EXHIBIT 1.1
BANC ONE AUTO GRANTOR TRUST 1996-B
$______________ CLASS A ____% ASSET BACKED CERTIFICATES
$_____________ CLASS B ____% ASSET BACKED CERTIFICATES
BANK ONE, ARIZONA, NA
(SELLER)
FORM OF UNDERWRITING AGREEMENT
June __, 1996
BANC ONE CAPITAL CORPORATION
90 North High Street
Columbus, OH 43215
SALOMON BROTHERS INC
7 World Trade Center
32nd Floor
New York, NY 10048
Ladies and Gentlemen:
1. INTRODUCTORY. Banc One ABS Corporation, an Ohio Corporation (the
"Seller"), proposes to cause BANC ONE AUTO GRANTOR TRUST 1996-B (the "Trust") to
issue $______________ principal amount of its Class A ____% Asset Backed
Certificates (the "Class A Certificates") and $_____________ principal amount of
its Class B % Asset Backed Certificates (the "Class B Certificates" and,
together with the Class A Certificates, the "Certificates") and the Seller
proposes to sell the Certificates to the several underwriters named in Schedule
I attached hereto (the "Underwriters"). The assets of the Trust include, among
other things, a pool of retail receivables generated from time to time pursuant
to motor vehicle retail installment sale contracts (the "Receivables") secured
by new or used automobiles, vans or light-duty trucks financed thereby (the
"Financed Vehicles"), and certain monies received thereunder on or after June 1,
1996 (the "Cutoff Date"), and the other property and the proceeds thereof to be
conveyed to the Trustee pursuant to the Pooling and Servicing Agreement to be
dated as of June 1, 1996 (the "Pooling and Servicing Agreement") among the
Seller, as seller and Bank One, Arizona, NA, a national banking association, as
servicer (the "Bank" or the "Servicer") and Bankers Trust Company, a New York
banking corporation, as
trustee (the "Trustee"). Pursuant to the Pooling and Servicing Agreement, the
Seller will sell the Receivables to the Trustee, acting on behalf of Trust and
the Servicer will service the Receivables on behalf of the Trust. In addition,
pursuant to the Pooling and Servicing Agreement, the Servicer will agree to
perform certain administrative tasks. The Certificates will be issued pursuant
to the Pooling and Servicing Agreement.
Certain of the Receivables were originated by Valley National
Financial Services Company ("Valley National" or the "Subservicer"), a wholly-
owned subsidiary of the Bank will be sold to the Bank pursuant to the terms of
the Loan Purchase and Servicing Agreement (the "Loan Purchase and Servicing
Agreement") dated as of June 1, 1996 between the Bank and Valley National. The
Bank will sell the Receivables to the Seller pursuant to the terms of the Loan
Sale Agreement dated as of June 1, 1996 (the "Loan Sale Agreement") between the
Bank and the Seller.
Capitalized terms used and not otherwise defined herein shall have the
meanings given them in the Pooling and Servicing Agreement.
2. REPRESENTATIONS AND WARRANTIES OF THE SELLER. (a) The Seller
represents and warrants to and agrees with the Underwriters that:
(i) A registration statement (No. 333-3457), including a form of
prospectus, on Form S-3 relating to the Certificates has been filed with
the Securities and Exchange Commission (the "Commission") and either (A)
has been declared effective under the Securities Act of 1933, as amended
(the "Act"), and is not proposed to be amended or (B) is proposed to be
amended by amendment or post-effective amendment. If the Seller does not
propose to amend such registration statement and if any post-effective
amendment to such registration statement has been filed with the Commission
prior to the execution and delivery of the Underwriting Agreement, the most
recent such amendment has been declared effective by the Commission. For
purposes of the Underwriting Agreement, "Effective Time" means (x) if the
Seller has advised the Underwriters that it does not propose to amend such
registration statement, the date and time as of which such registration
statement, or the most recent post-effective amendment thereto (if any)
filed prior to the execution and delivery of the Underwriting Agreement,
was declared effective by the Commission, or (y) if the Seller has advised
the Underwriters that it proposes to file an amendment or post-effective
amendment to such registration statement, the date and time as of which
such registration statement, as amended by such amendment or post-effective
-2-
amendment, as the case may be, is declared effective by the Commission.
"Effective Date" means the date of the Effective Time. Such registration
statement, as amended at the Effective Time, including all information (if
any) deemed to be a part of such registration statement as of the Effective
Time pursuant to Rule 430A(b) under the Act, and including the exhibits
thereto and any material incorporated by reference therein, is hereinafter
referred to as the "Registration Statement," and the form of prospectus
relating to the Certificates, as first filed with the Commission pursuant
to and in accordance with Rule 424(b) ("Rule 424(b)") under the Act or, if
no such filing is required, as included in the Registration Statement at
the Effective Date, is hereinafter referred to as the "Prospectus."
(ii) If the Effective Time is prior to the execution and delivery of
the Underwriting Agreement: (A) on the Effective Date, the Registration
Statement conformed in all material respects to the requirements of the Act
and the rules and regulations of the Commission under the Act (the "Rules
and Regulations"), (B) on the date of the Underwriting Agreement, the
Registration Statement conforms, and at the time of filing of the
Prospectus pursuant to Rule 424(b), the Registration Statement and the
Prospectus will conform, in all material respects to the requirements of
the Act and the Rules and Regulations, (C) on the Effective Date, the
Registration Statement did 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 (D) on
the Effective Date, the Prospectus, if not filed pursuant to Rule 424(b),
did not, and on the date of any filing pursuant to Rule 424(b) and on the
Closing Date the Prospectus 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
are made, not misleading. If the Effective Time is subsequent to the
execution and delivery of the Underwriting Agreement: (1) on the Effective
Date, the Registration Statement and the Prospectus will conform in all
material respects to the requirements of the Act and the Rules and
Regulations, (2) on the Effective Date, the Registration Statement will not
include 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 (3) on the Effective Date, at the
time of filing of the Prospectus pursuant to Rule 424(b) and at the Closing
Date, the Prospectus will not include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary in order to
-3-
make the statements therein, in the light of the circumstances under which
they were made, not misleading. The two preceding sentences do not apply
to statements in or omissions from the Registration Statement or Prospectus
based upon written information furnished to the Seller by any Underwriter
through the Underwriters specifically for use therein and the Seller
acknowledges that the only such information is the Underwriters'
Information as defined in Section 2(b) hereof.
