EXECUTION COPY
$1,000,000,000
CONTIMORTGAGE HOME EQUITY LOAN TRUST 1998-4
Home Equity Loan Pass-Through Certificates
Series 1998-4, Class A
UNDERWRITING AGREEMENT
December 2, 1998
Credit Suisse First Boston Corporation
as Representative of the Several Underwriters
00 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
ContiSecurities Asset Funding Corp. (the "Depositor"), a Delaware
corporation, has authorized the issuance and sale of Home Equity Loan
Pass-Through Certificates, Series 1998-4, Class A (the "Class A
Certificates"). The Class A Certificates are referred to as the "Offered
Certificates." Also issued are the Class B Certificates (the "Class B
Certificates") and the Class R Certificates (the "Class R Certificates"). The
Class A Certificates, the Class B Certificates and the Class R Certificates
are collectively referred to as the "Certificates."
Only the Offered Certificates are being purchased by the Underwriters
named in Schedule A hereto, and the Underwriters are purchasing, severally,
only the Offered Certificates set forth opposite their names in Schedule A,
except that the amounts purchased by the Underwriters may change in accordance
with Section X of this Agreement. Credit Suisse First Boston Corporation is
acting as representative of the several Underwriters and in such capacity is
hereinafter referred to as the "Representative."
The Certificates will be issued under a pooling and servicing
agreement (the "Pooling and Servicing Agreement"), to be dated as of December
1, 1998 among the Depositor, ContiMortgage Corporation ("ContiMortgage"), as
the servicer and a seller (in such capacity, the "Servicer" or a "Seller," as
the case may be), ContiWest Corporation ("ContiWest"), as a seller (a
"Seller," and collectively with ContiMortgage, the "Sellers") and
Manufacturers and Traders Trust Company, as the Trustee (in such capacity, the
"Trustee"). Each of the Depositor, ContiMortgage and ContiWest is a subsidiary
of ContiFinancial Corporation ("ContiFinancial").
The Certificates will evidence fractional undivided interests in the
Trust (the "Trust") formed pursuant to the Pooling and Servicing Agreement.
The assets of the Trust will initially include, among other things, a pool of
fixed rate home equity loans having a Cut-Off Date as of the close of business
on December 7, 1998 (the "Home Equity Loans"), and such amounts as may be held
by the Trustee in any accounts held by the Trustee for the Trust. The Home
Equity Loans are secured primarily by first and second deeds of trust or
mortgages on one-
to four-family residential properties. A form of the Pooling and Servicing
Agreement has been filed as an exhibit to the Registration Statement.
The Certificates are more fully described in a Registration Statement
which the Depositor has furnished to the Underwriters. Capitalized terms used
but not defined herein shall have the meanings given to them in the Pooling
and Servicing Agreement.
The Class A Certificates will be entitled to the benefits of a
certificate guaranty insurance policy (the "Policy") issued by MBIA Insurance
Corporation ("MBIA"). The Depositor, ContiMortgage and ContiWest will also
enter into an Indemnification Agreement (the "Indemnification Agreement")
dated as of December 1, 1998 among the Underwriters, the Depositor,
ContiMortgage, ContiWest and MBIA, governing the liability of the several
parties with respect to the losses resulting from material misstatements or
omissions contained in the Prospectus Supplement.
Pursuant to Section 3.05 of the Pooling and Servicing Agreement and
concurrently with the execution thereof, ContiMortgage and ContiWest will
transfer to the Depositor all of their right, title and interest in and to the
unpaid principal balances of the Home Equity Loans as of the Cut-Off Date and
interest due after the Cut-Off Date and the collateral securing each Home
Equity Loan.
SECTION I. Representations and Warranties of the Depositor. The
Depositor represents and warrants to, and agrees with the Underwriters that as
of the date hereof and as of the Closing Date:
A. A Registration Statement on Form S-3 (No. 333-61863), has (i) been
prepared by the Depositor in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act") and the rules and
regulations (the "Rules and Regulations") of the United States Securities and
Exchange Commission (the "Commission") thereunder, (ii) been filed with the
Commission under the Securities Act and (iii) become effective and is still
effective as of the date hereof under the Securities Act; Copies of such
Registration Statement have been delivered by the Depositor to the
Underwriters. As used in this Agreement, "Effective Time" means the date and
the time as of which such Registration Statement, or the most recent
post-effective amendment thereto, if any, was declared effective by the
Commission; "Effective Date" means the date of the Effective Time;
"Registration Statement" means such registration statement, at the Effective
Time, including any documents incorporated by reference therein at such time;
"Basic Prospectus" means such final prospectus dated September 17, 1998; and
"Prospectus Supplement" means the final prospectus supplement relating to the
Offered Certificates, to be filed with the Commission pursuant to paragraphs
(2), (3) or (5) of Rule 424(b) of the Rules and Regulations. "Prospectus"
means the Basic Prospectus together with the Prospectus Supplement. Reference
made herein to the Prospectus shall be deemed to refer to and include any
documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act, as of the date of the Prospectus and any reference
to any amendment or supplement to the Prospectus shall be deemed to refer to
and include any document filed under the Securities Exchange Act of 1934 (the
"Exchange Act") after the date of the Prospectus, and
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incorporated by reference in the Prospectus and any reference to any amendment
to the Registration Statement shall be deemed to include any report of the
Depositor filed with the Commission pursuant to Section 13(a) or 15(d) of the
Exchange Act after the Effective Time that is incorporated by reference in the
Registration Statement. The Commission has not issued any order preventing or
suspending the use of the Prospectus or the effectiveness of the Registration
Statement and no proceedings for such purpose are pending or, to the
Depositor's knowledge, threatened by the Commission. There are no contracts or
documents of the Depositor which are required to be filed as exhibits to the
Registration Statement pursuant to the Securities Act or the Rules and
Regulations which have not been so filed or incorporated by reference therein
on or prior to the Effective Date of the Registration Statement other than
such documents or materials, if any, as any Underwriter delivers to the
Depositor pursuant to Section VIII (D) hereof for filing on Form 8-K. The
conditions for use of Form S-3, as set forth in the General Instructions
thereto, have been satisfied.
To the extent that any Underwriter has provided to the Depositor
Computational Materials that such Underwriter has provided to a prospective
investor, the Depositor will file or cause to be filed with the Commission a
report on Form 8-K containing such Computational Materials, as soon as
reasonably practicable after the date of this Agreement, but in any event, not
later than 11:00 a.m. New York time the date on which the Prospectus is made
available to the Underwriter and is filed with the Commission pursuant to Rule
424 of the Rules and Regulations.
B. The Registration Statement and the Prospectus conform, and any
further amendments or supplements to the Registration Statement or the
Prospectus will conform, when they become effective or are filed with the
Commission, as the case may be, in all respects to the requirements of the
Securities Act and the Rules and Regulations. The Registration Statement, as
of the Effective Date thereof and of any amendment thereto, did not contain an
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading. The Prospectus as of its date, and as amended or supplemented as
of the Closing Date does not and will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that no representation or warranty is made as
to information contained in or omitted from the Registration Statement or the
Prospectus in reliance upon and in conformity with written information
furnished to the Depositor in writing by any Underwriters through the
Representative expressly for use therein.
C. The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Securities Act
or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein not misleading;
and any further documents so filed and incorporated by reference in the
Prospectus, when such documents become effective or are filed with the
Commission, as the case may be, will conform in all
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material respects to the requirements of the Securities Act or the Exchange
Act, as applicable, and the rules and regulations of the Commission thereunder
and will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided that no representation is made as
to documents deemed to be incorporated by reference in the Prospectus as the
result of filing a Form 8-K at the request of the Underwriters except to the
extent such documents reflect information furnished by the Depositor to the
Underwriters for the purpose of preparing such documents.
D. Since the respective dates as of which information is given in the
Prospectus, there has not been any material adverse change in the general
affairs, management, financial condition, or results of operations of the
Depositor, otherwise than as set forth or contemplated in the Prospectus as
supplemented or amended as of the Closing Date.
E. The Depositor has been duly incorporated and is validly existing
as a corporation in good standing under the laws of its jurisdiction of
incorporation and is in good standing as a foreign corporation in each
jurisdiction in which its ownership or lease of property or the conduct of its
business so requires such standing. The Depositor has all power and authority
necessary to own or hold its properties, to conduct the business in which it
is engaged and to enter into and perform its obligations under this Agreement
and the Pooling and Servicing Agreement and to cause the Certificates to be
issued.
F. There are no actions, proceedings or investigations pending with
respect to which the Depositor has received service of process before or
threatened by any court, administrative agency or other tribunal to which the
Depositor is a party or of which any of its properties is the subject (a)
which if determined adversely to the Depositor would have a material adverse
effect on the business or financial condition of the Depositor, (b) asserting
the invalidity of this Agreement, the Pooling and Servicing Agreement or the
Certificates (c) seeking to prevent the issuance of the Certificates or the
consummation by the Depositor of any of the transactions contemplated by the
Pooling and Servicing Agreement or this Agreement, as the case may be, or (d)
which might materially and adversely affect the performance by the Depositor
of its obligations under, or the validity or enforceability of, the Pooling
and Servicing Agreement, this Agreement or the Certificates.
