will be paid to the Servicer and any investment
income from Eligible Investments credited to the Capitalized Interest Account,
which may be paid to the Seller under certain circumstances), (vii) the right of
the Company to cause Onyx to repurchase certain Contracts under certain
circumstances, and (viii) all proceeds of the foregoing. After the Closing Date,
the Trust will use the funds in the Prefunding Account to purchase contracts
(the "Prefunded Contracts", and together with the Funded Contracts, the
"Contracts") originated or purchased on or after the Subsequent Cut-Off Date and
on or before the end of the Funding Period from the Company.
The Notes will be issued in an aggregate principal amount of
$400,000,000 which is equal to the outstanding principal balance of the Initial
Contracts as of the Initial Cut-Off Date and the outstanding principal balance
of the Subsequent Contracts as of the Subsequent Cut-Off Date and the amount in
the Prefunding Account. The term "Cut-Off Date" as used herein refers to the
Initial Cut-Off Date for the Initial Contracts and the Subsequent Cut-Off Date
for the Subsequent Contracts and the related Prefunding Cut-Off Date for a
Prefunded Contract. Capitalized terms used herein and not otherwise herein
defined shall have the meanings assigned to such terms in the Servicing
Agreement or if not defined therein, in the Trust Agreement.
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The Company hereby agrees with the Underwriters, as follows:
2. Representations and Warranties of the Company. The Company
represents and warrants to, and agrees with the Underwriters that:
(i) The Company meets the requirements for use of Form
S-3 under the Securities Act of 1933 (the "Act"), as amended, and has
filed with the Securities and Exchange Commission (the "Commission") a
registration statement (Registration No. 333-103244) on such form,
including a prospectus and forms of prospectus supplements, for
registration under the Act of the offering and sale of the Notes. The
Company may have filed one or more amendments thereto, each of which
amendments has previously been furnished to the Representative. The
Company will also file with the Commission a prospectus supplement in
accordance with Rule 424(b) under the Act. The Company has included in
the Registration Statement (as hereinafter defined), as amended at the
Effective Date (as hereinafter defined), all information required by
the Act and the rules thereunder to be included in the Prospectus (as
hereinafter defined) with respect to the Notes and the offering
thereof. As filed, the registration statement as amended, the forms of
prospectus supplements, and any prospectuses or prospectus supplements
filed pursuant to Rule 424(b) under the Act relating to the Notes
shall, except to the extent that the Representative shall agree in
writing to a modification, be in all substantive respects in the form
furnished to the Representative prior to the Execution Time (as
hereinafter defined) or, to the extent not completed at the Execution
Time, shall contain only such specific additional information and other
changes as the Company has advised the Representative, prior to the
Execution Time, will be included or made therein.
For purposes of this 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. "Execution Time" shall mean the date and time that this Agreement
is executed and delivered by the parties hereto. Such registration
statement, as amended at the Effective Time, and including the exhibits
thereto and any material incorporated by reference therein (including
any ABS Term Sheets (as defined in Section 4 of this Agreement) filed
on Form 8-K), is hereinafter referred to as the "Registration
Statement," and any prospectus supplement (the "Prospectus Supplement")
relating to the Notes, as filed with the Commission pursuant to and in
accordance with Rule 424(b) under the Act is, together with the
prospectus filed as part of 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) being hereinafter referred to as the "Base Prospectus"),
hereinafter referred to as the "Prospectus". "Rule 424" refers to such
rule under the Act. Any reference herein to the Registration Statement,
the Prospectus or any Prospectus Supplement shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to
Item 12 of Form S-3 which were filed by the Company as the originator
of the Trust under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), on or before the Effective Date of the Registration
Statement or the issue date of the Prospectus or any Prospectus
Supplement, as the case may be (but shall not be deemed to refer to or
include any Form T-1 filed with respect to the Indenture Trustee); and
any reference herein to the terms
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"amend", "amendment" or "supplement" with respect to the Registration
Statement, the Prospectus or any Prospectus Supplement shall be deemed
to refer to and include the filing of any document under the Exchange
Act after the Effective Date of the Registration Statement, or the
issue date of the Prospectus or any Prospectus Supplement, as the case
may be, deemed to be incorporated therein by reference.
(ii) On the Effective Date and on the date of this
Agreement, the Registration Statement did or will, and, when the
Prospectus was first filed and on the Closing Date, the Prospectus and
any Prospectus Supplement did or will comply in all material respects
with the applicable requirements of the Act, the Exchange Act and the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"),
and the respective rules and regulations of the Commission thereunder
(the "Rules and Regulations"). On the Effective Date, the Registration
Statement did not and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; and, on the Effective Date, the Prospectus, if not filed
pursuant to Rule 424(b), did not or will not, and on the date of any
filing pursuant to Rule 424(b) and on the Closing Date, the Prospectus,
together with any Prospectus Supplement, did not or will not include
any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided,
however, that the Company makes no representation or warranty as to the
information contained in or omitted from the Registration Statement or
the Prospectus in reliance upon and in conformity with information
furnished in writing to the Company by any Underwriter through the
Representative specifically for use in connection with preparation of
the Registration Statement or the Prospectus.
(iii) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, (i) there has
not been any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general
affairs, business, management, financial condition, stockholders'
equity, results of operations, regulatory status or business prospects
of the Company or Onyx, and (ii) neither the Company nor Onyx has
entered into any transaction or agreement (whether or not in the
ordinary course of business) material to it that, in either case, would
reasonably be expected to materially adversely affect the interests of
the holders of the Notes, other than as set forth or contemplated in
the Prospectus.
(iv) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, with full power and authority (corporate
and other) to own its properties and conduct its businesses as
described in the Prospectus, and is duly qualified to transact business
as a foreign corporation in good standing under the laws of each
jurisdiction where the ownership or leasing of its properties or the
conduct of its business requires such qualification.
(v) As of the Closing Date, the representations and
warranties of the Company, as Seller, in the Servicing Agreement and
Trust Agreement will be true and correct, and each Funded Contract will
satisfy the representations and warranties set forth in Section 2.02(b)
of the Servicing Agreement.
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(vi) As of the related Prefunding Closing Date, the
representations and warranties of the Company in the Servicing
Agreement and Trust Agreement will be true and correct, and each
related Prefunded Contract will satisfy the representations and
warranties set forth in Section 2.02(d) of the Servicing Agreement.
(vii) No consent, approval, authorization or order of, or
filing with, any court or governmental agency or body is required to be
obtained or made by the Company for the consummation of the
transactions contemplated by this Agreement, except such as have been
obtained and made under the Act, such as may be required under state
securities laws and the filing of any financing statements required to
perfect the Trust's interest in the Contracts.
(viii) The Company is not in violation of its Certificate of
Incorporation or By-Laws or in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any
agreement or instrument to which it is a party or by which it or its
properties are bound which violation or default would have a material
adverse effect on the transactions contemplated herein or in the
Indenture, the Trust Agreement, the Servicing Agreement, the Purchase
Agreement or the Insurance Agreements. The execution, delivery and
performance by the Company of this Agreement, the Trust Agreement, the
Servicing Agreement, the Purchase Agreement or the Insurance Agreements
and the issuance and sale of the Notes and compliance with the terms
and provisions thereof will not result in a breach or violation of any
of the terms and provisions of or constitute a default under, any
statute, rule, regulation or order of any governmental agency or body
or any court having jurisdiction over the Company or any of its
properties or any agreement or instrument to which the Company is a
party or by which the Company is bound or to which any of the
properties of the Company is subject, or the Certificate of
Incorporation or By-Laws of the Company and the Company has full
corporate power and authority to authorize, cause the Trust to issue,
and sell the Notes as contemplated by this Agreement, to enter into
this Agreement, the Trust Agreement, the Servicing Agreement, the
Purchase Agreement and the Insurance Agreements and to consummate the
transactions contemplated herein and therein.
