EXHIBIT 1.2 - CLASS B UNDERWRITING AGREEMENT
EXECUTION COPY
$65,339,000
MMCA AUTO OWNER TRUST 2000-2
7.42% CLASS B ASSET BACKED NOTES
MMCA AUTO RECEIVABLES TRUST
CLASS B UNDERWRITING AGREEMENT
November 10, 2000
SALOMON SMITH BARNEY INC.
390 Greenwich Street
New York, New York 10013
Dear Sirs:
1. Introductory. MMCA Auto Receivables Trust (the "Seller"), a Delaware
business trust established pursuant to the Amended and Restated Trust
Agreement, dated as of October 1, 1999 (the "MART Trust Agreement"),
between Mitsubishi Motors Credit of America, Inc. ("MMCA") and Chase
Manhattan Bank USA, N.A. (formerly known as Chase Manhattan Bank Delaware),
as trustee (the "MART Trustee"), proposes, subject to the terms and
conditions stated herein, to cause MMCA Auto Owner Trust 2000-2 (the
"Trust") to issue and sell to Salomon Smith Barney Inc. ("Salomon"), as the
underwriter (the "Class B Underwriter") of $65,339,000 aggregate principal
amount of 7.42% Class B Asset Backed Notes (the "Class B Notes") as set
forth in Schedule A attached hereto.
Concurrently with the issuance and sale of the Class B Notes as
contemplated herein, the Trust will issue $125,000,000 aggregate principal
amount of 6.72813% Class A-1 Asset Backed Notes (the "Class A-1 Notes"),
$300,000,000 aggregate principal amount of 6.72% Class A-2 Asset Backed
Notes (the "Class A-2 Notes"), $260,000,000 aggregate principal amount of
6.78% Class A-3 Asset Backed Notes (the "Class A-3 Notes") and $174,467,000
aggregate principal amount of 6.86% Class A-4 Asset Backed Notes (the
"Class A-4 Notes" and, together with the Class A-1 Notes, the Class A-2
Notes and the Class A-3 Notes, the "Class A Notes"). The Class A Notes will
be sold pursuant to a Class A Underwriting Agreement, dated November 7,
2000 (the "Class A Underwriting Agreement"), between the Seller and
Salomon, as representative (the "Representative") of the underwriters named
therein (the "Class A Underwriters" and, together with the Class B
Underwriter, the "Underwriters"). The Class A Notes and the Class B Notes
(collectively, the "Notes") will be issued pursuant to the Indenture, dated
as of November 1, 2000 (the "Indenture"), between the Trust and The Bank of
Tokyo-Mitsubishi Trust Company (the "Indenture Trustee").
Concurrently with the issuance and sale of the Notes as
contemplated herein, the Trust will issue $80,418,606 aggregate principal
amount of certificates (the "Certificates"), each representing an interest
in the property of the Trust (the "Trust Property"). The Seller will retain
the Certificates. The Certificates will be issued pursuant to the Amended
and Restated Trust Agreement, dated as of November 1, 2000 (the "Trust
Agreement"), between the Seller and Wilmington Trust Company, as trustee
(the "Owner Trustee"). The Certificates will be subordinated to the Notes.
The assets of the Trust will include, among other things, (i) a
pool of motor vehicle retail installment sale contracts secured by new and
used automobiles and sport-utility vehicles to be conveyed to the Trust on
the Closing Date (as such term is defined in Section 3) (the "Receivables")
and (ii) with respect to (a) Actuarial Receivables, certain monies due
thereunder on or after the related Cutoff Date and (b) Simple Interest
Receivables, certain monies due or received thereunder on or after the
related Cutoff Date. The Receivables will be sold to the Trust by the
Seller and will be serviced for the Trust by MMCA (in such capacity, the
"Servicer"). Capitalized terms used but not defined herein have the
meanings ascribed thereto in the Sale and Servicing Agreement, dated as of
November 1, 2000 (the "Sale and Servicing Agreement"), among the Trust, the
Seller and the Servicer or, if not defined therein, in the Indenture, the
Trust Agreement or the Purchase Agreement, dated as of November 1, 2000
(the "Purchase Agreement"), between MMCA, as seller, and the Seller, as
purchaser, as the case may be. "Basic Documents" means (i) the Indenture,
(ii) the Trust Agreement, (iii) the First Tier Assignment, dated as of
November 1, 2000 (the "First Tier Assignment"), as executed by MMCA, (iv)
the Sale and Servicing Agreement, (v) the Purchase Agreement, (vi) the
Certificate of Trust, filed October 31, 2000 (the "Certificate of Trust"),
with the Secretary of State of the State of Delaware, (vii) the
Administration Agreement, dated as of November 1, 2000 (the "Administration
Agreement"), among MMCA, as administrator (the "Administrator"), the Trust
and the Indenture Trustee, (viii) the Note Depository Agreement, dated as
of November 1, 2000 (the "Note Depository Agreement"), among the Trust, the
Indenture Trustee, the Administrator and The Depository Trust Company, (ix)
the Yield Supplement Agreement, dated as of November 1, 2000 (the "Yield
Supplement Agreement"), between the Seller and MMCA, (x) the Control
Agreement, dated as of November 1, 2000 (the "Control Agreement"), among
the Seller, the Trust, the Servicer, the Indenture Trustee and The Bank of
Tokyo-Mitsubishi Trust Company, as securities intermediary, and (xi) the
Class A Underwriting Agreement. The Seller hereby agrees with the Class B
Underwriter as follows:
2. Representations and Warranties of the Seller. The Seller represents and
warrants to, and agrees with, the Class B Underwriter that:
(a) A registration statement on Form S-1 (No. 333-45842)
relating to the Notes, including a form of prospectus, has been
filed with the Securities and Exchange Commission (the
"Commission") and either (i) has been declared effective under the
Securities Act of 1933, as amended (the "Act"), and is not proposed
to be amended or (ii) is proposed to be amended by amendment or
post-effective amendment. If the Seller does not propose to amend
the registration statement and if any post-effective amendment to
the registration statement has been filed with the Commission prior
to the execution and delivery of this Agreement, the most recent
post-effective amendment has been declared effective by the
Commission or has become effective upon filing pursuant to Rule
462(c) under the Act ("Rule 462(c)"). For purposes of this
Agreement, "Effective Time" means (i) if the Seller has advised the
Class B Underwriter that it does not propose to amend the
registration statement, the date and time as of which the
registration statement, or the most recent post-effective amendment
thereto (if any) filed prior to the execution and delivery of this
Agreement, was declared effective by the Commission or has become
effective upon filing pursuant to Rule 462(c), or (ii) if the
Seller has advised the Class B Underwriter that it proposes to file
an amendment or post-effective amendment to the registration
statement, the date and time as of which the registration
statement, as amended by such amendment or post-effective
amendment, as the case may be, is declared effective by the
Commission. "Effective Date" means the date of the Effective Time.
The registration statement, as amended at the Effective Time,
including all information (if any) deemed to be a part of the
registration statement as of the Effective Time pursuant to Rule
430A(b) ("Rule 430A(b)") under the Act, is hereinafter referred to
as the "Registration Statement". The form of prospectus relating to
the Notes, as first filed with the Commission pursuant to and in
accordance with Rule 424(b) under the Act ("Rule 424(b)") or, if no
such filing is required, as included in the Registration Statement
at the Effective Time, is hereinafter referred to as the
"Prospectus". No document has been or will be prepared or
distributed in reliance on Rule 434 under the Act.