(iii) The Underwriting Agreement has been duly authorized, executed and
delivered by the Seller. The execution, delivery and performance of the
Underwriting Agreement and the issuance and sale of the Certificates and
compliance with the terms and provisions hereof will not result in a breach
or violation of any of the terms and provisions of, or constitute a default
under, any agreement or instrument to which the Seller is a party or by
which the Seller is bound or to which any of the properties of the Seller
is subject which could reasonably be expected to have a material adverse
effect on the transactions contemplated herein. The Seller has full
corporate power and authority to (i) authorize the Trustee to execute and
deliver the Certificates to the Seller and (ii) sell the Certificates to
the Underwriters, all as contemplated by the Underwriting Agreement.
(iv) Other than as contemplated by the Underwriting Agreement or as
disclosed in the Prospectus, there is no broker, finder or other party that
is entitled to receive from the Seller any brokerage or finder's fee or
other fee or commission as a result of any of the transactions contemplated
by the Underwriting Agreement.
(v) All legal or governmental proceedings, contracts or documents of
a character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement have
been so described or filed as required.
(vi) As of the Closing Date (as defined below), the representations
and warranties of (i) the Seller and the Bank under the Pooling and
Servicing Agreement will be true and correct in all material respects and
each such representation and warranty is so incorporated herein by this
reference; (ii) the Bank under the Loan Sale Agreement, (iii) Valley
National under the Loan Purchase and Servicing Agreement and (iv) the
Seller herein shall be true and correct in all material respects.
(vii) The Seller's assignment and delivery of the Receivables to the
Trustee, on behalf of the Trust, on the
-4-
Closing Date will vest in the Trustee, on behalf of the Trust, all the
Seller's right, title and interest therein, or will result in a first
priority perfected security interest therein, in either case subject to no
prior Lien.
(viii) The Certificates, when duly and validly executed and
authenticated by the Trustee, in accordance with the Pooling and Servicing
Agreement, and delivered and paid for pursuant hereto will be validly
issued and outstanding and entitled to the benefits of the Pooling and
Servicing Agreement.
(ix) Neither the transfer from the Seller to the Trustee, acting on
behalf of the Trust, of the Receivables and other Trust Property conveyed
by it to the Trust pursuant to the Pooling and Servicing Agreement, nor the
assignment of the security interest of the Seller in the Financed Vehicles
or the other Trust Property to the Trustee, acting on behalf of the Trust,
pursuant to the Pooling and Servicing Agreement, nor the issuance, sale and
delivery of the Certificates, nor the fulfillment of the terms of the
Certificates, will conflict with, or result in a breach, violation or
acceleration of, or constitute a default under, any term or provision of
the organizational documents of the Seller or any material indenture or
other material agreement or instrument to which the Seller is a party or by
which it or its properties is bound or result in a violation of or
contravene the terms of any statute, order or regulation applicable to the
Seller of any court, regulatory body, administrative agency, governmental
body or arbitrator having jurisdiction over the Seller or will result in
the creation of any Lien upon any material property or assets of the
Seller.
(x) The Seller has caused the Servicer to deliver to the Underwriters
or to counsel for the Underwriters complete and correct copies of publicly
available portions of the Consolidated Report of Condition of the Servicer
for the period ended March 31, 1996, as submitted to the Governors of the
Federal Reserve System; except as set forth in or contemplated in the
Registration Statement and the Prospectus, there has been no material
adverse change in the financial condition or results of operations of the
Servicer since March 31, 1996.
(xi) Any taxes, fees and other governmental charges in connection with
the execution, delivery and performance by the Seller of the Underwriting
Agreement, the Pooling and Servicing Agreement and the Certificates shall
have been paid or will be paid by or on behalf of the Seller at or prior to
the Closing Date to the extent then due.
-5-
(b) The Seller hereby agrees with the Underwriters that, for all
purposes of the Underwriting Agreement, the only information furnished to the
Seller by the Underwriters specifically for use in the Registration Statement,
the Prospectus, or any amendment or supplement thereto, or any related
preliminary prospectus, are the statements with respect to stabilization on the
second page of, and the statements under the caption "Underwriting" in, the
preliminary prospectus and the Prospectus (collectively, the "Underwriters'
Information").
3. PURCHASE, SALE AND DELIVERY OF THE 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 principal amount of the Class A Certificates set forth
opposite the name of such Underwriter in Schedule I hereto at a purchase price
of __________% of the principal amount thereof and the principal amount of the
Class B Certificates set forth opposite the name of such Underwriter in Schedule
I hereto at a purchase price of __________% of the principal amount thereof.
The Seller will deliver the Certificates to the Underwriters, for the account of
the Underwriters, against payment of the purchase price to or upon the order of
the Seller by wire transfer or check in Federal (same day) Funds, at the office
of Stroock & Stroock & Lavan, Seven Hanover Square, New York, New York 10004, at
10:00 a.m., New York time on June , 1996, or at such other time not later than
seven full business days thereafter as the Underwriters 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
Class A Certificates and one or more Class B 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 the limited circumstances specified in
the Pooling and Servicing Agreement.
4. OFFERING. It is understood that, after the Registration Statement becomes
effective, the Underwriters propose to offer the Certificates for sale to the
public (which may include selected dealers), on the terms set forth in the
Prospectus.
5. COVENANTS OF THE SELLER. The Seller covenants and agrees with
the several Underwriters that:
-6-
(a) If the Effective Time is prior to the execution and delivery of
the Underwriting Agreement, the Seller will file the Prospectus, properly
completed, with the Commission pursuant to and in accordance with subparagraph
(1) (or, if applicable and if consented to by the Underwriters, subparagraph
(4)) of Rule 424(b) not later than the earlier of (i) the second business day
following the execution and delivery of the Underwriting Agreement and (ii) the
fifth business day after the Effective Date. The Seller will advise the
Underwriters promptly of any such filing pursuant to Rule 424(b).
