MORTGAGE CAPITAL FUNDING, INC.
$805,992,000 (APPROXIMATE)
MULTIFAMILY/COMMERCIAL
MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 1998-MC3
CLASS A-1, CLASS A-2, CLASS X, CLASS B, CLASS C, CLASS D AND CLASS E
UNDERWRITING AGREEMENT
as of December 23, 1998
Xxxxxxx Xxxxx Xxxxxx Inc.
Seven World Trade Center
New York, New York 10048
Ladies and Gentlemen:
Mortgage Capital Funding, Inc., a Delaware corporation ("MCFI"),
proposes to sell to Xxxxxxx Xxxxx Xxxxxx Inc. (the "Underwriter"), pursuant to
this Underwriting Agreement (this "Agreement"), the classes of
Multifamily/Commercial Mortgage Pass-Through Certificates, Series 1998-MC3 that
are identified on Schedule I hereto (collectively, the "Registered
Certificates"), each having the initial aggregate stated principal amount (the
initial "Class Principal Balance") or, in the case of the Class X Certificates,
initial aggregate notional principal amount (the initial "Class Notional
Amount") set forth on Schedule I. The Registered Certificates, together with
the Class F, Class G, Class H, Class J, Class K, Class L, Class R-I, Class R-II
and Class R-III Certificates issued therewith (the "Privately Offered
Certificates" and, collectively with the Registered Certificates, the
"Certificates"), evidence the entire beneficial ownership interest in the
assets of a trust to be created by MCFI (such trust, the "Trust"; and such
assets collectively, the "Trust Fund"). The Trust Fund consists primarily of a
pool (the "Mortgage Pool") of multifamily and commercial mortgage loans (the
"Mortgage Loans") that will have, as of the close of business on December 1,
1998 (the "Cut-off Date"), after taking into account all payments of principal
due on the Mortgage Loans on or before such date, whether or not received, an
aggregate principal balance of $908,161,006 (subject to a variance of plus or
minus 5.0%). Certain of the Mortgage Loans (or the right to have such
transferred to the Trust) will be acquired by MCFI from Citicorp Real Estate,
Inc. ("CREI"; and such Mortgage Loans, the "CREI Mortgage Loans"), pursuant to
a mortgage loan purchase agreement, dated as of the date hereof (the "CREI/MCFI
Mortgage Loan Purchase Agreement"), between MCFI and CREI. The remaining
Mortgage Loans will be acquired by MCFI from Salomon Brothers Realty Corp.
("SBRC"; and such remaining Mortgage Loans, the "SBRC Mortgage Loans"),
pursuant to a mortgage loan purchase agreement dated as of the date hereof (the
"SBRC/MCFI Mortgage Loan Purchase Agreement"), between MCFI and SBRC. Three
separate real estate mortgage investment conduit ("REMIC") elections will be
made with respect to the Trust Fund for
federal income tax purposes. The Trust is to be created and the Certificates
are to be issued under a pooling and servicing agreement, dated as of the
Cut-off Date (the "Pooling and Servicing Agreement"), among MCFI as sponsor,
CREI and SBRC as mortgage loan sellers (in such capacity, each, a "Mortgage
Loan Seller"), AMRESCO Services, L.P., as master servicer (the "Master
Servicer"), Allied Capital Corporation, as special servicer (the "Special
Servicer"), LaSalle National Bank, as trustee (in such capacity, the "Trustee")
and REMIC administrator (in such capacity, the "REMIC Administrator") and ABN
AMRO Bank N.V., as fiscal agent (the "Fiscal Agent"). Capitalized terms used
but not defined herein have the meanings assigned thereto in the Pooling and
Servicing Agreement.
1. REPRESENTATIONS, WARRANTIES AND COVENANTS. MCFI represents and
warrants to, and covenants with, the Underwriter that:
(a) A registration statement (File No. 333-24489) on Form S-3 has been
filed with the Securities and Exchange Commission (the "Commission"), and has
become effective under the Securities Act of 1933, as amended (the "Securities
Act"); such registration statement includes a prospectus which, as
supplemented, shall be, and may include a preliminary prospectus supplement
which, as completed, is proposed to be, used in connection with the sale of the
Registered Certificates. Such registration statement, as amended to the date of
this Agreement, is hereinafter referred to as the "Registration Statement";
such prospectus (which shall be in the form in which it has most recently been
filed, as the same is proposed to be added to or changed), as first
supplemented by a prospectus supplement relating to the Registered
Certificates, filed, or transmitted for filing, with the Commission pursuant to
Rule 424(b) under the Securities Act and used in connection with the sale of
the Registered Certificates, is hereinafter referred to as the "Prospectus";
and such prospectus supplement is hereinafter referred to as the "Prospectus
Supplement". Any preliminary form of Prospectus that has heretofore been filed
pursuant to Rule 424 hereinafter is called the "Preliminary Prospectus". Any
reference herein to the terms "amend", "amendment" or "supplement" with respect
to the Registration Statement or the Prospectus shall be deemed to refer to and
include the filing of any document under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), deemed to be incorporated by reference therein
after the date hereof. MCFI will file with the Commission (i) within fifteen
(15) days of the issuance of the Certificates a Current Report on Form 8-K (for
purposes of filing the Pooling and Servicing Agreement and other material
contracts) and (ii) in the time period specified in Section 5(e) hereof, a
Current Report on Form 8-K (for purposes of filing certain Computational
Materials and ABS Term Sheets as described in Section 5(e) hereof).
(b) The Registration Statement, as of the date it became effective,
and the Prospectus, as of the date of the Prospectus Supplement, and any
revisions or amendments thereof or supplements thereto filed prior to the
termination of the offering of the Registered Certificates, as of their
respective effective or issue dates, conformed or will conform in all material
respects to the requirements of the Securities Act and the rules and
regulations of the Commission thereunder applicable to the use of such
documents as of such respective dates, and the Registration Statement and the
Prospectus, as revised, amended or supplemented as of the Closing Date (as
defined in Section 3), will conform in all material respects to the
requirements of the Securities Act and the rules and regulations of the
Commission thereunder applicable to the use of such documents as of
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the Closing Date; and no such document, as of such respective dates and, in the
case of the Prospectus and any revisions or amendments thereof or supplements
thereto filed prior to the Closing Date, as of the Closing Date, included or
will include any untrue statement of a material fact or omitted or will omit to
state 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; provided, however, that MCFI does not make any
representations, warranties or agreements to the Underwriter as to (i) the
information contained in or omitted from the Prospectus or any revision or
amendment thereof or supplement thereto in reliance upon and in conformity with
information furnished in writing by or on behalf of the Underwriter, CREI or
SBRC specifically for use in connection with the preparation of the Prospectus
or any revision or amendment thereof or supplement thereto or (ii) any
information in any Computational Materials and ABS Term Sheets (each as defined
in Section 9) provided by the Underwriter to prospective investors in
connection with the sale of the Registered Certificates. There are no contracts
or other documents relating to MCFI of a character required to be described in
or to be filed as exhibits to the Registration Statement, as of the date of the
Prospectus Supplement, that were not described or filed as required.
(c) As of the Closing Date, the Registered Certificates will be duly
authorized by MCFI, and, when the Registered Certificates have been duly
executed and authenticated in the manner contemplated in the Pooling and
Servicing Agreement and have been delivered to and paid for by the Underwriter
pursuant to this Agreement, the Registered Certificates will be validly issued
and outstanding and entitled to the benefits provided by the Pooling and
Servicing Agreement.
