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EXHIBIT 1.1
Onyx Acceptance Owner Trust 1998-A
$43,600,000 5.60% Auto Loan Backed Notes, Class A-1
$49,600,000 5.75% Auto Loan Backed Notes, Class A-2
$69,500,000 5.85% Auto Loan Backed Notes, Class A-3
$35,600,000 5.93% Auto Loan Backed Notes, Class A-4
$10,459,315 5.99% Auto Loan Backed Certificates
Onyx Acceptance Financial Corporation
as Seller
Onyx Acceptance Corporation
as Servicer
UNDERWRITING AGREEMENT
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June 11, 1998
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated, as representative of
the several Underwriters
World Financial Center
North Tower, 15th Floor
New York, New York l0281-1315
Ladies and Gentlemen:
1. Introductory. Onyx Acceptance Financial Corporation (the
"Company") proposes to cause Onyx Acceptance Owner Trust 1998-A (the "Trust") to
sell to Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (the
"Representative") and Salomon Brothers Inc (together with the Representative,
the "Underwriters") $43,600,000 5.60% Auto Loan Backed Notes, Class A-1 (the
"Class A-1 Notes"), $49,600,000 5.75% Auto Loan Backed Notes, Class A-2 (the
"Class A-2 Notes"), $69,500,000 5.85% Auto Loan Backed Notes, Class A-3 (the
"Class A-3 Notes"), $35,600,000 5.93% Auto Loan Backed Notes, Class A-4 (the
"Class A-4 Notes," and together with the Class A-1, Class A-2 and Class A-3
Notes, the "Notes"), and $10,459,315 5.99% Auto Loan Backed Certificates (the
"Certificates," and together with the Notes, the "Securities"). The Notes will
be issued pursuant to an Indenture dated as of June 1, 1998 (the "Indenture"),
between the Trust and The Chase Manhattan Bank as Indenture Trustee (the
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"Indenture Trustee"). The Certificates will be issued pursuant to a Trust
Agreement dated as of June 1, 1998 (the "Trust Agreement")among the Company,
Bankers Trust (Delaware) as Owner Trustee (the "Owner Trustee") and The Chase
Manhattan Bank as Co-Owner Trustee (the "Co-Owner Trustee"). Pursuant to a Sale
and Servicing Agreement dated as of June 1, 1998 (the "Servicing Agreement")
among the Trust, the Company as Seller (the "Seller"), Onyx Acceptance
Corporation as Servicer ("Onyx" or in such capacity, the " Servicer"), the
Indenture Trustee and the Co-Owner Trustee, the Seller will sell and assign to
the Trust, without recourse, the Seller's entire interest in the Contracts and
Onyx will act as servicer of the Contracts. Pursuant to an Administration
Agreement dated as of June 1, 1998 (the "Administration Agreement") among the
Trust, Onyx, the Company and the Indenture Trustee, Onyx will serve as
administrator of the Trust. Pursuant to a Purchase Agreement dated as of
September 8, 1994 (the "Onyx Purchase Agreement"), Onyx has sold the Contracts
to the Company. Pursuant to a purchase agreement dated as of the Closing Date
(the "Fundco Purchase Agreement" and together with the Onyx Purchase Agreement
the "Purchase Agreements"), Onyx Acceptance Funding Corporation ("Fundco") sold
certain of the Contracts to Onyx prior to the sale of the Contracts by Onyx to
the Company. Pursuant to an insurance and reimbursement agreement (the
"Insurance Agreement") among the Trust, the Company, Onyx, the Indenture Trustee
and MBIA Insurance Corporation (the "Insurer"), the Insurer has issued its
financial guarantee insurance policy (the "Guarantee") to the Indenture Trustee
for the benefit of the Securityholders guaranteeing timely payment of interest
and payment of principal at maturity on the Securities. The Trust's assets (the
"Trust Property") will include: (i) a pool of fixed rate motor vehicle retail
installment sales contracts (the "Contracts"), all of which were purchased from
the Seller and secured by new and used automobiles and light-duty trucks (the
"Financed Vehicles"), (ii) certain documents relating to the Contracts, (iii)
certain monies due under such Contracts and certain monies received with respect
to such Contracts on or after the Cut-Off Date, (iv) 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 Contract, (v) all amounts on deposit in the Collection
Account, the Note Distribution Account, the Certificate Distribution Account,
and the Spread Account, including all Eligible Investments credited thereto (but
excluding any
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investment income from Eligible Investments, which will be paid to the
Servicer), (vi) the right of the Company to cause Onyx to repurchase certain
Contracts under certain circumstances, and (vii) all proceeds of the foregoing.
