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EXHIBIT 1.1
FORD CREDIT AUTO LOAN MASTER TRUST
SERIES 1996-1 []% AND SERIES 1996-2
FLOATING RATE ASSET BACKED CERTIFICATES
FORD CREDIT AUTO RECEIVABLES CORPORATION
(SELLER)
February [], 1996
UNDERWRITING AGREEMENT
CS FIRST BOSTON CORPORATION
As Representative of the
Several Underwriters,
Park Avenue Plaza
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
1. Introductory. Ford Credit Auto Receivables Corporation, a
Delaware corporation (the "Seller"), proposes to sell $[] principal amount of
its Series 1996-1 []% Asset Backed Certificates (the "Series 1996-1
Certificates") and $[] principal amount of its Series 1996-2 Floating Rate
Asset Backed Certificates (the "Series 1996-2 Certificates" and together with
the Series 1996-1 Certificates, the "Certificates") of the Ford Credit Auto
Loan Master Trust (the "Trust"). Each Certificate will represent a fractional
undivided interest in the Trust. The assets of the Trust include, among other
things, a pool of wholesale receivables (the "Receivables") generated from time
to time pursuant to wholesale automobile loan revolving credit agreements and
the related Collateral Security and certain monies due thereunder on or after
December 31, 1995 (the "Cutoff Date"), such Receivables having been sold to the
Trust and serviced for the Trust by Ford Motor Credit Company, a Delaware
corporation (the "Servicer" or "Ford Credit"). The Certificates will be issued
in an aggregate principal amount of $[ ], which is approximately equal to []%
of the aggregate principal balance of the Receivables, as of the Cutoff Date.
The Certificates will be issued pursuant to a pooling and servicing agreement
(the
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"Agreement") dated as of December 31, 1991, among the Seller, the Servicer and
Chemical Bank, as Successor to Manufacturers Hanover Trust Company, as trustee
(the "Trustee") and, in the case of the Series 1996-1 Certificates, the Series
1996-1 Supplement to the Agreement, and, in the case of the Series 1996-2
Certificates, the Series 1996-2 Supplement to the Agreement, each to be dated
as of December 31, 1995 (together, the "Supplements"), among the Seller,
Servicer and the Trustee. The Agreement and the Supplements are collectively
referred to as the "Pooling and Servicing Agreement." In connection with the
issuance of the Certificates the Trust and Ford Credit will enter into two
interest rate swap agreements to be dated as of February 15, 1996 (together,
the "Interest Rate Swap Agreements").
Capitalized terms used herein and not otherwise defined shall have the
meanings given them in the Pooling and Servicing Agreement.
2. Representations and Warranties of the Seller. The Seller
represents and warrants to and agrees with the several underwriters named in
Schedule I hereto (the "Underwriters") (if there is only one Underwriter listed
in Schedule I, then "Representative" and "Underwriters" shall each refer to
such Underwriter) that:
(a) A registration statement (No. 333-00243), including
two forms of prospectus, on Form S-3, in respect of the Series 1996-1
Certificates and the Series 1996-2 Certificates has been filed with the
Securities and Exchange Commission (the "Commission") in the form heretofore
delivered to the Underwriters, and may have been, and is proposed to be
amended. Such registration statement, as amended at the time when it becomes
effective, including the exhibits thereto and any material incorporated by
reference therein, is hereinafter referred to as the "Registration Statement,"
and each such form of prospectus, as then amended, is hereinafter referred to
as a "Prospectus", with such forms together being referred to as the
"Prospectuses." For purposes of this Agreement, "Effective Time" means the
date and time as of which such Registration Statement is declared effective by
the Commission, and "Effective Date" means the date of the Effective Time.
(b) On the Effective Date, the Registration Statement
will conform, in all material respects to the requirements of the Securities
Act of 1933, as amended (the "Act"), the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), where applicable, and the rules and regulations
of the Commission under the Act or the Exchange Act, as applicable, and will
not, as of the Effective Date, contain any untrue statement of a material fact
or omit to state a material fact required to be stated
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therein or necessary to make the statements therein not misleading; provided,
however, that this representation and warranty shall not apply to any statement
or omission made in reliance upon and in conformity with information furnished
in writing to the Seller by the Underwriters expressly for use in the
Registration Statement relating to such Certificates. On the date of this
Agreement, the Registration Statement conforms, and at the Effective Time the
Registration Statement and each Prospectus will conform, in all material
respects to the requirements of the Act and the rules and regulations of the
Commission thereunder (the "Rules and Regulations"), and, except as aforesaid,
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.
(c) The consummation by the Seller of the transactions
contemplated by this Agreement, the Receivables Purchase Agreement and the
Pooling and Servicing Agreement, and the fulfillment of the terms thereof, will
not conflict with or result in a breach of any of the terms or provisions of,
or constitute a default under, or result in the creation of any lien, charge,
or encumbrance upon any of the property or assets of the Seller pursuant to the
terms of, any indenture, mortgage, deed of trust, loan agreement, guarantee,
lease financing agreement, or similar agreement or instrument under which the
Seller is a debtor or guarantor.
(d) This Agreement has been duly authorized, executed and
delivered by the Seller.