(b) The Seller will advise the Underwriters promptly of any proposal
to amend or supplement the registration statement as filed or the related
prospectus or the Registration Statement or the Prospectus and will not effect
such amendment or supplementation without the consent of the Underwriters, which
consent shall not be unreasonably withheld or delayed; the Seller will also
advise the Underwriters 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 Seller will also advise the Underwriters
promptly of the effectiveness of the Registration Statement (if the Effective
Time is subsequent to the execution of the Underwriting Agreement) and 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 Seller will use its reasonable best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible the lifting of
any issued stop order.
(c) If, at any time when a prospectus relating to the Certificates is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would contain 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 or supplement
the Prospectus to comply with the Act, the Seller promptly will prepare and file
with the Commission an amendment or supplement which will correct such statement
or omission, or an amendment or supplement which will effect such compliance.
Neither the consent of the Underwriters to, nor the delivery by the Underwriters
of, any such amendment or supplement shall constitute a waiver of any of the
conditions set forth in Section 6.
(d) The Seller will timely prepare and file all periodic reports, on
behalf of the Trust, with the Commission referred to in its No-Action Letter to
the Commission dated
-7-
August 11, 1995 until no longer required to do so as permitted by Section 15(d)
of the Exchange Act.
(e) The Seller will furnish to each of the Underwriters copies of the
Registration Statement (two of which will be signed and will include all
exhibits), each related preliminary prospectus, the Prospectus and all
amendments and supplements to such documents, in each case as soon as available
and in such quantities as the Underwriters reasonably request.
(f) The Seller will take all actions which are reasonably necessary
to arrange for the qualification of the Certificates for sale under the laws of
such jurisdictions as the Underwriters designate and will continue such
qualifications in effect so long as required for the distribution; PROVIDED,
HOWEVER, that in no event shall the Seller be obligated to qualify as a foreign
corporation or to execute a general or unlimited consent to service of process
in any such jurisdiction.
(g) For a period from the date of the Underwriting Agreement until
the retirement of the Certificates, or until such time as the Underwriters shall
cease to maintain a secondary market in the Certificates, whichever occurs
first, the Seller will deliver to the Underwriters the annual statements of
compliance and the annual independent certified public accountants' reports
furnished to the Trustee pursuant to the Pooling and Servicing Agreement, as
soon as such statements and reports are furnished to the Trustee.
(h) So long as any of the Certificates are outstanding, the Seller
will furnish to the Underwriters (i) as soon as practicable after the end of the
fiscal year all documents required to be distributed to Certificateholders or
filed with the Commission on behalf of the Trust pursuant to the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or any order of the
Commission thereunder and (ii) from time to time, any other information
concerning the Seller as the Underwriters may reasonably request only insofar as
such information reasonably relates to the Registration Statement or the
transactions contemplated by the Pooling and Servicing Agreement.
(i) On or before the Closing Date, the Seller shall mark its
accounting and computer records relating to the Receivables and shall cause the
Bank and Valley National to mark its respective computer records relating to the
Receivables to show the absolute ownership by the Trustee on behalf of the Trust
of the Receivables, and from and after the Closing Date none of the Seller, the
Bank or Valley National shall take any action inconsistent with the ownership by
the Trustee on behalf
-8-
of the Trust of such Receivables, other than as permitted by the Pooling and
Servicing Agreement.
(j) To the extent, if any, that any of the ratings provided with
respect to the Certificates by the rating agency or agencies that initially rate
any of the Certificates are conditional upon the furnishing of documents or the
taking of any other actions by the Seller on or prior to the Closing Date, the
Seller shall furnish such documents and take any such other actions. A copy of
any such document shall be provided to the Underwriters at the time it is
delivered to the rating agencies.
(k) For the period beginning on the date of the Underwriting
Agreement and ending on the Closing Date, neither the Seller nor any Affiliate
or trust originated, directly or indirectly, by the Seller or any Affiliate (or
any trust, partnership or other entity sponsored by the Seller or any Affiliate
or in which the Seller or any Affiliate is a partner or a stockholder) will,
without the prior written consent of the Underwriters, offer to issue or issue
notes collateralized by, or certificates (other than the Certificates)
evidencing an ownership interest in, motor vehicle installment sale contracts,
PROVIDED, HOWEVER, that except as otherwise provided by the Pooling and
Servicing Agreement, this shall not be construed to prevent (i) the sale of
Receivables by any Affiliate of the Seller to any person or (ii) any sales or
grants of participations in and to Receivables by one or more Affiliates of the
Seller to one or more other Affiliates of the Seller.
(l) The Seller will apply the net proceeds of the sale of the
Certificates that it receives in the manner set forth in the Prospectus under
the caption "Use of Proceeds."
(m) The Seller will pay all expenses incident to the performance of
its obligations under the Underwriting Agreement, including (i) the printing and
filing of the documents (including the Registration Statement and Prospectus),
(ii) the preparation, issuance and delivery of the Certificates to the
Underwriters, (iii) the fees and disbursements of the Seller's counsel and
accountants, (iv) the qualification of the Certificates under securities laws in
accordance with the provisions of Section 6(f), including filing fees and the
fees and disbursements of counsel for the Underwriters in connection therewith
and in connection with the preparation of any blue sky or legal investment
survey, if any is requested, (v) the printing and delivery to the Underwriters
of copies of the Registration Statement as originally filed and of each
amendment thereto, (vi) the printing and delivery to the Underwriters of copies
of any blue sky or legal investment survey prepared in connection with the
Certificates, (vii) any fees charged by rating agencies for the rating of the
Certificates, (viii) the fees and expenses, if any, incurred with respect to any
filing
-9-
with the National Association of Securities Dealers, Inc. and (ix) the fees and
expenses of Squire Sanders & Dempsey, Arizona.
6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the several Underwriters to purchase and pay for the Certificates
will be subject to the accuracy, as of the date hereof and as of the Closing
Date, of the representations and warranties on the part of the Seller herein, to
the accuracy of the written statements of officers of the Seller made pursuant
to the provisions of this Section, to the performance by the Seller of its
obligations hereunder and to the following additional conditions precedent:
(a) If the Effective Time is not prior to the execution and delivery
of the Underwriting Agreement, the Effective Time shall have occurred not later
than 6:00 p.m. New York City time on the date of the Underwriting Agreement or
such later time or date as shall have been consented to by the Underwriters.