G. This Agreement has been, and the Pooling and Servicing Agreement
when executed and delivered as contemplated hereby and thereby will have been,
duly authorized, executed and delivered by the Depositor, and this Agreement
constitutes, and the Pooling and Servicing Agreement when executed and
delivered as contemplated herein will constitute, legal, valid and binding
instruments enforceable against the Depositor in accordance with their
respective terms, subject as to enforceability to (x) applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting
creditors' rights generally, (y) general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law), and (z)
with respect to rights of indemnity under this Agreement, limitations of
public policy under applicable securities laws.
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H. The execution, delivery and performance of this Agreement, and the
Pooling and Servicing Agreement by the Depositor and the consummation of the
transactions contemplated hereby and thereby, and the issuance and delivery of
the Certificates do not and will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
any indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Depositor is a party, by which the Depositor is bound
or to which any of the properties or assets of the Depositor or any of its
subsidiaries is subject, which breach or violation would have a material
adverse effect on the business, operations or financial condition of the
Depositor or its ability to perform its obligations under this Agreement or
the Pooling and Servicing Agreement, nor will such actions result in any
violation of the provisions of the articles of incorporation or by-laws of the
Depositor or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Depositor or any of
its properties or assets, which breach or violation would have a material
adverse effect on the business, operations or financial condition of the
Depositor or its ability to perform its obligations under this Agreement, or
the Pooling and Servicing Agreement.
I. The Depositor has no reason to know that Xxxxxx Xxxxxxxx & Co. are
not independent public accountants with respect to the Depositor as required
by the Securities Act and the Rules and Regulations.
J. The direction by the Depositor to the Trustee to authenticate,
issue and deliver the Certificates has been duly authorized by the Depositor,
and, assuming the Trustee has been duly authorized to undertake such actions,
when executed, authenticated, issued and delivered by the Trustee, as
applicable, in accordance with the Pooling and Servicing Agreement, the
Certificates will be validly issued and outstanding and the holders of the
Certificates will be entitled to the rights and benefits of the Certificates
as provided by the Pooling and Servicing Agreement.
K. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the
United States is required for the issuance of the Certificates and the sale of
the Offered Certificates to the Underwriters, or the consummation by the
Depositor of the other transactions contemplated by this Agreement or the
Pooling and Servicing Agreement except such consents, approvals,
authorizations, registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and distribution
of the Offered Certificates by the Underwriters or as have been obtained.
L. The Depositor possesses all material licenses, certificates,
authorities or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct the business now conducted
by it and as described in the Prospectus, and the Depositor has not received
notice of any proceedings relating to the revocation or modification of any
such license, certificate, authority or permit which if decided adversely to
the Depositor would, singly or in the aggregate, materially and adversely
affect the conduct of its business, operations or financial condition.
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M. At the time of execution and delivery of the Pooling and Servicing
Agreement, the Depositor will: (i) have good title to the Home Equity Loans
conveyed by the Sellers, free and clear of any lien, mortgage, pledge, charge,
encumbrance, adverse claim or other security interest (collectively, "Liens");
(ii) not have assigned to any person any of its right or title in the Home
Equity Loans contemplated in the Pooling and Servicing Agreement or in the
Certificates being issued pursuant thereto; and (iii) have the power and
authority to sell its interest in the Home Equity Loans to the Trustee and to
sell the Offered Certificates to the Underwriters. Upon execution and delivery
of the Pooling and Servicing Agreement by the Trustee, the Trustee will have
acquired beneficial ownership of all of the right, title and interest in and
to the Home Equity Loans free of any Liens. Upon delivery to the Underwriters
of the Offered Certificates, the Underwriters will have good title to the
Offered Certificates, free of any Liens.
N. Reserved.
O. As of the Statistical Calculation Date, each of the Home Equity
Loans will meet the eligibility criteria described in the Prospectus and will
conform to the descriptions thereof contained in the Prospectus.
P. Reserved.
Q. Neither the Depositor nor the Trust created by the Pooling and
Servicing Agreement is an "investment company" within the meaning of such term
under the Investment Company Act of 1940 (the "1940 Act") and the rules and
regulations of the Commission thereunder.
R. At the Closing Date, the Offered Certificates and the Pooling and
Servicing Agreement will conform in all material respects to the descriptions
thereof contained in the Prospectus.
S. At the Closing Date, the Offered Certificates shall have been
rated in the highest rating category by Xxxxx'x Investors Service, Inc.
("Moody's"), Standard & Poor's, a division of the XxXxxx-Xxxx Companies, Inc.
("Standard & Poor's") and Fitch IBCA, Inc. ("Fitch").
T. Any taxes, fees and other governmental charges in connection with
the execution, delivery and issuance of this Agreement and the Pooling and
Servicing Agreement and the Certificates have been paid or will be paid at or
prior to the Closing Date.
U. At the Closing Date, each of the representations and warranties of
the Depositor, ContiMortgage and ContiWest set forth herein and in the Pooling
and Servicing Agreement will be true and correct in all material respects.
V. Any certificate signed by an officer of the Depositor and
delivered to the Representative or counsel for the Representative in
connection with an offering of the Offered Certificates shall be deemed, and
shall state that it is, a representation and warranty as to the
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matters covered thereby to each person to whom the representations and
warranties in this Section I are made.
W. Reserved.
SECTION II. Purchase and Sale. The commitment of the Underwriters to
purchase the Offered Certificates pursuant to this Agreement shall be deemed
to have been made on the basis of the representations and warranties herein
contained and shall be subject to the terms and conditions herein set forth.
The Depositor agrees to instruct the Trustee to issue the Offered Certificates
and agrees to sell to the Underwriters, and the Underwriters agree (except as
provided in Sections X and XI hereof) to purchase from the Depositor, the
aggregate initial principal amounts or percentage interests of the Offered
Certificates, as set forth opposite their names on Schedule A, at the purchase
price or prices set forth on Schedule A.
SECTION III. Delivery and Payment. Delivery of and payment for the
Offered Certificates shall be made at the offices of Xxxxx Xxxxxxxxxx LLP,
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such other place
as shall be agreed upon by the Representative and the Depositor at 10:00 A.M.
New York City time on December 17, 1998 or at such other time or date as shall
be agreed upon in writing by the Representative and the Depositor (such date
being referred to as the "Closing Date"). Payment shall be made to the
Depositor by wire transfer of same day funds payable to the account of the
Depositor. Delivery of the Offered Certificates shall be made to the
Representative for the accounts of the Underwriters against payment of the
purchase price thereof. The Offered Certificates shall be in such authorized
denominations and registered in such names as the Representative may request
in writing at least two business days prior to the Closing Date. The Offered
Certificates will be made available for examination by the Representative no
later than 2:00 p.m. New York City time on the first business day prior to the
Closing Date.
SECTION IV. Offering by the Underwriters. It is understood that,
subject to the terms and conditions hereof, the Underwriters propose to offer
the Offered Certificates for sale to the public as set forth in the
Prospectus.
SECTION V. Covenants of the Depositor. The Depositor and, to the
extent the provisions of subsections H and I below relate to ContiMortgage and
ContiWest, respectively, ContiMortgage and ContiWest agree as follows:
A. To prepare the Prospectus in a form approved by the Underwriters
and to file such Prospectus pursuant to Rule 424(b) under the Securities Act
not later than the Commission's close of business on the second business day
following the availability of the Prospectus to the Underwriters; to make no
further amendment or any supplement to the Registration Statement or to the
Prospectus prior to the Closing Date except as permitted herein; to advise the
Underwriters, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective
prior to the Closing Date or any supplement to the Prospectus or any amended
Prospectus has been filed prior to the Closing Date and to furnish the
Underwriters with copies thereof without charge; to file promptly
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all reports and any definitive proxy or information statements required to be
filed by the Depositor with the Commission pursuant to Section 13(a), 13(c),
14 or l5(d) of the Exchange Act subsequent to the date of the Prospectus and,
for so long as the delivery of a prospectus is required in connection with the
offering or sale of the Offered Certificates; to promptly advise the
Underwriters of its receipt of notice of the issuance by the Commission of any
stop order or the institution of or, to the knowledge of the Depositor, the
threatening of any proceeding for such purpose, or of: (i) any order
preventing or suspending the use of the Prospectus; (ii) the suspension of the
qualification of the Offered Certificates for offering or sale in any
jurisdiction; (iii) the initiation of or threat of any proceeding for any such
purpose; or (iv) any request by the Commission for the amending or
supplementing of the Registration Statement or the Prospectus or for
additional information. In the event of the issuance of any stop order or of
any order preventing or suspending the use of the Prospectus or suspending any
such qualification, the Depositor promptly shall use its best efforts to
obtain the withdrawal of such order by the Commission.
B. To furnish promptly to the Underwriters and to counsel for the
Underwriters a signed copy of the Registration Statement as originally filed
with the Commission, and of each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith.