3. Purchase, Sale, and Delivery of Certificates. On the basis of
the representations, warranties, and agreements herein contained, but subject
to the terms and conditions herein set forth, the Seller agrees to sell to the
Underwriters, and the Underwriters agree, severally and not jointly, to
purchase from the Seller, the aggregate principal amounts of the Certificates
set forth opposite the names of the Underwriters in Schedule I hereto. The
[Series 1996-1] Certificates are to be purchased at the purchase price of []%
of the aggregate principal amount [and the Series 1996-2 Certificates are to be
purchased at the purchase price of []% of the aggregate principal amount].
Against payment of the purchase price in immediately available funds
drawn to the order of the Seller, the Seller will deliver the Certificates to
the Representative, for the account of the Underwriters, at the office of Xxxxx
& Wood on February 15, 1996 at 10:00 a.m., New York time, or at such other time
not later than seven full business days thereafter as the Representa-
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tive and the Seller determine, such time being herein referred to as the
"Closing Date." The Certificates to be so delivered will be initially
represented by one or more Certificates registered in the name of Cede & Co.,
the nominee of The Depository Trust Company ("DTC"). The interests of
beneficial owners of the Certificates will be represented by book entries on
the records of DTC and participating members thereof. Definitive Certificates
will be available only under limited circumstances.
4. Offering by Underwriters. It is understood that, after the
Registration Statement becomes effective, the Underwriters propose to offer the
Series 1996-1 Certificates and the Series 1996-2 Certificates for sale to the
public (which may include selected dealers), as set forth in the related
Prospectuses.
5. Covenants of the Seller. The Seller covenants and agrees with
the Underwriters:
(a) If required, file each Prospectus with the Commission
pursuant to and in accordance with subparagraph (1) of the Rule 424(b) not
later than the time specified therein. The Seller will advise the Underwriters
promptly of any such filing pursuant to Rule 424(b).
(b) To make no amendment or any supplement to the
Registration Statement or to either of the Prospectuses as amended or
supplemented prior to the Closing Date, without furnishing the Representative
with a copy of the proposed form thereof and providing the Representative with
a reasonable opportunity to review the same; and during such same period to
advise the Representative, 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 a Prospectus as amended or supplemented or any
amended Prospectus has been filed or mailed for filing, of the issuance of any
stop order by the Commission, of the suspension of the qualification of the
Certificates 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
either of the Prospectuses as amended or supplemented or for additional
information; and, in the event of the issuance of any such stop order or of any
order preventing or suspending the use of any prospectus relating to the
Certificates or suspending any such qualification, to use promptly its best
efforts to obtain its withdrawal.
(c) Promptly from time to time to take such action as the
Representative may reasonably request in order to qualify the Certificates for
offering and sale under the securities laws of
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such states as the Representative may request and to continue such
qualifications in effect so long as necessary under such laws for the
distribution of such Certificates, provided that in connection therewith the
Seller shall not be required to qualify as a foreign corporation to do
business, or to file a general consent to service of process in any
jurisdiction, and provided further that the expense of maintaining any such
qualification more than one year from the Closing Date with respect to such
Certificates shall be at the Representative's expense.
(d) To furnish the Underwriters with copies of the
Registration Statement (including exhibits) and copies of the Prospectuses as
amended or supplemented in such quantities as the Representative may from time
to time reasonably request; and if, before a period of six months shall have
elapsed after the Effective Date and the delivery of a prospectus shall be at
the time required by law in connection with sales of any such Certificates,
either (i) any event shall have occurred as a result of which either of the
Prospectuses would include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading, or
(ii) for any other reason it shall be necessary during such same period to
amend or supplement either of the Prospectuses as amended or supplemented, to
notify the Representative and to prepare and furnish to the Representative as
the Representative may from time to time reasonably request an amendment or a
supplement to either of the Prospectuses which will correct such statement or
omission or effect such compliance; and in case any Underwriter is required by
law to deliver a prospectus in connection with sales of any of such
Certificates at any time six months or more after the Closing Date, upon the
Representative's request, but at the expense of such Underwriter, to prepare
and deliver to such Underwriter as many copies as the Representative may
request of an amended or supplemented prospectus complying with Section
10(a)(3) of the Act.
(e) To make generally available to Certificateholders of
the Trust as soon as practicable after the Effective Date of the Registration
Statement (as such date is defined in Rule 158(c) under the Act), an earnings
statement of the Seller complying with Rule 158 under the Act and covering a
period of at least twelve consecutive months beginning after such Effective
Date.
(f) The Seller will furnish to the Representative copies
of the Registration Statement (one of which will be signed and will include all
exhibits), each form of related preliminary prospectus, each of the
Prospectuses and all amendments and
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supplements to such documents, in each case as soon as available and in such
quantities as the Representative reasonably request.
(g) So long as any of the Certificates are outstanding,
to furnish the Representative copies of all reports or other communications
(financial or other) furnished to Certificateholders of the Trust, and to
deliver to the Representative during such same period, (i) as soon as they are
available, copies of any reports and financial statements furnished to or filed
with the Commission and (ii) such additional information concerning the
business and financial condition of the Seller as the Representative may from
time to time reasonably request.