(b) If the Effective Time is prior to the execution and delivery of
the Underwriting Agreement, the Prospectus and any supplements thereto shall
have been filed with the Commission in accordance with the Rules and Regulations
and Section 5(a) hereof. 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 or the Underwriters, shall be contemplated by the Commission.
(c) The Underwriters shall have received a letter, dated the date of
delivery thereof (which, if the Effective Time is prior to the execution and
delivery of the Underwriting Agreement, shall be on or prior to the date of the
Underwriting Agreement or, if the Effective Time is subsequent to the execution
and delivery of the Underwriting Agreement, shall be prior to the filing of the
amendment or post-effective amendment to the Registration Statement to be filed
shortly prior to the Effective Time), of Deloitte & Touche L.L.P. with respect
to certain agreed-upon procedures, confirming that such accountants are
independent public accountants within the meaning of the Act and the Rules and
Regulations, and substantially in the form of the draft to which the
Underwriters have previously agreed and otherwise in form and substance
reasonably satisfactory to the Underwriters and counsel for the Underwriters.
(d) Subsequent to the execution and delivery of the Underwriting
Agreement, there shall not have occurred (i) any change, or any development
involving a prospective change materially and adversely affecting (A) the Trust
Property taken as a whole or (B) the business or properties of the Seller, the
Bank, Valley National or BANC ONE CORPORATION which, in the
-10-
reasonable judgment of the Underwriters in the case of either (A) or (B) makes
it impractical or inadvisable to market the Certificates on the terms and in the
manner contemplated in the Prospectus; (ii) any downgrading in the rating of any
debt securities of BANC ONE CORPORATION or any of its Affiliates by any
"nationally recognized statistical rating organization" (as defined for purposes
of Rule 436(g) under the Act), or any public announcement that any such
organization has under surveillance or review its rating of any such debt
securities (other than an announcement with positive implications of a possible
upgrading, and no implication of a possible downgrading, of such rating); (iii)
any suspension or limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such exchange;
(iv) any suspension of trading of any securities of BANC ONE CORPORATION on any
exchange or in the over-the-counter market; (v) any banking moratorium declared
by Federal or New York authorities; or (vi) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress, or any other substantial national or international calamity or
emergency if, in the judgment of a majority in interest of the Underwriters
(including the Underwriters), the effect of any such outbreak, escalation,
declaration, calamity or emergency makes it impractical or inadvisable to
proceed with completion of the sale of and payment for the Certificates.
(e) The Underwriters shall have received an opinion of Squire,
Sanders & Dempsey, special counsel to the Seller, the Bank and Valley National
or from such other counsel reasonably satisfactory to the Underwriters and
counsel for the Underwriters, dated the Closing Date, satisfactory in form and
substance to the Underwriters and counsel for the Underwriters, to the effect
that:
(i) The Seller has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Ohio, with the
corporate power and authority to own its properties and to conduct its
business as such properties are currently owned and such business is
currently conducted, and to enter into and perform its obligations under
the Underwriting Agreement and the Pooling and Servicing Agreement.
(ii) The Seller has duly authorized, executed and delivered the
written order to the Trustee to execute and deliver the Certificates. When
the Certificates have been duly executed, delivered and authenticated in
accordance with the Pooling and Servicing Agreement and delivered and paid
for pursuant to the Underwriting Agreement, the Certificates will be
validly issued, outstanding and entitled to the benefits of the Pooling and
Servicing
-11-
Agreement, subject as to enforceability to the effects of applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium
and similar laws now or hereafter in effect relating to creditors' rights
generally and subject to general principles of equity (whether in a
proceeding at law or in equity).
(iii) The Seller has duly authorized, executed and delivered the
Underwriting Agreement, the Loan Sale Agreement and the Pooling and
Servicing Agreement, and each of the Loan Sale Agreement and the Pooling
and Servicing Agreement is the legal, valid and binding obligation of the
Seller, enforceable against the Seller in accordance with its terms,
subject as to enforceability to the effects of applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium and similar
laws now or hereafter in effect relating to creditors' rights generally and
subject to general principles of equity (whether applied in a proceeding at
law or in equity)
(iv) Neither the transfer of the Trust Property by the Seller to the
Trustee on behalf of the Trust, nor the execution and delivery by the
Seller of the Underwriting Agreement, the Loan Sale Agreement or the
Pooling and Servicing Agreement, nor the consummation by the Seller of the
transactions contemplated by the Underwriting Agreement, the Loan Sale
Agreement or the Pooling and Servicing Agreement nor the performance by the
Seller of its obligations thereunder will (i) violate the articles of
incorporation or the code of regulations, each as amended, of the Seller or
(ii) violate or contravene the terms of applicable provisions of statutory
law or regulation.
(v) To such counsel's knowledge, there are no actions, proceedings or
investigations pending against the Seller or threatened against the Seller
before any court, administrative agency or tribunal (i) asserting the
invalidity of the Trust, the Underwriting Agreement, the Loan Sale
Agreement or the Pooling and Servicing Agreement, (ii) seeking to prevent
the consummation of any of the transactions contemplated by the
Underwriting Agreement, the Loan Sale Agreement or the Pooling and
Servicing Agreement or the execution and delivery thereof or (iii) that
could reasonably be expected to materially and adversely affect the
enforceability of the Underwriting Agreement, the Loan Sale Agreement or
the Pooling and Servicing Agreement against the Seller or the ability of
the Seller to perform its obligations thereunder.
(vi) No consent, license, approval, authorization or order of, or
filing with, any court or governmental agency or body is required of the
Seller for the consummation by
-12-
the Seller of the transactions contemplated in the Underwriting Agreement,
the Loan Sale Agreement or the Pooling and Servicing Agreement, except such
consents, licenses, approvals, authorizations or orders as have been
obtained or such filings as have been made and except where the failure to
obtain the same would not have a material adverse effect upon the rights of
the Certificateholders.