C. To deliver promptly to the Underwriters without charge such number
of the following documents as the Underwriters shall reasonably request: (i)
conformed copies of the Registration Statement as originally filed with the
Commission and each amendment thereto (in each case including exhibits); (ii)
the Prospectus and any amended or supplemented Prospectus; and (iii) any
document incorporated by reference in the Prospectus (including exhibits
thereto). If the delivery of a prospectus is required at any time prior to the
expiration of nine months after the Closing Date in connection with the
offering or sale of the Offered Certificates, and if at such time any events
shall have occurred as a result of which the Prospectus as then amended or
supplemented would include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such Prospectus
is delivered, not misleading, or, if for any other reason it shall be
necessary during such same period to amend or supplement the Prospectus or to
file under the Exchange Act any document incorporated by reference in the
Prospectus in order to comply with the Securities Act or the Exchange Act, the
Depositor shall notify the Underwriters and, upon any Underwriter's request,
shall file such document and prepare and furnish without charge to the
Underwriters and to any dealer in securities as many copies as the
Underwriters may from time to time reasonably request of an amended Prospectus
or a supplement to the Prospectus which corrects such statement or omission or
effects such compliance, and in case the Underwriters are required to deliver
a Prospectus in connection with sales of any of the Offered Certificates at
any time nine months or more after the Effective Time, upon the request of the
Underwriters but at their expense, the Depositor shall prepare and deliver to
the Underwriters as many copies as the Underwriters may reasonably request of
an amended or supplemented Prospectus complying with Section 10(a)(3) of the
Securities Act.
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D. To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Depositor or the Underwriters, be required by
the Securities Act or requested by the Commission. Neither the Underwriters'
consent to nor their distribution of any amendment or supplement shall
constitute a waiver of any of the conditions set forth in Section VI.
E. To furnish the Underwriters and counsel for the Underwriters,
prior to filing with the Commission, and to obtain the consent of the
Underwriters for the filing of the following documents relating to the
Certificates: (i) any Post-Effective Amendment to the Registration Statement
or supplement to the Prospectus, or document incorporated by reference in the
Prospectus, or (ii) Prospectus pursuant to Rule 424 of the Rules and
Regulations.
F. To make generally available to holders of the Offered Certificates
as soon as practicable, but in any event not later than 90 days after the
close of the period covered thereby, a statement of earnings of the Trust
(which need not be audited) complying with Section 11(a) of the Securities Act
and the Rules and Regulations (including, at the option of the Depositor, Rule
158) and covering a period of at least twelve consecutive months beginning not
later than the first day of the first fiscal quarter following the Closing
Date.
G. To use its best efforts, in cooperation with the Underwriters, to
qualify the Offered Certificates for offering and sale under the applicable
securities laws of such states and other jurisdictions of the United States or
elsewhere as the Underwriters may designate, and maintain or cause to be
maintained such qualifications in effect for as long as may be required for
the distribution of the Offered Certificates. The Depositor will file or cause
the filing of such statements and reports as may be required by the laws of
each jurisdiction in which the Offered Certificates have been so qualified.
H. Unless the Underwriters shall otherwise have given their written
consent, no collateralized mortgage obligations or other similar securities
representing interests in or secured by other mortgage-related assets
originated or owned by ContiMortgage shall be publicly offered or sold, nor
shall ContiMortgage enter into any contractual arrangements that contemplate
the public offering or sale of such securities, until the earlier to occur of
the termination of the syndicate or the Closing Date.
I. Unless the Underwriters shall otherwise have given their written
consent, no collateralized mortgage obligations or other similar securities
representing interests in or secured by other mortgage-related assets
originated or owned by ContiWest shall be publicly offered or sold, nor shall
ContiWest enter into any contractual arrangements that contemplate the public
offering or sale of such securities, until the earlier to occur of the
termination of the syndicate or the Closing Date.
J. Unless the Underwriters shall otherwise have given their written
consent (such consent not to be unreasonably withheld), no collateralized
mortgage obligations or other similar securities representing interests in or
secured by other mortgage-related assets that are
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similar to the Home Equity Loans originated or owned by the Depositor shall be
publicly offered or sold until the earlier to occur of the termination of the
syndicate or the Closing Date.
K. So long as the Offered Certificates shall be outstanding the
Depositor shall cause the Trustee, pursuant to the Pooling and Servicing
Agreement, to deliver to the Underwriters as soon as such statements are
furnished to the Trustee: (i) the annual statement as to compliance delivered
to the Trustee pursuant to Section 8.16 of the Pooling and Servicing
Agreement; (ii) the annual statement of a firm of independent public
accountants furnished to the Trustee pursuant to Section 8.17 of the Pooling
and Servicing Agreement; (iii) the monthly servicing report furnished to the
Trustee pursuant to Section 7.08 of the Pooling and Servicing Agreement; and
(iv) the monthly reports furnished to the Certificateholders pursuant to
Section 7.09 of the Pooling and Servicing Agreement.
L. To apply the net proceeds from the sale of the Offered
Certificates in the manner set forth in the Prospectus.
SECTION VI. Conditions to the Underwriters' Obligation. The
obligations of the Underwriters hereunder to purchase the Offered Certificates
pursuant to the Agreement are subject to: (i) the accuracy on and as of the
Closing Date of the representations and warranties on the part of the
Depositor herein contained; (ii) the performance by the Depositor of all of
its obligations hereunder; and (iii) the following conditions as of the
Closing Date:
A. The Underwriters shall have received confirmation of the
effectiveness of the Registration Statement. No stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission. Any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus shall
have been complied with.
B. The Underwriters shall not have discovered and disclosed to the
Depositor on or prior to the Closing Date that the Registration Statement or
the Prospectus or any amendment or supplement thereto contains an untrue
statement of a fact or omits to state a fact which, in the opinion of Stroock
& Stroock & Xxxxx LLP, counsel for the Underwriters, is material and is
required to be stated therein or is necessary to make the statements therein
not misleading.
C. All corporate proceedings and other legal matters relating to the
authorization, form and validity of this Agreement, the Pooling and Servicing
Agreement, the Certificates, the Registration Statement and the Prospectus,
and all other legal matters relating to this Agreement and the transactions
contemplated hereby shall be satisfactory in all respects to counsel for the
Underwriters, and the Depositor shall have furnished to such counsel all
documents and information that they may reasonably request to enable them to
pass upon such matters.
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X. Xxxxx Xxxxxxxxxx LLP shall have furnished to the Underwriters and
MBIA their written opinion, as counsel to the Depositor, addressed to the
Underwriters and MBIA and dated the Closing Date, in form and substance
satisfactory to the Underwriters and MBIA, to the effect that:
(i) The conditions to the use by the Depositor of a registration
statement on Form S-3 under the Securities Act, as set forth in the General
Instructions to Form S-3, have been satisfied with respect to the Registration
Statement and the Prospectus.
(ii) The Registration Statement and any amendments thereto
have become effective under the Securities Act; to the best of such
counsel's knowledge, no stop order suspending the effectiveness of
the Registration Statement has been issued and not withdrawn and no
proceedings for that purpose have been instituted or threatened and
not terminated; and the Registration Statement, the Prospectus and
each amendment or supplement thereto, as of their respective
effective or issue dates (other than the financial and statistical
information contained therein, as to which such counsel need express
no opinion), complied as to form in all material respects with the
applicable requirements of the Securities Act and the rules and
regulations thereunder.
(iii) To the best of such counsel's knowledge, there are no
material contracts, indentures or other documents of a character
required to be described or referred to in the Registration Statement
or the Prospectus or 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.
(iv) The statements set forth in the Basic Prospectus under
the captions "Summary of Prospectus," "Description of The
Certificates," "The Trusts" and "The Pooling and Servicing Agreement"
and in the Prospectus Supplement under the captions "Description of
The Offered Certificates" and "The Pooling and Servicing Agreement,"
to the extent such statements purport to summarize certain provisions
of the Certificates or of the Pooling and Servicing Agreement, are
fair and accurate in all material respects.
(v) The statements set forth in the Basic Prospectus and the
Prospectus Supplement under the captions "ERISA Considerations,"
"Certain Legal Aspects of the Mortgage Assets" and "Certain Federal
Income Tax Considerations" to the extent that they constitute matters
of federal law, provide a fair and accurate summary of such law or
conclusions.
(vi) The Pooling and Servicing Agreement conforms in all
material respects to the description thereof contained in the
Prospectus and is not required to be qualified under the Trust
Indenture Act of 1939, as amended, and the Trust is not required to
be registered under the Investment Company Act of 1940, as amended.
(vii) Neither the Depositor nor the Trust is an "investment
company" or under the "control" of an "investment company" as such
terms are defined in the 1940 Act.
11
(viii)Assuming that (a) the Trustee causes certain assets of
the Trust Estate, as the Trustee has covenanted to do in the Pooling
and Servicing Agreement, to be treated as a "real estate mortgage
investment conduit" ("REMIC"), as such term is defined in the
Internal Revenue Code of 1986, as amended (the "Code"), and (b) the
parties to the Pooling and Servicing Agreement comply with the terms
thereof, the Trust Estate will be treated as a REMIC, both the Class
A Certificates and the Class B Certificates will be treated as
"regular interests" in a REMIC, and the Class R Certificates will be
treated as the sole "residual interest" in a REMIC. The Trust is not
subject to tax upon its income or assets by any taxing authority of
the State of New York.
(ix) To the best of such counsel's knowledge, there are no
actions, proceedings or investigations pending that would adversely
affect the status of the Trust Estate as a REMIC.
(x) As a consequence of the qualifications of the Trust
Estate as a REMIC, the Class A Certificates and the Class B
Certificates will be treated as "regular . . . interest(s) in a
REMIC" under Section 7701(a)(19)(C) of the Code and "real estate
assets" under Section 856(c) of the Code in the same proportion that
the assets in the Trust consist of qualifying assets under such
Sections. In addition, as a consequence of the qualification of the
Trust Estate as a REMIC, interest on the Offered Certificates will be
treated as "interest on obligations secured by mortgages on real
property" under Section 856(c) of the Code to the extent that such
Offered Certificates are treated as "real estate assets" under
Section 856(c) of the Code.