(d) As of the Closing Date, the Pooling and Servicing Agreement will
have been duly authorized, executed and delivered by XXXX and, assuming the
valid authorization, execution and delivery thereof by the other parties
thereto, will constitute a valid and binding agreement of MCFI enforceable in
accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency, reorganization or other laws relating to or affecting
the enforcement of creditors' rights and by general principles of equity.
(e) This Agreement has been duly authorized, executed and delivered by
XXXX and, assuming the valid authorization, execution and delivery hereof by
the Underwriter, constitutes a valid and binding obligation of MCFI enforceable
in accordance with its terms, except as enforcement hereof may be limited by
bankruptcy, insolvency, reorganization or other laws relating to or affecting
the enforcement of creditors' rights, by general principles of equity and by
public policy considerations underlying the securities laws, to the extent that
such public policy considerations limit the enforceability of the provisions of
this Agreement that purport to provide indemnification for securities laws
liabilities.
(f) MCFI has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus.
(g) MCFI is not aware of (i) any request by the Commission for any
further amendment of the Registration Statement or the Prospectus or for any
additional information, (ii) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or
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the institution or threatening of any proceeding for that purpose or (iii) any
notification with respect to the suspension of the qualification of the
Registered Certificates for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose.
(h) MCFI is not, and the issuance and sale of the Registered
Certificates in the manner contemplated by the Prospectus will not cause MCFI
to be, subject to registration or regulation as an investment company or
affiliate of an investment company under the Investment Company Act of 1940, as
amended (the "Investment Company Act").
(i) The transfer of the Mortgage Loans to the Trust and the sale of
the Certificates to the Underwriter, at the Closing Date, will be treated by
MCFI for financial accounting and reporting purposes as a sale of assets and
not as a pledge of assets to secure debt.
2. PURCHASE AND SALE. Subject to the terms and conditions and in
reliance on the representations and warranties herein set forth, XXXX agrees to
sell to the Underwriter, and the Underwriter agrees to purchase from MCFI, each
class of Registered Certificates set forth on Schedule I hereto, at the
purchase price for each such class as set forth on such Schedule I.
3. DELIVERY AND PAYMENT. Delivery of and payment for the Registered
Certificates shall be made in the manner, on the date and at the time specified
in Schedule I hereto, which date and time may be changed by agreement between
the Underwriter and MCFI (such date and time of delivery of and payment for the
Registered Certificates being hereinafter referred to as the "Closing Date").
Delivery of the Registered Certificates shall be made to the Underwriter
against payment by the Underwriter of the purchase price therefor to or upon
the order of MCFI in same-day funds by federal funds wire (or by such other
method as the Underwriter and XXXX may agree). Unless delivery is made through
the facilities of The Depository Trust Company, the Registered Certificates of
each class thereof shall be registered in such names and in such authorized
denominations as the Underwriter may have requested not less than three (3)
full business days prior to the Closing Date.
XXXX agrees to have the Registered Certificates available for
inspection, checking and packaging in New York, New York, at any time before
3:00 p.m. New York City time on the business day prior to the Closing Date.
4. OFFERING BY THE UNDERWRITER. It is understood that the Underwriter
proposes to offer the Registered Certificates for sale as set forth in the
Prospectus. It is further understood that XXXX, in reliance upon a no-filing
letter from the Attorney General of the State of New York granted pursuant to
Policy Statement 105, has not filed and will not file an offering statement
pursuant to Section 352-c of the General Business Law of the State of New York
with respect to the Registered Certificates. As required by Policy Statement
105, the Underwriter therefore covenants and agrees with MCFI that sales of the
Registered Certificates made by the Underwriter in and from the State of New
York will be made only to institutional investors within the meaning of Policy
Statement 105.
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5. AGREEMENTS. XXXX agrees with the Underwriter that:
(a) MCFI will not file any amendment to the Registration Statement
prior to the Closing Date, and will not file any supplement to the Prospectus
relating to or affecting the Registered Certificates at any time, except as
contemplated by Section 5(e) or unless MCFI has furnished a copy to the
Underwriter for its review prior to filing, and will not file any such proposed
amendment or supplement to which the Underwriter reasonably objects. Subject to
the foregoing sentence, MCFI will cause the Prospectus to be filed, or
transmitted for filing, with the Commission pursuant to Rule 424(b) under the
Securities Act and will promptly advise the Underwriter when the Prospectus has
been so filed, or transmitted for filing, and, prior to the termination of the
offering of the Registered Certificates, will also promptly advise each
Underwriter (i) when any amendment to the Registration Statement relating to
the Registered Certificates has become effective or any revision of or
supplement to the Prospectus has been so filed or transmitted for filing, (ii)
of any request by the Commission for any amendment of the Registration
Statement or the Prospectus or for any additional information, (iii) of the
issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the institution or threatening of any proceeding
for that purpose and (iv) of the receipt by MCFI of any notification with
respect to the suspension of the qualification of the Registered Certificates
for sale in any jurisdiction or the institution or threatening of any
proceeding for such purpose. MCFI will use its best efforts to prevent the
issuance of any such stop order and, if issued, to obtain as soon as possible
the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Registered
Certificates is required to be delivered under the Securities Act, (i) any
event occurs 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 a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or (ii) it shall be
necessary to revise, amend or supplement the Prospectus to comply with the
Securities Act or the rules and regulations of the Commission thereunder, MCFI
promptly will prepare and file with the Commission, subject to paragraph (a) of
this Section 5, a revision, amendment or supplement that will correct such
statement or omission or effect such compliance.
(c) MCFI will furnish to the Underwriter and its counsel, without
charge, signed (if available) copies of the Registration Statement (including
exhibits thereto) and, so long as delivery of a prospectus relating to the
Registered Certificates is required under the Securities Act, as many copies of
the Prospectus and any revisions or amendments thereof or supplements thereto
as may be reasonably requested.
(d) MCFI will use its best efforts to arrange for the qualification of
the Registered Certificates for sale under the laws of such jurisdictions as
the Underwriter may designate, to maintain such qualifications in effect so
long as required for the distribution of the Registered Certificates and to
arrange for the determination of the legality of the Registered Certificates
for purchase by institutional investors; provided, however, that MCFI shall not
be required to qualify to do business in any jurisdiction where it is not now
so qualified or to take any action that would subject it to general or
unlimited service of process in any jurisdiction where it is not now so
subject.
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(e) MCFI will cause or, if appropriate, has caused any Computational
Materials and ABS Term Sheets (each as defined in Section 9) with respect to
the Registered Certificates, which are or have been delivered by the
Underwriter to MCFI pursuant to or as contemplated by Section 9, to be filed
with the Commission on a Current Report on Form 8-K (the "Current Report")
pursuant to Rule 13a-11 under the Exchange Act not later than, in each such
case, the business day immediately following the later of (i) the day on which
such Computational Materials or ABS Term Sheets are delivered to counsel for
MCFI by the Underwriter and (ii) the date hereof; and, if such filing is
subsequent to the date hereof, MCFI will promptly advise the Underwriter when
each such Current Report has been so filed. If any Collateral Term Sheet (as
defined in Section 9) is provided by the Underwriter to potential investors in
the Registered Certificates, MCFI will cause each such Collateral Term Sheet
that is delivered by the Underwriter to MCFI to be filed with the Commission on
a Current Report pursuant to Rule 13a-11 under the Exchange Act on the business
day immediately following the day on which such Collateral Term Sheet is
delivered to counsel for MCFI by the Underwriter. The parties agree that any
material described in this Section 5(e) that is delivered after 2:00 p.m., New
York City time, on a business day shall be deemed to have been delivered on the
next business day. Each such Current Report shall be incorporated by reference
in the Prospectus and the Registration Statement. Notwithstanding the
foregoing, MCFI shall have no obligation to file materials provided by the
Underwriter pursuant to or as contemplated by Section 9 that, in the reasonable
determination of MCFI after making reasonable efforts to consult with the
Underwriter, are not required to be filed pursuant to the No-Action Letters (as
defined in Section 9), or that contain erroneous information or contain any
untrue statement of a material fact, or that, when read in conjunction with the
Prospectus, omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; it being understood,
however, that MCFI shall have no obligation to review or pass upon the accuracy
or adequacy of, or to correct, any Computational Materials or ABS Term Sheets
provided by the Underwriter to MCFI pursuant to or as contemplated by Section 9
hereof.