(vii) To such counsel's knowledge, there are no legal or governmental
proceedings pending or threatened against the Seller that are required to
be disclosed in the Registration Statement, other than those disclosed
therein.
(viii) The Seller is not, and will not as a result of the offer and sale
of the Certificates as contemplated in the Prospectus and the Underwriting
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.
(ix) All actions required, if any, to be taken and all filings
required to be made by the Seller or the Trust under the Act and the
Exchange Act prior to the sale of the Certificates have been duly taken or
made.
(x) The Pooling and Servicing Agreement need not be qualified under
the Trust Indenture Act and the Trust is not required to register under the
Investment Company Act.
(xi) Such counsel has been advised by the Commission's staff that the
Registration Statement has become effective under the Act; any required
filing of the Prospectus pursuant to Rule 424(b) promulgated under the Act
has been made in the manner and within the time period required under such
rule; and to such counsel's knowledge no stop order suspending the
effectiveness of the Registration Statement or any part thereof has been
issued and no proceedings for that purpose are pending or threatened by the
Commission.
(xii) The statements in the Prospectus under the headings "Summary of
Terms -- Tax Status," "Federal Income Tax Consequences," "Summary of
Terms--ERISA Considerations," and "ERISA Considerations," to the extent
that they constitute statements of matters of law or legal conclusions with
respect thereto, have been reviewed by such counsel and accurately describe
the material consequences to holders of the Certificates under the Code and
ERISA.
-13-
(xiii) The Trust will not be classified as an association taxable as a
corporation for federal income tax purposes and, instead, under subpart E,
part I of subchapter J of the Internal Revenue Code of 1986, as amended,
the Trust will be treated as a grantor trust and, except with respect to
amounts received with respect to the Receivables which are payable by the
Trust to the Seller or to the Collateral Agent for deposit in the Reserve
Fund and certain amounts payable by the Trust to the Servicer, each
Certificateholder will be treated as the owner of an undivided pro rata
interest in the income and corpus attributable to the Trust.
(xiv) To such counsel's knowledge, there are no contracts, indentures,
mortgages, loan agreements, notes, leases or other instruments to which the
Seller is a party that are required to be filed as exhibits to the
Registration Statement other than those described or referred to therein or
filed or incorporated by reference as exhibits thereto.
(xv) Such counsel shall state that they have participated in the
preparation of the Registration Statement and no facts have come to their
attention which may cause them to believe that the Registration Statement,
as of the Effective Time, contained any untrue statement of a material fact
or omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading or that
the Prospectus, as of its date or the Closing Date, contains any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that
such counsel need not express any view with respect to the financial,
statistical or computational material included in the Registration
Statement or the Prospectus.
(xvi) Each of the Loan Purchase and Servicing Agreement, the Loan Sale
Agreement, the Pooling and Servicing Agreement and the Bank Agreement meets
each of the requirements of Section 13(e) of the Federal Deposit Insurance
Act, as amended (the "FDIA"), and neither Section 11(d)(9) nor Section
11(n)(4)(I) of the FDIA would prevent the Pooling and Servicing Agreement
from forming the basis of a claim against the FDIC as conservator or
receiver or in its corporate capacity, or against any bridge bank chartered
pursuant to Section 11(n) of the FDIA. For purposes of this paragraph
(xiv), such counsel may assume that from the time of its execution each of
the Loan Purchase and Servicing Agreement, the Loan Sale Agreement, the
Pooling and Servicing Agreement and the Bank Agreement
-14-
has been and will be an official record (as such term is used in Sections
11(n)(4)(I)(iv) and 13(e)(4) of the FDIA) of the Bank.
(xvii) The Bank has been duly organized and is validly existing as a
national banking association in good standing under the laws of the United
States of America, with corporate power and authority to own its
properties, to conduct its business as now conducted and as proposed to be
conducted by it and to enter into and perform its obligations under the
agreement in the form attached hereto as Exhibit A (the "Bank Agreement")
the Pooling and Servicing Agreement, the Loan Purchase and Servicing
Agreement and the Loan Sale Agreement (collectively, the "Bank Documents").
(xviii) The Bank has duly authorized, executed and
delivered each of the Bank Documents, and each of the Bank Documents is the
legal, valid and binding obligations of the Bank, enforceable against the
Bank in accordance with the respective terms thereof, subject as to
enforceability, to the effects of applicable insolvency, receivership,
conservatorship and other similar laws affecting the rights of creditors'
generally or the rights of creditors of institutions the deposits in which
are insured by the FDIC and subject to general principles of equity
(whether applied in a proceeding at law or in equity).
(xix) Neither the execution and delivery by the Bank of any Bank
Document nor the consummation by the Bank of the transactions contemplated
therein nor the fulfillment of the terms thereof by the Bank will conflict
with, result in a breach, violation or acceleration of, or constitute a
default under, any term or provision of the articles of association or
by-laws of the Bank or result in a violation of or contravene the terms of
any statute, order or regulation applicable to the Bank of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over it.
(xx) To such counsel's knowledge, there are no actions, proceedings or
investigations pending or threatened against the Bank before or by any
governmental authority that could reasonably be expected to materially and
adversely affect the performance by the Bank of its obligations under, or
the validity or enforceability of, any Bank Document.
(xxi) Valley National has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Arizona
with corporate power and authority to own its properties, to conduct it
business as
-15-
now conducted and as proposed to be conducted by it and to enter into and
perform its obligations under the Loan Purchase and Servicing Agreement.
(xxii) Valley National has duly authorized, executed and delivered the
Loan Purchase and Servicing Agreement and the Loan Purchase and Servicing
Agreement is the legal, valid and binding obligation of Valley National,
enforceable against Valley National in accordance with its terms, subject
as to enforceability, to the effects of applicable bankruptcy, insolvency,
receivership, moratorium, fraudulent conveyance, reorganization,
conservatorship and other similar laws affecting the rights of creditors'
generally or the rights of creditors of institutions the deposits and
subject to general principles of equity (whether applied in a proceeding at
law or in equity).