(b) If the Effective Time is prior to the execution and
delivery of this Agreement: (i) on the Effective Date, the
Registration Statement conformed in all respects to the
requirements of the Act and the rules and regulations of the
Commission (the "Rules and Regulations") and did not include any
untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading and (ii) on the date of this
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 respects to the
requirements of the Act and the Rules and Regulations, and neither
of such documents includes, or will include, any untrue statement
of a material fact or omits, or will omit, to state any material
fact required to be stated therein or necessary to make the
statements therein not misleading. If the Effective Time is
subsequent to the execution and delivery of this Agreement: (i) on
the Effective Date, the Registration Statement and the Prospectus
will conform in all respects to the requirements of the Act and the
Rules and Regulations, (ii) neither of such documents will include
any untrue statement of a material fact or will omit to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading and (iii) no additional
registration statement related to the Notes pursuant to Rule 462(b)
has been or will be filed. The two preceding sentences do not apply
to statements in or omissions from the Registration Statement or
the Prospectus based upon written information furnished to the
Seller by the Class B Underwriter specifically for use therein, it
being understood and agreed that the only such information is that
described as such in Section 7(b).
(c) The Seller has been duly formed and is validly existing as
a business trust under the Delaware Business Trust Act, 12 Del.C.
ss. 3801 et. seq. (the "Delaware Trust Act"), with power and
authority to own its properties and conduct its business as
described in the Prospectus, and the Seller is duly qualified to do
business and is in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its
business requires such qualification.
(d) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required to
be obtained or made by the Seller or the Trust for the consummation
of the transactions contemplated by this Agreement and the Basic
Documents in connection with the issuance of the Notes and the
Certificates and the sale by the Seller of the Notes, 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 Seller's, the Trust's
and the Indenture Trustee's interest in the Receivables, which
financing statements will be filed in the appropriate offices
within 10 days of the Closing Date.
(e) The Seller is not in violation of the MART Trust Agreement
or other organizational documents 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 could have a material
adverse effect on the transactions contemplated herein or in the
Basic Documents. The execution, delivery and performance of this
Agreement and the Basic Documents, and the issuance of the Notes
and the Certificates and the sale by the Seller of the Notes and
compliance with the terms and provisions hereof and thereof will
not result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any
rule, regulation or order of any governmental agency or body or any
court, domestic or foreign, having jurisdiction over the Seller or
any of its properties, or 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 or any such subsidiary is subject,
or the MART Trust Agreement or other organizational documents of
the Seller, and the Seller has full power and authority to
authorize and issue the Notes and the Certificates and to sell the
Notes as contemplated by this Agreement, the Indenture and the
Trust Agreement, to enter into this Agreement and the Basic
Documents and to consummate the transactions contemplated hereby
and thereby.
(f) On the Closing Date, the Seller will have directed the
Owner Trustee to authenticate and execute the Certificates and,
when delivered and paid for pursuant to the Sale and Servicing
Agreement and the Trust Agreement, the Certificates will have been
duly executed, authenticated, issued and delivered and will
constitute valid and legally binding obligations of the Trust,
entitled to the benefits provided in the Trust Agreement and
enforceable in accordance with their terms.
(g) On the Closing Date, the Seller will have directed the
Owner Trustee to execute the Notes and directed the Indenture
Trustee to authenticate and deliver the Notes and, when
authenticated, delivered and paid for pursuant to the Indenture and
this Agreement, the Notes will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Trust, entitled to the benefits
provided in the Indenture and enforceable in accordance with its
terms.
(h) The Seller possesses adequate certificates, authorities and
permits issued by appropriate governmental agencies or bodies
necessary to conduct the business now operated by it and has not
received any notice of proceedings relating to the revocation or
modification of any such certificate, authority or permit that, if
determined adversely to the Seller, would individually or in the
aggregate have a material adverse effect on the Seller.
(i) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Seller or
any of its properties that, if determined adversely to the Seller,
would individually or in the aggregate have a material adverse
effect on the condition (financial or other), business or results
of operations of the Seller, or would materially and adversely
affect the ability of the Seller to perform its obligations under
this Agreement or the other Basic Documents to which it is a party,
or which are otherwise material in the context of the issuance and
sale of the Notes or the issuance of the Certificates or the sale
of the Notes; and no such actions, suits or proceedings are
threatened or, to the Seller's knowledge, contemplated.
(j) As of the Closing Date, the representations and warranties
of the Seller contained in the Basic Documents will be true and
correct.
(k) Since the respective dates as of which information is given
in the Registration Statement and the Prospectus, except as
otherwise stated therein, (i) there has been no material adverse
change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Seller,
whether or not arising in the ordinary course of business and (ii)
there have been no transactions entered into by the Seller, other
than those in the ordinary course of business, which are material
with respect to the Seller.
(l) Each of the Basic Documents to which the Seller is a party
has been duly authorized by the Seller and, when duly executed and
delivered by the Seller and the other parties thereto, will
constitute a valid and binding agreement of the Seller, enforceable
against the Seller in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law).
(m) This Agreement and the Class A Underwriting Agreement have
been duly authorized, executed and delivered by the Seller.
(n) The Seller has authorized the conveyance of the Receivables
to the Trust, and, as of the Closing Date, the Seller has directed
the Trust to execute and issue the Notes and the Certificates and
to sell the Notes.
(o) The Seller's assignment and delivery of the Receivables to
the Trust on the Closing Date will vest in the Trust all of the
Seller's right, title and interest therein, subject to no prior
lien, mortgage, security interest, pledge, adverse claim, charge or
other encumbrance.
(p) The Trust's assignment of the Receivables to the Indenture
Trustee pursuant to the Indenture will vest in the Indenture
Trustee, for the benefit of the Noteholders, a first priority
perfected security interest therein, subject to no prior lien,
mortgage, security interest, pledge, adverse claim, charge or other
encumbrance except for any tax lien, mechanics' lien or other lien
or encumbrance that attaches by operation of law.
(q) The Computer Tape of the Receivables created as of the
Closing Date and made available to the Class B Underwriter by the
Servicer are or will be, as applicable, complete and accurate as of
the date thereof and include or will include, as applicable, an
identifying description of the Receivables that are listed on
Schedule A to the Sale and Servicing Agreement.
(r) Any taxes, fees and other governmental charges in
connection with the execution, delivery and performance of this
Agreement, the Basic Documents, the Notes and the Certificates and
any other agreements contemplated herein or therein shall have been
paid or will be paid by the Seller at or prior to the Closing Date
to the extent then due.
(s) The consummation of the transactions contemplated by this
Agreement and the Basic Documents, and the fulfillment of the terms
hereof and thereof, will not conflict with or result in a breach of
any of the terms or provisions of, or constitute a default under,
or result in the creation of any lien, charge or encumbrance upon
any of the property or assets of the Seller pursuant to the terms
of, any indenture, mortgage, deed of trust, loan agreement,
guarantee, lease financing agreement or similar agreement or
instrument under which the Seller is a debtor or guarantor.
(t) The Seller is not and, after giving effect to the issuance
of the Notes and Certificates and the offering and sale of the
Notes and the application of the proceeds thereof as described in
the Prospectus, will not be required to be registered as an
"investment company" as defined in the Investment Company Act of
1940 (the "Investment Company Act").
3. Purchase, Sale and Delivery of Notes. 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
Class B Underwriter, and the Class B Underwriter agrees to purchase from
the Seller, the Class B Notes at a purchase price of 99.651316% of the
principal amount of the Class B Notes.
The Seller will deliver against payment of the purchase price
therefor, the Class B Notes in the form of one or more permanent global
securities in definitive form (the "Global Notes") deposited with the
Indenture Trustee as custodian for The Depository Trust Company ("DTC") and
registered in the name of Cede & Co., as nominee for DTC. Interests in any
permanent Global Notes will be held only in book-entry form through DTC,
except in the limited circumstances described in the Prospectus. Payment
for the Class B Notes shall be made by the Class B Underwriter in Federal
(same day) funds by official check or checks or wire transfer to an account
in New York previously designated to the Class B Underwriter by the Seller
at a bank acceptable to the Class B Underwriter, at the offices of Skadden,
Arps, Slate, Meagher & Flom LLP, Four Times Square, New York, New York
10036 at 10:00 a.m., New York time, on November 15, 2000, or at such other
time not later than seven full business days thereafter as the Class B
Underwriter and the Seller determine, such time being herein referred to as
the "Closing Date", against delivery to the Indenture Trustee as custodian
for DTC of the Global Notes representing all of the Class B Notes. The
Global Notes will be made available for checking at the above office of
Skadden, Arps, Slate, Meagher & Flom LLP at least 24 hours prior to the
Closing Date.