(f) MCFI will make generally available to Registered
Certificateholders as soon as practicable, but in any event not later than
eighteen months after the filing of the Prospectus pursuant to Rule 424(b)
under the Securities Act, an earnings statement (which need not be audited)
with respect to the Mortgage Pool complying with Section 11(a) of the
Securities Act and the rules and regulations of the Commission thereunder
(including at the option of MCFI, Rule 158 of the Securities Act) that may be
the annual report filed with the Commission with respect to the Trust.
6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITER AND MCFI. The
obligation of the Underwriter to purchase from MCFI, and the obligation of MCFI
to sell to the Underwriter, the Registered Certificates shall be subject to the
accuracy of the representations and warranties on the part of MCFI and the
Underwriter contained herein as of the date hereof and as of the Closing Date,
to the accuracy of the statements of XXXX and the Underwriter made in any
officer's certificate delivered pursuant to the provisions hereof, to the
performance by XXXX and the Underwriter of their respective obligations
hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted and be pending or shall have been threatened.
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(b) MCFI shall have furnished to the Underwriter:
(i) An executed copy of the Pooling and Servicing
Agreement;
(ii) An opinion of Xxxxxxx X. Xxxxx, Esq., counsel to
XXXX, dated the Closing Date, substantially to the effect that:
(A) MCFI is validly existing as a corporation in
good standing under the laws of the State of Delaware, with
corporate power and authority under such laws to own its
properties and assets and conduct its business as described
in the Prospectus;
(B) The Registered Certificates have been duly
authorized by MCFI and, when the Registered Certificates have
been duly executed and authenticated in the manner
contemplated in the Pooling and Servicing Agreement and have
been delivered to and paid for by the Underwriter pursuant to
this Agreement, the Registered Certificates will be validly
issued and outstanding and entitled to the benefits provided
by the Pooling and Servicing Agreement;
(C) The Pooling and Servicing Agreement has been
duly authorized, executed and delivered by XXXX and, upon the
due authorization, execution and delivery by the other
parties thereto, will constitute a valid, legal and binding
agreement of MCFI, enforceable against MCFI in accordance
with its terms, except as enforceability may be limited by
bankruptcy, insolvency, moratorium, reorganization or other
similar laws relating to or affecting the enforcement of
creditors' rights generally and by general principles of
equity, whether enforcement is sought in a proceeding in
equity or at law;
(D) The Pooling and Servicing Agreement 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;
(E) The Registration Statement has become effective
under the Securities Act, and, to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted and are pending or have
been threatened under the Securities Act;
(F) The Registration Statement, at the time the
Registration Statement became effective, and the Prospectus,
as of the date of the Prospectus Supplement, and each
revision or amendment thereof or supplement thereto relating
to the Registered Certificates, as of its effective or issue
date (except in each case for accounting, financial and
statistical statements included therein or omitted therefrom,
as to which such counsel has not been requested to comment),
appeared on their respective faces to be appropriately
responsive in all material respects to the
7
requirements of the Securities Act and the rules and
regulations of the Commission thereunder applicable to such
documents as of such respective dates; and the Prospectus, as
revised, amended or supplemented as of the date hereof
(except for accounting, financial and statistical statements
included therein or omitted therefrom, as to which such
counsel has not been requested to comment), conforms in all
material respects to the requirements of the Securities Act
and the rules and regulations of the Commission thereunder
applicable to use of the Prospectus (as so revised, amended
or supplemented) as of the date hereof;
(G) No consent, approval, authorization or order of
any federal or State of New York court or agency or other
governmental body is required for the consummation by MCFI of
the transactions contemplated by the terms of this Agreement,
except such as may be required under the securities or "blue
sky" laws of any state in connection with the purchase and
the offer and sale of the Registered Certificates by the
Underwriter as to which such counsel need not express any
opinion, and except such as have been obtained.
(H) Neither the sale of the Registered Certificates
to the Underwriter pursuant to this Agreement nor the
consummation of any other of the transactions contemplated by
or the fulfillment by MCFI of the terms of this Agreement
will result in a breach of any term or provision of the
certificate of incorporation or by-laws of MCFI or any
federal or State of New York statute or regulation or, to the
best of such counsel's knowledge, will conflict with, result
in a breach, violation or acceleration of or constitute a
default under any agreement of MCFI or any order of any
federal or State of New York court or agency or other
governmental body having jurisdiction over MCFI.
(I) The descriptions in the Prospectus, as of the
date hereof, of the Registered Certificates and the Pooling
and Servicing Agreement are, to the extent that such
descriptions constitute statements of matters of law or legal
conclusions with respect thereto, accurate in all material
respects;
(J) Such counsel does not know of any contracts or
other documents relating to MCFI of a character required to
be described in or to be filed as exhibits to the
Registration Statement, as of the date of the Prospectus
Supplement, that were not described or filed as required; and
(K) This Agreement has been duly authorized,
executed and delivered by XXXX and Xxxxxxxx.
In giving his opinion, Xxxxxxx X. Xxxxx, Esq., counsel to
MCFI, shall additionally state that, based on his review (or review by
attorneys under his supervision) of the statements contained in the
Registration Statement or the Prospectus mentioned in paragraph (F)
above and conferences and telephone conversations with representatives
of
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CREI, SBRC, the Underwriter, MCFI, the Trustee, the REMIC
Administrator, the Fiscal Agent, the Master Servicer, the Special
Servicer and their respective counsel, and without having reviewed any
of the mortgage notes, mortgages or other documents relating to the
Mortgage Loans or made any inquiry of any originator of any Mortgage
Loan not referenced above, nothing has come to such counsel's
attention that would lead him to believe that the Prospectus (except
for: any accounting, financial or statistical information contained in
or omitted from the Prospectus, information relating to the
characteristics of the Mortgage Loans and the related borrowers and
mortgaged properties, information incorporated by reference into the
Prospectus, and information relating to the Master Servicer, the
Special Servicer, the REMIC Administrator, the Trustee and the Fiscal
Agent contained in or omitted from the Prospectus, all as to which
such counsel has not been requested to comment), at the date of the
Prospectus Supplement or at the Closing Date, included or includes an
untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading.
Such opinion may express its reliance as to factual matters
on the representations and warranties made by, and on certificates or
other documents furnished by officers and/or authorized
representatives of, the parties to this Agreement and the Pooling and
Servicing Agreement and on certificates furnished by public officials.
Such opinion may rely on the opinion of Xxxxxx & Xxxxxx referred to in
Section 6(b)(iii) below that relates to the sections of the Prospectus
Supplement under the headings "Certain Federal Income Tax
Consequences" and "Certain ERISA Considerations" and of the
accompanying prospectus under the headings "Material Federal Income
Tax Consequences" and "ERISA Considerations". Such opinion may assume
the due authorization, execution and delivery of the instruments and
documents referred to therein by the parties thereto other than MCFI.