(xxiii) Neither the execution and delivery by Valley National of the Loan
Purchase and Servicing Agreement nor the consummation by Valley National of
the transactions contemplated therein nor the fulfillment of the terms
thereof by Valley National will conflict with, result in a breach,
violation or acceleration of, or constitute a default under, any term or
provision of the [articles of association or by-laws] of Valley National,
or result in a violation of or contravene the terms of any statute, order
or regulation applicable to Valley National of any court, regulatory body,
administrative agency or governmental body having jurisdiction over Valley
National.
(xxiv) To such counsel's knowledge, there are no actions, proceedings or
investigations pending or threatened against Valley National before or by
any governmental authority that could reasonably be expected to materially
and adversely affect the performance by Valley National of its obligations
under, or the validity or enforceability of the Loan Purchase and Servicing
Agreement.
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Underwriters. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the federal law of the United States of America and the
laws of the States of Ohio, Arizona and New York.
(f) The Underwriters shall have received the opinion of Squire,
Sanders & Dempsey, special counsel to the Seller, dated the Closing Date,
satisfactory in form and substance to the Underwriters and counsel for the
Underwriters, regarding the
-16-
creation, attachment and perfection of a first priority security interest in the
Receivables, the Financed Vehicles located in the State of Arizona and the
property held in the Reserve Fund in favor of the Trustee on behalf of the
Certificateholders. Such opinion may contain such assumptions, qualifications
and limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Underwriters. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the federal law of the United States of America and the
laws of the States of Ohio, Arizona and New York.
(g) The Underwriters shall have received the opinion of in-house
counsel to the Bank, or such other counsel acceptable to the Underwriters and
counsel for the Underwriters, dated the Closing Date, satisfactory in form and
substance to the Underwriters and counsel for the Underwriters to the effect
that:
(i) Neither the execution and delivery by the Bank of any Bank
Documents nor the consummation by the Bank of the transactions contemplated
therein nor the fulfillment of the terms thereof by the Bank will (a)
violate the articles of association or by-laws of the Bank, (b) result in a
breach, violation or acceleration of, or constitute a default under, any
term or provision of any material indenture or other material agreement or
instrument of which such counsel has knowledge after due inquiry to which
the Bank is a party or by which it is bound or (c) result in a violation of
or contravene the terms of any Federal or Arizona statute or, to such
counsel's knowledge, any order or regulation applicable to the Bank of any
Federal or Arizona court, regulatory body, administrative agency or
governmental body having jurisdiction over the Bank.
(ii) Such counsel has been advised of the Bank's standard operating
procedures relating to the Bank's acquisition of a perfected first priority
security interest in the vehicles financed by the Bank pursuant to the
retail automobile, van or light duty truck installment sale contracts in
the ordinary course of the Bank's business. Assuming that the Bank's
standard procedures are followed with respect to the perfection of security
interests in the Financed Vehicles (such counsel having no reason to
believe that the Bank has not or will not continue to follow its standard
procedures in connection with the perfection of security interests in the
Financed Vehicles), the Bank has acquired or will acquire a perfected first
priority security interest in the Financed Vehicles.
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of
-17-
this type and are reasonably acceptable to counsel to the Underwriters. In
rendering such opinion, such counsel may state that they express no opinion as
to the laws of any jurisdiction other than the federal law of the United States
of America and the laws of the State of Arizona.
(h) The Underwriters shall have received the opinion of in-house
counsel to Valley National, or such other counsel acceptable to the Underwriters
and counsel for the Underwriters, dated the Closing Date, satisfactory in form
and substance to the Underwriters and counsel for the Underwriters to the effect
that:
(i) Neither the execution and delivery by Valley National of the Loan
Purchase and Servicing Agreement nor the consummation by Valley National of
the transactions contemplated therein nor the fulfillment of the terms
thereof by Valley national will (a) violate the [articles of association or
by-laws] of Valley National, (b) result in a breach, violation or
acceleration of, or constitute a default under, any term or provision of
any material indenture or other material agreement or instrument of which
such counsel has knowledge after due inquiry to which Valley National is a
party or by which it is bound or (c) result in a violation of or contravene
the terms of any Federal or Arizona statute or, to such counsel's
knowledge, any order or regulation applicable to Valley National of any
Federal or Arizona court, regulatory body, administrative agency or
governmental body having jurisdiction over Valley National.
(ii) Such counsel has been advised of Valley National's standard
operating procedures relating to Valley National's acquisition of a
perfected first priority security interest in the vehicles financed by
Valley National pursuant to the retail automobile, van or light duty truck
installment sale contracts in the ordinary course of Valley National's
business. Assuming that Valley National's standard procedures are followed
with respect to the perfection of security interests in the Financed
Vehicles (such counsel having no reason to believe that Valley National has
not or will not continue to follow its standard procedures in connection
with the perfection of security interests in the Financed Vehicles securing
the Receivables sold by Valley National to the Bank pursuant to the Loan
Purchase and Servicing Agreement), Valley National has acquired or will
acquire a perfected first priority security interest in the Financed
Vehicles securing the Receivables sold by Valley National to the Bank
pursuant to the Loan Purchase and Servicing Agreement.
-18-
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Underwriters. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the federal law of the United States of America and the
laws of the State of Arizona.
(i) The Underwriters shall have received an opinion addressed to it
of Stroock & Stroock & Lavan, in its capacity as counsel to the Underwriters,
dated the Closing Date, with respect to the validity of the Certificates and
such other related matters as the Underwriters shall reasonably 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.
(j) The Underwriters shall have received an opinion of counsel to the
Trustee, dated the Closing Date and satisfactory in form and substance to the
Underwriters and counsel for the Underwriters, to the effect that:
(i) The Trustee is a banking corporation validly existing and in good
standing under the laws of the State of New York.
(ii) The Trustee has the requisite power and authority to execute,
deliver and perform its obligations under the Pooling and Servicing
Agreement and has taken all necessary action to authorize the execution,
delivery and performance by it of the Pooling and Servicing Agreement.
(iii) The Pooling and Servicing Agreement has been duly executed and
delivered by the Trustee and constitutes a legal, valid and binding
obligation of the Trustee, enforceable against the Trustee in accordance
with its respective terms, except that such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium, liquidation, or other
similar laws applicable to banking corporations affecting the enforcement
of creditors' rights generally, and by general principles of equity,
including, without limitation, concepts of materiality, reasonableness,
good faith and fair dealing (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(iv) The Certificates have been duly authenticated by the Trustee in
accordance with the terms of the Pooling and Servicing Agreement.