(ix) This Agreement has been, and the Servicing Agreement,
the Trust Agreement, and the Insurance Agreements when executed and
delivered as contemplated hereby and thereby will have been, duly
authorized, executed and delivered by the Company, and this Agreement
constitutes, and the Servicing Agreement, the Trust Agreement and the
Insurance Agreements, when executed and delivered as contemplated
herein, will constitute, legal, valid and binding instruments
enforceable against the Company in accordance with their respective
terms, subject as to enforceability to (x) applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting
creditors' rights generally, (y) general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity
or at law), and (z) with respect to rights of indemnity under this
Agreement and the XL Indemnification Agreement limitations of public
policy under applicable securities laws.
(x) The Notes are duly and validly authorized by the
Company and, when executed, authenticated and delivered in accordance
with the Indenture and the Servicing
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Agreement, and issued and delivered to and paid for by the
Underwriters, as contemplated hereby, will be entitled to the benefits
provided by the Indenture and the Servicing Agreement.
(xi) The Company is not in violation of any provision of
any existing law or regulation or in default in the performance or
observance of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, deed of trust, loan
agreement, note, 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 the Company or the Trust.
3. Purchase, Sale, Payment and Delivery of Notes. On the basis of the
representations, warranties and agreements herein contained, but subject to the
terms and conditions set forth herein and any additional arrangements made
between the Underwriters and the Company, the Company agrees to sell to each
Underwriter, and each Underwriter agrees, severally and not jointly, to purchase
from the Company the aggregate principal amount of each class of Notes set forth
opposite such Underwriter's name on Schedule I hereto and at the price set forth
on such Schedule plus accrued interest, if any, from the Closing Date.
The Company will deliver the Notes to the Underwriters against payment
of the purchase price in immediately available funds by wire transfer to the
order of the Company at the offices of Xxxxxxx & Xxxxx L.L.P., 0000 Xxxx Xxxxxx,
Xxxxx 0000, Xxxxxx, Xxxxx 00000 at 10:00 a.m., New York City time on July 30,
2003 or at such other time not later than seven full business days thereafter as
the Underwriters and the Company determine, such time being herein referred to
as the "Closing Date". The Notes so to be delivered shall be represented by one
or more global notes as applicable registered in the name of Cede & Co., as
nominee for The Depository Trust Company, in such numbers as the Underwriters
shall reasonably request not later than 48 hours prior to the Closing Date. The
Company shall make such global notes, as applicable, representing the Notes
available for inspection by the Underwriters at the office at which the Notes
are to be delivered no later than 10:00 a.m., New York City time, on the
business day prior to the Closing Date.
4. Offering by the Underwriters. It is understood that, after the
Registration Statement becomes effective, the Underwriters propose to offer the
Notes for sale to the public (which may include selected brokers and dealers) as
set forth in the Prospectus.
The Underwriters may prepare and provide to prospective investors
certain ABS Term Sheets, in connection with its offering of the Notes, subject
to the following conditions:
(i) The Underwriters shall have complied with the
requirements of the no-action letter, dated February 17, 1995, issued
by the Commission to the Public Securities Association (the "No-Action
Letter").
(ii) For purposes hereof, "ABS Term Sheets" shall have the
meaning given such term in the No-Action Letter but shall include only
those ABS Term Sheets that have been prepared or delivered to
prospective investors by or at the direction of each of the
Underwriters.
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(iii) All ABS Term Sheets provided to prospective investors
that are required to be filed pursuant to the No-Action Letter shall
bear a legend substantially in the form attached hereto as either
Exhibit A-1 or Exhibit A-2, as applicable. The Company shall have the
right to require specific legends or notations to appear on any ABS
Term Sheets, the right to require changes regarding the use of
terminology and the right to determine the types of information
appearing therein. Notwithstanding the foregoing, this subsection (iii)
will be satisfied if all ABS Term Sheets referred to herein bear a
legend in a form previously approved in writing by the Company.
(iv) Each of the Underwriters shall have provided the
Company with representative forms of all ABS Term Sheets prior to their
first use, to the extent such forms have not previously been approved
in writing by the Company for use by each of the Underwriters. The
Underwriters shall have provided to the Company, for filing as part of
a current report on Form 8-K as provided in Section 5(xii), copies (in
such format as required by the Company) of all ABS Term Sheets that are
required to be filed with the Commission pursuant to the No-Action
Letter. Each of the Underwriters may provide copies of the foregoing in
a consolidated or aggregated form including all information required to
be filed. All ABS Term Sheets described in this subsection (iv) shall
have been provided to the Company not later than 10:00 a.m. (New York
City time) not less than one business day before filing thereof is
required to be made with the Commission pursuant to the No-Action
Letter. None of the Underwriters shall have provided to any investor or
prospective investor in the Notes any ABS Term Sheets on or after the
day on which ABS Term Sheets are required to be provided to the Company
pursuant to this subsection (iv) (other than copies of ABS Term Sheets
previously submitted to the company in accordance with this subsection
(iv) for filing pursuant to Section 5(xii)), unless such ABS Term
Sheets are preceded or accompanied by the delivery of a Prospectus to
such investor or prospective investor.
(v) All information included in the ABS Term Sheets shall
have been generated based on substantially the same methodology and
assumptions that are used to generate the information in the Prospectus
as set forth therein; provided that the ABS Term Sheets may have
included information based on alternative methodologies or assumptions
if specified therein. If any ABS Term Sheets that are required to be
filed were based on assumptions with respect to the Contract Pool that
differ from the final Contract Pool information in any material respect
or on Notes structuring terms that were revised in any material respect
prior to the printing of the Prospectus, each Underwriter shall have
prepared revised ABS Term Sheets based on the final Contract Pool
information and structuring assumptions, shall have circulated such
revised ABS Term Sheets to all recipients of the preliminary versions
thereof that indicated orally to either of the Underwriters they would
purchase all or any portion of the Notes, and shall have included such
revised ABS Term Sheets (marked, "as revised") in the materials
delivered to the Company pursuant to subsection (iv) above.
(vi) The Company shall not be obligated to file any ABS
Term Sheets that have been determined to contain any material error or
omission, provided that, at the request of the Underwriters, the
Company will file ABS Term Sheets that contain a material error or
omission if clearly marked "superseded by materials dated _________"
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and accompanied by corrected ABS Term Sheets that are marked,
"supersedes material previously dated _______, as corrected." If,
within the period during which the Prospectus relating to the Notes is
required to be delivered under the Act, any ABS Term Sheets are
determined, in the reasonable judgment of the Company or either of the
Underwriters, to contain a material error or omission, each Underwriter
shall prepare a corrected version of such ABS Term Sheets, shall
circulate such corrected ABS Term Sheets to all recipients of the prior
versions thereof that either indicated orally to either of the
Underwriters they would purchase all or any portion of the Notes, or
actually purchased all or any portion thereof, and shall deliver copies
of such corrected ABS Term Sheets (marked, "as corrected") to the
Company for filing with the Commission in a subsequent current report
on Form 8-K (subject to the Company's obtaining an accountant's comfort
letter in respect of such corrected ABS Term Sheets).
(vii) The Underwriters shall be deemed to have represented
as of the Closing Date, that, except for ABS Term Sheets provided to
the Company pursuant to subsection (iv) above, the Underwriters did not
provide any prospective investors with any information in written or
electronic form in connection with the offering of the Notes that is
required to be filed with the Commission in accordance with the
No-Action Letter.