Such opinion may be qualified as an opinion only on the General
Corporation Law of the State of Delaware, the laws of the State of New
York and the federal law of the United States.
(iii) One or more opinions, dated the Closing Date, of Xxxxxx
& Xxxxxx, special counsel to MCFI, substantially to the effect that:
(A) The statements in the Prospectus under the
headings "ERISA Considerations", "Certain ERISA
Considerations", "Material Federal Income Tax Consequences"
and "Certain Federal Income Tax Consequences", to the extent
that they describe certain matters of federal law or legal
conclusions with respect thereto, while not discussing all
possible consequences of an investment in the Registered
Certificates to all investors, provide a fair and accurate
summary of such matters and conclusions set forth under such
headings; and
(B) As described in the Prospectus Supplement and
assuming compliance with the provisions of the Pooling and
Servicing Agreement, (1) REMIC I will qualify as a REMIC
within the meaning of Sections 860A through 860G (the "REMIC
Provisions") of the Internal Revenue Code of 1986, and the
REMIC I
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Regular Interests will be "regular interests" and the Class
R-I Certificates will evidence the sole class of "residual
interests" in REMIC I (as both terms are defined in the REMIC
Provisions in effect on the Closing Date), (2) REMIC II will
qualify as a REMIC within the meaning of the REMIC
Provisions, and the REMIC II Regular Interests will be
"regular interests" and the Class R-II Certificates will
evidence the sole class of "residual interests" in REMIC II
and (3) REMIC III will qualify as a REMIC within the meaning
of the REMIC Provisions, and the Class X, Class A-1, Class
A-2, Class B, Class C, Class D, Class E, Class F, Class G,
Class H, Class J, Class K and Class L Certificates will
evidence "regular interests" and the Class R-III Certificates
will evidence the sole class of "residual interests" in REMIC
III.
(C) Assuming compliance with the provisions of the
Pooling and Servicing Agreement, for City and State of New
York income and corporation franchise tax purposes, REMIC I,
REMIC II and REMIC III will each be classified as a REMIC and
not as a corporation, partnership or trust, in conformity
with the federal income tax treatment of REMIC I, REMIC II
and REMIC III. Accordingly, the Trust Fund will be exempt
from all City and State of New York taxation imposed on its
income, franchise or capital stock, and its assets will not
be included in the calculation of any franchise tax
liability.
(D) The Pooling and Servicing Agreement, upon the
due authorization, execution and delivery by the other
parties thereto, will constitute a valid and legally binding
agreement of MCFI and is enforceable against it in accordance
with its terms, except as enforceability may be limited by
bankruptcy, insolvency, moratorium, reorganization or other
similar laws relating to or affecting the enforcement of
creditor's rights generally and by general principles of
equity, whether enforcement is sought in a proceeding in
equity or at law;
(E) The Pooling and Servicing Agreement is not
required to be qualified under the Trust Indenture Act of
1939, as amended, and the Trust Fund is not required to be
registered under the Investment Company Act;
(F) The Registration Statement, at the time it
became effective, and the Prospectus, as of the date of the
Prospectus Supplement, and each revision or amendment thereof
or supplement thereto relating to the Registered
Certificates, as of its effective or issue date (except in
each case for accounting, financial and statistical
statements included therein or omitted therefrom, as to which
such counsel expresses no opinion), appeared on their
respective faces to be appropriately responsive in all
material respects to the requirements of the Securities Act
and the rules and regulations of the Commission thereunder
applicable to such documents as of such respective dates; and
the Prospectus, as revised, amended or supplemented as of the
date hereof (except for accounting, financial and statistical
statements included therein or omitted therefrom, as to which
such counsel expresses no opinion), conforms in all material
respects to the requirements of the Securities Act
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and the rules and regulations of the Commission thereunder
applicable to use of the Prospectus (as so revised, amended,
or supplemented) as of the date hereof; and
(G) The statements set forth in the Prospectus
Supplement under the headings "Description of the Offered
Certificates" and "Servicing of the Mortgage Loans" and in
the Prospectus under the headings "Description of the
Certificates" and "Description of the Pooling Agreements",
insofar as such statements purport to summarize certain
material provisions of the Registered Certificates and the
Pooling and Servicing Agreement, provide a fair and accurate
summary of such provisions.
In giving its opinions, Xxxxxx & Xxxxxx, special counsel to
MCFI, shall additionally state that, based on conferences and
telephone conversations with representatives of CREI, SBRC, the
Underwriter, MCFI, the Trustee, the Fiscal Agent, the REMIC
Administrator, the Master Servicer, the Special Servicer and their
respective counsel (but without having reviewed any of the mortgage
notes, mortgages or other documents relating to the Mortgage Loans or
made any inquiry of any originator of any Mortgage Loan not referenced
above), nothing has come to such special counsel's attention that
would lead it to believe that the Prospectus (other than: any
accounting, financial or statistical information contained in or
omitted from the Prospectus and information incorporated by reference
into the Prospectus and any information relating to the
characteristics of the Mortgage Loans and the related borrowers and
mortgaged properties, all as to which such counsel has not been
requested to comment), at the date of the Prospectus Supplement or at
the Closing Date, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact necessary
in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
Such opinion may express its reliance as to factual matters
on the representations and warranties made by, and on certificates or
other documents furnished by officers and/or authorized
representatives of, the parties to this Agreement and the Pooling and
Servicing Agreement and on certificates furnished by public officials.
Such opinion may assume the due authorization, execution and delivery
of the instruments and documents referred to therein by the parties
thereto. Such opinion may be qualified as an opinion only on the laws
of the State of New York and the federal law of the United States.
(iv) The Underwriter shall have received copies of all legal
opinion letters delivered by Xxxxxx & Xxxxxx to the Rating Agencies in
connection with the issuance of the Registered Certificates,
accompanied in each case by a letter signed by Xxxxxx & Xxxxxx stating
that the Underwriter may rely on such opinion letter as if it were
addressed to the Underwriter as of the date thereof;
(v) Good standing certificates regarding MCFI, the Master
Servicer, the Special Servicer, the Trustee, the REMIC Administrator
and the Fiscal Agent from the Secretary of State (or other appropriate
authority) of the jurisdiction under which each such entity has been
formed, dated not earlier than 30 days prior to the Closing Date;
11
(vi) Certificates of MCFI, the Master Servicer, the Special
Servicer, the Trustee, the REMIC Administrator, and the Fiscal Agent,
each dated the Closing Date and signed by an executive officer or
authorized signatory of such party, to the effect that the
representations and warranties of such party herein and/or in the
Pooling and Servicing Agreement, as applicable, are true and correct
in all material respects on and as of the Closing Date with the same
effect as if made on the Closing Date, and XXXX has complied in all
material respects with all agreements and satisfied all the conditions
on its part to be performed or satisfied at or prior to the Closing
Date; and
(vii) Officer's certificates, dated the Closing Date and
signed by the Secretary or an assistant secretary of MCFI, the Master
Servicer, the Special Servicer, the Trustee, the REMIC Administrator
and the Fiscal Agent, to the effect that each individual who, as an
officer or representative of such party, signed this Agreement, the
Pooling and Servicing Agreement or any other document or certificate
delivered on or before the Closing Date in connection with the
transactions contemplated herein or in the Pooling and Servicing
Agreement, was at the respective times of such signing and delivery,
and is as of the Closing Date, duly elected or appointed, qualified
and acting as such officer or representative, and the signatures of
such persons appearing on such documents and certificates are their
genuine signatures. Such certificate shall be accompanied by true and
complete copies (certified as such by the Secretary or an assistant
secretary of such party) of the certificate of incorporation and
by-laws of such party, as in effect on the Closing Date, and of the
resolutions of such party and any required shareholder consent
relating to the transactions contemplated in this Agreement and the
Pooling and Servicing Agreement.