The Seller will deliver the Class A Notes and the Certificates to
the above office of Skadden, Arps, Slate, Meagher & Flom LLP on the Closing
Date. The certificate for the Certificates so to be delivered will be in
definitive form, in authorized denominations and registered in the name of
the Seller and will be made available for checking at the above office of
Skadden, Arps, Slate, Meagher & Flom LLP at least 24 hours prior to the
Closing Date.
Pursuant to Rule 15c6-1(d) under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), the parties hereto have agreed that
the Closing Date will be not later than November 15, 2000, unless otherwise
agreed to as described above.
4. Offering by the Class B Underwriter. It is understood that the Class B
Underwriter proposes to offer the Class B Notes for sale to the public
(which may include selected dealers) as set forth in the Prospectus.
5. Certain Agreements of the Seller. The Seller agrees with the Class B
Underwriter:
(a) If the Effective Time is prior to the execution and
delivery of this Agreement, the Seller will file the Prospectus
with the Commission pursuant to and in accordance with subparagraph
(1) (or, if applicable and if consented to by the Class B
Underwriter, subparagraph (4)) of Rule 424(b) not later than the
earlier of (i) the second business day following the execution and
delivery of this Agreement or (ii) the fifteenth business day after
the Effective Date. The Seller will advise the Class B Underwriter
promptly of any such filing pursuant to Rule 424(b).
(b) The Seller will advise the Class B Underwriter 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 Class B Underwriter's consent; and the
Seller will also advise the Class B Underwriter promptly of the
effectiveness of the Registration Statement (if its Effective Time
is subsequent to the execution and delivery of this Agreement) and
of any amendment or supplementation of the Registration Statement
or the Prospectus and of the institution by the Commission of any
stop order proceedings in respect of the Registration Statement and
will use its best efforts to prevent the issuance of any such stop
order and to obtain as soon as possible its lifting, if issued.
(c) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Act in connection with sales by
the Class B Underwriter or dealer, 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 in order 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 Seller will promptly notify
the Class B Underwriter of such event and will promptly prepare and
file with the Commission (subject to the Class B Underwriter's
prior review pursuant to Section 5(b)), at its own expense, an
amendment or supplement which will correct such statement or
omission, or an amendment which will effect such compliance.
Neither the Class B Underwriter's consent to, nor delivery of, any
such amendment or supplement shall constitute a waiver of any of
the conditions set forth in Section 6.
(d) As soon as practicable, but not later than the Availability
Date (as defined below), the Seller will cause the Trust to make
generally available to the Noteholders an earnings statement of the
Trust covering a period of at least 12 months beginning after the
Effective Date which will satisfy the provisions of Section 11(a)
of the Act. For the purpose of the preceding sentence,
"Availability Date" means the 90th day after the end of the Trust's
fourth fiscal quarter following the fiscal quarter that includes
such Effective Date.
(e) The Seller will furnish to the Class B Underwriter copies
of the Registration Statement (two of which will be signed and will
include all exhibits), each related preliminary prospectus, and, so
long as delivery of a prospectus relating to the Notes is required
under the Act in connection with sales by the Class B Underwriter
or dealer, the Prospectus and all amendments and supplements to
such documents, in each case as soon as available and in such
quantities as the Class B Underwriter requests. The Prospectus
shall be so furnished on or prior to 3:00 p.m., New York time, on
the business day following the later of the execution and delivery
of this Agreement or the Effective Time. All other such documents
shall be so furnished as soon as available. The Seller will pay the
expenses of printing and distributing to the Class B Underwriter
all such documents.
(f) The Seller will arrange for the qualification of the Notes
for offering and sale and the determination of their eligibility
for investment under the laws of such jurisdictions as the Class B
Underwriter designates and will continue such qualifications in
effect so long as required for the distribution of the Notes.
(g) For a period from the date of this Agreement until the
retirement of the Notes (i) the Seller will furnish to the Class B
Underwriter, copies of each certificate and the annual statements
of compliance delivered to the Indenture Trustee pursuant to
Section 3.9 of the Indenture and Sections 3.9 and 3.10 of the Sale
and Servicing Agreement and the annual independent certified public
accountant's servicing reports furnished to the Indenture Trustee
pursuant to Section 3.11 of the Sale and Servicing Agreement, by
first-class mail as soon as practicable after such statements and
reports are furnished to the Indenture Trustee, and (ii) such other
forms of periodic certificates or reports as may be delivered to
the Indenture Trustee, the Owner Trustee or the Noteholders under
the Indenture, the Trust Agreement, the Sale and Servicing
Agreement or the other Basic Documents.
(h) So long as any Note is outstanding, the Seller will furnish
to the Class B Underwriter by first-class mail as soon as
practicable, (i) all documents distributed, or caused to be
distributed, by the Seller to the Noteholders, (ii) all documents
filed, or caused to be filed, by the Seller with the Commission
pursuant to the Exchange Act, any order of the Commission
thereunder and (iii) such other information in the possession of
the Seller concerning the Trust as the Class B Underwriter from
time to time may reasonably request.
(i) The Seller will pay all expenses incident to the
performance of its obligations under this Agreement and the Class A
Underwriting Agreement and will reimburse the Class B Underwriter
(if and to the extent incurred by it) for any filing fees and other
expenses (including fees and disbursements of counsel) incurred by
it in connection with qualification of the Notes for sale and
determination of their eligibility for investment under the laws of
such jurisdictions as the Class B Underwriter designates and the
printing of memoranda relating thereto, for any fees charged by
investment rating agencies for the rating of the Notes, for any
travel expenses of the Seller's officers and employees and any
other expenses of the Seller in connection with attending or
hosting meetings with prospective purchasers of the Notes and for
expenses incurred in distributing the preliminary prospectuses and
the Prospectus (including any amendments and supplements thereto).
(j) To the extent, if any, that the ratings provided with respect to
the Notes by Moody's Investors Service, Inc. ("Moody's") and
Standard & Poor's, a Division of The McGraw-Hill Companies, Inc.
("Standard & Poor's" and, together with Moody's, the "Rating
Agencies") is conditional upon the furnishing of documents or the
taking of any other action by the Seller, the Seller shall furnish
such documents and take any such other action.
(k) On or before the Closing Date, the Seller shall cause the computer
records of the Seller and MMCA relating to the Receivables to be
marked to show the Trust's absolute ownership of the Receivables,
and from and after the Closing Date neither the Seller nor MMCA
shall take any action inconsistent with the Trust's ownership of
such Receivables, other than as permitted by the Sale and
Servicing Agreement.
6. Conditions of the Obligations of the Class B Underwriter. The
obligations of the Class B Underwriter to purchase and pay for the Class B
Notes on the Closing Date will be subject to the accuracy of the
representations and warranties on the part of the Seller herein, to the
accuracy of the statements of the Seller's officers made pursuant to the
provisions hereof, to the performance by the Seller of its obligations
hereunder and to the following additional conditions precedent:
(a) The Class B Underwriter shall have received a letter, dated
the date of delivery thereof (which, if the Effective Time is prior
to the execution and delivery of this Agreement, shall be on or
prior to the date of this Agreement or, if the Effective Time is
subsequent to the execution and delivery of this Agreement, shall
be prior to the filing of the amendment or post-effective amendment
to the registration statement to be filed shortly prior to such
Effective Time), of Ernst & Young LLP, in form and substance
satisfactory to the Class B Underwriter and counsel for the Class B
Underwriter, confirming that they are independent public
accountants within the meaning of the Act and the applicable Rules
and Regulations and stating in effect that (i) they have performed
certain specified procedures as a result of which they determined
that certain information of an accounting, financial or statistical
nature (which is limited to accounting, financial or statistical
information derived from the general accounting records of the
Trust, MMCA and the Seller) set forth in the Registration Statement
and the Prospectus (and any supplements thereto), agrees with the
accounting records of the Trust, MMCA and the Seller, excluding any
questions of legal interpretation, and (ii) they have performed
certain specified procedures with respect to the Receivables.
(b) If the Effective Time is not prior to the execution and
delivery of this Agreement, the Effective Time shall have occurred
not later than 10:00 p.m., New York time, on the date of this
Agreement or such later date as shall have been consented to by the
Class B Underwriter. If the Effective Time is prior to the
execution and delivery of this Agreement, the Prospectus shall have
been filed with the Commission in accordance with the Rules and
Regulations and Section 5(a). Prior to the Closing Date, no stop
order or other order of the Commission 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 Class B Underwriter, shall be
contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development or
event involving a prospective change, in the condition (financial
or other), business, properties or results of operations or retail
motor vehicle financing business or light-duty truck financing
business of the Trust, the Seller, Mitsubishi Motor Sales of
America, Inc. ("MMSA"), Mitsubishi Motors Corporation ("MMC") or
MMCA which, in the judgment of the Class B Underwriter, materially
impairs the investment quality of each Class of Notes or makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for each Class of Notes; (ii)
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; (iii) any banking moratorium declared by
Federal, California or New York authorities; or (iv) any outbreak
or escalation of major hostilities in which the United States is
involved, any declaration of war by Congress or any substantial
national or international calamity or emergency if, in the
judgement of the Class B Underwriter, the effect of any such
outbreak, escalation, declaration, calamity or emergency makes it
impractical or inadvisable to proceed with completion of the public
offering or the sale of and payment for each Class of Notes.
(d) The Class B Underwriter shall have received an opinion of
(A) J. Sean Plater, Esq., Director of Legal Affairs of the Seller,
(B) Skadden, Arps, Slate, Meagher & Flom LLP, special New York
counsel to the Seller, and (C) Richards, Layton & Finger, P.A.,
special Delaware counsel to the Seller, in each case dated the
Closing Date and satisfactory in form and substance to the Class B
Underwriter and counsel for the Class B Underwriter, and, in the
aggregate to the effect that:
(i) the Seller has been duly formed and is validly
existing as a business trust under the Delaware Trust Act, with
full power and authority to own its properties and conduct its
business as described in the Prospectus; the Seller is duly
qualified to do business and is in good standing in each
jurisdiction in which its ownership or lease of property or the
conduct of its business requires such qualification; and the
Seller has full power and authority under the Delaware Trust
Act and under the MART Trust Agreement to enter into and
perform its obligations under this Agreement and the Basic
Documents to which it is a party, to direct the Indenture
Trustee and the Owner Trustee to execute the Notes and the
Certificates, respectively, to consummate the transactions
contemplated hereby and thereby, and had at all times, and now
has, the power, authority and legal right to acquire, own and
sell the Receivables;
(ii) MMCA has been duly incorporated and is an
existing corporation in good standing under the laws of the
State of Delaware, with corporate power and authority to own
its properties and conduct its business as described in the
Prospectus; MMCA is duly qualified to do business and is in
good standing in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires such
qualification; and MMCA has full power and authority to enter
into and perform its obligations under this Agreement, the
Class A Note Indemnification Agreement, dated November 7, 2000
(the "Class A Note Indemnification Agreement"), between MMCA
and the Representative, acting on behalf of itself and as
Representative of the several Underwriters, the Class B Note
Indemnification Agreement, dated November 10, 2000 (the "Class
B Note Indemnification Agreement" and, together with the Class
A Note Indemnification Agreement, the "Note Indemnification
Agreements"), between MMCA and Salomon, and the Basic Documents
to which it is a party and to consummate the transactions
contemplated hereby and thereby, and had at all times, and now
has, the power, authority and legal right to acquire, own, sell
and service the Receivables;
(iii) each of the direction by the Seller to the
Owner Trustee to execute the Notes and the direction by the
Seller to the Indenture Trustee to authenticate and deliver the
Notes has been duly authorized by the Seller and, when the
Notes have been duly executed by the Owner Trustee and, when
authenticated and delivered by the Indenture Trustee in
accordance with the terms of the Indenture and delivered to and
paid for by the Class B Underwriter pursuant to this Agreement
and the Class A Underwriters pursuant to the Class A
Underwriting Agreement, the Notes will be duly and validly
issued and outstanding and will be entitled to the benefits of
the Indenture;
(iv) the direction by the Seller to the Owner Trustee
to authenticate and execute the Certificates has been duly
authorized by the Seller and, when the Certificates have been
duly executed, authenticated and delivered by the Owner Trustee
in accordance with the terms of the Trust Agreement and the
Certificates have been delivered to and paid for by the Seller
pursuant to the Sale and Servicing Agreement and the Trust
Agreement, the Certificates will be duly and validly issued and
outstanding and will be entitled to the benefits of the Trust
Agreement;
(v) the Note Indemnification Agreements and each
Basic Document to which MMCA is a party has been duly
authorized, executed and delivered by MMCA;
(vi) no consent, approval, authorization or order of,
or filing with any governmental agency or body or any court is
required for the execution, delivery and performance by the
Seller of this Agreement and the Basic Documents to which it is
a party, for the execution, delivery and performance by MMCA of
the Note Indemnification Agreements and the Basic Documents to
which it is a party or for the consummation of the transactions
contemplated by this Agreement, the Basic Documents or the Note
Indemnification Agreements, except for (i) the filing of
Uniform Commercial Code financing statements in California with
respect to the transfer of the Receivables to the Seller
pursuant to the Purchase Agreement (the "Seller Financing
Statements") and the transfer of the Trust Property to the
Trust pursuant to the Sale and Servicing Agreement (the "Trust
Financing Statements") and the filing of a Uniform Commercial
Code financing statement in Delaware with respect to the grant
by the Trust of a security interest in the Trust Property to
the Indenture Trustee pursuant to the Indenture (the "Indenture
Financing Statements"), which financing statements will be
filed in the appropriate offices within ten days of the Closing
Date; (ii) such as have been obtained and made under the Act;
and (iii) such as may be required under state securities laws;
(vii) the execution, delivery and performance of this
Agreement and the Basic Documents by the Seller, the execution,
delivery and performance of the Note Indemnification Agreement
and the Basic Documents by MMCA and the consummation of any
other of the transactions contemplated herein, in either Note
Indemnification Agreement or the Basic Documents will not
conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon
any of the property or assets of MMCA or the Seller pursuant to
the terms of the Certificate of Incorporation or the By-Laws of
MMCA or the documents of organization of the Seller, or any
statute, rule, regulation or order of any governmental agency
or body, or any court having jurisdiction over MMCA or the
Seller or their respective properties, or any agreement or
instrument known to such counsel after due investigation to
which MMCA or the Seller is a party or by which MMCA or the
Seller or any of their respective properties is bound;
(viii) such counsel has no reason to believe that any
part of the Registration Statement or any amendment thereto, as
of its effective date, contained any untrue statement of a
material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein
not misleading or that the Prospectus or any amendment or
supplement thereto, as of its issue date or as of the Closing
Date, 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,
in the light of the circumstances under which they were made,
not misleading; the descriptions in the Registration Statement
and the Prospectus of statutes, legal and governmental
proceedings and contracts and other documents are accurate and
fairly present the information required to be shown; and such
counsel does not know of any legal or governmental proceedings
required to be described in the Registration Statement or the
Prospectus which are not described as required or of any
contracts or documents of a character required to be described
in the Registration Statement or the Prospectus or to be filed
as exhibits to the Registration Statement which are not
described and filed as required; it being understood that such
counsel need express no opinion as to the financial statements
or other financial data contained in the Registration Statement
or the Prospectus;
(ix) there are no actions, proceedings or
investigations pending to which the Seller or MMCA is a party
or, to the best knowledge of such counsel, after due inquiry,
threatened before any court, administrative agency or other
tribunal having jurisdiction over MMCA or the Seller, (i) that
are required to be disclosed in the Registration Statement,
(ii) asserting the invalidity of this Agreement, either Note
Indemnification Agreement, any Basic Document, the Notes or the
Certificates, (iii) seeking to prevent the issuance of the
Notes or the Certificates or the consummation of any of the
transactions contemplated by this Agreement or the Basic
Documents, (iv) which might materially and adversely affect the
performance by the Seller or MMCA of its obligations under, or
the validity or enforceability of, this Agreement, either Note
Indemnification Agreement, any Basic Document, the Notes or the
Certificates or (v) seeking adversely to affect the federal
income tax attributes of the Notes as described in the
Prospectus under the heading "FEDERAL INCOME TAX CONSEQUENCES";
(x) the statements in the Registration Statement
under the heading "SOME IMPORTANT LEGAL ASPECTS OF THE
RECEIVABLES", to the extent they constitute statements of
matters of law or legal conclusions with respect thereto, are
correct in all material respects;
(xi) each of MMCA and the Seller has obtained all
necessary licenses and approvals in each jurisdiction in which
failure to qualify or to obtain such license or approval would
render any Receivable unenforceable by MMCA, the Seller, the
Trust, the Owner Trustee or the Indenture Trustee;
(xii) this Agreement and each Basic Document to which
the Seller is a party has been duly authorized, executed and
delivered by the Seller;
(xiii) such counsel is familiar with MMCA's standard
operating procedures relating to MMCA's acquisition of a
perfected first priority security interest in the vehicles
financed by MMCA pursuant to retail installment sale contracts
in the ordinary course of MMCA's business; assuming that MMCA's
standard procedures are followed with respect to the perfection
of security interests in the Financed Vehicles (and such
counsel has no reason to believe that MMCA has not or will not
continue to follow its standard procedures in connection with
the perfection of security interests in the Financed Vehicles),
MMCA has acquired or will acquire a perfected first priority
security interest in the Financed Vehicles;
(xiv) the Receivables are chattel paper as defined in
the UCC; and
(xv) immediately prior to the sale of the Receivables
by MMCA to the Seller pursuant to the Purchase Agreement and
the First Tier Assignment, MMCA was the sole owner of all
right, title and interest in, to and under the Receivables and
the other property to be transferred by it to the Seller;
immediately prior to the sale of the Receivables by the Seller
to the Trust pursuant to the Sale and Servicing Agreement, the
Seller was the sole owner of all right, title and interest in,
to and under the Receivables and the other property to be sold
by it to the Trust.
(e) The Class B Underwriter shall have received an opinion of
Skadden, Arps, Slate, Meagher & Flom LLP, special counsel to the
Seller, dated the Closing Date, and satisfactory in form and
substance to the Class B Underwriter and counsel for the Class B
Underwriter, to the effect that:
(i) each Receivable is a motor vehicle retail
installment sales contract that constitutes "chattel paper" as
defined in Section 9-105 of the UCC in effect in the States of
New York, Delaware and California;
(ii) the provisions of the Sale and Servicing
Agreement are effective to create, in favor of the Owner
Trustee, a valid security interest (as such term is defined in
Section 1-201 of the New York UCC) in the Seller's rights in
the Receivables and proceeds thereof, which security interest,
if characterized as a transfer for security, will secure
payment of the Notes;
(iii) the Trust Financing Statement is in appropriate
form for filing in the relevant filing office under the
California UCC, upon the filing of the Trust Financing
Statement in the relevant filing office, the security interest
in favor of the Owner Trustee in the Receivables and proceeds
thereof will be perfected, and no other security interest of
any other creditor of the Seller will be equal or prior to the
security interest of the Owner Trustee in the Receivables and
proceeds thereof;
(iv) the provisions of the Indenture are effective to
create, in favor of the Indenture Trustee, a valid security
interest (as such term is defined in Section 1-201 of the
Relevant UCC) in the Receivables and proceeds thereof to secure
payment of the Notes;
(v) assuming that each of the direction by the Seller
to the Owner Trustee to execute the Notes and the direction by
the Seller to the Indenture Trustee to authenticate and deliver
the Notes has been duly authorized by the Seller, when the
Notes have been duly executed by the Owner Trustee and
authenticated and delivered by the Indenture Trustee in
accordance with the terms of the Indenture and delivered to and
paid for by the Class B Underwriter pursuant to this Agreement
and the Class A Underwriters pursuant to the Class A
Underwriting Agreement, the Notes will be duly and validly
issued and outstanding and will be entitled to the benefits of
the Indenture;
(vi) assuming that the direction by the Seller to the
Owner Trustee to execute, authenticate and deliver the
Certificates has been duly authorized by the Seller, when the
Certificates have been duly executed, authenticated and
delivered by the Owner Trustee in accordance with the terms of
the Trust Agreement and the Certificates have been delivered to
and paid for by the Seller pursuant to the Sale and Servicing
Agreement and the Trust Agreement, the Certificates will be
duly and validly issued and outstanding and will be entitled to
the benefits of the Trust Agreement;
(vii) the statements in the Prospectus under the
caption "SOME IMPORTANT LEGAL ASPECTS OF THE RECEIVABLES", to
the extent they constitute matters of law or legal conclusions,
are correct in all material respects;
(viii) the Trust Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act");
(ix) the Indenture has been duly qualified under the
Trust Indenture Act;
(x) no authorization, approval or consent of any
court or governmental agency or authority is necessary under
the Federal law of the United States or the laws of the State
of New York in connection with the execution, delivery and
performance by the Seller of this Agreement and the Basic
Documents to which it is a party, the execution, delivery and
performance by MMCA of the Note Indemnification Agreements and
the Basic Documents to which it is a party or for the
consummation of the transactions contemplated by this
Agreement, the Note Indemnification Agreements or the Basic
Documents, except such as may be required under state
securities laws and such as have been obtained and made under
the Act;
(xi) the Registration Statement was declared
effective under the Act as of the date specified in such
opinion, the Prospectus either was filed with the Commission
pursuant to the subparagraph of Rule 424(b) specified in such
opinion on the date specified therein or was included in the
Registration Statement, and, to the best of the knowledge of
such counsel, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and
no proceedings for that purpose have been instituted or are
pending or contemplated under the Act, and the Registration
Statement and the Prospectus, and each amendment or supplement
thereof, as of their respective effective or issue dates,
complies as to form in all material respects with the
requirements of the Act and the Rules and Regulations; such
counsel has no reason to believe that any part of the
Registration Statement or any amendment thereto, as of its
effective date, contained any untrue statement of a material
fact or omitted to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading or that the Prospectus or any amendment or
supplement thereto, as of its issue date or as of such Closing
Date, contained 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; and to the best knowledge
of such counsel, such counsel does not know of any contracts or
documents of a character required to be described in the
Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement which are not described
and filed as required; it being understood that such counsel
need express no opinion as to the financial statements or other
financial data contained in the Registration Statement or the
Prospectus;
(xii) each of the Certificate of Trust, the Trust
Agreement, the Sale and Servicing Agreement, the Administration
Agreement, the Yield Supplement Agreement, the Purchase
Agreement, the Control Agreement and the First Tier Assignment
constitutes the legal, valid and binding agreement of the
Seller and MMCA, in each case as to those documents to which it
is a party, enforceable against the Seller and MMCA in
accordance with their terms (subject to applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and
other similar laws affecting creditors' rights generally from
time to time in effect, and subject, as to enforceability, to
general principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at
law) except, as applicable, that such counsel need not express
an opinion with respect to indemnification or contribution
provisions which may be deemed to be in violation of the public
policy underlying any law or regulation;
(xiii) assuming due authorization, execution and
delivery by the Indenture Trustee and the Owner Trustee, the
Indenture constitutes the legal, valid and binding agreement of
the Trust, enforceable against the Trust in accordance with its
terms (subject to applicable bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws
affecting creditors' rights generally from time to time in
effect, and subject, as to enforceability, to general
principles of equity, regardless of whether such enforceability
is considered in a proceeding in equity or at law) except, as
applicable, that such counsel need not express an opinion with
respect to indemnification or contribution provisions which may
be deemed to be in violation of the public policy underlying
any law or regulation;
(xiv) neither the Trust nor the Seller is and, after
giving effect to the issuance of the Notes and the Certificates
and the sale of the Notes and the application of the proceeds
thereof, as described in the Prospectus, neither the Trust nor
the Seller will be, an "investment company" as defined in the
Investment Company Act of 1940, as amended;
(xv) the Notes, the Certificates, the Purchase
Agreement, the Administration Agreement, the First Tier
Assignment, the Sale and Servicing Agreement, the Yield
Supplement Agreement, the Trust Agreement, this Agreement, the
Class A Underwriting Agreement and the Indenture each conform
in all material respects with the descriptions thereof
contained in the Registration Statement and the Prospectus; and
(xvi) the Trust Agreement is the legal, valid and
binding agreement of the Seller, enforceable against the
Seller, in accordance with its terms under the law of the State
of Delaware.
(f) The Class B Underwriter shall have received an opinion of
Skadden, Arps, Slate, Meagher & Flom LLP, special tax counsel for
the Seller, dated the Closing Date and satisfactory in form and
substance to the Class B Underwriter and counsel for the Class B
Underwriter, to the effect that for federal income tax purposes (i)
the Notes will be characterized as indebtedness of the Trust, (ii)
the Trust will not be classified as an association (or publicly
traded partnership) taxable as a corporation and (iii) the
statements set forth in the Prospectus under the headings "SUMMARY
OF TERMS--ERISA Considerations", "SUMMARY OF TERMS-Eligibility of
Notes for Purchase by Money Market Funds", "SOME IMPORTANT LEGAL
ASPECTS OF THE RECEIVABLES", "ERISA CONSIDERATIONS", "SUMMARY OF
TERMS--Tax Status", "FEDERAL INCOME TAX CONSEQUENCES", "LEGAL
INVESTMENT" and "TERMS OF THE NOTES--Terms of the Indenture" (last
sentence of the last paragraph under "Events of Default Under the
Indenture" and last sentence of the first paragraph under "Remedies
Following an Event of Default under the Indenture" only) to the
extent such statements constitute matters of law or legal
conclusions with respect thereto, are correct in all material
respects.
(g) The Class B Underwriter shall have received an opinion of
Skadden, Arps, Slate, Meagher & Flom LLP, special tax counsel for
the Seller, dated the Closing Date and satisfactory in form and
substance to the Class B Underwriter and counsel for the Class B
Underwriter, to the effect that (i) for California state franchise
and income tax purposes (A) the Trust will not be taxable as a
corporation and (B) the Notes will be treated as indebtedness, (ii)
the Notes will be characterized as indebtedness for Delaware state
income tax purposes, (iii) the Trust will not be subject to
Delaware state franchise or income tax as a separate entity and
(iv) the statements set forth in the Prospectus under the headings
"SUMMARY OF TERMS-Tax Status" and "STATE TAX CONSEQUENCES", to the
extent such statements constitute matters of law or legal
conclusions with respect thereto, are correct in all material
respects.
(h) The Class B Underwriter shall have received from Brown &
Wood LLP, counsel for the Class B Underwriter, an opinion, dated
the Closing Date, with respect to the validity of the Notes, the
Registration Statement, the Prospectus and other related matters as
the Class B Underwriter may require, and the Seller shall have
furnished to such counsel such documents as it may request for the
purpose of enabling it to pass upon such matters.
(i) The Class B Underwriter shall have received a certificate,
dated the Closing Date, of the Chairman of the Board, the President
or any Vice President and a principal financial or accounting
officer, or equivalent officer or officers, of each of the Seller
and MMCA in which such officers, to the best of their knowledge
after reasonable investigation, shall state that: the
representations and warranties of the Seller in this Agreement are
true and correct; the representations of MMCA in the Note
Indemnification Agreements are true and correct; the Seller or
MMCA, as applicable, 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; the representations and warranties
of the Seller or MMCA, as applicable, in the Basic Documents are
true and correct as of the dates specified in such agreements; the
Seller or MMCA, as applicable, has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied
under such agreements at or prior to the Closing Date; 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, subsequent
to the date of the Prospectus, there has been no material adverse
change, nor any development or event involving a prospective
material adverse change, in the condition (financial or otherwise),
business, properties or results of operations of the Seller or MMCA
or their respective businesses except as set forth in or
contemplated by the Prospectus or as described in such certificate.
(j) The Class B Underwriter shall have received an opinion of
Pryor, Cashman, Sherman & Flynn LLP, counsel to the Indenture
Trustee, dated the Closing Date and satisfactory in form and
substance to the Class B Underwriter and counsel for the Class B
Underwriter, to the effect that:
(i) the Indenture Trustee is a banking corporation
duly incorporated and validly existing under the laws of the
State of New York;
(ii) the Indenture Trustee has the full corporate
trust power to accept the office of indenture trustee under the
Indenture and to enter into and perform its obligations under
the Indenture, the Sale and Servicing Agreement and the
Administration Agreement;
(iii) the execution and delivery of the Indenture and
the Administration Agreement and the acceptance of the Sale and
Servicing Agreement and the performance by the Indenture
Trustee of its obligations under the Indenture, the Sale and
Servicing Agreement and the Administration Agreement have been
duly authorized by all necessary corporate action of the
Indenture Trustee and each has been duly executed and delivered
on behalf of the Indenture Trustee;
(iv) the Indenture, the Sale and Servicing Agreement
and the Administration Agreement constitute valid and binding
obligations of the Indenture Trustee enforceable against the
Indenture Trustee in accordance with their terms under the laws
of the State of New York and the federal law of the United
States;
(v) the execution and delivery by the Indenture
Trustee of the Indenture and the Administration Agreement and
the acceptance of the Sale and Servicing Agreement do not
require any consent, approval or authorization of, or any
registration or filing with, any New York or United States
federal governmental authority, other than the qualification of
the Indenture Trustee under the Trust Indenture Act;
(vi) each of the Notes has been duly authenticated
and delivered by the Indenture Trustee;
(vii) neither the consummation by the Indenture
Trustee of the transactions contemplated in the Sale and
Servicing Agreement, the Indenture or the Administration
Agreement nor the fulfillment of the terms thereof by the
Indenture Trustee will conflict with, result in a breach or
violation of, or constitute a default under any law or the
charter, By-laws or other organizational documents of the
Indenture Trustee or the terms of any indenture or other
agreement or instrument known to such counsel and to which the
Indenture Trustee or any of its subsidiaries is a party or is
bound or any judgment, order or decree known to such counsel to
be applicable to the Indenture Trustee or any of its
subsidiaries of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction
over the Indenture Trustee or any of its subsidiaries;
(viii) to such counsel's knowledge there is no
action, suit or proceeding pending or threatened against the
Indenture Trustee (as trustee under the Indenture or in its
individual capacity) before or by any governmental authority
that if adversely decided, would materially adversely affect
the ability of the Indenture Trustee to perform its obligations
under the Indenture, the Sale and Servicing Agreement or the
Administration Agreement; and
(ix) the execution, delivery and performance by the
Indenture Trustee of the Sale and Servicing Agreement, the
Indenture and the Administration Agreement will not subject any
of the property or assets of the Trust or any portion thereof,
to any lien created by or arising with respect to the Indenture
Trustee that are unrelated to the transactions contemplated in
such Agreements.
(k) The Class B Underwriter shall have received an opinion of
Richards, Layton & Finger, P.A., counsel to the Owner Trustee,
dated the Closing Date and satisfactory in form and substance to
the Class B Underwriter and counsel for the Class B Underwriter, to
the effect that:
(i) the Owner Trustee has been duly incorporated and
is validly existing as a banking corporation in good standing
under the laws of the State of Delaware;
(ii) the Owner Trustee has full corporate trust power
and authority to enter into and perform its obligations under
the Trust Agreement and, on behalf of the Trust, under the
other Basic Documents to which it is a party and has duly
authorized, executed and delivered such Basic Documents and
such Basic Documents constitute the legal, valid and binding
agreement of the Owner Trustee, enforceable in accordance with
their terms, except that certain of such obligations may be
enforceable solely against the Trust Property (subject to
applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other similar laws affecting
creditors' rights generally from time to time in effect, and
subject, as to enforceability, to general principles of equity,
regardless of whether such enforceability is considered in a
proceeding in equity or at law);
(iii) the Certificates have been duly executed,
authenticated and delivered by the Owner Trustee as owner
trustee and authenticating agent; each of the Notes has been
duly executed by the Owner Trustee, on behalf of the Trust;
(iv) the execution and delivery by the Owner Trustee
of the Trust Agreement and, on behalf of the Trust, of the
other Basic Documents to which it is a party and the
performance by the Owner Trustee of its obligations thereunder
do not conflict with, result in a breach or violation of, or
constitute a default under the Articles of Association or
By-laws of the Owner Trustee; and
(v) the execution, delivery and performance by the
Owner Trustee of the Trust Agreement and, on behalf of the
Trust, of the other Basic Documents to which it is a party do
not require any consent, approval or authorization of, or any
registration or filing with, any Delaware or United States
federal governmental authority having jurisdiction over the
trust power of the owner Trustee, other than those consents,
approvals or authorizations as have been obtained and the
filing of the Certificate of Trust with the Secretary of State
of the State of Delaware.
(l) The Class B Underwriter shall have received an opinion of
Richards, Layton & Finger, P.A., special Delaware counsel to the
Trust, dated the Closing Date and satisfactory in form and
substance to the Class B Underwriter and counsel for the Class B
Underwriter, to the effect that:
(i) the Trust has been duly formed and is validly
existing as a business trust under the Delaware Trust Act;
(ii) the Trust has the power and authority under the
Delaware Trust Act and the Trust Agreement, and the Trust
Agreement authorizes the Owner Trustee, to execute, deliver and
perform its obligations under the Sale and Servicing Agreement,
the Indenture, the Administration Agreement, the Note
Depository Agreement, the Notes and the Certificates;
(iii) to the extent that Article 9 of the UCC as in
effect in the State of Delaware (the "Delaware UCC") is
applicable (without regard to conflict of laws principles), and
assuming that the security interest created by the Indenture in
the Receivables has been duly created and has attached, upon
the filing of the Indenture Financing Statement with the
Secretary of State of Delaware the Indenture Trustee will have
a perfected security interest in the Trust's rights in such
Receivables and the proceeds thereof, and such security
interest will be prior to any other security interest granted
by the Trust that is perfected solely by the filing of
financing statements under the Delaware UCC, excluding purchase
money security interests underss.9-312(4) of the Delaware UCC
and temporarily perfected security interests in proceeds
underss.9-306(3) of the Delaware UCC;
(iv) no re-filing or other action is necessary under
the Delaware UCC in order to maintain the perfection of such
security interest except for the filing of continuation
statements at five year intervals;
(v) assuming that the Notes have been duly executed
by the Owner Trustee on behalf of the Trust, and assuming that
the Notes have been duly authenticated by the Indenture
Trustee, when the Notes have been delivered in accordance with
the Indenture, the Notes will be validly issued and entitled to
the benefits of the Indenture;
(vi) assuming that the Certificates have been duly
authorized, executed and authenticated by the Owner Trustee on
behalf of the Trust, when the Certificates have been issued and
delivered in accordance with the instructions of the Seller,
the Certificates will be validly issued and entitled to the
benefits of the Trust Agreement; and
(vii) under 12 Del. C. ss. 3805(b), no creditor of
any Certificateholder (including creditors of the Seller in its
capacity as Certificateholder) shall have any right to obtain
possession of, or otherwise exercise legal or equitable
remedies with respect to, the property of the Trust except in
accordance with the terms of the Trust Agreement.
(m) The Class B Underwriter shall have received an opinion of
Pryor Cashman Sherman & Flynn LLP, counsel to the MART Trustee,
dated the Closing Date and satisfactory in form and substance to
the Class B Underwriter and counsel for the Class B Underwriter, to
the effect that:
(i) the MART Trustee has been duly incorporated and
is validly existing as a banking corporation in good standing
under the laws of the State of Delaware;
(ii) the MART Trustee has full corporate trust power
and authority to enter into and perform its obligations under
the MART Trust Agreement and has duly authorized, executed and
delivered the MART Trust Agreement and the MART Trust Agreement
constitutes the legal, valid and binding agreement of the MART
Trustee, enforceable in accordance with its terms;
(iii) the execution and delivery by the MART Trustee
of the MART Trust Agreement and the performance by the MART
Trustee of its obligations thereunder do not conflict with,
result in a breach or violation of, or constitute a default
under the Articles of Association or By-laws of the MART
Trustee; and
(iv) the execution, delivery and performance by the
MART Trustee of the MART Trust Agreement do not require any
consent, approval or authorization of, or any registration or
filing with, any Delaware or United States federal governmental
authority having jurisdiction over the trust power of the MART
Trustee, other than those consents, approvals or authorizations
as have been obtained.
(n) The Class B Underwriter shall have received an opinion of
Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the Seller,
dated the Closing Date and satisfactory in form and substance to
the Class B Underwriter and counsel for the Class B Underwriter,
(i) with respect to the characterization of the transfer of the
Receivables by MMCA to the Seller and from the Seller to the Trust
and (ii) to the effect that should MMCA become the debtor in a case
under the Bankruptcy Code, and the Seller would not otherwise
properly be a debtor in a case under the Bankruptcy Code, and if
the matter were properly briefed and presented to a court
exercising bankruptcy jurisdiction, the court, exercising
reasonable judgment after full consideration of all relevant
factors, should not order, over the objection of the
Certificateholders or the Noteholders, the substantive
consolidation of the assets and liabilities of the Seller with
those of MMCA and such opinion shall be in substantially the form
previously discussed with the Class B Underwriter and counsel for
the Class B Underwriter and in any event satisfactory in form and
in substance to the Class B Underwriter and counsel for the Class B
Underwriter.
(o) The Class B Underwriter shall have received evidence
satisfactory to it and its counsel that, within ten days of the
Closing Date, UCC-1 financing statements have been or are being
filed in the office of the Secretary of State of the state of (i)
California reflecting the transfer of the interest of MMCA in the
Receivables and the proceeds thereof to the Seller and the transfer
of the interest of the Seller in the Receivables and the proceeds
thereof to the Trust and (ii) Delaware reflecting the grant of the
security interest by the Trust in the Receivables and the proceeds
thereof to the Indenture Trustee.
(p) The Class B Underwriter shall have received an opinion of
Skadden, Arps, Slate, Meagher & Flom LLP, special counsel to the
Seller, dated the Closing Date and satisfactory in form and
substance to the Class B Underwriter and the counsel for the Class
B Underwriter to the effect that (i) the provisions of the
Indenture are effective to create a valid security interest in
favor of the Indenture Trustee, to secure payment of the Notes, in
all "securities entitlements" (as defined in Section 8-102(a)(17)
of the New York UCC) with respect to "financial assets" (as defined
in Section 8-102(a)(9) of the New York UCC) now or hereafter
credited to the Reserve Account (such securities entitlements, the
"Securities Entitlements"), (ii) the provisions of the control
agreement for purposes of Article 8 of the New York UCC are
effective to perfect the security interest of the Indenture Trustee
in the Securities Entitlements and (iii) no security interest of
any other creditor of the Trust will be prior to the security
interest of the Indenture Trustee in such Securities Entitlements.
(q) The Class A-1 Notes shall have been rated at least "P-1"
and "A-1+" by Moody's and Standard & Poor's, respectively. The
Class A-2 Notes, Class A-3 Notes and Class A-4 Notes shall have
been rated "Aaa" and "AAA" by Moody's and Standard & Poor's,
respectively, and the Class B Notes shall have been rated at least
"A2" and "A" by Moody's and Standard & Poor's, respectively.
(r) The Class B Underwriter shall have received a letter, dated
the Closing Date, of Ernst & Young LLP which meets the requirements
of subsection (a) of this Section, except that the specified date
referred to in such subsection will be a date not more than three
days prior to the Closing Date for purposes of this subsection.
(s) On the Closing Date, the Certificates shall have been
issued to the Seller and the Class A Notes shall have been issued,
authenticated and delivered to the Class A Underwriters pursuant to
the Class A Underwriting Agreement.
(t) The Class B Underwriter shall have received from Skadden,
Arps, Slate, Meagher & Flom LLP and each other counsel for the
Seller, a letter dated the Closing Date to the effect that the
Class B Underwriter may rely upon each opinion rendered by such
counsel to either Standard & Poor's or Moody's in connection with
the rating of any Class of Notes, as if each such opinion were
addressed to the Class B Underwriter.
The Seller will furnish the Class B Underwriter with such
conformed copies of such opinions, certificates, letters and documents as
the Class B Underwriter reasonably requests.
7. Indemnification and Contribution.
(a) The Seller will indemnify and hold harmless the Class B Underwriter
against any losses, claims, damages or liabilities to which the Class B
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 the Class B Underwriter for any legal or other expenses
reasonably incurred by the Class B 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 and in conformity with written
information furnished to the Seller by the Class B Underwriter specifically
for use therein, it being understood and agreed that the only such
information furnished by the Class B Underwriter consists of the
information described as such in subsection (b) below; and provided,
further, that with respect to any untrue statement or omission or alleged
untrue statement or omission made in any preliminary prospectus, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of the Class B Underwriter from whom the person asserting any such
losses, claims, damages or liabilities purchased the Class B Notes
concerned, to the extent that the untrue statement or omission or alleged
untrue statement or omission was eliminated or remedied in the Prospectus,
which Prospectus was required to be delivered by the Class B Underwriter
under the Act to such person and was not so delivered if the Seller had
previously furnished copies thereof to the Class B Underwriter.
(b) The Class B Underwriter will indemnify and hold harmless the Seller
against any losses, claims, damages or liabilities to which the Seller may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in the Registration Statement, the Prospectus, or any
amendment or 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 the Class B Underwriter
specifically for use therein, and will reimburse any legal or other
expenses reasonably incurred by the Seller in connection with investigating
or defending any such loss, claim, damage, liability or action as such
expenses are incurred, it being understood and agreed that the only such
information furnished by the Class B Underwriter consists of the following
information in the Prospectus: the figures on the cover page concerning the
terms of the offering by the Class B Underwriter, the concession and
reallowance figures appearing under the caption "Underwriting" and the
information contained in the fifth paragraph under the caption
"Underwriting".
(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,
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 if indemnity could have been sought hereunder
by such indemnified party unless such settlement (i) includes an
unconditional release of such indemnified party from all liability on any
claims that are the subject matter of such action and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act
by or on behalf of any indemnified party.
(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 indemnified party as a result of the losses, 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 Class B Underwriter on the other from
the offering of the Class B Notes or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Seller on the one hand
and the Class B 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 Seller on the one hand and the Class B Underwriter
on the other shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Class B Notes (before deducting expenses)
received by the Seller bear to the total underwriting discounts and
commissions received by the Class B Underwriter in respect of the Class B
Notes. 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 the Class B 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 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), the Class B
Underwriter shall not be required to contribute any amount under this
Agreement and under the Class B Note Indemnification Agreement in excess of
the amount by which the underwriting discount or commission allocable to
the Class B Notes underwritten by it and distributed to the public exceeds
the amount of any damages which the Class B 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 the
Class B Underwriter within the meaning of the Act; and the obligations of
the Class B Underwriter under this Section shall be in addition to any
liability which the Class B Underwriter 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.
8. Survival of Certain Representations and Obligations. The respective
indemnities, agreements, representations, warranties and other statements
of the Seller or its officers and of the Class B Underwriter 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 Class B Underwriter or the Seller or any of
their respective representatives, officers or directors or any controlling
person, and will survive delivery of and payment for the Class B Notes. If
for any reason the purchase of the Class B Notes by the Class B Underwriter
is not consummated, the Seller shall remain responsible for the expenses to
be paid or reimbursed by it pursuant to Section 5 and the respective
obligations of the Seller and the Class B Underwriter pursuant to Section 7
shall remain in effect, and if any Notes have been purchased hereunder the
representations and warranties in Section 2 and all obligations under
Section 5 shall also remain in effect. If the purchase of the Class B Notes
by the Class B Underwriter is not consummated for any reason other than
solely because of the occurrence of any event specified in clause (ii),
(iii) or (iv) of Section 6(c), the Seller will reimburse the Class B
Underwriter for all out-of-pocket expenses (including fees and
disbursements of counsel) reasonably incurred by it in connection with the
offering of the Notes.
9. Notices. All communications hereunder will be in writing and, if sent to
the Class B Underwriter, will be mailed, delivered or telegraphed and
confirmed to the Class B Underwriter at 390 Greenwich Street, New York, New
York 10013, Attention: General Counsel, or, if sent to the Seller, will be
mailed, delivered or sent by facsimile and confirmed to it at P.O. Box
6038, Cypress, California 90630-5205, Attention: Secretary/Treasurer,
Telecopy: (714) 236-1300; provided, however, that any notice to the Class B
Underwriter pursuant to Section 7 will be mailed, delivered or telecopied
and confirmed to the Class B Underwriter.
10. No Bankruptcy Petition. The Class B Underwriter agrees that, prior to
the date which is one year and one day after the payment in full of all
securities issued by the Seller or by a trust for which the Seller was the
depositor which securities were rated by any nationally recognized
statistical rating organization, it will not institute against, or join any
other person in instituting against, the Seller any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
proceedings under any Federal or state bankruptcy or similar law.
11. Successors. This Agreement will 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 obligation hereunder.
12. 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.
13. Applicable Law; Submission to Jurisdiction.
(a) This Agreement shall be governed by, and construed in accordance with,
the laws of the State of New York.
(b) The Seller hereby submits to the nonexclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New
York in any suit or proceeding arising out of or relating to this Agreement
or the transactions contemplated hereby.
If the foregoing is in accordance with the Class B Underwriter's
understanding of our agreement, kindly sign and return to the Seller one of
the counterparts hereof, whereupon it will become a binding agreement
between the Seller and the Class B Underwriter in accordance with its
terms.
Very truly yours,
MMCA AUTO RECEIVABLES TRUST
By: /s/ Hideyuki Kitamura
---------------------
Name: Hideyuki Kitamura
Title: Secretary & Treasurer
The foregoing Class B Underwriting Agreement is hereby confirmed and
accepted as of the date first above written.
SALOMON SMITH BARNEY INC.
By: /s/ John C. Dahl
------------------
Name: John C. Dahl
Title: Vice President
SCHEDULE A
Amount of
Class B
Underwriter Notes
----------- -----
Salomon Smith Barney Inc. $65,339,000