(viii) In the event of any delay in the delivery by the
Underwriters to the Company of any ABS Term Sheets required to be
delivered in accordance with subsection (iv) above, or in the delivery
of the accountant's comfort letter in respect thereof pursuant to
Section 5(xii), the Company shall have the right to delay the release
of the Prospectus to investors or to the Underwriters, to delay the
Closing Date and to take other appropriate actions in each case as
necessary in order to allow the Company to comply with its agreement
set forth in Section 5(xii) to file the ABS Term Sheets by the time
specified therein.
5. Certain Agreements of the Company. The Company agrees with the
Underwriters that:
(i) Immediately following the execution of this
Agreement, the Company will prepare a Prospectus Supplement setting
forth the amount of Notes covered thereby and the terms thereof not
otherwise specified in the Base Prospectus, the price at which such
Notes are to be purchased by the Underwriters, the initial public
offering price, the selling concessions and allowances, and such other
information as the Company deems appropriate and shall furnish a copy
to the Representative in accordance with Section 5(vii) of this
Agreement. The Company will transmit the Prospectus including such
Prospectus Supplement to the Commission pursuant to Rule 424(b) by a
means reasonably calculated to result in filing that complies with all
applicable provisions of Rule 424(b). The Company will advise the
Representative promptly of any such filing pursuant to Rule 424(b).
(ii) Prior to the termination of the offering of the
Notes, the Company will not file any amendment of the Registration
Statement or supplement to the Prospectus unless the Company has
furnished the Representative with a copy for its review prior to filing
and will not file any such proposed amendment or supplement without the
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Representative's consent, which consent will not unreasonably be
withheld. Subject to the foregoing sentence, if filing of the
Prospectus is otherwise required under Rule 424(b), the Company will
file the Prospectus, properly completed, and any supplement thereto,
with the Commission pursuant to and in accordance with the applicable
paragraph of Rule 424(b) within the time period prescribed and will
provide evidence satisfactory to the Representative of such timely
filing.
(iii) The Company will advise the Representative promptly
of any proposal to amend or supplement the Registration Statement as
filed or the Prospectus, and will not effect such amendment or
supplement without the Representative's consent, which consent will not
unreasonably be withheld. The Company will also advise the
Representative promptly of any request by the Commission for any
amendment of or supplement to the Registration Statement or the
Prospectus or for any additional information and the Company will also
advise the Representative promptly of any amendment or supplement to
the Registration Statement or the Prospectus and of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threat of any proceeding
for that purpose, and the Company will use its best efforts to prevent
the issuance of any such stop order and to obtain as soon as possible
the lifting of any issued order.
(iv) The Company will use every reasonable effort to cause
the Registration Statement, and any amendment thereto, if not effective
at the Execution Time, to become effective.
(v) 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
(subject to the Representative's prior review pursuant to paragraph
(ii) of this Section 5) an amendment or supplement which will correct
such statement or omission or an amendment or supplement which will
effect such compliance.
(vi) As soon as practicable, the Company will cause the
Trust to make generally available to the Noteholders and the holders of
the Residual Interest Instruments of the Trust an earnings statement or
statements of the Trust covering a period of at least 12 months
beginning after the Closing Date which will satisfy the provisions of
Section 11(a) of the Act and Rule 158 of the Commission promulgated
thereunder.
(vii) The Company will furnish to each Underwriter copies
of the Registration Statement, the Prospectus and any preliminary
Prospectus Supplement related thereto and all amendments and
supplements to such documents, in each case as soon as available and in
such quantities as each Underwriter may reasonably request.
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(viii) The Company will cooperate with each Underwriter in
arranging for the qualification of the Notes for sale and the
determination of their eligibility for investment under the laws of
such jurisdictions as each Underwriter designates and will continue
such qualifications in effect so long as required for the distribution
of the Notes; provided, however, that the Company shall not be
obligated to qualify to do business in any jurisdiction in which it is
not currently so qualified or to take any action which would subject it
to general or unlimited service of process in any jurisdiction where it
is not now so subject. The Company will promptly advise the
Underwriters of the receipt by the Company of any notification with
respect to the suspension or the qualification of the Notes for sale in
any jurisdiction or the initiation or threat of any proceeding for such
purpose.
(ix) For a period from the date of this Agreement until
the retirement of the Notes, the Company will furnish to the
Underwriters copies of the annual statements of compliance delivered to
the Indenture Trustee pursuant to Section 3.09 of the Indenture and
Section 3.10 of the Servicing Agreement, and the annual independent
public accountant's reports furnished to the Indenture Trustee pursuant
to Section 3.11 of the Servicing Agreement, as soon as practicable
after such statements and reports are furnished to the Indenture
Trustee and Owner Trustee respectively.
(x) So long as any of the Notes are outstanding, the
Company will furnish to you as soon as practicable, (A) all documents
distributed, or caused to be distributed, by the Servicer to the
Noteholders, (B) all documents filed, or caused to be filed, by the
Company with the Commission pursuant to the Exchange Act, any order of
the Commission thereunder or pursuant to a "no-action" letter from the
staff of the Commission and (C) from time to time, such other
information in the possession of the Company concerning the Trust and
any other information concerning the Company filed with any
governmental or regulatory authority which is otherwise publicly
available as you may reasonably request.
(xi) (a) On or before the Closing Date the Company shall
cause its computer records relating to the Funded Contracts to be
marked to show the Trust's absolute ownership of the Funded Contracts
and shall cause the Servicer to mark its computer records relating to
the Funded Contracts to show the sale to the Company of the Funded
Contracts and the subsequent transfer of the Funded Contracts to the
Trust, and from and after the Closing Date the Company shall not, and
shall instruct the Servicer not to, take any action inconsistent with
the Trust's ownership of such Funded Contracts, other than as permitted
by the Indenture and the Trust Agreement.
(b) On or before the related Prefunding Closing Date, the
Company shall cause its computer records for the related Prefunded
Contracts to be marked to show the Trust's absolute ownership of the
related Prefunded Contracts and shall cause the Servicer to mark its
computer records for the related Prefunded Contracts to show the sale
to the Company of the related Prefunded Contracts and the subsequent
transfer of the related Prefunded Contracts to the Trust, and after the
related Prefunding Closing Date, the Company shall not, and shall
instruct the Servicer not to, take any action inconsistent
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with the Trust's ownership of such Prefunded Contracts, other than as
permitted by the Indenture and the Trust Agreement.
(xii) The Company will file with the Commission as part of
a current report on Form 8-K each ABS Term Sheet provided to the
Company by each of the Underwriters and identified by each of them as
such within the time period allotted for such filing pursuant to the
No-Action Letter; provided, however, that prior to such filing of an
ABS Term Sheet (other than any ABS Term Sheets that are not based on
the Contract Pool information) by the Company, each of the Underwriters
must comply with their obligations pursuant to Section 4 and the
Company must receive a letter from PricewaterhouseCoopers, certified
public accountants, satisfactory in form and substance to the Company,
to the effect that such accountants have performed certain specified
procedures, all of which have been agreed to by the Company, as a
result of which PricewaterhouseCoopers have determined that the
information included in such ABS Term Sheet (if any), provided by the
Underwriters to the Company for filing on a current report on Form 8-K
pursuant to Section 4 and, if the Company then so specifies, this
subsection (xii), and that the accountants have examined in accordance
with such agreed upon procedures, is accurate except as to such matters
that are not deemed by the Company to be material. The Company shall
file any corrected ABS Term Sheets described in Section 4(vi) as soon
as practicable following receipt thereof.