The Securities will be issued in an aggregate principal amount of $208,759,315
which is equal to the outstanding principal balance of Contracts as of June 1,
1998 (the "Cut-off Date"). 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.
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, as amended (the "Act"), and has filed with
the Securities and Exchange Commission (the "Commission") a registration
statement (Registration No. 333-51239) on such Form, including a
prospectus and forms of prospectus supplements, for registration under
the Act of the offering and sale of the Notes and Certificates. 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 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 Certificates 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 and
Certificates 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 Representa-
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tive 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(b) 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 and Certificates, 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 "Basic 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 "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
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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 (as defined below), 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
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materially adversely affect the interests of the holders of the Notes or
Certificates, 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 Contract will satisfy the
representations and warranties set forth in Section 2.02(b) of the
Servicing Agreement.
(vi) 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.
(vii) 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
Agreements or the Insurance Agreement. The execu-
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tion, delivery and performance by the Company of this Agreement, the
Trust Agreement, the Servicing Agreement, the Purchase Agreements or the
Insurance Agreement and the issuance and sale of the Securities 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 Securities as contemplated by this Agreement, to enter into
this Agreement, the Trust Agreement, the Servicing Agreement, the
Purchase Agreements and the Insurance Agreement and to consummate the
transactions contemplated herein and therein.
(viii) This Agreement has been duly authorized, executed and
delivered by the Company.
3. Purchase, Sale, Payment and Delivery of Securities. On the
basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, 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
Securities 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 Securities 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 June 17, 1998 or at such other time not later than seven full business
days thereafter as the Underwriters and the Company determine, such time being
herein
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referred to as the "Closing Date". The Securities so to be delivered shall be
represented by one or more global notes or certificates 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 or
certificates, as applicable, representing the Securities available for
inspection by the Underwriters at the office at which the Securities 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. (a) It is understood that, after
the Registration Statement becomes effective, the Underwriters propose to offer
the Securities for sale to the public (which may include selected brokers and
dealers) as set forth in the Prospectus.
(b) The Underwriters may prepare and provide to prospective
investors certain ABS Term Sheets, in connection with its offering of the
Certificates, 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 the Underwriters.
(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 Exhibit A. 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
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Xxxxxx referred to herein bear a legend in a form previously approved in
writing by the Company.
(iv) 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 the Underwriters. The Underwriters shall have
provided to the Company, for filing as a post-effective amendment to the
Registration Statement 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. 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. The
Underwriters shall have not provided to any investor or prospective
investor in the Securities 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 Securities structuring terms
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that were revised in any material respect prior to the printing of the
Prospectus, the Underwriters 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
the Underwriters they would purchase all or any portion of the
Securities, 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 _______" 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 Securities is required to be
delivered under the Act, any ABS Term Sheets are determined, in the
reasonable judgment of the Company or the Underwriters, to contain a
material error or omission, the Underwriters 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 the Underwriters they would purchase all or any
portion of the Securities, 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 post-effective amendment to the Registration Statement
(subject to the Company's obtaining an accountant's comfort letter in
respect of such corrected ABS Term Sheets, which shall be at the expense
of the Underwriters).
(vii) The Underwriters shall be deemed to have represented as of
the Closing Date, that, except for ABS Term Sheets provided to the
Company
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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 Securities 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
Securities covered thereby and the terms thereof not otherwise specified
in the Basic Prospectus, the price at which such Securities are to be
purchased by the Underwrit ers, 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(b) of this Agreement. The Company will
transmit the Prospectus including such Prospectus Supplement to the
Commission pursuant to Rule 424(b) by a means rea sonably 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
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and will not file any such proposed amendment or supplement to which the
Representative reasonably objects. 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
to 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 Securities
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
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with the Commission (subject to the Underwriter'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 Securityholders of the Trust an earnings
statement or statements of the Trust covering a period of at least 12
months beginning after the Effective Date of the Registration Statement
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
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.