(h) To pay or cause to be paid all costs and expenses
incident to the performance of its obligations hereunder including any fees
charged by the rating agency or rating agencies that initially rate the
Certificates, and the reasonable expenses incurred in distributing preliminary
prospectuses and the Prospectuses (including any amendments and supplements
thereto required within six months from the Effective Date pursuant to Section
5(d) hereof) it being understood that, except as provided in this subsection
(h) and Section 9 hereof, the Underwriters will pay all their own costs and
expenses, including, without limitation, the cost of printing any agreement
among underwriters, transfer taxes on resale of the Certificates by the
Underwriters, and any advertising expenses connected with any offers that the
Underwriters may make. Notwithstanding anything to the contrary contained in
the foregoing, (i) the Underwriters shall pay directly (A) all Blue Sky fees
and expenses as well as reasonable fees and expenses of counsel in connection
with state securities law qualifications and any legal investment surveys; and
(B) the reasonable fees and expenses of Brown & Wood, Underwriters' counsel and
(ii) the Seller shall pay (A) the Commission the filing fee with respect to the
Certificates; (B) all fees of any rating agencies rating the Certificates; (C)
all fees and expenses of the Trustee; (D) all reasonable fees and expenses of
Xxxxxx Xxxx & Xxxxxx, counsel to the Trustee; (E) all fees and expenses of
Coopers & Xxxxxxx relating to the letter referred to in Section 6(a) of the
Underwriting Agreement; (F) all fees and expenses of accountants incurred in
connection with the delivery of any accountant's or auditor's reports required
pursuant to the Pooling and Servicing Agreement; (G) the cost of printing any
preliminary and final prospectus relating to the Certificates, and the
Registration Statement; and (H) any other fees and expenses incurred in
connection with the performance of its obligations under the Underwriting
Agreement.
(i) For a period from the date of this Agreement until
the retirement of the Certificates, or until such time as the
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Underwriters shall cease to maintain a secondary market in the Certificates,
whichever occurs first, to deliver to the Representative the annual statements
of compliance and the annual independent certified public accountants' reports
furnished to the Trustee pursuant to Article III of the Pooling and Servicing
Agreement, as soon as such statements and reports are furnished to the Trustee.
(j) On or before the Closing Date, the Seller shall cause
Ford Credit's computer records relating to the Receivables contained in any
Accounts to be marked to show the Trusts absolute ownership of the Receivables,
and from and after the Closing Date neither the Seller nor the Servicer shall
take any action inconsistent with the Trust's ownership of such Receivables
other than as permitted by the Pooling and Servicing Agreement.
(k) To the extent, if any, that the rating provided with
respect to the Certificates by the rating agency or agencies that initially
rate the Certificates is conditional upon the furnishing of documents or the
taking of any other actions by the Seller, the Seller shall furnish such
documents and take any such other actions.
6. Conditions of the Obligations of the Underwriters. The
obligation of the Underwriters to purchase and pay for the Certificates will be
subject to the accuracy of the representations and warranties on the part of
the Seller herein, to the accuracy of the statements of officers of the Seller
made pursuant to the provisions hereof, to the performance by the Seller of its
obligations hereunder and to the following additional conditions precedent:
(a) On or prior to the Closing Date, Xxxxxxx & Xxxxxxx
shall have furnished to the Representative a letter dated as of the Closing
Date substantially in the form and substance of the draft to which the
Representative previously agreed.
(b) The Registration Statement shall have become
effective not later than 4:00 p.m., New York time, on the day following the
date of this Agreement or such later date as shall have been consented to by
the Representative; 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 Seller, shall be contemplated by the Commission.
(c) The Representative shall have received as of the
Closing Date an officer's certificate signed by the Chairman of the Board, the
President, the Executive Vice President Finance or
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the Treasurer of the Seller representing and warranting that, as of the Closing
Date, the representations and warranties of the Seller in this Agreement will
be true and correct in all material respects, that the Seller 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 in all material respects,
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
contemplated by the Commission.
(d) Since the respective dates as of which information is
given in each of the Prospectuses as amended or supplemented, there shall not
have occurred any material adverse change, or any development involving a
prospective material adverse change, in or affecting particularly the business
or assets of the Trust, Seller, Ford Credit or Ford Motor Company or any
material adverse change in the financial position or results or operations of
the Trust, Seller, Ford Credit or Ford Motor Company otherwise than as set
forth or contemplated in each of the Prospectuses, which in any such case makes
it impracticable or inadvisable in the Representative's reasonable judgment to
proceed with the public offering or the delivery of the Certificates on the
terms and in the manner contemplated in each of the Prospectuses as amended or
supplemented.
(e) Subsequent to the execution and delivery of this
Agreement, the United States shall not have become engaged in hostilities which
have resulted in the declaration of a national emergency or a declaration of
war which makes it impracticable or inadvisable in the Representative's
reasonable judgment to proceed with the public offering of the delivery of the
Certificates on the terms and in the manner contemplated in each of the
Prospectuses as amended or supplemented.