(xiii) The Company will cause Xxxxxxx & Xxxxx L.L.P. to
deliver to the Underwriters on or before the Prefunding Closing Date,
the opinions required to be furnished pursuant to Section 2.01(j) of
the Servicing Agreement, addressed to the Underwriters, with respect to
the transfer of the related Prefunded Contracts substantially in the
form of the opinions delivered by Xxxxxxx & Xxxxx L.L.P. on the Closing
Date with respect to the Funded Contracts.
(xiv) The Company will deliver to the Underwriters (i) on
or before each Prefunding Closing Date, the Officer's Certificate and
certificate from each secured creditor required to be furnished
pursuant to Section 2.01(j) of the Servicing Agreement and (ii) on or
before each Prefunding Transfer Date, the Transfer Certificate required
to be furnished pursuant to Section 2.01(c) of the Servicing Agreement.
6. Payment of Expenses. The Company will pay or cause to be paid
all expenses incident to the performance of its obligations under this
Agreement, including (i) the printing and filing of the Registration Statement
as originally filed and of each amendment thereto and the Prospectus and
Prospectus Supplement, (ii) the Trust Agent's, the Indenture Trustee's and Owner
Trustee's fees and the fees and disbursements of the counsel to the Trust Agent,
the Indenture Trustee and to the Owner Trustee, (iii) any up-front fees and
premiums payable to the Insurer and the fees and disbursements of counsel to the
Insurer, (iv) the fees and disbursements of the accountants, (v) the fees of the
rating agencies and (vi) blue sky expenses.
7. Conditions to the obligations of the Underwriters. The
obligation of the Underwriters to purchase and pay for the Notes will be subject
to the accuracy of the representations and warranties on the part of the Company
herein, to the accuracy of the written statements of officers of the Company
made pursuant to the provisions hereof, to the
11
performance by the Company of its obligations hereunder and to the following
additional conditions precedent:
(i) On or prior to the date of this Agreement, the
Representative shall have received a letter, dated the date of this
Agreement, of PricewaterhouseCoopers and substantially in the form
heretofore agreed, which letter shall be in form and substance agreed
to by the Representative.
(ii) The Registration Statement shall have become
effective prior to the Execution Time, 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 Company or the
Representative, shall be contemplated by the Commission or by any
authority administering any state securities or blue sky law; the
Prospectus and any supplements thereto shall have been filed (if
required) with the Commission in accordance with the Rules and
Regulations and the applicable paragraphs of Section 5 hereof; if
filing of the Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b), the Prospectus shall be filed in the manner
and within the time period required by Rule 424(b); and 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 threatened.
(iii) Subsequent to the execution and delivery of this
Agreement, there shall have not occurred (a) any change, or any
development involving a prospective change, in or affecting
particularly the business or properties of the Company or Onyx which,
in the reasonable judgment of each of the Underwriters, materially
impairs the investment quality of the Notes; (b) any suspension or
material 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 Onyx on any
exchange or in the over-the-counter market by such exchange or
over-the-counter market or by the Commission; (c) any banking
moratorium declared by federal, New York or California authorities; (d)
any outbreak or material escalation of major hostilities or any other
substantial national or international calamity or emergency if, in the
reasonable judgment of each Underwriter, the effect of any such
outbreak, escalation, calamity or emergency on the United States
financial markets makes it impracticable or inadvisable to proceed with
completion of the sale of, and any payment for, the Notes.
(iv) The Underwriters shall have received an opinion,
dated the Closing Date, of Xxxxxxx & Xxxxx L.L.P., counsel of the
Company, substantially to the effect that:
(a) The Company (1) is duly incorporated and is validly
existing and in good standing under the laws of the State of
Delaware, (2) has the corporate power and corporate authority
to own its properties and conduct its business as described in
the Prospectus and (3) had at all relevant times, and now has,
the power, authority and legal right to acquire, own and sell
the Contracts;
12
(b) The Company has, or at the time such agreement was
executed and delivered, had, the corporate power and corporate
authority to execute and deliver this Agreement, the Trust
Agreement, the Servicing Agreement, the Purchase Agreement and
the Insurance Agreements and to consummate the transactions
contemplated herein and therein;
(c) No consent, approval, authorization or order of, or filing
with, any California, Delaware or federal governmental agency
or body or any court is or was required by the Company to
perform the transactions contemplated by this Agreement, the
Trust Agreement, the Servicing Agreement, the Purchase
Agreement or the Insurance Agreements except for (1) filing of
a Uniform Commercial Code financing statement in the State of
Delaware with respect to the transfer of the Contracts to the
Trust pursuant to the Trust Agreement and the Servicing
Agreement, and the sale of the Contracts to the Company
pursuant to the Purchase Agreement, (2) such consents,
approvals, authorizations, orders or filings as may be
required under federal law which have been made or obtained
and (3) such consents, approvals, authorizations, orders or
filings as may be required under state securities laws;
(d) None of the execution, delivery and performance by the
Company of this Agreement, the Trust Agreement, the Servicing
Agreement, the Purchase Agreement or the Insurance Agreements,
the transfer of the Contracts to the Trust, the assignment of
the security interests of the Company in the Financed
Vehicles, the issuance and sale of the Notes or the
consummation of any other of the transactions contemplated
herein or in the Trust Agreement, the Servicing Agreement, the
Purchase Agreement or the Insurance Agreements conflicts or
will conflict with, has resulted or will result in a breach,
violation or acceleration of any of the terms of, or has
constituted or will constitute a default under, the By-Laws or
the Certificate of Incorporation of the Company, as amended,
or, to such counsel's knowledge (i) any rule, order, statute
or regulation known to such counsel to be currently applicable
to the Company of any court, regulatory body, administrative
agency or governmental body having jurisdiction over the
Company or (ii) the terms of any material indenture or other
material agreement or instrument known to such counsel to
which the Company is a party or by which it or its properties
are bound;
(e) To such counsel's knowledge, there are no actions,
proceedings or investigations pending or threatened before any
court, administrative agency or other tribunal (1) asserting
the invalidity of this Agreement, the Trust Agreement, the
Servicing Agreement, the Purchase Agreement or the Insurance
Agreements or the Notes, (2) seeking to prevent the issuance
of the Notes or the consummation of any of the transactions
contemplated by this Agreement, the Trust Agreement, the
Servicing Agreement, the Purchase Agreement or the Insurance
Agreements, (3) seeking adversely to affect the federal income
tax attributes of the Notes as described in the Base
Prospectus under the headings "SUMMARY OF TERMS -- Tax
Status"; "CERTAIN FEDERAL INCOME TAX CONSEQUENCES"; "TRUSTS
FOR WHICH A PARTNERSHIP
13
ELECTION IS MADE" and "TRUSTS TREATED AS GRANTOR TRUSTS" and
in the Prospectus Supplement under the headings "SUMMARY OF
TERMS -- Federal Income Tax Status" and "CERTAIN FEDERAL
INCOME TAX CONSEQUENCES";
(f) This Agreement, the Trust Agreement, the Servicing
Agreement, the Purchase Agreement and the Insurance Agreements
have each been duly authorized, executed and delivered by the
Company;
(g) The Funded Contracts constitute "tangible chattel paper"
as defined in Section 9105(a)(2) of the Uniform Commercial
Code of the State of California;
(h) The statements in the Prospectus under the caption
"CERTAIN LEGAL ASPECTS OF THE CONTRACTS," and "ERISA
CONSIDERATIONS" to the extent they constitute matters of
California or federal law or legal conclusions, are correct in
all material respects;
(i) [Reserved]
(j) When the Notes have been duly executed by the Owner
Trustee and delivered by the Trust Agent on behalf of the
Trust, authenticated by the Indenture Trustee in accordance
with the Indenture and delivered and paid for pursuant to this
Agreement, the Notes will be the valid, legal and binding
obligations of the Trust, enforceable against the Trust in
accordance with their terms, subject to bankruptcy,
