$800,000,000
CONTIMORTGAGE HOME EQUITY LOAN TRUST 1999-3
Home Equity Loan Pass-Through Certificates
Series 1999-3
UNDERWRITING AGREEMENT
----------------------
June 9, 1999
Credit Suisse First Boston Corporation,
as Representative of the Several Underwriters
00 Xxxxxxx Xxxxxx
New York, NY 10010
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 1999-3, Class A-1, Class A-2, Class A-3, Class
A-4, Class A-5, Class A-6, Class A-7, Class A-8, Class A-9 IO (the "Class A
Certificates") and Class B (the "Class B Certificates" and, together with the
Class A Certificates, the "Offered Certificates"). Also issued are the Class C
Certificates, the Class R Certificates, the Class R-I Certificates and the Class
R-II Certificates (the "Retained Certificates"). The Class A Certificates, the
Class B Certificates and the Retained 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 June 1, 1999 among
the Depositor, Norwest Bank Minnesota, National Association, as master servicer
(the "Master Servicer") 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, two pools of
home equity loans, one comprised of fixed rate home equity loans and the other
comprised of adjustable rate home equity loans, having a
Cut-Off Date as of the close of business on May 31, 1999 (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 Ambac Assurance
Corporation (the "Certificate Insurer"). The Depositor, ContiMortgage and
ContiWest will also enter into an Indemnification Agreement (the
"Indemnification Agreement") dated as of June 1, 1999 among the Underwriters,
the Depositor, ContiMortgage, ContiWest and the Certificate Insurer, 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
-2-
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 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
-3-
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 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
-4-
law), and (z) with respect to rights of indemnity under this Agreement,
limitations of public policy under applicable securities laws.
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
-5-
would, singly or in the aggregate, materially and adversely affect the conduct
of its business, operations or financial condition
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 Cutoff 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 (other than the Class
B Certificates) shall have been rated in the highest rating category by Xxxxx'x
Investors Service, Inc. ("Moody's") and Standard & Poor's Ratings Services, a
division of The XxXxxx-Xxxx Companies, Inc. ("Standard & Poor's") and the Class
B Certificates shall have been rated "Baa3" by Moody's and "BBB-" by Standard &
Poor's.
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.
-6-
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 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) severally and not jointly to purchase from
the Depositor, the aggregate initial principal amounts or percentage interests
of the Offered Certificates of each Class, 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 June 17, 1999 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
-7-
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 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
-8-
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.
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
-9-
similar securities representing interests in or secured by other
mortgage-related assets that are 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.
-10-
X. Xxxxx Xxxxxxxxxx LLP shall have furnished to the Underwriters and
the Certificate Insurer their written opinion, as counsel to the Depositor,
addressed to the Underwriters and the Certificate Insurer and dated the Closing
Date, in form and substance satisfactory to the Underwriters and the Certificate
Insurer, 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 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, REMIC I, REMIC II and REMIC III
will each be treated as a REMIC, each Class of the Class A Certificates,
the Class B Certificates and the Class C Certificates will be treated as
"regular interests" in a REMIC, and the Class R, Class R-I and Class R-II
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 REMIC I, REMIC II or REMIC III as a REMIC.
(x) As a consequence of the qualifications of REMIC I, REMIC II and
REMIC III as REMICs, the Class A Certificates, Class B and Class C
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 REMIC I, XXXXX XX and XXXXX XXX as
REMICs, interest on the Class A, Class B and Class C 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 assets 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 the Certificate
Insurer a written statement, addressed to the Underwriters and the Certificate
Insurer and dated the Closing Date, in form and substance satisfactory to the
Underwriters and the Certificate Insurer 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
-12-
any document filed at the request of an Underwriter to the extent such document
relates to Computational Materials) 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 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 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 the Certificate Insurer their written
opinion, as counsel to ContiMortgage and ContiWest, addressed to the
Underwriters and the Certificate Insurer 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 the Certificate Insurer
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.
(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
-14-
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 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 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.
-15-
X. Xxxxxxx X. Xxxxxxxx, Esq., Counsel for the Depositor, shall have
furnished to the Underwriters and the Certificate Insurer his written opinion,
addressed to the Underwriters and the Certificate Insurer and dated the Closing
Date, in form and substance satisfactory to the Underwriters and the Certificate
Insurer, 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 change 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 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
-16-
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.