(c) The Underwriter shall have received, with respect to each of the
Mortgage Loan Sellers, the Master Servicer, the Special Servicer, the Trustee,
the REMIC Administrator and the Fiscal Agent, a favorable opinion of counsel,
dated the Closing Date, addressing the valid existence and good standing of
such party under the laws of the jurisdiction of its organization, the due
authorization, execution and delivery of the Pooling and Servicing Agreement by
such party and, subject to the same limitations as set forth in Section
6(b)(ii)(C), the enforceability of the Pooling and Servicing Agreement against
such party. Such opinion may express its reliance as to factual matters on
representations and warranties made by, and on certificates or other documents
furnished by officers and/or authorized representatives of parties to this
Agreement and the Pooling and Servicing Agreement and on certificates furnished
by 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 party on behalf of which such opinion is being
rendered. Such opinion may be qualified as an opinion only on the laws of the
jurisdiction in which the party on whose behalf such opinion is being rendered
is organized, the laws of the State of New York and the federal law of the
United States.
(d) XXXX and the Underwriter shall have received from Xxxxxx Xxxxxxxx,
certified public accountants, various comfort letters, dated, as applicable,
the date of the preliminary Prospectus Supplement, the date of the Prospectus
Supplement or other date acceptable to MCFI and the Underwriter, in form and
substance reasonably satisfactory to MCFI and the Underwriter, stating in
effect that:
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(i) They have performed certain specified procedures as a
result of which they have determined that the information of an
accounting, financial or statistical nature set forth in the
Prospectus Supplement under the caption "Description of the Mortgage
Pool" and on Annex A thereto agrees with the data sheet or computer
tape prepared by each Mortgage Loan Seller, unless otherwise noted in
such letter(s); and
(ii) They have compared the data contained in the data sheet
or computer tape referred to in the immediately preceding clause (i)
to information contained in an agreed upon sampling of the Mortgage
Loan files and in such other sources as shall be specified by them,
and found such data and information to be in agreement, unless
otherwise noted in such letter.
(e) MCFI and the Underwriter shall have received from Xxxxxx Xxxxxxxx,
certified public accountants, a letter dated on or about the Closing Date, in
form and substance reasonably satisfactory to MCFI and the Underwriter, to the
effect that they have performed certain specified procedures, all of which have
been agreed to by XXXX and the Underwriter, as a result of which they confirmed
the information of an accounting, financial or statistical nature included in
the Prospectus Supplement under the caption "Yield and Maturity
Considerations".
(f) The Underwriter shall have delivered to MCFI an officer's
certificate (i) stating that attached thereto are all of the information,
tables, charts and other items that constitute "Computational Materials" or
"ABS Term Sheets" prepared by the Underwriter that are required to be filed
with the Commission pursuant to the terms of the No-Action Letters and stating
that the Underwriter has otherwise complied with the terms of the No-Action
Letters and (ii) representing that, other than the items described in clause
(i), no term sheets, collateral information or other data in written form that
would be required to be filed with the Commission pursuant to the No-Action
Letters were furnished by the Underwriter to actual or potential investors for
the Registered Certificates prior to the Closing Date.
(g) Xxxxxx Xxxxxxxx shall have furnished to MCFI and the Underwriter a
letter or letters, each in form and substance satisfactory to MCFI, relating to
the Computational Materials and ABS Terms Sheets of the Underwriter filed in
accordance with Section 5(e), dated the date of the related Current Report on
Form 8-K and stating in effect that:
(i) using the assumptions and methodology used by the
Underwriter, all of which shall be described by reference in the
letter, they have recalculated the numerical data and dates set forth
in such Computational Materials and ABS Term Sheets of the Underwriter
(or portions thereof) attached to such letter, compared the results of
their calculations to the corresponding items in such Computational
Materials and ABS Term Sheets (or portions thereof) and found such
items to be in agreement with the respective results of such
calculation;
(ii) if such Computational Materials and ABS Term Sheets
include data reflecting the distribution of interest at other than a
fixed rate, or reflecting other characteristics that give rise to the
use of tables in such Computational Materials and ABS Term Sheets,
such
13
letter shall also set forth such other statements as are customarily
set forth by Xxxxxx Xxxxxxxx in such letter with respect to such data;
and
(iii) they have performed certain specified procedures as a
result of which they have determined that the information of an
accounting, financial or statistical nature set forth in such
Computational Materials and ABS Term Sheets agrees with the data sheet
or computer tape prepared by each Mortgage Loan Seller, unless
otherwise indicated in such letter.
(h) The Underwriter shall have received an opinion of Xxxxxxx & Xxxxx
L.L.P., counsel to the Underwriter, in form and substance satisfactory to them.
(i) MCFI and the Underwriter shall have received an opinion of
counsel, dated the Closing Date, from Xxxxxxx & Xxxxx L.L.P., stating that,
based on conferences and telephone conversations with representatives of CREI,
SBRC, the Underwriter, MCFI, the Trustee, the REMIC Administrator, the Fiscal
Agent, the Master Servicer, the Special Servicer and their respective counsel,
and further based on a review of certain legal documents relating to each
Mortgage Loan with a Cut-off Date Balance in excess of $45,000,000, mortgage
files related to a sample of other Mortgage Loans described therein and a
compilation of the information in the loan summaries for the Mortgage Loans
(but otherwise without having reviewed any of the mortgage notes, mortgages or
other documents relating to the Mortgage Loans or made any inquiry of any
originator of any Mortgage Loan), nothing has come to such counsel's attention
that would lead him to believe that the Prospectus (except for: any accounting,
financial or statistical information contained in or omitted from the
Prospectus and information incorporated by reference into the Prospectus, all
as to which such counsel has not been requested to comment), at the date of the
Prospectus Supplement or at the Closing Date, included or includes an untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(j) Subsequent to the date hereof, there shall not have occurred any
change, or any development involving a prospective change, in or affecting the
business or properties of MCFI that the Underwriter concludes, in its opinion
after consultation with MCFI, materially impairs the investment quality of the
Registered Certificates so as to make it impractical or inadvisable to proceed
with the public offering or the delivery of the Registered Certificates as
contemplated by the Prospectus.
(k) The Registered Certificates shall have been assigned ratings no
less than those set forth on Schedule I and such ratings shall not have been
rescinded or qualified.