(xi) Reserved.
(xii) Reserved.
(xiii)The Certificates have been duly executed and delivered
by the Depositor to the Trustee for authentication.
Such counsel shall also have furnished to the Underwriters and MBIA a written
statement, addressed to the Underwriters and MBIA and dated the Closing Date,
in form and substance satisfactory to the Underwriters and MBIA to the effect
that nothing has come to the attention of such counsel which lead them to
believe that: (a) the Registration Statement, at the time such Registration
Statement became effective, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading (except as to financial or
statistical data contained in the Registration Statement); (b) the Prospectus,
as of its date and as of the Closing Date, contained or contains an untrue
statement of a material fact or omitted or omits to state a 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; or (c) any document incorporated by reference in the Prospectus or
any further amendment or supplement to any such incorporated document made by
the Depositor prior to the Closing Date (other than any document filed at the
request of an Underwriter to the extent such document relates to Computational
Materials)
12
contained, as of the time it became effective or was filed with the
Commission, as the case may be, an untrue statement of a material fact or
omitted to state a 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.
E. The Underwriters shall have received the favorable opinion, dated
the Closing Date, of Xxxxx Xxxxxxxxxx LLP, special counsel to the Depositor,
addressed to the Depositor and satisfactory to Xxxxx'x, Standard & Poor's,
Fitch and the Underwriters, with respect to certain matters relating to the
transfer of the Home Equity Loans to the Depositor and from the Depositor to
the Trust, and such counsel shall have consented to reliance on such opinion
by Xxxxx'x, Standard & Poor's, Fitch and the Underwriters as though such
opinion had been addressed to each such party.
X. Xxxxx Xxxxxxxxxx LLP, counsel for ContiMortgage in its capacity as
both a Seller and the Servicer and ContiWest in its capacity as a Seller,
shall have furnished to the Underwriters and MBIA their written opinion, as
counsel to ContiMortgage and ContiWest, addressed to the Underwriters and MBIA
and the Depositor and dated the Closing Date, in form and substance
satisfactory to the Underwriters, to the effect that:
(i) ContiMortgage is duly organized, validly existing in
good standing as a corporation under the laws of the State of
Delaware.
(ii) ContiMortgage has full corporate power and authority to
serve in the capacity of a seller and the servicer of the Home Equity
Loans as contemplated in the Pooling and Servicing Agreement and to
transfer the Home Equity Loans to the Depositor as contemplated in
the Pooling and Servicing Agreement.
(iii) The Pooling and Servicing Agreement and this Agreement
have been duly authorized, executed and delivered by ContiMortgage,
and, assuming the due authorization, execution and delivery of such
agreements by the other parties thereto, constitute the legal, valid
and binding agreements of ContiMortgage, enforceable against
ContiMortgage in accordance with their respective terms, subject as
to enforceability to (x) bankruptcy, insolvency, reorganization,
moratorium, receivership or other similar laws now or hereafter in
effect relating to creditors' rights generally and (y) the
qualification that the remedy of specific performance and injunctive
and other forms of equitable relief may be subject to equitable
defenses and to the discretion, with respect to such remedies, of the
court before which any proceedings with respect thereto may be
brought and (z) public policy considerations under the securities
laws which may limit the availability of indemnification as to
securities law liability.
(iv) No consent, approval, authorization, order,
registration or qualification of or with any court or governmental
agency or body having jurisdiction over ContiMortgage is required for
the consummation by ContiMortgage of the transactions contemplated by
the Pooling and Servicing Agreement except such consents, approvals,
authorizations, registrations and qualifications as have been
obtained.
13
(v) Neither the sale and transfer of the Home Equity Loans
by ContiMortgage to the Depositor, nor the execution, delivery or
performance by ContiMortgage of the Pooling and Servicing Agreement
and the transactions contemplated thereby (A) conflict with or result
in a breach of, or constitute a default under, (i) any term or
provision of the certificate of incorporation or by-laws of
ContiMortgage; (ii) any term or provision of any material agreement,
deed of trust, mortgage loan agreement, contract, instrument or
indenture, or other agreement to which ContiMortgage is a party or is
bound or to which any of the property or assets of ContiMortgage or
any of its subsidiaries is subject; (iii) to the best of such firm's
knowledge without independent investigation any order, judgment,
writ, injunction or decree of any court or governmental authority
having jurisdiction over ContiMortgage; or (iv) any law, rule or
regulation, applicable to ContiMortgage; or (B) to the best of such
firm's knowledge without independent investigation, results in the
creation or imposition of any lien, charge or encumbrance upon the
Trust Estate or upon the Certificates.
(vi) The execution of the Pooling and Servicing Agreement is
sufficient to convey all of ContiMortgage's, ContiWest's and the
Depositor's right, title and interest in the Home Equity Loans to the
Trust (except as otherwise specifically set forth in the Pooling and
Servicing Agreement) and following the consummation of the
transaction contemplated by Section 3.05 of the Pooling and Servicing
Agreement, the transfers of the Home Equity Loans by ContiMortgage
and ContiWest to the Depositor and by the Depositor to the Trust are
sufficient to vest in the Trust all of ContiMortgage's, ContiWest's
and the Depositor's right, title and interest in the Home Equity
Loans (except as otherwise specifically set forth in the Pooling and
Servicing Agreement).
(vii) There are, to the best of such counsel's knowledge
without independent investigation, no actions, proceedings or
investigations pending with respect to which ContiMortgage has
received service of process or threatened against ContiMortgage
before any court, administrative agency or other tribunal (a)
asserting the invalidity of the Pooling and Servicing Agreement, the
Underwriting Agreement or the Certificates, (b) seeking to prevent
the consummation of any of the transactions contemplated by the
Pooling and Servicing Agreement or (c) which would materially and
adversely affect the performance by ContiMortgage of its obligations
under, or the validity or enforceability of, the Pooling and
Servicing Agreement or the Underwriting Agreement.
X. Xxxxxxx X. Xxxxxxxx, Esq., Counsel for ContiWest, in its capacity
as a Seller, shall have furnished to the Underwriters and MBIA his written
opinion, addressed to the Underwriters and dated as of the Closing Date, in
form and substance satisfactory to the Underwriters, to the effect that:
(i) ContiWest is duly organized, validly existing in good
standing as a corporation under the laws of the State of Nevada.
14
(ii) ContiWest has full corporate power and authority to
serve in the capacity of a seller of the Home Equity Loans as
contemplated in the Pooling and Servicing Agreement and to transfer
the Home Equity Loans to the Depositor as contemplated in the Pooling
and Servicing Agreement.
(iii) The Pooling and Servicing Agreement and this Agreement
have been duly authorized, executed and delivered by ContiWest, and,
assuming the due authorization, execution and delivery of such
agreement by the other parties thereto, constitute the legal, valid
and binding agreements of ContiWest, enforceable against ContiWest in
accordance with its terms, subject as to enforceability to (x)
bankruptcy, insolvency, reorganization, moratorium, receivership or
other similar laws now or hereafter in effect relating to creditors'
rights generally and (y) the qualification that the remedy of
specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion,
with respect to such remedies, of the court before which any
proceedings with respect thereto may be brought and (z) public policy
considerations under the securities laws which may limit the
availability of indemnification as to securities law xxxxxxxxx.
(iv) No consent, approval, authorization, order,
registration or qualification of or with any court or governmental
agency or body having jurisdiction over ContiWest is required for the
consummation by ContiWest of the transactions contemplated by the
Pooling and Servicing Agreement except such consents, approvals,
authorizations, registrations and qualifications as have been
obtained.
(v) Neither the sale and transfer of the Home Equity Loans
by ContiWest to the Depositor, nor the execution, delivery or
performance by ContiWest of the Pooling and Servicing Agreement and
the transactions contemplated thereby (A) conflict with or result in
a breach of, or constitute a default under, (i) any term or provision
of the articles of incorporation or by-laws of ContiWest; (ii) any
term or provision of any material agreement, deed of trust, mortgage
loan agreement, contract, instrument or indenture, or other agreement
to which ContiWest is a party or is bound or to which any of the
property or assets of ContiWest or any of its subsidiaries is
subject; (iii) to the best of such counsel's knowledge without
independent investigation any order, judgment, writ, injunction or
decree of any court or governmental authority having jurisdiction
over ContiWest; or (iv) any law, rule or regulation, applicable to
ContiWest; or (B) to the best of such counsel's knowledge without
independent investigation, results in the creation or imposition of
any lien, charge or encumbrance upon the Trust Estate or upon the
Certificates.
(vi) There are, to the best of such counsel's knowledge
without independent investigation, no actions, proceedings or
investigations pending with respect to which ContiWest has received
service of process or threatened against ContiWest before any court,
administrative agency or other tribunal (a) asserting the invalidity
of the Pooling and Servicing Agreement, the Underwriting Agreement or
the Certificates, (b) seeking to prevent the consummation of any of
the transactions contemplated by the
15
Pooling and Servicing Agreement or (c) which would materially and
adversely affect the performance by ContiWest of its obligations
under, or the validity or enforceability of, the Pooling and
Servicing Agreement or the Underwriting Agreement.