I. The Underwriters and the Certificate Insurer 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.
J. The Underwriters and the Certificate Insurer shall have received the
favorable opinion of counsel to the Master Servicer, (including Corporate
Counsel) dated the Closing Date, addressed to the Underwriters and in form and
scope reasonably satisfactory to counsel to the Underwriters, to the effect
that:
(i) The Master Servicer is a national banking association duly
organized, validly existing and in good standing under the laws of the
United States of America.
(ii) The Master Servicer has full power and authority to serve as
Master Servicer as contemplated in the Pooling and Servicing Agreement.
(iii) The Pooling and Servicing Agreement has been duly authorized,
executed and delivered by the Master Servicer.
(iv) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body having
jurisdiction
-17-
over the Master Servicer is required for the consummation by the Master
Servicer of the transactions contemplated by the Pooling and Servicing
Agreement, except such consents, approvals, authorizations, registrations
and qualification as have been obtained.
(v) The execution, delivery and performance of the Pooling and
Servicing Agreement by the Master Servicer and the consummation of the
transactions contemplated thereby do not and will not (a) 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 Master Servicer is
a party or by which the Master Servicer is bound or to which any of the
property or assets of the Master Servicer or any of its subsidiaries is
subject or (b) result in any violation of the provisions of the charter or
By-laws of the Master Servicer or any statute or any order, rule or
regulation of any court or government agency or body having jurisdiction
over the Master Servicer or any of its properties or assets.
(vi) The Pooling and Servicing Agreement constitutes the legal, valid
and binding agreement of the Master Servicer, enforceable against the
Master Servicer in accordance with its terms, subject to the provisions of
bankruptcy, insolvency, reorganization, or moratorium laws or other laws
relating to or affecting the rights of creditors and to general principles
of equity.
K. The Depositor, ContiMortgage, ContiWest and ContiFinancial shall
each have furnished to the Underwriters and the Certificate Insurer 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 December 31, 1998 which
-18-
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 December 31, 1998 other than as disclosed in (i) ContiFinancial's Form
10-Q dated February 16, 1999 or (ii) the press release issued on June 4,
1999. 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 June 4, 1999, 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 May 19, 1999.
L. The Trustee shall have furnished to the Underwriters and the
Certificate Insurer 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.
M. The Master Servicer shall have furnished to the Underwriters and the
Certificate Insurer a certificate of the Master Servicer, signed by one or more
duly authorized officers of the Master Servicer, dated by the Closing Date, as
to (i) the accuracy of the representations and warranties of the Master Servicer
in the Pooling and Servicing Agreement, (ii) the authenticity of the attached
articles of association and by-laws, (iii) the incumbency of the officers
executing the Pooling and Servicing Agreement and (iv) such other matters as the
Representative shall reasonably request.
N. The Offered Certificates (other than the Class B Certificates) shall
have been rated in the highest rating category by Xxxxx'x Investors Service,
Inc. ("Moody's") and Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. ("Standard & Poor's") and the Class B Certificates
shall have been rated "Baa3" by Moody's and "BBB-" by Standard & Poor's; no
Class of Offered Certificates shall have been put on credit watch for possible
downgrade.
O. 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.
P. 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
-19-
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.
Q. 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.
R. 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.
S. The Underwriters shall have received any other opinions delivered to
the Ratings Agencies or the Certificate Insurer.
T. 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 the Certificate
Insurer and the other parties thereto at or prior to the Closing Date.
U. The Underwriters shall have received a favorable opinion of Xxxxxxx,
Xxxxxxxx and Xxxx, counsel to the Certificate Insurer, dated the Closing Date
and in form and substance satisfactory to counsel for the Underwriters, to the
effect that:
(i) The Certificate Insurer is a stock insurance corporation, duly
incorporated and validly existing under the laws of the Wisconsin. The
Certificate Insurer is validly licensed to do business in Wisconsin 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 the Certificate Insurer of the
Policy and the Indemnification Agreement are within the corporate power of
the Certificate
-20-
Insurer and have been authorized by all necessary corporate action on the
part of the Certificate Insurer; 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) The Certificate Insurer 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 the
Certificate Insurer 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 the Certificate Insurer 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 the Certificate Insurer.