(f) X.X. Xxxxxxxx, Xxx., Vice President - General Counsel
of Ford Credit and the Seller, or other counsel satisfactory to the
Representative in their reasonable judgment, shall have furnished to the
Representative, his written opinion, dated the Closing Date, in form reasonably
satisfactory to the Representative in its reasonable judgment, to the effect
that:
(i) The Seller has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Delaware, and is duly qualified to transact business and
is in good standing in each jurisdiction in the United States of
America in which the conduct of its business or the ownership of its
property requires such qualification.
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(ii) This Agreement has been duly authorized,
executed and delivered by the Seller.
(iii) The Pooling and Servicing Agreement and the
Receivables Purchase Agreement have been duly authorized, executed and
delivered by, and each constitutes a valid and binding obligation of,
the Seller.
(iv) The consummation of the transactions
contemplated by this Agreement, the Pooling and Servicing Agreement,
the Receivables Purchase Agreement and the Interest Rate Swap
Agreements, and the fulfillment of the terms thereof, will not
conflict with or result in a material breach of any of the terms or
provisions of, or constitute a default under, or result in the
creation or imposition of any material lien, charge or encumbrance
upon any of the property or assets of the Seller pursuant to the terms
of, any indenture, mortgage, deed of trust, loan agreement, guarantee,
lease financing agreement or similar agreement or instrument known to
such counsel under which the Seller is a debtor or guarantor, nor will
such action result in any violation of the provisions of the
Certificate of Incorporation or the By-Laws of the Seller.
(v) The Certificates have been duly authorized
and executed by the Seller; when authenticated by the Trustee in
accordance with the Pooling and Servicing Agreement and delivered and
paid for pursuant to the Underwriting Agreement, the Certificates will
constitute valid and binding obligations entitled to the benefits
provided by the Pooling and Servicing Agreement.
(vi) The Registration Statement has become effective
under the Act and, to the best knowledge of such counsel, no stop
order suspending the effectiveness of the Registration Statement has
been issued and no proceeding for that purpose has been instituted or
threatened by the Commission, the Registration Statement and each of
the Prospectuses as amended or supplemented and any further amendments
and supplements thereto made by the Seller prior to the Closing Date
(other than the financial statements and other accounting information
contained in the Registration Statement or either of the Prospectuses
as amended or supplemented or any further amendments or supplements
thereto, or omitted therefrom, as to which such counsel need express
no opinion) comply as to form in all material respects with the
requirements of the Act and the rules and regulations thereunder.
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(vii) Such counsel believes that neither the
Registration Statement (other than the financial statements and other
accounting information contained therein or omitted therefrom, as to
which such counsel need express no opinion) nor any amendment hereto,
at the time the same became effective, contained any untrue statement
of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading.
(viii) Such counsel believes that at the Closing
Date neither of the Prospectuses as amended or supplemented (other
than the financial statements and the other accounting information
contained therein or omitted therefrom, as to which such counsel need
express no opinion) contains any untrue statement of a material fact
or omits to state any material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(ix) Such counsel does not know of any contract or
other document of a character required to be filed as an exhibit to
the Registration Statement or required to be incorporated by reference
into either of the Prospectuses as amended or supplemented or required
to be described in the Registration Statement or either of the
Prospectuses as amended or supplemented which is not filed or
incorporated by reference or described as required.
(x) Such counsel does not know of any legal or
governmental proceedings pending to which the Seller is a party or of
which any property of the Seller is the subject, and no such
proceedings are known by such counsel to be threatened or contemplated
by governmental authorities or threatened by others, other than as set
forth or contemplated in each of the Prospectuses as amended or
supplemented and other than such proceedings which, in his opinion,
will not have a material adverse effect upon the general affairs,
financial position, net worth or results of operations (on an annual
basis) of the Seller and will not materially and adversely affect the
performance by the Seller of its obligations under, or the validity
and enforceability of, the Pooling and Servicing Agreement, the
Receivables Purchase Agreement or the Certificates.
(xi) The Certificates, the Pooling and Servicing
Agreement, the Receivables Purchase Agreement and this Agreement each
conform in all material respects with the
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descriptions thereof contained in the Registration Statement and the
related Prospectuses.
(xii) The Seller has full power and authority to
sell and assign the property sold or to be sold and assigned to and
deposited with the Trustee as part of the Trust and has duly
authorized such sale and assignment to the Trustee by all necessary
corporate action.
(xiii) Prior to any sale or assignment thereof by
the Seller to the Trust, the Seller was the sole owner of all right,
title and interest in, and had good and marketable title to, the
Receivables and the Collateral Security transferred by it to the
Trust. The assignment of the Receivables and the Collateral Security,
all documents and instruments relating thereto and all proceeds
thereof to the Trustee, pursuant to the Pooling and Servicing
Agreement, vest in the Trustee all interests which were purported to
be conveyed thereby, were free and clear of any liens, security
interests or encumbrance except as specifically permitted pursuant to
the Pooling and Servicing Agreement.