X. Xxxxxxx X. Xxxxxxxx, Esq., Counsel for the Depositor, shall have
furnished to the Underwriters and MBIA his written opinion, addressed to the
Underwriters and MBIA and dated the Closing Date, in form and substance
satisfactory to the Underwriters and MBIA, to the effect that:
(i) The Depositor has been duly organized and is validly
existing as a corporation in good standing under the laws of the
State of Delaware and is in good standing as a foreign corporation in
each jurisdiction in which its ownership or lease of property or the
conduct of its business so requires such standing except where the
failure to be in good standing would not result in a material adverse
change in the condition of the Depositor, whether or not arising in
the ordinary course of business. The Depositor has all power and
authority necessary to own or hold its properties and to conduct the
business in which it is engaged and to enter into and perform its
obligations under this Agreement and the Pooling and Servicing
Agreement and to cause the Certificates to be issued.
(ii) The Depositor is not in violation of its articles of
incorporation or by-laws or in default in the performance or
observance of any material obligation, agreement, covenant or
condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Depositor is
a party or by which it or its properties may be bound, which default
might result in any material adverse changes in the financial
condition, earnings, affairs or business of the Depositor or which
might materially and adversely affect the properties or assets, taken
as a whole, of the Depositor.
(iii) This Agreement and the Pooling and Servicing Agreement
have been duly authorized, executed and delivered by the Depositor
and, assuming the due authorization, execution and delivery of such
agreements by the other parties thereto, such agreements constitute
valid and binding obligations, enforceable against the Depositor in
accordance with their respective terms, subject as to enforceability
to (x) bankruptcy, insolvency, reorganization, moratorium or other
similar laws now or hereafter in effect relating to creditors' rights
generally, (y) general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law) and (z)
with respect to rights of indemnity under this Agreement, limitations
of public policy under applicable securities laws.
(iv) The execution, delivery and performance of this
Agreement and the Pooling and Servicing Agreement by the Depositor,
the consummation of the transactions contemplated hereby and thereby,
and the issuance and delivery of the Certificates do not and will not
conflict with or result in a breach or violation of any of the terms
or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan
16
agreement or other agreement or instrument to which the Depositor is
a party or by which the Depositor is bound or to which any of the
property or assets of the Depositor or any of its subsidiaries is
subject, which breach or violation would have a material adverse
effect on the business, operations or financial condition of the
Depositor or its ability to perform its obligations under this
Agreement and the Pooling and Servicing Agreement nor will such
actions result in a violation of the provisions of the articles of
incorporation or by-laws of the Depositor or any statute or any
order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Depositor or any of its properties or
assets, which breach or violation would have a material adverse
effect on the business, operations or financial condition of the
Depositor or its ability to perform its obligations under this
Agreement and the Pooling and Servicing Agreement.
(v) The direction by the Depositor to the Trustee to issue,
authenticate and deliver the Certificates has been duly authorized by
the Depositor and, assuming that the Trustee has been duly authorized
to do so, when executed, authenticated and delivered by the Trustee
in accordance with the Pooling and Servicing Agreement, the
Certificates will be validly issued and outstanding and will be
entitled to the benefits of the Pooling and Servicing Agreement.
(vi) No consent, approval, authorization, order,
registration or qualification of or with any court or governmental
agency or body is required for the issuance of the Certificates, and
the sale of the Offered Certificates to the Underwriters, or the
consummation by the Depositor of the other transactions contemplated
by this Agreement and the Pooling and Servicing Agreement, except
such consents, approvals, authorizations, registrations or
qualifications as may be required under the Securities Act or state
securities or Blue Sky laws in connection with the purchase and
distribution of the Offered Certificates by the Underwriters or as
have been previously obtained.
(vii) There are not, to the best of his knowledge without
independent investigation, any actions, proceedings or investigations
pending with respect to which the Depositor has received service of
process before or threatened by any court, administrative agency or
other tribunal to which the Depositor is a party or of which any of
its properties is the subject: (a) which if determined adversely to
the Depositor would have a material adverse effect on the business,
results of operations or financial condition of the Depositor; (b)
asserting the invalidity of the Pooling and Servicing Agreement or
the Certificates; (c) seeking to prevent the issuance of the
Certificates or the consummation by the Depositor of any of the
transactions contemplated by the Pooling and Servicing Agreement or
this Agreement, as the case may be; or (d) which might materially and
adversely affect the performance by the Depositor of its obligations
under, or the validity or enforceability of, the Pooling and
Servicing Agreement, this Agreement or the Certificates.
(viii)The Certificates have been duly and validly authorized
and issued and, immediately prior to the sale of the Offered
Certificates to the Underwriters, such Certificates are owned by the
Depositor, free and clear of all Liens.
17
I. The Underwriters and MBIA shall have received the favorable
opinion of counsel to the Trustee, dated the Closing Date, addressed to the
Underwriters and in form and scope satisfactory to counsel to the
Underwriters, to the effect that:
(i) The Trustee is a banking corporation duly incorporated
and validly existing under the law of the State of New York.
(ii) The Trustee has the full corporate trust power to
execute, deliver and perform its obligations under the Pooling and
Servicing Agreement.
(iii) The execution and delivery by the Trustee of the
Pooling and Servicing Agreement, and the performance by the Trustee
of its obligations under the Pooling and Servicing Agreement, have
been duly authorized by all necessary corporate action of the
Trustee.
(iv) The Pooling and Servicing Agreement is a valid and
legally binding obligation of the Trustee enforceable against the
Trustee.
(v) The execution and delivery by the Trustee of the Pooling
and Servicing Agreement does not (a) violate the Organization
Certificate of the Trustee or the by-laws of the Trustee, (b) to such
counsel's knowledge, violate any judgment, decree or order of any New
York or United States federal court or other New York or United
States federal governmental authority by which the Trustee is bound
or (c) assuming the non-existence of any judgment, decree or order of
any court or other governmental authority that would be violated by
such execution and delivery, violate any New York or United States
federal statute, rule or regulation or require any consent, approval
or authorization of any New York or United States federal court or
other New York or United States federal governmental authority.
(vi) The Certificates have been duly executed, authenticated
and delivered by the Trustee.
(vii) If the Trustee were acting as Servicer under the
Pooling and Servicing Agreement as of the date of such opinion, the
Trustee would have the full corporate trust power to perform the
obligations of the Servicer under the Pooling and Servicing
Agreement; and
(viii) To the best of such counsel's knowledge, there are no
actions, proceedings or investigations pending or threatened against
or affecting the Trustee before or by any court, arbitrator,
administrative agency or other governmental authority which, if
decided adversely to the Trustee, would materially and adversely
affect the ability of the Trustee to carry out the transactions
contemplated in the Pooling and Servicing Agreement.
18
J. The Underwriters and MBIA shall have received the favorable
opinion or opinions, dated the Closing Date, of counsel for the Underwriters,
with respect to the issue and sale of the Offered Certificates, the
Registration Statement, this Agreement, the Prospectus and such other related
matters as the Underwriters may reasonably require.
K. Reserved.
L. The Depositor, ContiMortgage, ContiWest and ContiFinancial shall
each have furnished to the Underwriters and MBIA a certificate, dated the
Closing Date and signed by the Chairman of the Board, the President or a Vice
President of the Depositor, ContiMortgage, ContiWest and ContiFinancial,
respectively, stating as it relates to each, as of the Closing Date:
(i) The representations and warranties of the Depositor,
ContiMortgage and ContiWest in this Agreement are true and correct as
of the Closing Date; and the Depositor, ContiMortgage and ContiWest
have complied with each of their respective agreements contained
herein which are to have been complied with on or prior to the
Closing Date;
(ii) The information contained in the Prospectus relating to
the Depositor, ContiMortgage, ContiWest and the Home Equity Loans is
true and accurate in all material respects and nothing has come to
his or her attention that would lead such officer to believe that the
Registration Statement or the Prospectus includes any untrue
statement of a material fact or omits to state a material fact
necessary to make the statements therein not misleading;
(iii) There has been no amendment or other document filed
affecting the certificate of incorporation or by-laws of the
Depositor since May 18, 1995 or the certificate of incorporation or
by-laws of ContiMortgage since October 19, 1990 or the Articles of
incorporation or by-laws of ContiWest since January 1, 1997 and no
such amendment has been authorized. No event has occurred since
September 30, 1998 which has affected the good standing of the
Depositor, ContiMortgage or ContiWest under the laws of the States of
Delaware and Nevada, as applicable; and
(iv) There has not occurred any material adverse change, or
any development involving a prospective material adverse change, in
the condition, financial or otherwise, or in the earnings, business
or operations of the Depositor, ContiMortgage, ContiWest or
ContiFinancial from September 30, 1998. No publicly-held debt of
ContiFinancial shall have been downgraded or put on credit watch for
possible downgrade, nor is ContiFinancial aware of any anticipated
downgrading or credit watch situation regarding ContiFinancial, in
each case since November 20, 1998, other than as previously disclosed
to the underwriter on or prior to the date hereof; there has been no
suspension of trading in ContiFinancial's publicly-held common stock
since September 30, 1998.