7. INDEMNIFICATION AND CONTRIBUTION. (a) MCFI agrees to indemnify and
hold harmless the Underwriter and each person who controls the Underwriter
within the meaning of either the Securities Act or the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to which it
or any of them may become subject under the Securities Act, the Exchange Act,
or other federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any
14
untrue statement or alleged untrue statement of a material fact contained in
the Registration Statement or in the Prospectus, or in any revision or
amendment thereof or supplement thereto, or in any other filing incorporated by
reference therein, or arise out of or are based upon the omission or alleged
omission (in the case of any Computational Materials or ABS Term Sheets in
respect of which XXXX agrees to indemnify the Underwriter, as set forth below,
when such are read in conjunction with the Prospectus) 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 it or him in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided that MCFI will not be liable in any such case to the extent that any
such loss, claim, damage or liability arises out of or is based upon (i) any
such untrue statement or alleged untrue statement or omission or alleged
omission made in the Prospectus or any revision or amendment thereof or
supplement thereto in reliance upon and in conformity with written information
furnished to MCFI by or on behalf of the Underwriter specifically for use in
connection with the preparation thereof, (ii) any such untrue statement or
alleged untrue statement or omission or alleged omission that is, in accordance
with the terms thereof, covered by the indemnification provided by SBRC
pursuant to the SBRC/MCFI Mortgage Loan Purchase Agreement or covered by the
indemnification provided by CREI pursuant to the CREI/MCFI Mortgage Loan
Purchase Agreement, (iii) any such untrue statement or alleged untrue statement
is made in any Computational Materials or ABS Term Sheets provided by the
Underwriter to prospective investors in connection with the sale of the
Registered Certificates and incorporated by reference into the Registration
Statement or Prospectus as a result of any filing pursuant to Section 5(e),
(iv) any omission or alleged omission to state in any Computational Materials
or ABS Term Sheets provided by the Underwriter to prospective investors in
connection with the sale of the Registered Certificates and incorporated by
reference into the Registration Statement or Prospectus as a result of any
filing pursuant to Section 5(e), a material fact that, when read in conjunction
with the Prospectus, is required to be stated therein or necessary to make the
statements therein not misleading, or (v) any breach, inaccuracy or untruth of
any of the statements, representations, warranties and/or covenants made by the
Underwriter and set forth in Section 6(f) and/or Section 9(b). This indemnity
agreement will be in addition to any liability that MCFI may otherwise have.
(b) The Underwriter agrees to indemnify and hold harmless MCFI and
each of its directors, each of its officers who signed the Registration
Statement or any amendments thereof, and each person who controls MCFI within
the meaning of either the Securities Act or the Exchange Act, to the same
extent as the foregoing indemnities from MCFI to the Underwriter, but only with
reference to (i) written information furnished to MCFI by or on behalf of the
Underwriter, specifically for use in connection with the preparation of the
Prospectus or any revision or amendment thereof or supplement thereto, (ii) any
untrue statement or alleged untrue statement or omission or alleged omission
made in Computational Materials or ABS Term Sheets provided by the Underwriter
to prospective investors in connection with the sale of the Registered
Certificates and incorporated by reference into the Registration Statement or
Prospectus as a result of any filing pursuant to Section 5(e) (except that no
such indemnity shall be available for any losses, claims, damages or
liabilities, or actions in respect thereof, resulting from any Collateral Error
(as defined below), other than a Corrected Collateral Error (as defined below))
and (iii) any breach, inaccuracy or untruth of any of the statements,
representations, warranties and/or covenants set forth in Section
15
6(f) and/or Section 9(b). This indemnity agreement will be in addition to any
liability that the Underwriter may otherwise have. MCFI acknowledges that the
statements set forth in the second sentence of the final paragraph on the cover
page of the Prospectus Supplement, in the second sentence under the heading
"Risk Factors -- Risks Related to the Offered Certificates -- Risks Associated
with Lack of Liquidity and Changes in Market Value", and in the first two
sentences of the third paragraph, the first sentence of the fourth paragraph
and the first sentence of the sixth paragraph under the heading "Method of
Distribution" in the Prospectus Supplement, constitute the only information
furnished in writing by or on behalf of the Underwriter for inclusion in the
Prospectus or any revision or amendment thereof or supplement thereto, and the
Underwriter confirms that such statements attributable thereto are correct.
As used herein, "Collateral Error" shall mean any error in
the information concerning the Mortgage Loans furnished by either Mortgage Loan
Seller to MCFI or the Underwriter in writing or by electronic transmission that
was used in the preparation of any Computational Materials or ABS Term Sheets;
and "Corrected Collateral Error" shall mean any Collateral Error as to which
the Underwriter, not later than the date hereof, was notified in writing or
provided in written or electronic form information superseding or correcting
such Collateral Error, including, without limitation, as part of the
Prospectus.
(c) Promptly after receipt by an indemnified party under this Section
7 of notice of the commencement of any suit, action, proceeding (including,
without limitation, any governmental or regulatory investigation), claim or
demand, such indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 7, notify the
indemnifying party in writing of the commencement thereof, but the omission so
to notify the indemnifying party will not relieve the indemnifying party from
any liability that it may have to any indemnified party otherwise than under
this Section 7; provided, however, that any increase in such liability as a
result of such failure to notify shall not be an expense of the indemnifying
party. In case any such action is brought against any indemnified party and it
notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein, and to the extent that it may
elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof, with counsel reasonably satisfactory to such indemnified
party; provided that, if the defendants in any such action include both the
indemnified party and the indemnifying party, and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties that are different from or additional to those
available to the indemnifying party, the indemnified party or parties shall
have the right to select separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of
such action and approval by the indemnified party of counsel, the indemnifying
party will not be liable to such indemnified party for legal expenses of other
counsel or other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the preceding
sentence (it being understood, however, that the indemnifying party shall not
be liable for the expenses of more than one separate counsel (in addition to
any local counsel), approved by the
16
indemnified party or parties, representing the indemnified party or parties who
are parties to such action), (ii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time period after notice of
commencement of the action or (iii) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable, such
liability shall be only in respect of the counsel referred to in such clause
(i) or (iii). No indemnifying party shall, without the written consent of the
indemnified party, effect the settlement or compromise of, or consent to the
entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (A)
includes an unconditional release of the indemnified party from all liability
arising out of such action or claim and (B) does not include a statement as to
or an admission of fault, culpability or a failure to act, by or on behalf of
the indemnified party.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this Section 7 is
due in accordance with its terms but is for any reason held by a court to be
unavailable on grounds of policy or otherwise, MCFI and the Underwriter shall
each contribute to the aggregate losses, claims, damages and liabilities
(including legal and other expenses reasonably incurred in connection with
investigating or defending same) to which MCFI and the Underwriter may be
subject in such proportion so that the Underwriter is responsible for 0.5%
thereof and MCFI is responsible for the balance; provided, however, that if
such allocation is not permitted by applicable law, then the indemnifying party
shall contribute in such proportion as is appropriate to reflect not only the
relative benefits referred to above but also the relative fault of MCFI on the
one hand and the Underwriter on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. Notwithstanding the foregoing
provisions of this Section 7(d), the Underwriter shall not be required to
contribute any amount in excess of the amount by which the total price at which
the Registered Certificates were sold, exceeds the amount of any damages that
the Underwriter has otherwise been required to pay by reason of such untrue
statement or omission or alleged untrue statement or omission. The relative
fault of XXXX on the one hand and the Underwriter on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by MCFI or by the
Underwriter and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
Notwithstanding the foregoing, however, 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 such
fraudulent misrepresentation. For purposes of this Section 7, each person who
controls the Underwriter within the meaning of either the Securities Act or the
Exchange Act shall have the same rights to contribution as the Underwriter, and
each person who controls MCFI within the meaning of either the Securities Act
or the Exchange Act, each officer of MCFI who shall have signed the
Registration Statement or any amendments thereof and each director of MCFI
shall have the same rights to contribution as MCFI. Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under
17
this paragraph (d), notify such party or parties from whom contribution may be
sought, but the omission to so notify such party or parties shall not relieve
the party or parties from whom contribution may be sought from any other
obligation it or they may have hereunder or otherwise than under this paragraph
(d).
8. FEES AND EXPENSES. (a) Except as provided in Section 8(b), costs
and expenses incurred in connection with the transactions herein contemplated
shall be borne by the Underwriter and MCFI in proportion to the aggregate
principal amount of the Mortgage Loans contributed by their respective
affiliates pursuant to the SBRC/MCFI Mortgage Loan Purchase Agreement, or the
CREI/MCFI Mortgage Loan Purchase Agreement, as applicable.