(xiv) Immediately prior to the transfer of the
Receivables to the Trustee, the Seller's interest in the Receivables,
the Collateral Security, the security interests in the Vehicles
securing the Receivables and the proceeds of each of the foregoing was
perfected upon the filing of the UCC-1 financing statement the form of
which is attached to such opinion with the Secretary of State of the
State of Michigan and constituted a perfected first priority interest
therein. If a court concludes that the transfer of the Receivables
from the Seller to the Trustee is a sale, the interest of the Trustee
in the Receivables, the Collateral Security, the security interests in
the Vehicles securing the Receivables and the proceeds of each of the
foregoing will be perfected upon the filing of the UCC-1 financing
statement the form of which is attached to such opinion with the
Secretary of State of the State of Michigan and will constitute a
first priority perfected interest therein. If a court concludes that
such transfer is not a sale, the Pooling and Servicing Agreement
constitutes a grant by the Seller to the Trustee of a valid security
interest in the Receivables, the Collateral Security, the security
interests in the Vehicles securing the Receivables and the proceeds of
each of the foregoing, which security interest is perfected upon the
filing of the UCC-1 financing statement the form of which is attached
to such opinion with the Secretary of State of the State of Michigan
and will constitute a first priority perfected security interest
therein. No filing or
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other action, other than the filing of the UCC-1 financing statements
with the Secretary of State of the State of Michigan referred to
above, is necessary to perfect and maintain the interest or the
security interest of the Trustee in the Receivables, the Collateral
Security, the security interests in the Vehicles securing the
Receivables and the proceeds of each of the foregoing against third
parties.
(xv) The Seller is not, and will not as a result of
the offer and sale of the Certificates as contemplated by this
Agreement become, an "investment company" as defined in the Investment
Company Act.
(xvi) The statements in each Prospectus under the
heading "Certain Tax Matters--State and Local Tax Consequences"
accurately describe the material Michigan tax consequences to holders
of the Certificates.
Such opinion may be made subject to the
qualifications that the enforceability of the terms of the Pooling and
Servicing Agreement, the Receivables Purchase Agreement and the
Certificates may be limited by bankruptcy, insolvency, reorganization
or other similar laws relating to or affecting the enforcement of
creditors' rights generally and by general equitable principles,
regardless of whether such enforceability is considered in a
proceeding in equity or at law.
(g) X.X. Xxxxxxxx, Xxx., Vice President - General Counsel
of Ford Credit and the Seller, or other counsel satisfactory to the
Representative in their reasonable judgment, shall have furnished to the
Representative his written opinion, dated as of the Closing Date, in form
satisfactory to the Representative in its reasonable judgment, to the effect
that:
(i) Ford Credit has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the State of Delaware, and is duly qualified to transact business and
is in good standing in each jurisdiction in the United States of
America in which the conduct of its business or the ownership of its
property requires such qualification.
(ii) The indemnification agreement (the
"Indemnification Agreement") dated as of the date hereof, between Ford
Credit and the Underwriters, has been duly authorized, executed and
delivered by Ford Credit.
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(iii) The Pooling and Servicing Agreement, the
Receivables Purchase Agreement and the Interest Rate Swap Agreements
have been duly authorized, executed and delivered by, and each
constitutes a valid and binding obligation of, Ford Credit.
(iv) The consummation of the transactions
contemplated by the Pooling and Servicing Agreement, the Receivables
Purchase Agreement, the Interest Rate Swap Agreements and the
Indemnification Agreement, and the fulfillment of the terms thereof,
will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under (in each case material to
Ford Credit and its subsidiaries considered as a whole), or result in
the creation or imposition of any lien, charge or encumbrance (in each
case material to Ford Credit and its subsidiaries considered as a
whole) upon any of the property or assets of Ford Credit pursuant to
the terms of, any indenture, mortgage, deed of trust, loan agreement,
guarantee, lease financing agreement or similar agreement or
instrument known to such counsel under which Ford Credit is a debtor
or guarantor, nor will such action result in any violation of the
provisions of the Certificate of Incorporation or the By-Laws of Ford
Credit.
(v) Such counsel does not know of any legal or
governmental proceedings pending to which Ford Credit is a party or of
which any property of Ford Credit is the subject, and no such
proceedings are known by such counsel to be threatened or contemplated
by governmental authorities or threatened by others, other than as set
forth or contemplated in the Prospectuses as amended or supplemented
and other than such proceedings which, in his opinion, will not have a
material adverse effect upon the general affairs, financial position,
net worth or results of operations (on an annual basis) of Ford Credit
and its subsidiaries considered as a whole and will not materially and
adversely affect the performance by Ford Credit of its obligations
under, or the validity and enforceability of, the Pooling and
Servicing Agreement, the Receivables Purchase Agreement, the Interest
Rate Swap Agreements or the Indemnification Agreement.
(vi) Ford Credit had and has full power and
authority to sell and assign the property sold and assigned or to be
sold and assigned to the Seller pursuant to the Receivables Purchase
Agreement and duly authorized such sale and assignment to the Seller
by all necessary corporate action.
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(vii) The statements in each Prospectus under the
caption "Risk Factors--Certain Legal Aspects" and the caption "Certain
Legal Aspects of the Receivables," to the extent they constitute
matters of law or legal conclusions, are correct in all material
respects.
(viii) The Receivables are "chattel paper"under the
Uniform Commercial Code.