insolvency, reorganization, moratorium, fraudulent or
preferential conveyance and other similar laws of general
application relating to or affecting creditors' rights
generally, and general principles of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law);
(k) Assuming the authorization, execution and delivery thereof
by each party thereto other than the Company and Onyx, each of
the Trust Agreement, the Purchase Agreement, the Servicing
Agreement and the Insurance Agreements constitutes the legal,
valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms, subject, as
to enforcement, to (1) the effect of bankruptcy, insolvency,
reorganization, moratorium, fraudulent or preferential
conveyance and other similar laws of general application
relating to or affecting creditors' rights generally, and
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law); and (2) the unenforceability under certain circumstances
of provisions indemnifying a party against liability where
such indemnification is contrary to public policy;
(l) The Registration Statement became effective under the Act;
after due inquiry, to the best of such counsel's knowledge, no
stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose
have been instituted or are pending or contemplated under the
Act; the Registration Statement, and each amendment thereof or
supplement
14
thereto as of its effective date and the Prospectus as of its
date of issuance appeared on its face to be appropriately
responsive in all material respects to the applicable
requirements of the Act and the Rules and Regulations, and
such counsel need not opine as to the financial statements and
related notes, schedules and other financial and statistical
data included therein; and any required filing of the
Prospectus and Prospectus Supplement pursuant to Rule 424(b)
has been made;
(m) The Notes, the Indenture, the Trust Agreement, the
Servicing Agreement, the Purchase Agreement, and the Guarantee
conform in all material respects to the descriptions thereof
contained in the Registration Statement and the Prospectus;
(n) The Trust Agreement is not required to be qualified under
the Trust Indenture Act of 1939, as amended;
(o) The Indenture has been duly qualified under the Trust
Indenture Act;
(p) The Company is not, and after giving effect to the
offering and sale of the Notes as contemplated in the
Prospectus and this Agreement and the application of the
proceeds thereof as described in the Prospectus will not be,
an "investment company" as defined in the Investment Company
Act of 1940, as amended (the "Investment Company Act"). Onyx
is not an "investment company" within the meaning of the
Investment Company Act;
(q) The Trust is not now, and immediately following the sale
of the Notes pursuant to this Agreement will not be, required
to be registered under the Investment Company Act;
(r) The Indenture, the Servicing Agreement and the
Administration Agreement, assuming that they have been duly
authorized by, and when duly executed and delivered by, the
Owner Trustee on behalf of the Trust, will constitute the
legal, valid and binding obligations of the Trust, enforceable
against the Trust in accordance with their terms, except that
the enforceability thereof may be subject to bankruptcy,
insolvency, reorganization, moratorium, fraudulent or other
preferential conveyance and other similar laws and other
similar laws of general application relating to or affecting
the rights of creditors generally and to general principles of
equity (regardless of whether such enforcement is considered
in a proceeding in equity or at law);
(s) all actions required to be taken, and all filings required
to be made, by the Company under the Act and the Exchange Act
prior to the sale of the Notes have been duly taken or made;
and
(t) to such counsel's knowledge and information, there are no
legal or governmental proceedings pending or threatened that
are required to be disclosed in the Registration Statement,
other than those disclosed therein.
15
In addition, such counsel shall opine, in form and substance
satisfactory to you, (i) as to certain matters relating to the
acquisition by the Company of a perfected first priority security
interest in the vehicles financed by the Funded Contracts and (ii) as
to the existence of a valid, perfected, first priority security
interest in the Funded Contracts in favor of the Owner Trustee from the
Company and in favor of the Indenture Trustee from the Owner Trustee.
In rendering such opinion, such counsel may rely (i) as to
matters of fact, to the extent deemed proper and as stated therein, on
certificates of responsible officers of the Company and public
officials and (ii) on other opinions of counsel as specified therein.
References to the Prospectus in this paragraph (iv) include any
supplements thereto.
(v) The Underwriters shall have received an opinion,
dated the Closing Date, of Xxxxxxx & Xxxxx L.L.P., counsel to Onyx,
substantially to the effect that:
(a) Onyx (1) is duly incorporated and is validly existing and
in good standing under the laws of the State of its
incorporation, (2) has the corporate power and corporate
authority to own its properties and conduct its business as
described in the Prospectus and (3) had at all relevant times,
and now has, the power, authority and legal right to acquire,
own and sell the Funded Contracts;
(b) Onyx has the corporate power and corporate authority to
execute and deliver the Servicing Agreement, the Insurance
Agreements, Indemnification Agreement and the Administration
Agreement, to the extent applicable, and at the time it was
executed and delivered, had the power and authority to execute
and deliver the Purchase Agreement, and to consummate the
transactions contemplated herein and therein;
(c) No consent, approval, authorization or order of, or filing
with, any California or federal governmental agency or body or
any court is required by Onyx to perform the transactions
contemplated by the Insurance Agreements, the Servicing
Agreement, the Administration Agreement, Indemnification
Agreement or the Purchase Agreement, as applicable, except for
(1) filing of a Uniform Commercial Code financing statement in
the State of Delaware with respect to the sales of the
Contracts to the Company pursuant to the Purchase Agreement
and (2) such consents, approvals, authorizations, orders or
filings as may be required under the federal and state
securities laws; the opinion set forth in this sentence is
limited to such authorizations, approvals, consents and orders
which, in such counsel's experience, are normally applicable
to transactions of the type contemplated by the Insurance
Agreements, the Servicing Agreement, the Administration
Agreement and the Purchase Agreement, as applicable;
(d) None of the execution, delivery and performance by Onyx of
the Servicing Agreement, the Insurance Agreements, the
Administration Agreement, Indemnification Agreement or the
Purchase Agreement, as applicable, or the transfer of the
Contracts to the Company, has conflicted with or will conflict
with, has resulted or will result in a breach, violation or
acceleration of any of the terms
16
of, or has constituted or will constitute a default under, the
By-Laws or the Certificate of Incorporation of Onyx, as
amended, or, to the best of such counsel's knowledge, any
rule, order, statute or regulation known to such counsel to be
currently applicable to Onyx of any court, regulatory body,
administrative agency or governmental body having jurisdiction
over Onyx or the terms of any material indenture or other
material agreement or instrument known to such counsel to
which Onyx is a party or by which it or its properties are
bound;
(e) The Servicing Agreement, the Insurance Agreements, the
Administration Agreement and the Purchase Agreement have each
been duly authorized, executed and delivered by Onyx;
(f) The indemnification agreement dated as of the date hereof,
between Onyx and the Representative has been duly authorized,
executed and delivered by Xxxx; and
(g) Assuming the authorization, execution and delivery thereof
by the Company with respect to the Servicing Agreement, the
Insurance Agreements, the Administration Agreement and the
Purchase Agreement, as applicable, each such agreement
constitutes the legal, valid and binding agreement of Onyx,
enforceable against Onyx in accordance with its terms,
subject, as to enforcement, to (1) the effect of bankruptcy,
insolvency, reorganization, moratorium, fraudulent or
preferential conveyance and other similar laws of general
application relating to or affecting creditors' rights
generally and general principles of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law); and (2) the unenforceability under certain
circumstances of provisions indemnifying a party against
liability where such indemnification is contrary to public
policy.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent deemed proper and as stated therein, on
certificates of responsible officers of Onyx and public officials.