(k) The Underwriters shall have received copies of each opinion of
counsel delivered to either rating agency,
-19-
together with a letter addressed to the Underwriters, dated the Closing Date, to
the effect that each Underwriter may rely on each such opinion to the same
extent as though such opinion was addressed to each as of its date.
(l) The Underwriters shall have received certificates dated the
Closing Date of each of the Seller, the Bank and Valley National, executed by
any two of the Chairman of the Board, the President, any Executive Vice
President, Senior Vice President or Vice President, the Treasurer, any Assistant
Treasurer, the Secretary, the principal financial officer or the principal
accounting officer of each of the Seller, the Bank and Valley National, in which
such officer of the Seller, the Bank or Valley National, as the case may be,
shall state that, to the best of its knowledge after reasonable investigation,
(i) the representations and warranties of the Seller contained in the
Underwriting Agreement and the Pooling and Servicing Agreement, the Bank in each
of the Bank Documents or Valley National in the Loan Purchase and Servicing
Agreement, as applicable, are true and correct in all material respects, (ii)
that Seller, the Bank, or Valley National, as the case may be, has complied with
all agreements and satisfied all conditions on its respective part to be
performed or satisfied under such agreements at or prior to the Closing Date,
(iii) in the case of the certificate from the Seller only, 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, and (iv) since March 31, 1996, except as may be disclosed in the
Prospectus or in such certificate, no material adverse change, or any
development involving a prospective material adverse change, in or affecting
particularly the business or properties of the Bank or Valley National, as
applicable, has occurred.
(m) The Underwriters shall have received evidence satisfactory to it
that, on or before the Closing Date, UCC-1 financing statements have been or are
being filed in the appropriate filing offices reflecting the transfer of the
interest in the Receivables and the proceeds thereof from Valley National to the
Bank, from the Bank to the Seller and from the Seller to the Trustee on behalf
of the Trust.
(n) The Class A Certificates shall be rated "AAA" or its equivalent,
and the Class B Certificates shall be rated at least "A" or its equivalent, in
each case by Moody's and S&P and neither corporation shall have placed either
the Class A Certificates or the Class B Certificates under surveillance or
review with possible negative implications.
(o) The issuance of the Certificates shall not have resulted in a
reduction or withdrawal by any Rating Agency of
-20-
the current rating of any outstanding securities issued or originated by the
Seller.
(p) The Underwriters shall have received, upon execution hereof, the
duly executed agreement of the Bank in the form attached as Exhibit A.
The Seller will provide or cause to be provided to the Underwriters
such conformed copies of such of the foregoing opinions, certificates, letters
and documents as the Underwriters shall reasonably request.
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
untrue statement or alleged untrue statement of any material fact contained in
the Registration Statement, the Prospectus 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 as such expenses are incurred;
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 the Underwriters'
Information; PROVIDED, FURTHER, that the Seller shall not be liable to any
Underwriter to the extent that any such loss, claim, damage or liability of such
Underwriter arises as a result of a misstatement or omission or alleged
misstatement or omission in any related preliminary prospectus that was
corrected in the Prospectus (and copies of which Prospectus were furnished to
the Underwriters) and such Underwriter, if required by law, failed to give or
send to the purchaser, at or prior to the written confirmation of sale, a copy
of the Prospectus.
(b) Each Underwriter, severally and not jointly, agrees to 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, the Prospectus or
any amendment or
-21-
supplement thereto or any related preliminary prospectus, or arise out of or are
based upon the omission or the alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in reliance upon and in conformity with written information furnished to the
Seller by such Underwriter through the Underwriters specifically for use
therein, and will reimburse the Seller for any legal or other expenses
reasonably incurred by the Seller in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under this Section
of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above. In case any such action is brought against
any indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party (who shall not, except with the consent of the indemnified
party, be counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof and approval by the indemnified party of the counsel appointed
by the indemnifying party, the indemnifying party will not be liable to such
indemnified party under this Section for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. No indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability from any
claims that are the subject matter of such action.
(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, then each indemnifying party shall contribute to
the amount paid or payable by such indemnifying party as a result of the losses,
-22-
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Seller on the one hand and the Underwriters on the other from the offering
of the Certificates or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the 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 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. 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. The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (d) shall be deemed to
include any 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 subsection (d). 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 were offered to the public exceeds the 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.
(e) The obligations of the Seller under this Section 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; and the obligations of the
Underwriters under this Section shall be in addition to any liability which the
respective Underwriters may otherwise have and shall extend, upon the same terms
and conditions, to each director of the Seller, to each officer of the Seller
who has signed the Registration Statement and to each person, if any, who
controls the Seller within the meaning of the Act.
-23-
8. SURVIVAL OF REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements of the
Seller or its officers and of the Underwriters set forth in or made pursuant to
the Underwriting Agreement or contained in certificates of officers of the
Seller submitted pursuant hereto shall remain operative and in full force and
effect, regardless of any investigation or statement as to the results thereof,
made by or on behalf of any Underwriter, the Seller or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Certificates. If for any reason the
purchase of the Certificates by the Underwriters is not consummated, the Seller
shall remain responsible for the expenses to be paid or reimbursed by the Seller
pursuant to Section 5(m) and the respective obligations of the Seller and the
Underwriters pursuant to Section 7 shall remain in effect. If for any reason
the purchase of the Certificates by the Underwriters is not consummated (other
than because of a failure to satisfy the conditions set forth in items (iii),
(v) and (vi) of Section 6(d)), the Seller will reimburse the Underwriters for
all out-of-pocket expenses (including reasonable fees and disbursements of
counsel) reasonably incurred by them in connection with the offering of the
Certificates.