(b) If this Agreement shall be terminated by the Underwriter
because of any failure or refusal on the part of MCFI to comply with the terms
or to fulfill any of the conditions of this Agreement or if for any reason MCFI
shall be unable to perform its obligations under this Agreement or any
condition of the Underwriter's obligations cannot be fulfilled, XXXX agrees to
reimburse or cause the reimbursement of the Underwriter for all out-of-pocket
expenses (including the reasonable fees and expenses of its counsel) reasonably
incurred by the Underwriter in connection with this Agreement or the offering
contemplated hereunder.
9. COMPUTATIONAL MATERIALS AND ABS TERM SHEETS. (a) Not later than
10:30 a.m., New York City time, on the date hereof, the Underwriter shall
deliver to MCFI five (5) complete copies of all materials provided by the
Underwriter to prospective investors in the Registered Certificates that
constitute either (i) "Computational Materials" within the meaning of the
no-action letter dated May 20, 1994 issued by the Division of Corporation
Finance of the Commission to Xxxxxx, Xxxxxxx Acceptance Corporation I, Xxxxxx,
Xxxxxxx & Co. Incorporated, and Xxxxxx Structured Asset Corporation and the
no-action letter dated May 27, 1994 issued by the Division of Corporation
Finance of the Commission to the Public Securities Association (together, the
"Xxxxxx Letters") or (ii) "ABS Term Sheets" within the meaning of the no-action
letter dated February 17, 1995 issued by the Division of Corporation Finance of
the Commission to the Public Securities Association (the "PSA Letter", and
together with the Xxxxxx Letters, the "No-Action Letters"), if the filing of
such materials with the Commission is a condition of the relief granted in such
letters and, in the case of any such materials that constitute "Collateral Term
Sheets" within the meaning of the PSA Letter, such Collateral Term Sheets have
not previously been delivered to MCFI as contemplated by Section 9(b)(i) below.
Each delivery of Computational Materials pursuant to this paragraph (a) shall
be effected by delivering four (4) copies of such materials to counsel for MCFI
on behalf of MCFI at the address specified in Section 17 hereof and one copy of
such materials to MCFI. Each delivery of ABS Term Sheets pursuant to this
paragraph (a) shall be effected by delivering such materials to counsel for
MCFI on behalf of MCFI at the address specified in Section 17 hereof in a
format that will permit such materials to be promptly filed electronically with
the Commission.
(b) The Underwriter represents and warrants to and agrees with XXXX,
as of the date hereof and as of the Closing Date, as applicable, that:
18
(i) if the Underwriter has provided any Collateral Term
Sheets to potential investors in the Registered Certificates prior to
the date hereof and if the filing of such materials with the
Commission is a condition of the relief granted in the PSA Letter,
then in each such case the Underwriter delivered such materials in the
format contemplated by Section 9(a) to counsel for MCFI on behalf of
MCFI at the address specified in Section 17 hereof no later than 10:30
a.m., New York City time, on the first business day following the date
on which such materials were initially provided to a potential
investor;
(ii) the Computational Materials (either in original,
aggregated or consolidated form) and ABS Term Sheets furnished to MCFI
pursuant to Section 9(a) or as contemplated in Section 9(b)(i)
constitute all of the materials relating to the Registered
Certificates furnished by the Underwriter (whether in written,
electronic or other format) to prospective investors in the Registered
Certificates prior to the date hereof, except for any Preliminary
Prospectus and any Computational Materials and ABS Term Sheets that
are not required to be filed with the Commission in accordance with
the No-Action Letters, and all Computational Materials and ABS Term
Sheets provided by the Underwriter to potential investors in the
Registered Certificates comply with the requirements of the No-Action
Letters;
(iii) on the respective dates any such Computational
Materials and/or ABS Term Sheets with respect to the Registered
Certificates referred to in Section 9(b)(ii) were last furnished by
the Underwriter to each prospective investor, on the date of delivery
thereof to MCFI pursuant to or as contemplated by this Section 9 and
on the Closing Date, such Computational Materials and/or ABS Term
Sheets did not and will not include any untrue statement of a material
fact, or, when read in conjunction with the Prospectus, omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading;
(iv) at the time any Computational Materials or ABS Term
Sheets with respect to the Registered Certificates were furnished to a
prospective investor and on the date hereof, the Underwriter
possessed, and on the date of delivery of such materials to MCFI
pursuant to or as contemplated by this Section 9 and on the Closing
Date, the Underwriter will possess, the capability, knowledge,
expertise, resources and systems of internal control necessary to
ensure that such Computational Materials and/or ABS Term Sheets
conform to the representations and warranties of the Underwriter
contained in subparagraphs (ii) and (iii) above of this paragraph (b);
(v) all Computational Materials and ABS Term Sheets with
respect to the Registered Certificates furnished by the Underwriter to
potential investors contained and will contain a legend, prominently
displayed on the first page thereof, to the effect that MCFI has not
prepared, reviewed or participated in the preparation of such
Computational Materials or ABS Term Sheets, is not responsible for the
accuracy thereof and has not authorized the dissemination thereof;
19
(vi) all Collateral Term Sheets with respect to the
Registered Certificates furnished by the Underwriter to potential
investors contained and will contain a legend, prominently displayed
on the first page thereof, indicating that the information contained
therein will be superseded by the description of the Mortgage Loans
contained in the Prospectus and, except in the case of the initial
Collateral Term Sheet, that such information supersedes the
information in all prior Collateral Term Sheets; and
(vii) on and after the date hereof, the Underwriter shall not
deliver or authorize the delivery of any Computational Materials, ABS
Term Sheets or other materials relating to the Registered Certificates
(whether in written, electronic or other format) to any potential
investor unless such potential investor has received a Prospectus
prior to or at the same time as the delivery of such Computational
Materials, ABS Term Sheets or other materials.
Notwithstanding the foregoing, the Underwriter makes no representation
or warranty as to whether any Computational Materials or ABS Term Sheets with
respect to the Registered Certificates included or will include any untrue
statement resulting directly from any Collateral Error (except any Corrected
Collateral Error, with respect to materials prepared after the receipt by the
Underwriter from MCFI or either Mortgage Loan Seller of notice of such
Corrected Collateral Error or materials superseding or correcting such
Corrected Collateral Error).
(c) The Underwriter acknowledges and agrees that XXXX has not
authorized and will not authorize the distribution of any Computational
Materials or ABS Term Sheets with respect to the Registered Certificates to any
prospective investor, and agrees that any such Computational Materials and/or
ABS Term Sheets furnished to prospective investors shall include a disclaimer
in the form set forth in paragraph (b)(v) above. The Underwriter agrees that it
will not represent to potential investors that any Computational Materials
and/or ABS Term Sheets with respect to the Registered Certificates were
prepared or disseminated on behalf of MCFI.
(d) If, at any time when a prospectus relating to the Registered
Certificates is required to be delivered under the Securities Act prior to 90
days from the date hereof, it shall be necessary in the opinion of the
Underwriter or its counsel to amend or supplement the Prospectus as a result of
an untrue statement of a material fact contained in any Computational Materials
or ABS Term Sheets provided by the Underwriter pursuant to or as contemplated
by this Section 9 or the omission to state a material fact required, when
considered in conjunction with the Prospectus, to be stated therein or
necessary to make the statements therein, when read in conjunction with the
Prospectus, not misleading, or if it shall be necessary to amend or supplement
any Current Report to comply with the Securities Act or the rules thereunder,
the Underwriter, at its expense (or, if such amendment or supplement is
necessary due to a Collateral Error (except any Corrected Collateral Error,
with respect to materials prepared after the receipt by the Underwriter from
MCFI or either Mortgage Loan Seller of notice of such Corrected Collateral
Error or materials superseding or correcting such Corrected Collateral Error),
at the expense of MCFI), shall promptly prepare and furnish to MCFI for filing
with the Commission an amendment or supplement that will correct such statement
or omission or an amendment that will effect such compliance and shall
distribute such amendment or supplement to each prospective investor in the
Registered Certificates that received such information being amended or
supplemented. The Underwriter represents and warrants to MCFI, as of the date
20
of delivery of such amendment or supplement to MCFI, that such amendment or
supplement will not include any untrue statement of a material fact or, when
read in conjunction with the Prospectus, omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading. MCFI shall have no obligation to file such amendment or supplement
if MCFI determines that (i) such amendment or supplement contains any untrue
statement of a material fact or, when read in conjunction with the Prospectus,
omits to state a material fact required to be stated therein or necessary to
make the statements therein not misleading (it being understood, however, that
MCFI shall have no obligation to review or pass upon the accuracy or adequacy
of, or to correct, any such amendment or supplement provided by the Underwriter
to MCFI pursuant to this paragraph (d)) or (ii) such filing is not required
under the Securities Act. Notwithstanding the foregoing, the Underwriter makes
no representation or warranty as to whether any such amendment or supplement of
Computational Materials or ABS Term Sheets with respect to the Registered
Certificates included or will include any untrue statement resulting directly
from any Collateral Error (except any Corrected Collateral Error, with respect
to materials prepared after the receipt by the Underwriter from MCFI or either
the Mortgage Loan Seller of notice of such Corrected Collateral Error or
materials superseding or correcting such Corrected Collateral Error).
(e) If, at any time when a prospectus relating to the Registered
Certificates is required to be delivered under the Securities Act prior to 90
days from the date hereof, it shall be necessary in the opinion of MCFI or its
counsel to amend or supplement the Prospectus as a result of an untrue
statement of a material fact contained in any Computational Materials or ABS
Term Sheets provided by the Underwriter pursuant to or as contemplated by this
Section 9 or the omission to state therein a material fact required, when
considered in conjunction with the Prospectus, to be stated therein or
necessary to make the statements therein, when read in conjunction with the
Prospectus, not misleading, or if it shall be necessary to amend or supplement
any Current Report to comply with the Securities Act or the rules thereunder,
MCFI promptly will notify the Underwriter of the necessity of such amendment or
supplement, and the Underwriter, at its expense (or, if such amendment or
supplement is necessary due to a Collateral Error (except any Corrected
Collateral Error, with respect to materials prepared after the receipt by the
Underwriter from MCFI or either the Mortgage Loan Seller of notice of such
Corrected Collateral Error or materials superseding or correcting such
Corrected Collateral Error), at the expense of MCFI), shall promptly prepare
and furnish to MCFI for filing with the Commission an amendment or supplement
that will correct such statement or omission or an amendment that will effect
such compliance and shall distribute such amendment or supplement to each
prospective investor in the Registered Certificates that received such
information being amended or supplemented. The Underwriter represents and
warrants to MCFI, as of the date of delivery of such amendment or supplement to
MCFI, that such amendment or supplement will not include any untrue statement
of a material fact or, when read in conjunction with the Prospectus, omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading. Notwithstanding the foregoing, the
Underwriter makes no representation or warranty as to whether any such
amendment or supplement of Computational Materials or ABS Term Sheets with
respect to the Registered Certificates included or will include any untrue
statement resulting directly from any Collateral Error (except any Corrected
Collateral Error, with respect to materials prepared after the receipt by the
Underwriter from MCFI or either the Mortgage Loan Seller of notice of such
Corrected Collateral Error or materials superseding or correcting such
Corrected Collateral Error).
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(f) The Underwriter (at its own expense) further agree to provide to
MCFI any accountants' letters obtained relating to the Computational Materials
and/or ABS Term Sheets, which accountants' letters shall be addressed to MCFI
or shall state that MCFI may rely thereon; provided that the Underwriter shall
have no obligation to procure such letter.
10. TERMINATION. This Agreement shall be subject to termination by
notice given to MCFI, if the sale of the Registered Certificates provided for
herein is not consummated because of any failure or refusal on the part of MCFI
to comply in all material respects with the terms or to fulfill in all material
respects any of the conditions of this Agreement, or if for any reason MCFI
shall be unable to perform in all material respects its obligations under this
Agreement. This Agreement shall also be subject to termination in the absolute
discretion of the Underwriter, by notice given to MCFI prior to delivery of and
payment for the Certificates, if prior to such time (i) trading in securities
generally on the New York Stock Exchange shall have been suspended or
materially limited, (ii) a general moratorium on commercial banking activities
in New York shall have been declared by either federal or New York State
authorities, or (iii) there shall have occurred any material outbreak or
escalation of hostilities or other calamity or crisis the effect of which on
the financial markets of the United States is such as to make it, in the
reasonable judgment of the Underwriter after consultation with MCFI,
impracticable to market the Registered Certificates.
11. [RESERVED]
12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, warranties, indemnities and other statements of
MCFI, the Underwriter and their respective officers, directors, employees and
agents set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation made by or on behalf of the
Underwriter, MCFI or any of the officers, directors or controlling persons
referred to in Section 7 hereof, and will survive delivery of and payment for
the Registered Certificates. The provisions of Sections 7 and 8(b) hereof shall
survive the termination or cancellation of this Agreement.
13. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, directors and controlling persons referred to in Section 7 hereof,
and no other person will have any right or obligation hereunder.
14. APPLICABLE LAW. This Agreement will be governed by and construed
in accordance with the substantive laws of the State of New York, applicable to
agreements negotiated, made and to be performed entirely in said state.
15. OBLIGATIONS OF CITICORP. Xxxxxxxx agrees, in consideration of and
as an inducement to the Underwriter's purchase of Registered Certificates from
MCFI, to indemnify and hold harmless the Underwriter, and each person who
controls the Underwriter, against any failure by MCFI to perform any of its
obligations under Section 7 of this Agreement, after receipt from the
Underwriter of written notice of any such failure that has not been remedied
within 30 days.
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16. MISCELLANEOUS. This Agreement supersedes all prior or
contemporaneous agreements and understandings relating to the subject matter
hereof (other than the Term Sheet). Neither this Agreement nor any term hereof
may be changed, waived, discharged or terminated except by a writing signed by
the party against whom enforcement of such change, waiver, discharge or
termination is sought. This Agreement may be signed in any number of
counterparts, each of which shall be deemed an original, and that taken
together shall constitute one and the same instrument.
17. NOTICES. All communications hereunder will be in writing and
effective only upon receipt and, if sent to the Underwriter, will be delivered
to Xxxxxxx Xxxxx Xxxxxx Inc., Seven World Trade Center, New York, New York
10048, Attention: Xxxxxx Xxxxxx; and, if sent to MCFI, will be delivered to
MCFI, at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xx. Xxxxxxx X.
Xxxxxxx, Xx., with a copy to Xxxxxxx X. Xxxxx, Esq. at 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000; and, if sent to Citicorp, will be delivered to Citicorp,
Citicorp Center, 000 Xxxx 00 Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxx X. Xxxxx, Vice President; or, in each such case, to such
other address as may be forwarded by any such party to the other parties hereto
in writing.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the undersigned a counterpart hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among MCFI, Citicorp and the Underwriter.
Very truly yours,
MORTGAGE CAPITAL FUNDING, INC.
By: /s/ Xxxx X. Xxxxxxxxx
-------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Authorized Signatory
CITICORP
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Vice President
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
XXXXXXX XXXXX XXXXXX INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