(viii) The Company will cooperate with the Underwriters in
arranging for the qualification of the Securities 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
Securities; 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.
(ix) For a period from the date of this Agreement until the
retirement of the Securities, 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 In-
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denture 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 Securities 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
Securityholders, (B) all documents filed, or caused to be filed, by the
Company with the Commission pursuant to the Securities Act of 1934, as
amended, 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) On or before the Closing Date the Company shall cause its
computer records relating to the Contracts to be marked to show the
Trust's absolute ownership of the Contracts and shall cause the Servicer
to mark its computer records relating to the Contracts to show the sale
to the Company of the Contracts and the subsequent transfer of the
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 Contracts, other than as
permitted by the Indenture and Trust Agreement.
(xii) The Company will file with the Commission a post-effective
amendment setting forth each ABS Terms Sheet provided to the Company by
the Underwriters and identified by it 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, the Underwriters must comply with their obligations
pursuant to Section 4 and the Company must receive a letter from Coopers
& Xxxxxxx,
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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 Coopers & Xxxxxxx have determined that the
information included in such ABS Term Sheet (if any), provided by the
Underwriters to the Company for filing on a post-effective amendment
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 foregoing letter
shall be at the expense of the Underwriters. The Company shall file any
corrected ABS Term Sheets described in Section 4(b)(vi) as soon as
practicable following receipt thereof.
6. Payment of Expenses. Except as provided in Sections 4(b) and
5(xii) 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
Indenture Trustee's and Owner Trustee's fees and the fees and disbursements of
the counsel to 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 Securities 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 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
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Xxxxxxx & Xxxxxxx 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 the Underwriters, materially impairs the
investment quality of the Securities; (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 the
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Representative, 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 Securities.
(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;
(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 Agreement 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 and the Servicing Agreement, the Purchase
Agreement or the Insurance Agreement except for (1) filing of a
Uniform Commercial Code financing statement in the State of
California 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
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under the federal 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
Agreement, 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 Securities 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 Agreement 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 the best of such counsel's knowledge, 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 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 the best knowledge of such counsel, after due
inquiry, 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 Agreement or the Securities, (2)
seeking to prevent the issuance of the Securities or the
consummation of any of the transactions contemplated by this
Agreement, the Trust Agreement, the
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Servicing Agreement, the Purchase Agreement or the Insurance
Agreement (3) seeking adversely to affect the federal income tax
attributes of the Securities as described in the Base Prospectus
under the headings "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";
(f) This Agreement, the Trust Agreement, the Servicing
Agreement, the Purchase Agreement and the Insurance Agreement
have each been duly authorized, executed and delivered by the
Company;
(g) The Contracts constitute "chattel paper" as defined
in Section 9-105(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) The direction by the Company to the Co-Owner Trustee
to authenticate the Certificates has been duly authorized by the
Company and, when the Certificates have been duly executed,
authenticated and delivered by the Co-Owner Trustee in
accordance with the Trust Agreement and delivered and paid for
pursuant to this Agreement, will be duly and validly issued and
outstanding, and will be entitled to the benefits of the Trust
Agreement.
(j) When the Notes have been duly executed and delivered
by the Co-Owner Trustee on behalf of the Trust, authenticated by
the Indenture Trustee
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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, Fundco and
Onyx, each of the Trust Agreement, the Purchase Agreements, the
Servicing Agreement and the Insurance Agreement 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 as of the date and time specified in such opinion; 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
thereto as of its Effective Date and the Prospectus as of its
date of issuance
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21
appeared on its face to be appropriately responsive in all
material respects to the applicable requirements of the
Securities 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 Securities, 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; and
(p) The Company is not, and will not as a result of the
offer and sale of the Securities as contemplated in the
Prospectus and this Agreement become, an "investment company" as
defined in the Investment Company Act of 1940, as amended (the
"Investment Company Act")or a company "controlled by" an
"investment company" within the meaning of the Investment
Company Act.