(ix) Immediately prior to the sale of the
Receivables to the Seller, Ford Credit owned the Receivables free and
clear of any lien, security interest or charge. With respect to each
Receivable constituting part of the trust, such Receivable is secured
by a validly perfected first priority security interest in the vehicle
financed thereby in favor of Ford Credit as a secured party or Ford
Credit has instituted appropriate procedures that if followed (and
such counsel has no reason to believe that they will not be so
followed) will result in the perfection of a first priority security
interest in the vehicle financed thereby in favor of Ford Credit as a
secured party. Each such Receivable has been duly and validly assigned
to the Seller by Ford Credit.
(x) All filings necessary under applicable law to
perfect both the sale of the Receivables by Ford Credit to the Seller
pursuant to the Receivables Purchase Agreement have been made and,
provided that neither Ford Credit nor the Seller relocated its
principal place of business in a state other than Michigan and that
Ford Credit maintains the list of Receivables for inspection by
interested parties as described above, no other filings (other than
the filing of continuation statements) need be made to maintain the
perfection of the sale of the Receivables either to the Seller
pursuant to the Receivables Purchase Agreement or to the Trustee as
Trustee of the Trust pursuant to the Pooling and Servicing Agreement.
(xi) The Pooling and Servicing Agreement is not
required to be qualified under the Trust Indenture Act of 1939, as
amended, and the Trust is not, and will not be as a result of the
offer and sale of the Certificates contemplated by this Agreement,
required to be registered under the Investment Company Act of 1940, as
amended.
(xii) No consent, approval, authorization or order
of any court or governmental agency or body is required for the
consummation of the transactions contemplated herein or in the Pooling
and Servicing Agreement, the Receivables Purchase Agreement, the
Interest
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Rate Swap Agreements or the Indemnification Agreement, except such as
may be required under federal or state securities laws in connection
with the acquisition by the Underwriters of the Certificates, filings
with respect to the transfer of the Receivables to the Seller pursuant
to the Receivables Purchase Agreement and to the Trustee pursuant to
the Pooling and Servicing Agreement and such other approvals as have
been obtained.
(xiii) Such counsel does not know of any legal or
governmental proceedings pending to which either Ford Credit or the
Seller is a party or of which any property of either Ford Credit or
the Seller is the subject, and no such proceedings are known by such
counsel to be threatened or contemplated by governmental authorities
or threatened by others (1) seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions
contemplated by this Agreement, the Pooling and Servicing Agreement,
the Receivables Purchase Agreement, the Interest Rate Swap Agreements
or the Indemnification Agreement, or (2) seeking adversely to affect
the federal income tax attributes of the Certificates as described in
each Prospectus under the heading "Certain United States Federal
Income Tax Consequences."
(xiv) Neither the issuance or sale of the
Certificates, nor the execution and delivery of the Certificates, the
Pooling and Servicing Agreement, the Receivables Purchase Agreement,
the Interest Rate Swap Agreements or Indemnification Agreement,
including, without limitation, this Agreement nor the consummation of
any of the other transactions contemplated herein or in the Pooling
and Servicing Agreement, the Receivables Purchase Agreement, the
Interest Rate Swap Agreements or Indemnification Agreement by Ford
Credit or the Seller, as the case may be, contravenes or will
contravene the terms of any material provision of any statute, order,
or regulation applicable to Ford Credit or the Seller, as the case may
be, the failure with which to comply could have a material adverse
effect on Ford Credit and its subsidiaries considered as a whole or
the Seller, as the case may be.
(h) Xxxxx & Xxxx (or such other counsel satisfactory to
the Representative) shall have furnished their written opinion, dated the
Closing Date, with respect to the characterization of the transfer of the
Receivables by Ford Credit to the Seller as a sale, and with respect to the
characterization of the transfer of the Receivables from the Seller to the
Trust, to the Representative and to Ford Credit, and such opinion shall be in
substantially the form previously
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discussed with the Representative and their counsel and in any event
satisfactory in form and in substance to the Representative and their counsel
and to Ford Credit.
(i) Brown & Wood, special federal tax counsel to the
Seller, shall have furnished to the Representative their written opinion, dated
as of the Closing Date, in form and in substance satisfactory to the
Representative in its reasonable judgment, to the effect that the statements in
the Registration Statement and each Prospectus under the headings "Certain Tax
Matters" and "ERISA Considerations," 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.
(j) The Representative shall have received an opinion of
Xxxxx & Xxxx addressed to the Representative, dated the Closing Date, with
respect to the validity of the Certificates and such other related matters as
the Representative shall require and the Seller shall have furnished or caused
to be furnished to such counsel such documents as they may reasonably request
for the purpose of enabling them to pass upon such matters.
(k) The Representative shall have received an opinion
addressed to the Representative, the Seller and the Servicer of Xxxxxx Xxxx &
Xxxxxx, counsel to the Trustee, dated the Closing Date and satisfactory in form
and substance to the Representative and to counsel to the Underwriters, to the
effect that:
(i) The Trustee has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
New York with full corporate trust power and authority to enter into
and perform its obligations under the Pooling and Servicing Agreement
and the Interest Rate Swap Agreement.