V. The Underwriters shall have received from the Certificate Insurer a
certificate, signed by the president, a senior vice president or a vice
president of the Certificate Insurer, 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 the Certificate Insurer 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 the Certificate
Insurer, 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
"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 the Certificate Insurer to meet its payment
obligations under the Policy;
-21-
(iv) The tables regarding the Certificate Insurer's capitalization set
forth under the caption " Certificate Insurer" presents fairly the
capitalization of the Insurer as of March 31, 1999;
(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 the
Certificate Insurer by any "nationally recognized statistical rating
organization," as such term is defined for purposes of the Securities Act;
(vi) The audited balance sheet of the Certificate Insurer as of
December 31, 1998 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 the
Certificate Insurer 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 the Certificate
Insurer as of March 31, 1999 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 the Certificate Insurer as of 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, 1998 audited statements.
(vii) to the best knowledge of such officer, since December 31, 1998,
no material adverse change has occurred in the financial position of the
Certificate Insurer other than as set forth in the Prospectus Supplement.
The officer of the Certificate Insurer certifying to items (v)
- (vii) shall be an officer in charge of a principal financial function.
The Certificate Insurer 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.
-22-
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).
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
-23-
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 such
Underwriter and any such director, officer or controlling person for any legal
or other expenses reasonably incurred by such 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 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,
-24-
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; 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
-25-
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 (i)
includes an unconditional release of such indemnified party from all liability
on any claims that are the subject of such action and (ii) does not include a
statement as to, or an admission of, fault, culpability or a failure to act by
or on behalf of an indemnified party.
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) 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
-26-
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 relevant Class of Offered Certificates or (ii) if the
allocation 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, plus the total proceeds to the Depositor from the sale of the
Class A-9 IO Certificates (before deducting expenses) bears to the total
underwriting discounts and commissions received by the related Underwriter from
time to time in negotiated sales of the related Offered 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 such 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
-27-
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-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.
-28-
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.
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,
-29-
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.
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.
-30-
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 Xxxxxxxx
----------------------------------
Name: Xxxx Xxxxxxxx
Title: Authorized Signatory
By: /s/ Xxxx Xxxx
----------------------------------
Name: Xxxx Xxxx
Title: Authorized Signatory
CONFIRMED AND ACCEPTED, as of the date first above written:
CREDIT SUISSE FIRST BOSTON CORPORATION
Acting on its own behalf and as Representative
of the Several Underwriters
referred to in the foregoing agreement
By:/s/ Xxxx Xxxxxx
--------------------------
Name: Xxxx Xxxxxx
Title: Vice President
CONTIMORTGAGE CORPORATION CONTIWEST CORPORATION
Accepts and hereby agrees solely to Accepts and xxxxxx agrees solely to
the provisions of Section V (H) the provisions of Section V (I)
By: /s/ Xxxxxxxx Xxxxx By: /s/ Xxx Xxxxxxx
------------------------------ -----------------------------
Name: Xxxxxxxx X. Xxxxx Name: Xxx Xxxxxxx
Title: Authorized Signatory Title: Authorized Signatory
By: /s/ Xxxxxx Xxxxx By: /s/ Xxxx Xxxx
------------------------------ -----------------------------
Name: Xxxxxx Xxxxx Name: Xxxx Xxxx
Title: Authorized Signatory Title: Authorized Signatory
-32-
SCHEDULE A
Class A-1 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $41,820,000 99.99768% 0.1250% 99.872680%
Bear, Xxxxxxx & Co. Inc. $41,820,000 99.99768% 0.1250% 99.872680%
Greenwich Capital Markets, Inc. $41,820,000 99.99768% 0.1250% 99.872680%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $41,820,000 99.99768% 0.1250% 99.872680%
Xxxxxx Xxxxxxx & Co. Incorporated $41,820,000 99.99768% 0.1250% 99.872680%
Class A-2 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $25,260,000 99.98545% 0.1650% 99.820450%
Bear, Xxxxxxx & Co. Inc. $25,260,000 99.98545% 0.1650% 99.820450%
Greenwich Capital Markets, Inc. $25,260,000 99.98545% 0.1650% 99.820450%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $25,260,000 99.98545% 0.1650% 99.820450%
Xxxxxx Xxxxxxx & Co. Incorporated $25,260,000 99.98545% 0.1650% 99.820450%
(1) Plus Accrued Interest.