(q) The Trust is not now, and immediately following the
sale of the Securities pursuant to this Agreement will not be,
required to be registered under the Investment Company Act.
(r) The Indenture, the Sale and 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
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with their terms, except (x) 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).
In addition, such counsel shall opine (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 Contracts and (ii) as
to the existence of a valid, perfected, first priority security interest
in the Contacts 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 and Fundco,
substantially to the effect that:
(a) Each of Onyx and Fundco (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 Contracts;
(b) Each of Onyx and Fundco has the corporate power and
corporate authority
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23
to execute and deliver the Servicing Agreement, the
Administration Agreement, and the Purchase Agreements, 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 the Servicing Agreement, the
Administration Agreement, to the extent applicable, 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 or Fundco to perform the
transactions contemplated by the Servicing Agreement, the
Administration Agreement or the Purchase Agreements, as
applicable, except for (1) filing of a Uniform Commercial Code
financing statement in the State of California with respect to
the sale of the Contracts to the Company pursuant to the
Purchase Agreements 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
Servicing Agreement, the Administration Agreement and the
Purchase Agreements, as applicable;
(d) None of the execution, delivery and performance by
Onyx or Fundco of the Servicing Agreement, the Administration
Agreement or the Purchase Agreements, 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 of, or has
constituted or will constitute a default under, the By-Laws or
the Certificate of Incorporation of Onyx or Fundco, as amended,
or, to the best of such counsel's knowledge, any rule, order,
statute
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24
or regulation known to such counsel to be currently applicable
to Onyx or Fundco of any court, regulatory body, administrative
agency or governmental body having jurisdiction over Onyx or
Fundco or the terms of any material indenture or other material
agreement or instrument known to such counsel to which Onyx or
Fundco is a party or by which it or its properties are bound;
(e) The Servicing Agreement, the Administration
Agreement and the Purchase Agreements have each been duly
authorized, executed and delivered by Onyx and Fundco, as
applicable;
(f) The indemnification agreement dated as of the date
hereof, between Onyx and the Underwriters has been duly
authorized, executed and delivered by Onyx; and
(g) Assuming the authorization, execution and delivery
thereof by the Company with respect to the Servicing Agreement,
the Administration Agreement and the Purchase Agreements, each
such agreement constitutes the legal, valid and binding
agreement of Onyx and Fundco, as applicable, enforceable against
Onyx and Fundco 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 certifi-
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25
xxxxx 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 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 the
characterization of the transfer of the Contracts by Onyx to the Company
as a sale and with respect to the perfection of the Trust's interests in
the 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
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26
counsel to the Company, dated the Closing Date and satisfactory in form
and substance to you substantially to the effect that:
(a) The 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, dated
the Closing Date, of Xxxx, Xxxxxxx, Xxxxx & Xxxxxxxxxx, 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 Agreement and the Indemnification
Agreement;
(c) Except as have already been obtained, no
authorization, consent, approval, license, formal exemption or
declaration from, nor any registration or filing
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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 Agreement or the Indemnification
Agreement dated as of the Closing Date among the Underwriters,
Onyx and the Insurer (the "Indemnification Agreement") against
the Insurer, is required in connection with the execution and
delivery by the Insurer of the Guarantee, the Insurance
Agreement or the Indemnification Agreement or in connection with
the Insurer's performance of its obligations thereunder;
(d) The Guarantee, the Insurance Agreement and the
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
Agreement by the parties thereto (other than the Insurer), the
Insurance Agreement 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
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28
(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 (viii) include
any supplements thereto.
(ix) The Underwriters shall have received an opinion of Xxxxxxx,
Xxxxxxxx & Xxxx, counsel to the Indenture Trustee and Co-Owner Trustee,
dated the Closing Date and satisfactory in form and substance to you,
substantially in the form of Exhibit B hereto.