(ii) The Pooling and Servicing Agreement and the
Interest Rate Swap Agreements have been duly executed and delivered by
the Trustee, and, insofar as the laws governing the trust powers of
the Trustee are concerned and assuming due authorization, execution
and delivery thereof by the Seller and the Servicer, the Pooling and
Servicing Agreement and the Interest Rate Swap Agreements each
constitutes a legal, valid and binding obligation of the Trustee,
enforceable against the Trustee in accordance with its terms, except
(1) the enforceability thereof may be subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights, and (2) the remedy
of specific
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performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court
before which any proceeding therefor may be brought.
(iii) The Certificates have been duly authenticated
and delivered by the Trustee.
(iv) Neither the execution nor delivery by the
Trustee of the Pooling and Servicing Agreement, the Interest Rate Swap
Agreements nor the consummation of any of the transactions by the
Trustee contemplated thereby required the consent or approval of, the
giving of notice to, the registration with, or the taking of any other
action with respect to, any governmental authority or agency under any
existing federal or New York State law governing the trust powers of
the Trustee, except such as have been obtained, made or taken.
(l) The Representative shall have received an officer's
certificate dated the Closing Date of the Chairman of the Board, the President,
the Executive Vice President-Finance or the Treasurer of each of Ford Credit,
the Seller and the Servicer in which such officers shall state that, to the
best of their knowledge after reasonable investigation, the representations and
warranties of the Seller and the Servicer contained in the Pooling and
Servicing Agreement and the representations and warranties of Ford Credit and
the Seller contained in the Receivables Purchase Agreement are true and correct
in all material respects, that Ford Credit, the Seller or the Servicer, as the
case may be, has complied with all agreements and satisfied all conditions on
its part to be performed or satisfied under such agreements at or prior to the
Closing Date in all material respects.
(m) The Interest Rate Swap shall have been duly
authorized, executed and delivered by each party thereto and all fees due and
payable to Ford Credit thereunder shall have been paid in full on or prior to
the Closing Date.
(n) The Certificates shall have been rated in the highest
rating category by Standard & Poor's Corporation and Xxxxx'x Investors Service,
Inc.
7. Indemnification and Contribution. (a) The Seller will
indemnify and hold each Underwriter harmless against any losses, claims,
damages, or liabilities, joint or several, to which such Underwriter may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
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untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, either of the Prospectuses, or any amendment or
supplement thereto, or any related preliminary prospectus, or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, and will reimburse each Underwriter for any legal or other
expenses reasonably incurred by such Underwriter in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Seller will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity with
written information furnished to the Seller by any Underwriter through the
Representative specifically for use therein; and provided further, that the
Seller shall not be liable to any Underwriter or any person controlling any
Underwriter under the indemnity agreement in this subsection (a) with respect
to any of such documents to the extent that any such loss, claim, damage or
liability of the Underwriters or such controlling person results from the fact
that such Underwriter sold the Certificates to a person to whom there was not
sent or given, at or prior to the written confirmation of such sale, a copy of
the related Prospectus or of the related Prospectus as then amended or
supplemented (excluding documents incorporated by reference), whichever is most
recent, if the Seller has previously furnished copies thereof to such
Underwriter.
The indemnity agreement in this subsection (a) shall be in
addition to any liability which the Seller may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act.
(b) Each Underwriter will indemnify and hold harmless the
Seller against any losses, claims, damages or liabilities to which the Seller
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, either of the Prospectuses or any
amendment or supplement thereto, or any related preliminary prospectus, or
arise out of or are based upon the omission or the alleged omissions to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in
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reliance upon and in conformity with written information furnished to the
Seller by such Underwriter through the Representative specifically for use
therein, and will reimburse any legal or other expenses reasonably incurred by
the Seller in connection with investigating or defending any such action or
claim.
The indemnity agreement in this subsection (b) shall be in
addition to any liability which each Underwriter may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls the Seller within the meaning of the Act.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) of written notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against the
indemnifying party under subsection (a) or (b) above notify the indemnifying
party of the commencement thereof, and in the event that such indemnified party
shall not so notify the indemnifying party within 30 days following receipt of
any such notice by such indemnified party, the indemnifying party shall have no
further liability under such subsection to such indemnified party unless the
indemnifying party shall have received other notice addressed and delivered in
the manner provided in Section 10 hereof of the commencement of such actions
but the omission so to notify the indemnifying party will not relieve it from
any liability which it may have to any indemnified party otherwise than under
such subsection. In case any such action is brought against any indemnified
party and it notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the extent
that it may wish, jointly with any other indemnifying party similarly notified,
to assume the defense thereof, with counsel satisfactory to such indemnified
party in its reasonable judgment, and after notice from the indemnifying party
to such indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under such
subsection for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
(d) If the indemnification provided for in this Section
is unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities
(or actions in respect thereof) in such proportion as is
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appropriate to reflect the relative benefits received by the Seller on the one
hand and the Underwriters on the other from the offering of the Certificates.