19
M. The Trustee shall have furnished to the Underwriters and MBIA a
certificate of the Trustee, signed by one or more duly authorized officers of
the Trustee, dated the Closing Date, as to the due authorization, execution
and delivery of the Pooling and Servicing Agreement by the Trustee and the
acceptance by the Trustee of the Trusts created thereby and the due execution,
authentication and delivery of the Certificates by the Trustee thereunder and
such other matters as the Representative shall reasonably request.
N. The Certificate Insurance Policy and the Insurance Agreement shall
have been issued by the Certificate Insurer and shall have been duly
authenticated by an authorized agent of the Certificate Insurer, if so
required under applicable state law or regulations.
O. The Offered Certificates shall have been rated in the highest
rating category by Xxxxx'x Investors Service, Inc. ("Moody's"), Standard &
Poor's Rating Services, a division of the XxXxxx-Xxxx Companies, Inc.
("Standard & Poor's") and Fitch IBCA, Inc. ("Fitch"); the Offered Certificates
shall not have been put on credit watch for possible downgrade.
P. The Depositor shall have furnished to the Underwriters such
further information, certificates and documents as the Underwriters may
reasonably have requested not less than three full business days prior to the
Closing Date.
Q. Prior to the Closing Date, counsel for the Underwriters shall have
been furnished with such documents and opinions as they may reasonably require
for the purpose of enabling them to pass upon the issuance and sale of the
Certificates as herein contemplated and related proceedings or in order to
evidence the accuracy and completeness of any of the representations and
warranties, or the fulfillment of any of the conditions, herein contained, and
all proceedings taken by the Depositor in connection with the issuance and
sale of the Certificates as herein contemplated shall be satisfactory in form
and substance to the Underwriters and counsel for the Underwriters.
R. Subsequent to the execution and delivery of this Agreement none of
the following shall have occurred: (i) trading in securities generally on the
New York Stock Exchange, the American Stock Exchange or the over-the-counter
market shall have been suspended or minimum prices shall have been established
on either of such exchanges or such market by the Commission, by such exchange
or by any other regulatory body or governmental authority having jurisdiction;
(ii) a banking moratorium shall have been declared by Federal or state
authorities; (iii) the United States shall have become engaged in hostilities,
there shall have been an escalation of hostilities involving the United States
or there shall have been a declaration of a national emergency or war by the
United States; or (iv) there shall have occurred such a material adverse
change in general economic, political or financial conditions (or the effect
of international conditions on the financial markets of the United States
shall be such) as to make it in each of the instances set forth in clauses
(i), (ii), (iii) and (iv) herein, in the reasonable judgment of the
Underwriters, impractical or inadvisable to proceed with the public offering
or delivery of the Certificates on the terms and in the manner contemplated in
the Prospectus.
20
S. The Representative shall have received letters, including
bring-down letters, from Xxxxxx Xxxxxxxx LLP, dated on or before the Closing
Date, in form and substance satisfactory to the Representative and counsel for
the Underwriters, to the effect that they have performed certain specified
procedures requested by the Representative with respect to the information set
forth in the Prospectus and certain matters relating to ContiMortgage and
ContiWest.
T. The Underwriters shall have received any other opinions delivered
to the Ratings Agencies.
U. The Policy shall have been duly executed and issued at or prior to
the Closing Date and shall conform in all material respects to the description
thereof in the Prospectus. The Insurance Agreement and the Indemnification
Agreement shall each have been duly executed and delivered by MBIA and the
other parties thereto at or prior to the Closing Date.
V. The Underwriters shall have received a favorable opinion of Xxxxx
Xxxx, counsel to MBIA, dated the Closing Date and in form and substance
satisfactory to counsel for the Underwriters, to the effect that:
(i) MBIA is a stock insurance corporation, duly incorporated
and validly existing under the laws of the State of New York. MBIA is
validly licensed to do business in New York and is authorized to
issue the Policy and perform its obligations under the Policy in
accordance with the terms thereof.
(ii) The execution and delivery by MBIA of the Policy and
the Indemnification Agreement are within the corporate power of MBIA
and have been authorized by all necessary corporate action on the
part of MBIA; the Policy has been duly executed and is the valid and
binding obligation of the Insurer enforceable in accordance with its
terms except that the enforcement of the Policy may be limited by
laws relating to bankruptcy, insolvency, reorganization, moratorium,
receivership and other similar laws affecting creditors' rights
generally and by general principles of equity.
(iii) MBIA is authorized to deliver the Indemnification
Agreement, and such agreement has been duly executed and delivered
and constitutes the legal, valid and binding obligations of MBIA
enforceable in accordance with its terms except that the enforcement
of the Indemnification Agreement may be limited by laws relating to
bankruptcy, insolvency, reorganization, moratorium, receivership and
other similar laws affecting creditors' rights generally and by
general principles of equity and by public policy considerations
relating to indemnification for securities law violations.
In rendering this opinion, such counsel may rely, as to matters of
fact, on certificates of responsible officers of MBIA and public officials.
Such opinion may assume the due authorization, execution and delivery of the
instruments and documents referred to therein by the parties thereto other
than MBIA.
21
W. The Underwriters shall have received from MBIA a certificate,
signed by the president, a senior vice president or a vice president of MBIA,
dated the Closing Date, to the effect that the signer of such certificate has
carefully examined the Policy, the Indemnification Agreement and the related
documents and that, to the best of his or her knowledge based on reasonable
investigation:
(i) There are no actions, suits or proceedings pending or
threatened against or affecting MBIA which, if adversely determined,
individually or in the aggregate, would adversely affect the
Insurer's performance under the Policy or the Indemnification
Agreement;
(ii) Each person who as an officer or representative of
MBIA, signed or signs the Policy, the Indemnification Agreement or
any other document delivered pursuant hereto, on the date thereof, or
on the Closing Date, in connection with the transactions described in
this Agreement was, at the respective times of such signing and
delivery, and is now, duly elected or appointed, qualified and acting
as such officer or representative, and the signatures of such persons
appearing on such documents are their genuine signatures;
(iii) The information contained in the Prospectus Supplement
under the captions "Credit Enhancement - The Certificate Insurance
Policy" and "The Certificate Insurer" is true and correct in all
material respects and does not omit to state a material fact with
respect to the description of the Policy or the ability of MBIA to
meet its payment obligations under the Policy;
(iv) The tables regarding MBIA's capitalization set forth
under the caption "The Certificate Insurer" presents fairly the
capitalization of the Insurer as of September 30, 1998;
(v) On or prior to the Closing Date, there has been no
downgrading, nor has any notice been given of (A) any intended or
potential downgrading or (B) any review or possible changes in rating
the direction of which has not been indicated, in the rating accorded
the claims paying ability of MBIA by any "nationally recognized
statistical rating organization," as such term is defined for
purposes of the Securities Act;
(vi) The audited balance sheet of MBIA as of December 31,
1997 and the related statement of income and retained earnings for
the fiscal year then ended, and the accompanying footnotes, together
with the related opinion of an independent certified public
accountant, copies of which are incorporated by reference in the
Prospectus Supplement, fairly present in all material respects the
financial condition of MBIA as of such date and for the period
covered by such statements in accordance with generally accepted
accounting principles consistently applied; the unaudited balance
sheet of MBIA as of September 30, 1998 and the related statement of
income and retained earnings for the three-month period then ended,
copies of which are included in the Prospectus Supplement, fairly
present in all material respects the financial condition of MBIA as
of
22
such date and for the period covered by such statements in accordance
with generally accepted accounting principles applied consistently
with those principles applied in preparing the December 31, 1997
audited statements.
(vii) to the best knowledge of such officer, since September
30, 1998, no material adverse change has occurred in the financial
position of MBIA other than as set forth in the Prospectus
Supplement.
The officer of MBIA certifying to items (v) - (vii) shall be an
officer in charge of a principal financial function.
MBIA shall attach to such certificate a true and correct copy of its
certificate or articles of incorporation, as appropriate, and its by-laws, all
of which are in full force and effect on the date of such certificate.
If any condition specified in this Section VII shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be
terminated by the Underwriters by notice to the Depositor at any time at or
prior to the Closing Date, and such termination shall be without liability of
any party to any other party except as provided in Section VII.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably
satisfactory to counsel for the Underwriters.
SECTION VII. Payment of Expenses. The Depositor agrees to pay:
A. the costs incident to the authorization, issuance, sale and
delivery of the Certificates and any taxes payable in connection therewith;
(b) the costs incident to the preparation, printing and filing under the
Securities Act of the Registration Statement and any amendments and exhibits
thereto; (c) the costs of distributing the Registration Statement as
originally filed and each amendment thereto and any post-effective amendments
thereof (including, in each case, exhibits), the Prospectus and any amendment
or supplement to the Prospectus or any document incorporated by reference
therein, all as provided in this Agreement; (d) the costs of reproducing and
distributing this Agreement; (e) the fees and expenses of Stroock & Stroock &
Xxxxx LLP in qualifying the Certificates under the securities laws of the
several jurisdictions as provided in Section V (G) hereof and of preparing,
printing and distributing a Blue Sky Memorandum and a Legal Investment Survey
(including related fees and expenses of counsel to the Representative); (f)
any fees charged by securities rating services for rating the Offered
Certificates; (g) the cost of the accountants comfort letter relating to the
Prospectus; and (h) all other costs and expenses incidental to the performance
of the obligations of the Depositor (including costs and expenses of counsel
to the Depositor); provided that, except as provided in this Section VII, the
Underwriters shall pay their own costs and expenses, including the costs and
expenses of their counsel, any transfer taxes on the Offered Certificates
which they may sell and the expenses of advertising any offering of the
Offered Certificates made by the Underwriters, and the Underwriters shall pay
the cost of any accountant's comfort letters relating to any Computational
Materials (as defined herein).