9. FAILURE TO PURCHASE THE CERTIFICATES. If any Underwriter or
Underwriters default in its obligations to purchase its portion of Class A
and/or Class B Certificates hereunder, and the aggregate principal amount that
such defaulting Underwriter or Underwriters agreed but failed to purchase does
not exceed 10% of the total principal amount of the Certificates, the
Underwriters may make arrangements satisfactory to the Seller for the purchase
of such Certificates by other persons, including any of the Underwriters, but if
no such arrangements are made by the Closing Date, the nondefaulting
Underwriters shall be obligated severally, in proportion to their respective
commitments hereunder, to purchase the Certificates that such defaulting
Underwriters agreed but failed to purchase. If any Underwriter or Underwriters
so default and the aggregate principal amount of the Certificates with respect
to such default or defaults exceeds 10% of the total principal amount of the
Certificates, and arrangements satisfactory to the Underwriters are not made by
the Seller for the purchase of such Certificates by other persons within 48
hours after such default, the Underwriting Agreement will terminate without
liability on the part of any nondefaulting Underwriter or the Seller, except as
provided in Section 8. As used in the Underwriting 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.
-24-
10. NOTICES. Any written request, demand, authorization, direction,
notice, consent or waiver shall be personally delivered or mailed certified
mail, return receipt requested (or in the form of telex or facsimile notice,
followed by written notice as aforesaid) and shall be deemed to have been duly
given upon receipt, if sent to the Underwriters, when delivered to Banc One
Capital Corporation, 90 North High Street, Columbus, Ohio 43215, Attention:
Asset Backed Securities Department (fax # (614) 221-2441) and Salomon Brothers
Inc, 7 World Trade Center, New York, New York 10048, Attention: Asset Backed
Securities Department (fax # (212) 783-3848), and if sent to the Seller, when
delivered to Banc One ABS Corporation, 100 East Broad Street, Columbus, Ohio
43271, Attention: Jeffrey B. Upperman (fax # (614) 248-5099).
11. SUCCESSORS. The Underwriting Agreement shall inure to the benefit of and
be binding upon the parties hereto 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. COUNTERPARTS. The Underwriting Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all such
counterparts shall together constitute one and the same Agreement.
13. APPLICABLE LAW. The Underwriting Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York without regard
to the choice of law provisions thereof.
-25-
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us one of the counterparts hereof,
whereupon it will become a binding agreement between the Seller and the
Underwriters in accordance with its terms.
Very truly yours,
BANC ONE ABS CORPORATION
By:
--------------------------------
Name:
Title:
The foregoing Underwriting
Agreement is hereby confirmed
and accepted as of the date
first written above.
BANC ONE CAPITAL CORPORATION
By:
---------------------------
Name:
Title:
SALOMON BROTHERS INC
By:
---------------------------
Name:
Title:
-26-
SCHEDULE I
INITIAL PRINCIPAL
UNDERWRITER CLASS AMOUNT OF CERTIFICATES
- ----------- ----- ----------------------
Banc One Capital
Corporation A $
Salomon Brothers Inc A $
Banc One Capital
Corporation B $
Salomon Brothers Inc B $
EXHIBIT A
June __, 1996
BANC ONE CAPITAL CORPORATION
90 North High Street
Columbus, OH 43215
SALOMON BROTHERS INC
7 World Trade Center
32nd Floor
New York, NY 10048
Re: Underwriting Agreement dated June __, 1996 (the
"Underwriting Agreement") among Banc One ABS Corporation
(the "Company"), Banc One Capital Corporation and Salomon
Brothers Inc (TOGETHER, THE "UNDERWRITERS")
---------------------------------------------------------
Ladies and Gentlemen:
Pursuant to the Underwriting Agreement, the Company has undertaken
certain financial obligations to the Underwriters. Any financial obligations of
the Company (including all fees to be paid) under the Underwriting Agreement,
whether or not specifically enumerated in this paragraph, are hereinafter
referred to as the "Joint and Several Obligations"; PROVIDED, HOWEVER, that
"Joint and Several Obligations" shall mean only the financial obligations of the
Company under the Underwriting Agreement (including without limitation the
payment of money damages for a breach of any of the Company's representations,
warranties or obligations, whether financial or otherwise).
As a condition of its execution of the Underwriting Agreement, the
Underwriters have required the undersigned to acknowledge its joint-and-several
liability with the Company for the payment of the Joint and Several Obligations
under the Underwriting Agreement.
Now, therefore, the Underwriters and Bank One, Arizona, NA, do hereby
agree that:
(i) Bank One, Arizona, NA hereby agrees to be absolutely and
unconditionally jointly and severally liable with the Company to
the Underwriters for the payment of the Joint and Several
Obligations.
A-1
(ii) Bank One, Arizona, NA may honor its obligations hereunder either
by direct payment of any Joint and Several Obligations or by
causing any Joint and Several Obligations to be paid to the
Underwriters by the Company or another affiliate of Bank One,
Arizona, NA
(iii) This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York without regard to the
choice of law provisions thereof.
(iv) 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.
(v) This Agreement shall inure to the benefit of and be binding upon
the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in
Section 7 of the Underwriting Agreement, and no other person will
have any right or obligations hereunder.
(vi) Any written request, demand, authorization, direction, notice,
consent or waiver shall be personally delivered or mailed
certified mail, return receipt requested (or in the form of telex
or facsimile notice, followed by written notice as aforesaid) and
shall be deemed to have been duly given upon receipt, if sent to
the Underwriters, when delivered to Banc One Capital Corporation,
90 North High Street, Columbus, Ohio 43215, Attention: Asset
Backed Securities Department (fax # (614) 221-2441) and Salomon
Brothers Inc, 7 World Trade Center, New York, New York 10048,
Attention: Asset Backed Securities Department (fax # (212) 783-
3848); and if sent to the Seller, when delivered to 100 East
Broad Street, Columbus, Ohio 43271, Attention: Jeffrey B.
Upperman (fax # (614) 248-5099).
A-2
Capitalized terms used herein and not defined herein shall have their
respective meanings as set forth in the Underwriting Agreement.
Very truly yours,
BANK ONE, ARIZONA, NA
By:
----------------------------------------
Name:
Title:
Acknowledged and Agreed:
BANC ONE CAPITAL CORPORATION
By:
-------------------------------
Name:
Title:
SALOMON BROTHERS INC
By:
-------------------------------
Name:
Title:
A-3