(x) 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, substantially in the form of Exhibit C
hereto.
(xi) 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,
substantially in the form of Exhibit D hereto.
(xii) The Representative shall have received from Skadden, Arps,
Slate, Xxxxxxx & 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 Securities, 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.
(xiii) The Underwriters shall have received a letter, dated the
Closing Date, of
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Xxxxxxx & Xxxxxxx 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.
(xiv) The Underwriters shall have received evidence satisfactory
to them that the Securities have been rated in the highest rating
category by Xxxxx'x Investors Service, Inc. and by Standard & Poor's
Ratings Services.
(xv) 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.
(xvi) 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
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30
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.
(xvii) 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.
(xviii) 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 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.
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8. Indemnification.
(i) The Company will indemnify and hold harmless each
Underwriter and each person, if any, who controls such Underwriter with
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 the
Underwriters for any legal or other expenses reasonably incurred by the
Underwriters 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 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
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has previously furnished copies thereof in sufficient quantity to the
Underwriters, if the person asserting such loss, claim, damage or
liability was not given the final Prospectus (or any amendment or
supplement thereto) on or prior to the confirmation of the sale of the
Securities.
(ii) Each Underwriter severally and 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 Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx
Incorporated 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 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
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33
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, 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.
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 Securities or
(ii) if the allocation provided by clause (i) above is not permitted by
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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 such 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 such
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 such 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 any amount in excess of the underwriting
discount or commission applicable to the Securities 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.
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 or Onyx which, in the reasonable judgment of the Underwriters,
materially impairs the investment quality of the Securities; (b) any suspension
or material
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limitation of trading in securities generally on the New York Stock
Exchange, or any setting of minimum prices for trading on such exchange, or any
suspension of trading of any securities of the 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; (c) any banking moratorium declared by Federal, New
York or California authorities; or (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 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 Securities.
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 Securities. If for any reason the
purchase of the Securities 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 Securities 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), (c) or (d) of Section 10, and
other than solely because the Underwriters fail to perform their obligations
hereunder, the Company will reimburse the Underwriter for all out-of-pocket
expenses (including fees and disbursements of counsel) reasonably incurred by it
in connection with the offering of the Securities.
12. Notices. All communications hereunder will be in writing and,
if sent to the Underwriters, will be mailed, delivered or telegraphed and
confirmed to the Underwriters at c/x Xxxxxxx Xxxxx & Co., World Financial
Center, Attention: Managing Director, Asset-Backed Securities De-
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partment, or to such other address as the Underwriters 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, 0000 Xxxxxx Xxxxxx Xxxxx, 0xx Xxxxx, Xxxxxx XX 00000, Attention:
Xxxxx X. Xxxxx, Esq., Executive Vice President.
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 the
benefit of no other person, firm or corporation. No purchaser of Securities from
the Underwriters shall be deemed to be a successor by reason merely of such
purchase.
14. 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.
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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 Certificates hereunder on the Closing Date and the
aggregate principal amount of the Securities that such defaulting Underwriter
agreed but failed to purchase does not exceed 10% of the total principal amount
of the Certificates, the Representative may make arrangements satisfactory to
the Representative and the Seller for the purchase of such Securities by other
persons, including either of the Underwriters, but if no such arrangements are
made by the Closing Date, the nondefaulting Underwriter shall be obligated, in
proportion to its respective commitment hereunder, to purchase the Securities
that such defaulting Underwriter agreed but failed to purchase. If an
Underwriter so defaults and the aggregate principal amount of the Securities
with respect to such default exceeds 10% of the total principal amount of the
Securities and arrangements satisfactory to the Representative and the Company
for the purchase of such Securities by other persons are not made within 24
hours after such default, 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.
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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: /s/ XXXXX X. XXXXX
--------------------------------
Name: Xxxxx X. Xxxxx
Title: Executive Vice President
The foregoing Underwriting Agreement is
hereby confirmed and accepted as of the
date first above written.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
Salomon Brothers Inc
By: Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
/s/ XXXXXX X. XXXXXX
-----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
For themselves and the other several
underwriters named in Schedule I
attached hereto.
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