If, however, the allocation provided by the immediately preceding sentence is
not permitted by applicable law, then each indemnifying party shall contribute
to such amount paid or payable by such indemnified party in such proportion as
is appropriate to reflect not only such relative benefits but also the relative
fault of the Seller on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages, or liabilities (or actions in respect thereof) as well as any
other relevant equitable considerations. The relative benefits received by the
Seller on the one hand and the underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Seller bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the related Prospectus as amended or
supplemented with respect to the Certificates. 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 Seller or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or omission,
including, with respect to any Underwriter, the extent to which such losses,
claims, damages or liabilities (or actions in respect thereof) result from the
fact that such Underwriter sold such Certificates to a person to whom there was
not sent or given, at or prior to the written confirmation of such sale, a copy
of the related Prospectus or the related Prospectus as then supplemented or
amended (excluding documents incorporated by reference), whichever is more
recent, if the Seller has previously furnished copies thereof to such
Underwriter. The Seller and the Underwriters, severally and not jointly, agree
that it would not be just and equitable if contribution pursuant to this
subsection (d) 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 subsection (d). The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) 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.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Certificates underwritten by it and distributed to the
public were offered to the public exceeds the
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amount of any damages which such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
8. Survival of Certain Representations and Obligations. The
respective indemnities, agreements, representations, warranties and other
statements of the Seller (including, without limitation, Section 5(k)) 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 any Underwriter
or the Seller or any of their respective representatives, officers or directors
of any controlling person, and will survive delivery of and payment for the
Certificates.
9. Failure to Purchase the Certificates. If the purchase of the
Certificates shall not be consummated by the Underwriters because the condition
set forth in Section 6(e) has not been met, then the Seller shall be under no
liability to the Underwriters with respect to the Certificates except as
provided in Section 5(h) and Section 7 hereof; but if for any other reason any
Certificates are not delivered by the Seller as provided herein, the Seller
will be liable to reimburse the Underwriters, through the Representative, for
all out-of-pocket expenses, including counsel fees and disbursements reasonably
incurred by the Underwriters in making preparations for the offering of the
Certificates, but the Seller shall then have no further liability to any
Underwriter with respect to such Certificates except as provided in Section
5(h) and Section 7 hereof. If any Underwriter or Underwriters default on their
obligations to purchase Certificates hereunder and the aggregate principal
amount of Certificates that such defaulting Underwriter or Underwriters agreed
but failed to purchase does not exceed 10% of the total principal amount of
Certificates, the Representative may make arrangements satisfactory to the
Seller for the purchase of such Certificates by other persons, including the
non-defaulting Underwriter or Underwriters, but if no such arrangements are
made by the Closing Date, the non-defaulting Underwriter or Underwriters shall
be obligated, in proportion to their commitments hereunder, to purchase the
Certificates that such defaulting Underwriter or Underwriters agreed but failed
to purchase. If any Underwriter or Underwriters so default and the aggregate
principal amount of Certificates with respect to which such default or defaults
occur exceeds 10% of the total principal amount of Certificates and
arrangements satisfactory to the non-defaulting Underwriter or Underwriters and
the Seller for the purchase of such Certificates by other persons are not made
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within 36 hours after such default, this Agreement will terminate without
liability on the part of any non-defaulting Underwriter or the Seller, except
as provided in Section 8. As used in this Agreement, the term "Underwriter"
includes any person substituted for an Underwriter under this Section. Nothing
herein will relieve a defaulting Underwriter or Underwriters from liability for
its default.
10. Notices. All communications hereunder will be in writing and,
if sent to the Representative or the Underwriters, will be mailed, delivered or
sent by facsimile transmission and confirmed to CS First Boston Corporation,
Park Avenue Plaza, 00 Xxxx 00xx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: [ ], facsimile number (212) [ ], if sent to the Seller,
will be mailed, delivered or sent by facsimile transmission, and confirmed to
it at Ford Credit Auto Receivables Corporation, The American Road, Dearborn,
Michigan 48121, attention of the Secretary - facsimile number (000) 000-0000.
11. Successors. This Agreement will inure to the benefit of and
be binding upon the Underwriters and the Seller and their respective successors
and the officers and directors and controlling persons referred to in Section
7, and no other person will have any right or obligations hereunder.
12. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
13. Counterparts. This Agreement may be executed by each of the
parties hereto in any number of counterparts, and by each of the parties hereto
on separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
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If the foregoing is in accordance with your understanding, please sign
and return to us a counterpart hereof, whereupon this letter and your
acceptance hereof shall constitute a binding agreement.
Very truly yours,
FORD CREDIT AUTO RECEIVABLES
CORPORATION
By:___________________________
Name:
Title:
Accepted in New York, New York,
as of the date hereof:
CS FIRST BOSTON CORPORATION
Acting on their own behalf and
as Representative of the
several Underwriters.
By: _______________________________
Name:
Title:
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SCHEDULE I
Series 1996-1 Certificates
CS First Boston Corporation . . . . . . . . . . . . . . $[ ]
[ ] . . . . . . . . . . . . . . . . . . . . . . . . . $[ ]
Series 1996-1 Certificate Total . . . . . . . . . . . $[ ]
Series 1996-2 Certificates
CS First Boston Corporation . . . . . . . . . . . . . $[ ]
Series 1996-2 Certificate Total . . . . . . . . . . . $[ ]