23
If this Agreement is terminated by the Underwriters in accordance
with the provisions of Section VI or Section XI, the Depositor shall cause the
Underwriters to be reimbursed for all reasonable out-of-pocket expenses,
including fees and disbursements of Stroock & Stroock & Xxxxx LLP, counsel for
the Underwriters.
SECTION VIII. Indemnification and Contribution.
A. The Depositor agrees to indemnify and hold harmless each
Underwriter, each Underwriter's respective officers and directors and each
person, if any, who controls such Underwriter within the meaning of Section 15
of the Securities Act from and against any and all loss, claim, damage or
liability, joint or several, or any action in respect thereof (including, but
not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of the Offered Certificates), to which such Underwriter or
any such controlling person may become subject, under the Securities Act or
otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement, or any amendment
thereof or supplement thereto, (ii) 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, (iii) any untrue statement or alleged
untrue statement of a material fact contained in the Prospectus, or any
amendment thereof or supplement thereto, or (iv) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading and shall reimburse such
Underwriter and each such controlling person promptly upon demand for any
legal or other expenses reasonably incurred by such Underwriter or such
controlling person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Depositor shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in the
Prospectus, or any amendment thereof or supplement thereto, or the
Registration Statement, or any amendment thereof or supplement thereto, in
reliance upon and in conformity with written information furnished to the
Depositor by or on behalf of such Underwriter through the Representative,
specifically for inclusion therein, and shall reimburse the Underwriter and
any such director, officer or controlling person for any legal or other
expenses reasonably incurred by the Underwriter or any director, officer or
controlling person in connection with investigating or defending or preparing
to defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which the Depositor may otherwise have to any Underwriter or any
such officer or director or any controlling person of any such Underwriter.
B. Each Underwriter severally agrees to indemnify and hold harmless
the Depositor, each of its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Depositor
within the meaning of Section 15 of the Securities Act against any and all
loss, claim, damage or liability, or any action in respect thereof, to which
the Depositor or any such director, officer or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action
24
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, or any
amendment thereof or supplement thereto, (ii) 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, (iii) any untrue statement or
alleged untrue statement of a material fact contained in the Prospectus, or
any amendment thereof or supplement thereto, or (iv) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, but in each case only to the
extent that the 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 Depositor by or on behalf of such Underwriter
specifically for inclusion therein, and shall reimburse the Depositor and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Depositor or any director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may otherwise have to the Depositor or any such
director, officer or controlling person.
C. Promptly after receipt by any indemnified party under this Section
VIII of notice of any claim or the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
any indemnifying party under this Section VIII, notify the indemnifying party
in writing of the claim or the commencement of that action; provided, however,
that the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section VIII except to the extent it
has been materially prejudiced by such failure and, provided further, that the
failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section VIII.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, except to
the extent provided in the next following paragraph, the indemnifying party
shall not be liable to the indemnified party under this Section VIII for any
legal or other expenses subsequently incurred by the indemnified party in
connection with the defense thereof other than reasonable costs of
investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel;
25
or (iii) the indemnifying party has failed to assume the defense of such
action and employ counsel reasonably satisfactory to the indemnified party, in
which case, if such indemnified party notifies the indemnifying party in
writing that it elects to employ separate counsel at the expense of the
indemnifying party, the indemnifying party shall not have the right to assume
the defense of such action on behalf of such indemnified party, it being
understood, however that the indemnifying party shall not, in connection with
any one such action or separate but substantially similar or related actions
in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to one local counsel per jurisdiction)
at any time for all such indemnified parties, which firm shall be designated
in writing by the related Underwriter, if the indemnified parties under this
Section VIII consist of one or more Underwriters or any of its or their
controlling persons, or the Depositor, if the indemnified parties under this
Section VIII consist of the Depositor or any of the Depositor's directors,
officers or controlling persons.
Each indemnified party, as a condition of the indemnity agreements
contained in Section VIII (A) and (B), shall use its reasonable best efforts
to cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be
a final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against
any loss or liability by reason of such settlement or judgment. 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
on any claims that are the subject of such action.
Notwithstanding the foregoing paragraph, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than
30 days after receipt by such indemnifying party of the aforesaid request and
(ii) such indemnifying party shall not have reimbursed the indemnified party
in accordance with such request prior to the date of such settlement.
D. Each Underwriter agrees to provide the Depositor no later than two
Business Days prior to the day on which the Prospectus Supplement is required
to be filed pursuant to Section I (A) hereof with a copy of any Computational
Materials (defined below) produced by such Underwriter for filing with the
Commission on Form 8-K.
E. Each Underwriter severally agrees, to indemnify and hold harmless
the Depositor, each of the Depositor's officers and directors and each person
who controls the Depositor within the meaning of Section 15 of the Securities
Act against any and all losses, claims, damages or liabilities, to which they
may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
26
arise out of or are based upon any untrue statement of a material fact
contained in the Computational Materials provided by such Underwriter, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading when read in
conjunction with the Prospectus, and agrees to reimburse each such indemnified
party for any legal or other expenses reasonably incurred by him, her or it in
connection with investigating or defending or preparing to defend any such
loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that in no event shall an Underwriter be liable to the
Depositor under this paragraph E in an amount in excess of the fees received
by such Underwriter in connection with the offering of the Offered
Certificates. The obligations of an Underwriter under this Section VIII (E)
shall be in addition to any liability which such Underwriter may otherwise
have.
The procedures set forth in Section VIII (C) shall be equally
applicable to this Section VIII (E).
F. The Depositor agrees to indemnify and hold harmless each
Underwriter, each Underwriter's respective officers and directors and each
person, if any, who controls such Underwriter within the meaning of Section 15
of the Securities Act from and against any and all losses, claims, damages or
liabilities, joint or several, or any action in respect thereof (including,
but not limited to, any loss, claim, damage, liability or action relating to
purchases and sales of the Offered Certificates), to which they may become
subject, under the Securities 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 of a material fact contained in the Seller
Provided Information (as defined below) provided by the Company, 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, in the light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party for
any legal or other expenses reasonably incurred by him, her or it in
connection with investigating or defending or preparing to defend any such
loss, claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which the
Depositor may otherwise have to any Underwriter or any such officer or
director or any controlling person of any such Underwriter.
The procedures set forth in Section VIII (C) shall be equally
applicable to this Section VIII (F).
G. If the indemnification provided for in this Section VIII shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section VIII (A), (B), (E) or (F) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein,
then each indemnifying party shall, in lieu of indemnifying such indemnified
party, contribute to the amount paid or payable by such indemnified party as a
result of such loss, claim, damage or liability, or action in respect thereof,
(i) in such proportion as shall be appropriate to reflect the relative
benefits received by the Depositor on the one hand and the Underwriters on the
other from the offering of the Offered Certificates or (ii) if the allocation
27
provided by clause (i) above is not permitted by applicable law or if the
indemnified party failed to give the notice required under Section VIII (C),
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 Depositor
on the one hand and the related Underwriter on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or
liability, or action in respect thereof, as well as any other relevant
equitable considerations.
The relative benefits of an Underwriter and the Depositor shall be
deemed to be in such proportion as the sum of the original principal amount of
the offering bears to the total underwriting discounts and commissions
received by the Underwriter from time to time in negotiated sales of the
related Certificates.
The relative fault of an Underwriter and the Depositor shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Depositor or by the Underwriter, the intent of
the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission and other
equitable considerations.
The Depositor and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this Section VIII (G) were to be
determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purposes) or by any other method of allocation which does
not take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss, claim,
damage or liability, or action in respect thereof, referred to above in this
Section VIII (G) shall be deemed to include, for purposes of this Section VIII
(G), any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such action or claim.
For purposes of this Section VIII, in no case shall any Underwriter
(except with respect to any document (other than the Computational Materials)
incorporated by reference into the Registration Statement or Prospectus at the
request of such Underwriter through the Representative and except as may be
provided in any agreement among the Underwriters relating to the offering of
the Offered Certificates) be responsible for any amount in excess of the
amount by which (x) the amount received by such Underwriter in connection with
its sale of the Offered Certificates exceeds (y) the amount paid by such
Underwriter to the Depositor for the Offered Certificates hereunder. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of fraudulent misrepresentation.
H. For purposes of this Section VIII, as to each Underwriter the term
"Computational Materials" means collectively, "Computational Materials,"
"Collateral Term Sheets" and "Structural Term Sheets" as such terms are
defined in the No-Action Letter of May 20, 1994 issued by the Securities and
Exchange Commission (the "Commission") to Xxxxxx, Xxxxxxx Acceptance
Corporation I, Xxxxxx, Xxxxxxx & Co. Incorporated and Xxxxxx Structured Asset
Corporation, as made applicable to other issuers and underwriters by the
Commission in response to the request of the Public Securities Association
dated May 24, 1994, and the No-
28
Action Letter of February 17, 1995 issued by the Commission to the Public
Securities Association, provided, that the term Computational Materials shall
not include any Seller Provided Information. "Seller Provided Information"
means any computer tape (or other information) furnished to any Underwriter by
any Seller concerning the assets comprising the Trust including such
information as to which an accountant's letter was not furnished to the
Underwriter or the Seller.