-33-
Class A-3 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $14,540,000 99.97451% 0.1875% 99.78701%
Bear, Xxxxxxx & Co. Inc. $14,540,000 99.97451% 0.1875% 99.78701%
Greenwich Capital Markets, Inc. $14,540,000 99.97451% 0.1875% 99.78701%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $14,540,000 99.97451% 0.1875% 99.78701%
Xxxxxx Xxxxxxx & Co. Incorporated $14,540,000 99.97451% 0.1875% 99.78701%
Class A-4 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $8,300,000 99.98696% 0.2110% 99.77596%
Bear, Xxxxxxx & Co. Inc. $8,300,000 99.98696% 0.2110% 99.77596%
Greenwich Capital Markets, Inc. $8,300,000 99.98696% 0.2110% 99.77596%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $8,300,000 99.98696% 0.2110% 99.77596%
Xxxxxx Xxxxxxx & Co. Incorporated $8,300,000 99.98696% 0.2110% 99.77596%
(1) Plus Accrued Interest.
-34-
Class A-5 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $8,180,000 99.96325% 0.2610% 99.70225%
Bear, Xxxxxxx & Co. Inc. $8,180,000 99.96325% 0.2610% 99.70225%
Greenwich Capital Markets, Inc. $8,180,000 99.96325% 0.2610% 99.70225%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $8,180,000 99.96325% 0.2610% 99.70225%
Xxxxxx Xxxxxxx & Co. Incorporated $8,180,000 99.96325% 0.2610% 99.70225%
Class A-6 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $14,540,000 99.88302% 0.3600% 99.52302%
Bear, Xxxxxxx & Co. Inc. $14,540,000 99.88302% 0.3600% 99.52302%
Greenwich Capital Markets, Inc. $14,540,000 99.88302% 0.3600% 99.52302%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $14,540,000 99.88302% 0.3600% 99.52302%
Xxxxxx Xxxxxxx & Co. Incorporated $14,540,000 99.88302% 0.3600% 99.52302%
(1) Plus Accrued Interest.
-35-
Class A-7 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $8,960,000 99.98660% 0.3350% 99.651600%
Bear, Xxxxxxx & Co. Inc. $8,960,000 99.98660% 0.3350% 99.651600%
Greenwich Capital Markets, Inc. $8,960,000 99.98660% 0.3350% 99.651600%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $8,960,000 99.98660% 0.3350% 99.651600%
Xxxxxx Xxxxxxx & Co. Incorporated $8,960,000 99.98660% 0.3350% 99.651600%
Class A-8 Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $30,400,000 100.00000% 0.2300% 99.77000%
Bear, Xxxxxxx & Co. Inc. $30,400,000 100.00000% 0.2300% 99.77000%
Greenwich Capital Markets, Inc. $30,400,000 100.00000% 0.2300% 99.77000%
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx $30,400,000 100.00000% 0.2300% 99.77000%
Xxxxxx Xxxxxxx & Co. Incorporated $30,400,000 100.00000% 0.2300% 99.77000%
(1) Plus Accrued Interest.
-36-
Class A-9 IO Certificates
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation 100% 3.76089% 0.0700% 3.69089%
Underwriting
Underwriter Principal Amount Price to Public Discount Pirchase Price (1)
----------- ---------------- --------------- -------- ------------------
Credit Suisse First Boston Corporation $8,000,000 84.12721% 0.7725% 83.354710%
Bear, Xxxxxxx & Co. Inc. $8,000,000 84.12721% 0.7725% 83.354710%
Greenwich Capital Markets, Inc. $8,000,000 84.12721% 0.7725% 83.354710%
Xxxxxx Xxxxxxx & Co. Incorporated $8,000,000 84.12721% 0.7725% 83.354710%
(1) Plus Accrued Interest.
-37-
EXHIBIT A
[Letterhead of CONTIFINANCIAL CORPORATION]
June 9, 1999
Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
New York, NY 10010
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 Representative of the
Several Underwriters (the "Representative"), 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 June 9, 1999, between Depositor and the Representative.
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.
-38-
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 June 9, 1999
CREDIT SUISSE FIRST BOSTON CORPORATION
as Representative of the Several Underwriters
By:_______________________________
Name:
Title:
-39-