In addition, such counsel shall state that they have participated in
conferences with the officers and other representatives of the Company and Onyx,
representatives of the independent public accountants of the Company and Onyx
and representatives of the Underwriters and the Insurer at which the contents of
the Registration Statement and the Prospectus and related matters were discussed
and, although such counsel has not independently verified and are not passing
upon and do not assume any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Registration Statement and the
Prospectus, on the basis of the foregoing, no facts have come to such counsel's
attention that lead them to believe that the Registration Statement, as of the
Effective Date, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus as of its date or as
of the Closing Date contained or contains an untrue statement of a material fact
or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (it being understood that such counsel need make no
17
comment and express no belief with respect to (i) any information incorporated
by reference in the Registration Statement or the Prospectus or (ii) the
financial statements and related notes, schedules and the other financial and
statistical data included in the Registration Statement or the Prospectus).
(vi) The Underwriters shall have received opinions of
Xxxxxxx & Xxxxx L.L.P., counsel to the Company, dated the Closing Date
and satisfactory in form and substance to you, with respect to the
characterization of the transfer of the Funded Contracts by Onyx to the
Company as a sale and with respect to the perfection of the Trust's
interests in the Funded Contracts and with respect to the
non-consolidation of the Company with Onyx in the event of bankruptcy
filing with respect to Onyx and with respect to certain other matters.
(vii) The Underwriters shall have received an opinion of
Xxxxxxx & Xxxxx L.L.P., tax counsel to the Company, dated the Closing
Date and satisfactory in form and substance to you substantially to the
effect that:
(a) The Class A Notes will be characterized as debt and the
Trust will not be characterized as an association (or a
publicly traded partnership) taxable as a corporation;
(b) The Statements in the Base Prospectus under the heading
"SUMMARY OF TERMS -- Tax Status"; "CERTAIN FEDERAL INCOME TAX
CONSEQUENCES"; "TRUSTS FOR WHICH A PARTNERSHIP ELECTION IS
MADE" and "TRUSTS TREATED AS GRANTOR TRUSTS" and in the
Prospectus Supplement under the headings "SUMMARY OF TERMS --
Federal Income Tax Status" and "CERTAIN FEDERAL INCOME TAX
CONSEQUENCES" to the extent that they constitute matters of
law or legal conclusions with respect thereto, have been
prepared or reviewed by such counsel and are correct in all
material respects; and
(c) Such state tax opinions as are satisfactory to the
Representative.
(viii) The Underwriters shall have received an opinion of
Xxxxxxx Xxxxxxxxx, in-house counsel to the Company and Onyx, dated the
Closing Date and satisfactory in form and substance to you.
(ix) The Underwriters shall have received an opinion,
dated the Closing Date, of Xxxx Xxxx Constant, in-house counsel to the
Insurer, substantially to the effect that:
(a) The Insurer is a corporation validly existing, in good
standing and licensed to transact the business of surety and
financial guaranty insurance under the laws of the State of
New York;
(b) The Insurer has the corporate power to execute and
deliver, and to take all action required of it under the
Guarantee, the Insurance Agreements and the XL Indemnification
Agreement;
18
(c) Except as have already been obtained, no authorization,
consent, approval, license, formal exemption or declaration
from, nor any registration or filing with, any court or
governmental agency or body of the United States of America or
the State of New York, which if not obtained would affect or
impair the validity or enforceability of the Guarantee, the
Insurance Agreements or the XL Indemnification Agreement
against the Insurer, is required in connection with the
execution and delivery by the Insurer of the Guarantee, the
Insurance Agreements or the XL Indemnification Agreement or in
connection with the Insurer's performance of its obligations
thereunder;
(d) The Guarantee, the Insurance Agreement and the XL
Indemnification Agreement have been duly authorized, executed
and delivered by the Insurer, and the Guarantee and, assuming
due authorization, execution and delivery of the Insurance
Agreements by the parties thereto (other than the Insurer),
the Insurance Agreements constitute the legally valid and
binding obligations of the Insurer, enforceable in accordance
with their respective terms subject, as to enforcement, to (1)
bankruptcy, reorganization, insolvency, moratorium and other
similar laws relating to or affecting the enforcement of
creditors' rights generally, including, without limitation,
laws relating to fraudulent transfers or conveyances,
preferential transfers and equitable subordination, presently
or from time to time in effect and general principles of
equity (regardless of whether such enforcement is considered
in a proceeding in equity or at law), as such laws may be
applied in any such proceeding with respect to the Insurer and
(2) the qualification that the remedy of specific performance
may be subject to equitable defenses and to the discretion of
the court before which any proceedings with respect thereto
may be brought; and
(e) The Guarantee is not required to be registered under the
Securities Act of 1933, as amended.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent deemed proper and as stated therein, on
certificates of responsible officers of the Insurer and public
officials. References to the Prospectus in this paragraph (ix) include
any supplements thereto.
(x) The Underwriters shall have received an opinion of
Xxxxxxx, Xxxxxxxx & Xxxx, counsel to the Indenture Trustee and Trust
Agent, dated the Closing Date and satisfactory in form and substance to
you.
(xi) The Underwriters shall have received an opinion of
Xxxxxxxx, Xxxxxx & Finger, counsel to the Owner Trustee, dated the
Closing Date and satisfactory in form and substance to you.
(xii) The Underwriters shall have received an opinion of
Xxxxxxxx, Xxxxxx & Finger special Delaware counsel to the Trust, dated
the Closing Date and satisfactory in form and substance to you.
19
(xiii) The Representative shall have received from Xxxxxx
Xxxxxx Xxxxx & Xxxx LLP, counsel to the Underwriters, such opinion or
opinions, dated the Closing Date and satisfactory in form and substance
to you, with respect to the validity of the Notes, the Registration
Statement, the Prospectus and other related matters as the Underwriters
may require, and the Company shall have furnished to such counsel such
documents as they reasonably request for the purpose of enabling them
to pass upon such matters.
(xiv) The Underwriters shall have received a letter, dated
the Closing Date, of PricewaterhouseCoopers which meets the
requirements of the subsection (i) of this Section 7, except that the
specified date referred to in such subsection will be a date not more
than five days prior to the Closing Date for the purposes of this
subsection.
(xv) The Underwriters shall have received evidence
satisfactory to them that the Notes have been rated in the highest
rating category by Xxxxx'x Investors Service, Inc. and by Standard &
Poor's Ratings Services.
(xvi) The Underwriters shall have received a certificate,
dated the Closing Date, of a Vice President or more senior officer of
the Company in which such officer shall state that, to the best of his
or her knowledge after reasonable investigation, the representations
and warranties of the Company in this Agreement are true and correct on
and as of the Closing Date, that the Company 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, that the
representations and warranties of the Company, as Seller, in the
Servicing Agreement and the Trust Agreement are true and correct as of
the dates specified therein and the representations and warranties set
forth in Section 2.02(b) of the Servicing Agreement, are true and
correct as of the dates specified in the Servicing Agreement, that 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 and that, subsequent to
the date of the Prospectus, there has been no material adverse change
in the financial position or results of operations of the Company's
motor vehicle installment loan business except as set forth in or
contemplated by the Prospectus or as described in such certificate.
(xvii) The Underwriters shall have received a certificate,
dated the Closing Date, of a Vice President or more senior officer of
Onyx in which such officer shall state that, to the best of his or her
knowledge after reasonable investigation, the representations and
warranties of Onyx in the Purchase Agreement and Servicing Agreement
are true and correct in all material respects on and as of the Closing
Date, that Onyx has complied with all agreements and satisfied all
conditions on its part to be performed or satisfied thereunder at or
prior to the Closing Date, that the representations and warranties of
Onyx, as Servicer, in the Servicing Agreement are true and correct as
of the dates specified in the Servicing Agreement, there has been no
material adverse change in the financial position or results of
operations of Onyx's motor vehicle installment loan business except as
set forth in or contemplated by the Prospectus or as described in such
certificate.
20
(xviii) The Guarantee shall have been duly authorized,
executed, issued and delivered by the Insurer; all fees due and payable
to the Insurer as of the Closing Date shall have been paid in full; and
the Guarantee shall conform to the description thereof in the
Registration Statement and the Prospectus.
(xix) The Underwriters shall have received a certificate
from a senior officer of the Insurer to the effect that such officer
has no reason to believe that the section of the Prospectus Supplement
captioned "DESCRIPTION OF THE INSURER" or any such amendment thereof or
supplement thereto as of its Effective Date or date of issuance, as the
case may be, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
The Company will furnish or cause to be furnished to the Underwriters
such number of conformed copies of such opinions, certificates, letters and
documents as the Underwriters reasonably request.
8. Indemnification.
(i) The Company will indemnify and hold harmless each
Underwriter, its directors, members, officers, agents and each person,
if any, who controls such Underwriter within the meaning of Section 15
of the Act against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) (a) arise out of, or are based upon, any
untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, 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 or (b) arise out of, or are based upon, any
untrue statement or alleged untrue statement of any material fact
contained in the Prospectus or arise out of, or are based upon, the
omission or alleged omission to state therein a material fact necessary
to make the statements therein, in light of the circumstances under
which they were made, not misleading; and will reimburse each
Underwriter for any legal or other expenses reasonably incurred, as
incurred, by each Underwriter in connection with investigating or
defending any such action or claim; provided, however, that the Company
shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of, or is based upon, an untrue
statement or alleged untrue statement or omission or alleged omission
(x) made in the Registration Statement or the Prospectus or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by the Underwriters expressly for
use therein, or (y) contained in any ABS Term Sheet to the extent set
forth in subsection (ii) of this Section 8; provided, further, that the
Company shall not be liable under this subsection (i) to the extent
that such losses, claims, damages or liabilities arose out of or are
based upon an untrue statement or omission made in any preliminary
prospectus that is corrected in the final Prospectus (or any amendment
or supplement thereto), and the Company has previously furnished copies
thereof in a timely manner and in sufficient quantity to the
Underwriters, if the person asserting such loss, claim, damage or
liability was not given
21
the final Prospectus (or any amendment or supplement thereto) on or
prior to the confirmation of the sale of the Notes and such delivery of
the final Prospectus was required under applicable securities laws.
(ii) Each Underwriter, severally and not jointly, agrees
to indemnify and hold harmless the Company, its directors, each of its
officers or agents who signed the Registration Statement, and each
person, if any, who controls the Company within the meaning of Section
15 of the Act against any and all loss, liability, claim, damage and
expense described in the indemnity contained in subsection (i) of this
Section 8, as incurred, but only with respect to untrue statements or
omissions, or alleged untrue statements or omissions, (A) made in the
Registration Statement (or any amendment thereto) or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto)
in reliance upon and in conformity with written information furnished
to the Company by the Underwriters through the Representative expressly
for use in the Registration Statement (or any amendment thereto) or any
preliminary prospectus or the Prospectus (or any amendment or
supplement thereto) or (B) made in the ABS Term Sheets distributed by
the Underwriters and filed as a post-effective amendment to the
Registration Statement or the Prospectus or as a result of any filing
pursuant to Section 5(xii); provided, however that the Underwriters
will not be liable in any such case to the extent that any such loss,
claim or damage or liability arises out of, or is based upon, an untrue
statement or omission made in the ABS Term Sheet or any supplement
thereto in reliance upon and in conformity with (x) information
furnished to such Underwriter by the Company or (y) information
contained in the Registration Statement or any preliminary prospectus
or the Prospectus other than information described in clause (A) above.
(iii) Each indemnified party shall give prompt notice to
the indemnifying party of any action commenced against the indemnified
party in respect of which indemnity may be sought hereunder, but
failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability which it may have hereunder or
otherwise than on account of this indemnity agreement except and to the
extent of any prejudice to such indemnifying party arising from such
failure to provide such notice. In case any such action shall be
brought against an indemnified party and it shall have notified the
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it
shall wish, to assume the defense thereof, with counsel, satisfactory
to such indemnified party (who shall not, except with the consent of
the indemnified party, be counsel to the indemnifying party with
respect to such action), and it being understood that the indemnifying
party shall not, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances, be liable
for the reasonable fees and expenses of more than one separate firm of
attorneys, and, after notice from the indemnifying party to the
indemnified party of its election so to assume the defense thereof and
the appointment of counsel satisfactory to the indemnified party, the
indemnifying party shall not be liable to the indemnified party under
subsections (i) or (ii) of this Section 8 for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred
by the indemnified party, in connection with the defense thereof other
than reasonable costs of investigation.
22
9. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 8 is for any reason held to be unavailable other than in accordance with
its terms, then each indemnifying party shall contribute to the amount paid or
payable by such indemnifying party as a result of the losses, claims, damages or
liabilities referred to in 8(i) and 8(ii) above (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and each Underwriter on the other from the offering of the 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 the Company on
the one hand and of the related Underwriter 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 the Company on the one hand and each Underwriter on the
other shall be deemed to be in the same proportion as the total net proceeds
from the offering (before deducting expenses) received by the Company bear to
the total underwriting discounts and commissions received by each Underwriter.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the related Underwriter and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this Section 9 shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
Section 9. Notwithstanding the provisions of this Section 9, no Underwriter
shall be required to contribute under this agreement and any related
indemnification agreement considered as one agreement any amount in the
aggregate in excess of the underwriting discount or commission applicable to the
Notes purchased by it hereunder. The Company and each Underwriter agrees that it
would not be just and equitable if contribution pursuant to this Section 9 were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
Section 9. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of this
Section 9, each person who controls either Underwriter within the meaning of
either the Act or the Exchange Act and each director, officer, employee and
agent of such Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company or Onyx within the meaning
of either the Act or the Exchange Act and each officer and director of the
Company or Onyx shall have the same rights to contribution as the Company or
Onyx, subject in each case to the applicable terms and conditions of this
Section 9.
10. Termination. The Underwriters may terminate this Agreement
immediately upon notice to the Company, if at any time, prior to the Closing
Date, there has occurred: (a) any change, or any development involving a
prospective change, in or affecting particularly the business or properties of
the Company, Onyx or the Insurer which, in the reasonable judgment of the
Underwriters, materially impairs the investment quality of the Notes; (b) any
suspension or material limitation of trading in securities generally on the New
York Stock Exchange, or any setting of minimum prices for trading on such
exchange; (c) any suspension of trading of any
23
securities of the Company or of Onyx on any exchange or in the over-the-counter
market by such exchange or over-the-counter market or by the Commission; (d) any
banking moratorium declared by federal, New York or California authorities; (e)
any outbreak or material escalation of major hostilities or any other
substantial national or international calamity or emergency if, in the
reasonable judgment of the Underwriters, the effect of any such outbreak,
escalation, calamity or emergency on the United States financial markets makes
it impracticable or inadvisable to proceed with completion of the sale of and
any payment for the Notes; or (f) there shall have occurred such a material
adverse change in general economic, political or financial conditions (or the
effect of international conditions on the financial markets of the United States
shall be such) as to make it, in the judgment of the Underwriters, impractical
or inadvisable to proceed with the public offering or delivery of the Notes on
the terms and in the manner contemplated in the Prospectus.
11. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Company or its officers and of the Underwriters set forth in
or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation, or statement as to the results thereof, made by
or on behalf of the Underwriters, the Company or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Notes. If for any reason the purchase of
the Notes by the Underwriters is not consummated, the Company shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
6 and the respective obligations of the Company and the Underwriters pursuant to
Sections 6, 8 and 9 shall remain in effect. If the purchase of the Notes by the
Underwriters is not consummated for any reason other than solely because of the
occurrence of any event specified in clauses (b), (c) or (d) of Section 7(iii)
or clauses (b), (d) or (e) of Section 10, and other than solely because the
Underwriters fail to perform their obligations hereunder, the Company will
reimburse each Underwriter for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by it in connection with the
offering of the Notes.
12. Notices. All communications hereunder will be in writing and,
if sent to the Representative, will be mailed, delivered or telegraphed and
confirmed to the Representative at Credit Suisse First Boston LLC, Xxxxxx
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Asset Finance Group, or to
such other address as the Representative may designate in writing to the
Company, or if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to the Company at Onyx Acceptance Financial Corporation, 00000 Xxxxx
Xxxxxx Xxxxx, Xxxxx 000, Xxxxxxxx Xxxxx, XX 00000, Attention: Xxxxxxx X.
Xxxxxxxxx, Esq., Senior Vice President and General Counsel.
13. Successors. This Agreement will inure to the benefit of, and
be binding upon, the parties hereto and their respective successors. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any person, firm or corporation, other than the parties hereto and their
respective successors and the controlling persons and officers and directors
referred to in Sections 8 and 9 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
parties hereto and their respective successors, and said controlling persons and
officers and directors and their heirs and legal representatives, and for
24
the benefit of no other person, firm or corporation. No purchaser of Notes from
the Underwriters shall be deemed to be a successor by reason merely of such
purchase.
14. Counterparts. This 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.
15. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
16. Severability of Provisions. Any covenant, provisions,
agreement or term of this Agreement that is prohibited or is held to be void or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof.
17. Entire Agreement. This Agreement constitutes the entire
agreement and understanding of the parties hereto with respect to the matters
and transactions contemplated hereby and supersedes all prior agreements and
understandings whatsoever relating to such matters and transactions.
18. Amendment. Neither this Agreement nor any term hereof may be
changed, waived, discharged or terminated orally, but only by an instrument in
writing signed by the party against whom enforcement of the change, waiver,
discharge or termination is sought.
19. Heading. The headings in this Agreement are for the purposes
of reference only and shall not limit or otherwise affect the meaning hereof.
20. The Representative. The Representative will act for the
several Underwriters in connection with the transactions described in this
Agreement, and any action taken by the Representative under this Agreement will
be binding upon all the Underwriters.
21. Defaults of Underwriters. If any Underwriter defaults in its
obligation to purchase the Notes hereunder on the Closing Date and the aggregate
principal amount of the Notes that such defaulting Underwriter agreed but failed
to purchase does not exceed 10% of the total principal amount of the Notes, the
Representative may make arrangements satisfactory to the Representative and the
Company for the purchase of such Notes by other persons, including either of the
Underwriters, but if no such arrangements are made by the Closing Date, the
nondefaulting Underwriter(s) shall be obligated, in proportion to its respective
commitment hereunder, to purchase the Notes that such defaulting Underwriter
agreed but failed to purchase. If an Underwriter so defaults and the aggregate
principal amount of the Notes with respect to such default exceeds 10% of the
total principal amount of the Notes and arrangements satisfactory to the
Representative and the Company for the purchase of such Notes by other persons
are not made within 24 hours after such default or such other period of time as
is agreed upon in writing by the Company and the Representative, this Agreement
will terminate without liability on the part of the nondefaulting Underwriter or
the Company, except as provided in Section 11. Nothing herein will relieve a
defaulting Underwriter from liability for its default.
25
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicate thereof,
whereupon it will become a binding agreement among the undersigned in accordance
with its terms.
Very truly yours,
ONYX ACCEPTANCE FINANCIAL
CORPORATION
By:____________________________
Name:
Title:
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
Credit Suisse First Boston LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By: CREDIT SUISSE FIRST BOSTON LLC,
as Representative
__________________________________________
Name:
Title:
26
Exhibit A-1
The information herein is preliminary, and will be superseded by the
applicable prospectus and prospectus supplement and by any other information
subsequently filed with the Securities and Exchange Commission. The information
addresses only certain aspects of the applicable security's characteristics and
thus does not provide a complete assessment. As such, the information may not
reflect the impact of all structural characteristics of the security. The
assumptions underlying the information, including structure and collateral, may
be modified from time to time to reflect changed circumstances. The attached
term sheet is not intended to be a prospectus or prospectus supplement and any
investment decision with respect to the Notes should be made by you based solely
upon all of the information contained in the final prospectus and the final
prospectus supplement. Under no circumstances shall the information presented
constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of the securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of such jurisdiction. The securities may not be sold
nor may an offer to buy be accepted prior to the delivery of a final prospectus
and final prospectus supplement relating to the securities. All information
described herein is preliminary, limited in nature and subject to completion or
amendment. No representation is made that the above referenced securities will
actually perform as described in any scenario presented. A final prospectus and
final prospectus supplement may be obtained by contacting the Credit Suisse
First Boston Trading Desk at (000) 000-0000.
27
Exhibit A-2
The information herein is preliminary, and will be superseded by the
applicable prospectus and prospectus supplement and by any other information
subsequently filed with the Securities and Exchange Commission. The information
addresses only certain aspects of the applicable security's characteristics and
thus does not provide a complete assessment. As such, the information may not
reflect the impact of all structural characteristics of the security. The
assumptions underlying the information, including structure and collateral, may
be modified from time to time to reflect changed circumstances. The attached
term sheet is not intended to be a prospectus or prospectus supplement and any
investment decision with respect to the Notes should be made by you based solely
upon all of the information contained in the final prospectus and the final
prospectus supplement. Under no circumstances shall the information presented
constitute an offer to sell or the solicitation of an offer to buy nor shall
there be any sale of the securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or qualification
under the securities laws of such jurisdiction. The securities may not be sold
nor may an offer to buy be accepted prior to the delivery of a final prospectus
and final prospectus supplement relating to the securities. All information
described herein is preliminary, limited in nature and subject to completion or
amendment. No representation is made that the above referenced securities will
actually perform as described in any scenario presented. A final prospectus and
final prospectus supplement may be obtained by contacting the Merrill, Xxxxx,
Xxxxxx, Xxxxxx & Xxxxx Incorporated Syndicate Desk at (000) 000-0000.
28
SCHEDULE I
OFFERED SECURITY PRINCIPAL AMOUNT
Class A-1 Notes
Purchase Price: 99.85000%
Credit Suisse First Boston LLC $ 40,000,000
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $ 40,000,000
Incorporated
Class A-2 Notes
Purchase Price: 99.75762%
Credit Suisse First Boston LLC $ 50,000,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx $ 50,000,000
Incorporated
Class A-3 Notes
Purchase Price: 99.72291%
Credit Suisse First Boston LLC $ 50,000,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx $ 50,000,000
Incorporated
Class A-4 Notes
Purchase Price: 99.67167%
Credit Suisse First Boston LLC $ 60,000,000
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $ 60,000,000
Incorporated
29