I. The Underwriters confirm that the information set forth in the
last paragraph on the cover page of and under the caption "Underwriting" in
the Prospectus Supplement and the Computational Materials are correct and
constitute the only information furnished in writing to the Depositor by or on
behalf of any Underwriter specifically for inclusion in the Registration
Statement and the Prospectus.
SECTION IX. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in certificates of officers of the Depositor submitted
pursuant hereto shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Underwriters or
controlling persons thereof, or by or on behalf of the Depositor, and shall
survive delivery of any Offered Certificates to the Underwriters.
SECTION X. Default by One or More of the Underwriters. If one or more
of the Underwriters participating in the public offering of the Offered
Certificates shall fail at the Closing Date to purchase the Offered
Certificates which it is (or they are) obligated to purchase hereunder (the
"Defaulted Certificates"), then the non-defaulting Underwriters shall have the
right, within 24 hours thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but
not less than all, of the Defaulted Certificates in such amounts as may be
agreed upon and upon the terms herein set forth. If, however, the Underwriters
have not completed such arrangements within such 24 hour period, then (i) if
the aggregate principal amount of Defaulted Certificates does not exceed 10%
of the aggregate principal amount of the Offered Certificates to be purchased
pursuant to this Agreement, the non-defaulting Underwriters named in this
Agreement shall be obligated to purchase the full amount thereof in the
proportions that their respective underwriting obligations hereunder bear to
the underwriting obligations of all such non-defaulting Underwriters, or (ii)
if the aggregate principal amount of Defaulted Certificates exceeds 10% of the
aggregate principal amount of the Offered Certificates to be purchased
pursuant to this Agreement, this Agreement shall terminate, without any
liability on the part of any non-defaulting Underwriters. No action taken
pursuant to this Section X shall relieve any defaulting Underwriter from the
liability with respect to any default of such Underwriter under this
Agreement. In the event of a default by any Underwriter as set forth in this
Section X, each of the Underwriters and the Depositor shall have the right to
postpone the Closing Date for a period not exceeding five Business Days in
order that any required changes in the Registration Statement or Prospectus or
in any other documents or arrangements may be effected.
29
SECTION XI. Termination of Agreement. The Underwriters may terminate
this Agreement immediately upon notice to the Depositor, at any time at or
prior to the Closing Date if any of the events or conditions described in
Section VI (R) of this Agreement shall occur and be continuing, or if any
other closing condition set forth in Section VI shall not have been fulfilled
when required to be fulfilled. In the event of any such termination, the
covenant set forth in Section V (H), the provisions of Section VII, the
indemnity and contribution agreements set forth in Section VIII, and the
provisions of Sections IX, XIV and XVI shall remain in effect.
SECTION XII. Notices. All statements, requests, notices and
agreements hereunder shall be in writing, and:
A. if to the Underwriters, shall be delivered or sent by mail, telex
or facsimile transmission to Credit Suisse First Boston Corporation, 00
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx Xxxxxx; and
B. if to the Depositor, shall be delivered or sent by mail, telex or
facsimile transmission to care of ContiSecurities Asset Funding Corp., 0000
Xxxx Xxxxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxx Xxxxx Xxxxxx 00000 (fax:
000-000-0000), with a copy to ContiFinancial Corporation, 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Chief Counsel (Fax: 000-000-0000).
SECTION XIII. Persons Entitled to the Benefit of this Agreement. This
Agreement shall inure to the benefit of and be binding upon the Underwriters
and the Depositor, and their respective successors. This Agreement and the
terms and provisions hereof are for the sole benefit of only those persons,
except that the representations, warranties, indemnities and agreements
contained in this Agreement shall also be deemed to be for the benefit of the
person or persons, if any, who control any of the Underwriters within the
meaning of Section 15 of the Securities Act, and for the benefit of each
Underwriter's respective officers and directors and for the benefit of
directors of the Depositor, officers of the Depositor who have signed the
Registration Statement and any person controlling the Depositor within the
meaning of Section 15 of the Securities Act. Nothing in this Agreement is
intended or shall be construed to give any person, other than the persons
referred to in this Section XIII, any legal or equitable right, remedy or
claim under or in respect of this Agreement or any provision contained herein.
SECTION XIV. Survival. The respective indemnities, representations,
warranties and agreements of the Depositor and the Underwriters contained in
this Agreement, or made by or on behalf of them, respectively, pursuant to
this Agreement, shall survive the delivery of and payment for the Certificates
and shall remain in full force and effect, regardless of any investigation
made by or on behalf of any of them or any person controlling any of them.
SECTION XV. Definition of the Term "Business Day". For purposes of
this Agreement, "Business Day" means any day on which the New York Stock
Exchange, Inc. is open for trading.
30
SECTION XVI. Governing Law: Submission to Jurisdiction; Waiver of
Jury Trial. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York without giving effect to the principles
of conflicts of law thereof.
The parties hereto hereby submit to the jurisdiction of the United
States District Court for the Southern District of New York and any court in
the State of New York located in the City and County of New York, and
appellate court from any thereof, in any action, suit or proceeding brought
against it or in connection with this Agreement or any of the related
documents or the transactions contemplated hereunder or for recognition or
enforcement of any judgment, and the parties hereto hereby agree that all
claims in respect of any such action or proceeding may be heard or determined
in New York State court or, to the extent permitted by law, in such federal
court.
The parties hereto hereby irrevocably waive, to the fullest extent
permitted by law, any and all rights to trial by jury in any legal proceeding
arising out of or relating to this Agreement or the transactions contemplated
hereby.
SECTION XVII. Counterparts. This Agreement may be executed in
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION XVIII. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
SECTION XIX. Reserved.
31
If the foregoing correctly sets forth the agreement between the
Depositor and the Underwriters, please indicate your acceptance in the space
provided for the purpose below.
Very truly yours,
CONTISECURITIES ASSET FUNDING
CORP.
By: /s/ Xxxx Xxxx
------------------------------------
Name: Xxxx Xxxx
Title: Authorized Signatory
By: /s/ Xxxx Xxxxxxxx
------------------------------------
Name: Xxxx Xxxxxxxx
Title: Authorized Signatory
CONFIRMED AND ACCEPTED, as of the date first above written:
CREDIT SUISSE FIRST BOSTON CORPORATION
By: /s/ Xxxx Xxxxxx
---------------------------------
Name: Xxxx Xxxxxx
Title: Director
CONTIMORTGAGE CORPORATION CONTIWEST CORPORATION
Accepts and hereby agrees solely to Xxxxxxx and xxxxxx agrees solely to the
the provisions of Section V (H) provisions of Section V (I)
By: /s/ Xxxxxxxx X. Xxxxx By: /s/ Xxx X. Xxxxxxx
--------------------------------- ------------------------------------
Name: Xxxxxxxx X. Xxxxx Name: Xxx X. Xxxxxxx
Title: Senior Vice President Title: Vice President
By: /s/ Xxxxxx X. Xxxx By: /s/ Xxxx Xxxx
--------------------------------- ------------------------------------
Name: Xxxxxx X. Xxxx Name: Xxxx Xxxx
Title: Senior Vice President Title: Assistant Secretary
SCHEDULE A
Class A-F Certificates
Underwriter Principal Amount Price to Public Underwriting Purchase Price
----------- ---------------- --------------- Discount --------------
-------- (1)
Credit Suisse First Boston
Corporation $986,190,000 99.9954% 0.181% 99.8144%
ContiFinancial Services Corporation $ 13,810,000 99.9954% 0.181% 99.8144%
(1) Plus accrued interest from December 8, 1998.
EXHIBIT A
[LETTERHEAD OF CONTIFINANCIAL CORPORATION]
December 2, 1998
Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
This Guaranty is made by ContiFinancial Corporation, a Delaware
corporation with its principal office at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 ("CFC"), in favor of Credit Suisse First Boston Corporation as
Underwriter, with its principal office at 00 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000.
As an inducement to you and in consideration of your entering into
the Underwriting Agreement referred to below, CFC hereby absolutely,
unconditionally and irrevocably guarantees the prompt performance of the
obligations, including any payment obligations, of ContiSecurities Asset
Funding Corp., ("Depositor"), a Delaware corporation with its principal office
at 0000 Xxxx Xxxxxxxxxx Xxxxxxxxx, Xxx Xxxxx, Xxxxxx 00000, under Section VIII
of the Underwriting Agreement, dated as of December 2, 1998, between Depositor
and Credit Suisse First Boston Corporation, as Underwriter. This Guaranty is a
guaranty of performance and payment and not of collection. The obligations of
CFC hereunder shall not be impaired by failure of Depositor to provide notice
to CFC of any modification or amendment of said contract agreed to by the
parties thereto. This Guaranty may be amended only by an instrument in writing
executed by the undersigned.
This Guaranty shall be governed by the laws of the State of New York
applicable to agreements made and to be performed in the State of New York
without giving effect to the conflict of law rules thereof.
IN WITNESS WHEREOF, CFC has caused this Guaranty to be executed by
duly authorized corporate officers the day and year first above written.
CONTIFINANCIAL CORPORATION
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
ACCEPTED
as of December __, 1998
CREDIT SUISSE FIRST BOSTON CORPORATION,
as Underwriter
By:
--------------------------------
Name:
Title:
