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EXHIBIT 1.1
PUERTO RICO INDUSTRIAL, TOURIST, EDUCATIONAL,
MEDICAL AND ENVIRONMENTAL CONTROL
FACILITIES FINANCING AUTHORITY
INDUSTRIAL REVENUE BONDS
1999 SERIES A
(Doral Financial Center Project)
BOND PURCHASE AGREEMENT
October __, 1999
Puerto Rico Industrial, Tourist,
Educational, Medical and Environmental
Control Facilities Financing Authority
Minillas Government Center
Santurce, Puerto Rico
Attention: Executive Director
Doral Financial Corporation
Doral Properties, Inc.
0000 Xxxxxxxx X. Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxxxxx Xxxx 00000
Attention: President
Ladies and Gentlemen:
The undersigned (hereinafter called the "Underwriters") hereby offer
to enter into this Agreement with Puerto Rico Industrial, Tourist, Educational,
Medical and Environmental Control Facilities Financing Authority (hereinafter
called the "Authority"), a body corporate and politic constituting a public
corporation and governmental instrumentality of the Commonwealth of Puerto Rico
(the "Commonwealth"), created under Act No. 121 of the Legislature of Puerto
Rico, approved June 27, 1977, as amended (the "Act"), and with Doral Financial
Corporation, a corporation organized under the laws of the Commonwealth ("Doral
Financial") and Doral Properties,
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Inc., a corporation organized under the laws of the Commonwealth and a
wholly-owned subsidiary of Doral Financial (the "Borrower"), which upon your
acceptance of this offer and of this Agreement will be binding on the
Authority, Doral Financial, the Borrower and the Underwriters. This offer is
made subject to the acceptance of this Agreement by the Authority, Doral
Financial and the Borrower on or before 6:00 P.M., Atlantic Standard time, on
October __, 1999, and if not so accepted will be subject to withdrawal by the
Underwriters upon notice delivered to the Authority, Doral Financial and the
Borrower at any time prior to such acceptance.
1. PURCHASE AND SALE. Upon the terms and conditions and upon the
basis of the representations, warranties and agreements set forth herein, each
Underwriter hereby agrees, severally and not jointly, to purchase from the
Authority, and the Authority hereby agrees to sell and to deliver to each
Underwriter, the principal amount of the Authority's Industrial Revenue Bonds,
1999 Series A (Doral Financial Center Project) (hereinafter called the "Bonds")
set forth opposite such Underwriter=s name in Schedule I hereto, at a purchase
price of __% of the principal amount thereof. The Bonds shall be dated the date
of delivery thereof, shall bear interest at such rates, payable on the first
day of each month in each year, commencing ______________, 1999, until maturity
or prior redemption, all as described in the Official Statement and Prospectus
hereinafter mentioned.
2. THE BONDS AND THE OFFICIAL STATEMENT AND PROSPECTUS.
(a) The Bonds shall be as described in the Official Statement
and Prospectus of the Authority, dated October __, 1999. Such Official
Statement and Prospectus (including the cover page and all appendices included
therein and all information
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incorporated by reference therein), as amended or supplemented from time to
time, is hereinafter referred to as the "Official Statement and Prospectus."
The Bonds shall be issued and secured under and pursuant to a Trust Agreement,
to be dated as of October __, 1999 (the "Trust Agreement"), between the
Authority and Citibank, N.A., as trustee (the "Bond Trustee"). The Bonds shall
be payable and shall be subject to redemption as provided in the Trust
Agreement.
(b) The proceeds from the sale of the Bonds will be loaned by the
Authority to the Borrower pursuant to a Loan and Guaranty Agreement, to be
dated as of October __, 1999 (the "Loan and Guaranty Agreement"), between the
Authority, the Borrower, and Doral Financial, for the purpose, among other
things, of:
(i) financing, in part, the development,
construction and equipping of the Doral Financial Corporation Center (the
"Project"); and
(ii) paying certain expenses incurred in
connection with the issuance and sale of the Bonds.
(c) The obligations of the Borrower under the Loan and Guaranty
Agreement will be guaranteed by Doral Financial.
(d) Concurrently with its acceptance hereof, the Authority shall
deliver to the Representative (hereinafter referred to):
(i) a certified copy of the resolution or
resolutions of the Authority (collectively, the "Bond Resolution") approved and
adopted by the Board of Directors of the Authority on October __, 1999
authorizing the issuance and sale of the Bonds;
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and
(ii) a copy of the Official Statement and
Prospectus manually signed on behalf of the Authority by the Executive Director
or the Assistant Executive Director of the Authority, or any person authorized
to act on his behalf pursuant to the by-laws of the Authority, and approved by
the Borrower.
The Authority will provide to the Representative such additional
copies of the Bond Resolution and the Official Statement and Prospectus as the
Representative may reasonably request. As soon as practicable (but not later
than two days) after the date hereof, the Authority shall deliver to the
Underwriters a sufficient number of copies of the Official Statement and
Prospectus as the Underwriters may reasonably request so as to enable the
Underwriters to comply with the provisions of Paragraph (b)(4) of Rule 15c2-12
of the Securities Exchange Act of 1934, as amended (the "Rule"). The Authority
shall be under no obligation to determine what number of copies of the Official
Statement and Prospectus requested by the Underwriters pursuant to the
preceding sentence shall be sufficient to enable the Underwriters to comply
with the requirements of the Rule.
The Authority has previously delivered to the Underwriters a
Preliminary Official Statement and Prospectus of the Authority, dated October
__, 1999, relating to the Bonds (such Preliminary Official Statement and
Prospectus, including all appendices thereto, and all information included or
incorporated by reference therein, being herein called the "Preliminary
Official Statement and Prospectus").
(e) Concurrently with its acceptance hereof, the Borrower
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shall deliver to the Representative a letter signed and dated the date hereof
and addressed to the Underwriters from Pricewaterhouse Coopers LLP, independent
certified public accountants, to the effect that such accounting firm confirms
that it is an independent certified public accountant with respect to Doral
Financial and the Borrower within the meaning of Rule 101 of the Code of
Professional Conduct of the American Institute of Certified Public Accountant
and stating that on the basis of a reading of the latest available interim
unaudited financial statements made available to them, inquiries of officers of
Doral Financial and the Borrower responsible for financial and accounting
matters and other specified procedures set forth in such letter, nothing came
to their attention that caused them to believe that (A) at the date of the
latest available interim financial statements of Doral Financial and the
Borrower read by such accountants and at a subsequent specified date not more
than five business days prior to the date of such letter, there was, with
respect to Xxxxx Financial and the Borrower, any change in the capital stock,
deposits, securities sold under agreements to repurchase, notes payable, loans
payable or any decrease in stockholders= equity of the Borrower, Doral
Financial and its subsidiaries consolidated with amounts shown as of the dates
of the financial statements of Doral Financial and the Borrower included in the
Official Statement and Prospectus or (B) for the period from December 31, 1998,
to the date of the latest available interim financial statements of Doral
Financial and the Borrower read by such accountants and the period from the
date of such interim financial statements to a specified date not more than
five business days prior to the date of such letter, there was any decrease, as
compared with the corresponding periods of the previous year, in net income,
except in all cases set forth in clauses (A) and (B) above for changes,
increases or decreases which the Official Statement and Prospectus discloses
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have occurred, and they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information contained in
the Official Statement and Prospectus (in each case to the extent that such
dollar amounts, percentages and other financial information are derived from
the general accounting records of Doral Financial and the Borrower subject to
the internal controls of the accounting system of Doral Financial and the
Borrower or are derived directly from such records by analysis or computation)
with the results obtained from inquiries, a reading of such general accounting
records and other procedures specified in such letter and have found such
dollar amounts, percentages and other financial information to be in agreement
with such results.
(f) In order to allow the Underwriters to comply with
the Rule, the Borrower will enter into a Continuing Disclosure Agreement (the
"Continuing Disclosure Agreement") with the Trustee no later than the Closing
Date.
3. AUTHORITY OF THE REPRESENTATIVE. The Underwriters represent
that Popular Securities, Inc. (the "Representative") has been duly authorized
by the Underwriters to act hereunder on behalf of the other Underwriters and
shall have full authority to execute this Agreement and to take such actions as
it may deem advisable in respect of all matters pertaining to this Agreement.
Any action taken under this Agreement by the Representative will be binding
upon all the Underwriters.
4. PUBLIC OFFERING. The Underwriters agree to make a bona fide
public offering of the Bonds at the offering prices set forth in the Official
Statement and Prospectus. The Underwriters may offer to sell the Bonds to
certain dealers and others at prices lower than the initial public offering
prices, and such offering prices
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may be changed, from time to time, by the Underwriters. The Authority, Doral
Financial and the Borrower authorize the Underwriters to use copies of the
Official Statement and Prospectus and any amendments or supplements thereto and
the information contained therein and copies of the Bond Resolution, the Loan
and Guaranty Agreement and the Trust Agreement in connection with the public
offering and sale of the Bonds, and Doral Financial, the Borrower and the
Authority agree not to supplement or amend, or cause to be supplemented or
amended, the Official Statement and Prospectus, the Bond Resolution, the Loan
and Guaranty Agreement or the Trust Agreement at any time prior to the date of
delivery and payment of the Bonds pursuant to Paragraph 8 hereof (such payment
and delivery and the other actions contemplated hereby to take place at the
time of such payment and delivery being hereafter sometimes called the
"Closing") without the prior written consent of the Underwriters.
5. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE AUTHORITY.
The Authority hereby represents, warrants and agrees as follows:
(a) the Authority is a body corporate and politic
constituting a public corporation and governmental instrumentality of the
Commonwealth duly constituted and existing under the laws of the Commonwealth
and has, and at the date of the Closing will have, full right, power and
authority (i) to enter into this Agreement, the Trust Agreement, the Loan and
Guaranty Agreement and the Letter of Representations relating to the Bonds (the
"DTC Agreement") from the Authority and the Trustee to The Depository Trust
Company, New York, New York ("DTC"), (ii) to adopt the Bond Resolution, (iii)
to issue and sell the Bonds pursuant to the Trust Agreement and to deliver or
cause to be delivered the Bonds to or for the account of
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the Underwriters as provided herein, (iv) to perform all of the transactions
contemplated by the Official Statement and Prospectus, the Trust Agreement, the
Loan and Guaranty Agreement, the Bond Resolution, the DTC Agreement and this
Agreement and (v) to approve, execute and deliver the Official Statement and
Prospectus;
(b) the Authority has duly adopted the Bond Resolution, has
duly authorized the execution and delivery of the Bonds, the Official Statement
and Prospectus, the Trust Agreement, the Loan and Guaranty Agreement, the DTC
Agreement and this Agreement and is duly authorized to perform the obligations
to be performed by the Authority under the Bond Resolution, the Bonds, the
Trust Agreement, the Loan and Guaranty Agreement, the Official Statement and
Prospectus, the DTC Agreement and this Agreement;
(c) the Authority is not, and at the time of the Closing will
not be, in breach of or in default under any applicable law (including, without
limitation, any administrative rulemaking law) or administrative regulation of
the Commonwealth, any applicable judgement or decree or any indenture, Loan and
Guaranty Agreement, note, resolution, agreement or other instrument to which
the Authority is a party or otherwise subject, which breach or default would in
any way materially adversely affect the Bond Resolution, this Agreement, the
Trust Agreement, the Loan and Guaranty Agreement, the DTC Agreement, the
Official Statement and Prospectus or the issuance of the Bonds, and no event
has occurred and is continuing which with the passage of time or giving of
notice, or both, would constitute such a breach or default; and the due
authorization, execution and delivery by the Authority of this Agreement, the
Loan and Guaranty Agreement, the Trust Agreement, the DTC Agreement, the
Official Statement and Prospectus and the issuance, sale and delivery of the
Bonds, the adoption of the Bond
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Resolution by the Authority and compliance with the provisions hereof and
thereof will not conflict with or constitute a breach of or default under any
law (including, without limitation, any administrative rulemaking law),
administrative regulation, judgement, decree or any agreement or other
instrument to which the Authority is a party or otherwise subject; nor will any
such execution, delivery, issuance, sale, adoption or compliance result in the
creation or imposition of any lien, charge, encumbrance or security interest of
any nature whatsoever upon any of the revenues, property or assets of the
Authority except as expressly provided or permitted hereby and by the Trust
Agreement, the Loan and Guaranty Agreement, the Bond Resolution, the DTC
Agreement, the Official Statement and Prospectus and the Bonds;
(d) all authorizations, approvals, licenses, consents and
orders of any governmental authority or agency having jurisdiction of the
matter which would constitute a condition precedent to, or the absence of which
would materially adversely affect, the performance by the Authority of its
obligations hereunder have been or will by the Closing be obtained;
(e) at the Closing Date (hereinafter mentioned), the Bonds,
the Bond Resolution, the Loan and Guaranty Agreement, the Trust Agreement, the
DTC Agreement and this Agreement will constitute the legal, valid and binding
obligations of the Authority enforceable in accordance with their respective
terms, except to the extent enforcement thereof may be limited by bankruptcy,
insolvency, or other similar laws affecting creditors' rights generally or may
be subject to general principles of equity (regardless of whether such
enforceability shall be considered in a proceeding in equity or at law);
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(f) there is no action, suit, proceeding, inquiry or
investigation, at law or in equity, before or by any court, public board or
body, pending or, to the knowledge of the Authority, threatened against the
Authority affecting the existence or powers of the Authority or the titles of
its officers to their respective offices or seeking to prohibit, restrain or
enjoin the issuance, sale or delivery of the Bonds, or in any way contesting or
affecting the validity or enforceability of the Bonds, the Bond Resolution,
this Agreement, the Trust Agreement, the Loan and Guaranty Agreement, the DTC
Agreement or contesting the powers of the Authority with respect to or any
authority for the issuance of the Bonds, the adoption of the Bond Resolution,
the execution, delivery or performance of this Agreement, the Trust Agreement,
the Loan and Guaranty Agreement, or the DTC Agreement, or, to the knowledge of
the Authority, is there any basis therefor, wherein an unfavorable decision,
ruling or finding would materially adversely affect the transactions
contemplated hereby or by the Official Statement and Prospectus or the validity
or enforceability of the Bonds, the Bond Resolution, this Agreement, the Trust
Agreement, the Loan and Guaranty Agreement, or the DTC Agreement;
(g) the Bonds, when sold to the Underwriters as provided
herein and issued and delivered in accordance with the Trust Agreement, will be
validly issued and outstanding obligations of the Authority entitled to the
benefits of the Trust Agreement;
(h) the information in the Official Statement and Prospectus
under the captions "AFICA," "Government Development Bank for Puerto Rico" and
"Legal Investment" does not contain any untrue or misleading statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they are
made, not
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misleading;
(i) the Authority agrees to cooperate with the Underwriters
and their counsel in any endeavor to qualify the Bonds for offering and sale
under the securities or blue sky laws of such jurisdictions of the United
States as the Underwriters may request, provided that the Authority shall not
be required to execute a general consent to service of process or qualify to do
business in connection with any such qualification in any such jurisdiction,
and the Authority consents to the lawful use of the Preliminary Official
Statement and Prospectus and the Official Statement and Prospectus by the
Underwriters in obtaining such qualifications;
(j) if between the date of this Agreement and the date that
is twenty-five days after the end of the "underwriting period" (as defined in
the Rule) the Authority becomes aware of the existence or occurrence of any
event which would or might cause the Official Statement and Prospectus, as then
supplemented or amended, to contain any untrue statement of a material fact or
to 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, the Authority shall promptly notify the Underwriters
thereof;
(k) as of its date, the Preliminary Official Statement and
Prospectus was deemed "final" by the Authority for purposes of paragraph (b)(1)
of the Rule and omitted therefrom only such information permitted to be omitted
therefrom by the Rule; and
(l) the Authority will provide, or direct the provision of,
all information that may be required by the Securities and Exchange Commission
pursuant to the Rule and any future amendments
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thereto to the extent such amendments are deemed applicable to the Authority
and/or the Bonds.
6. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF DORAL FINANCIAL
AND THE BORROWER. Doral Financial and the Borrower, jointly and severally,
hereby represent and warrant to, and agree with, the Authority and the
Underwriters as follows:
(a) Each of the Borrower and Doral Financial confirms its
representations, warranties and agreements set forth in the Loan and Guaranty
Agreement.
(b) A fully executed counterpart of the Loan and Guaranty
Agreement, duly executed by Xxxxx Financial and the Borrower, shall be
delivered by Doral Financial and the Borrower at the Closing, in the form
theretofore submitted to the Underwriters and the Authority and approved by the
Underwriters and the Authority, with only such changes or modifications thereof
as the Underwriters, the Authority, Doral Financial and the Borrower shall
agree upon.
(c) Doral Financial is a bank holding company registered
under the Bank Holding Company Act of 1956 and duly organized, validly existing
and in good standing under the laws of the Commonwealth, and the Borrower is a
corporation duly organized, validly existing and in good standing under the
laws of the Commonwealth, each with power and authority to conduct their
businesses as described in the Official Statement and Prospectus and to
consummate the transactions contemplated by the Loan and Guaranty Agreement,
the Continuing Disclosure Agreement and this Agreement.
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(d) By official action of the Borrower prior to or
concurrently with the acceptance hereof, the Borrower has ratified the
distribution of the Preliminary Official Statement and Prospectus and approved
the distribution of the Official Statement and Prospectus.
(e) Doral Financial meets the requirements for the use of
Form S-3 under the Securities Act of 1933, as amended (the "Securities Act")
and the rules and regulations (collectively referred to as the "Rules and
Regulations") of the Securities and Exchange Commission (the "Commission")
thereunder, and has filed with the Commission a registration statement on such
Form for registration under the Securities Act of the offering and sale of the
Bonds, including the Official Statement and Prospectus, and has filed those
amendments to such registration statement as may have been required to the date
of this Agreement. Such registration statement has been declared effective by
the Commission. The Commission has not issued any order preventing or
suspending the use of the Official Statement and Prospectus or instituted or,
to the knowledge of Doral Financial or the Borrower, threatened any proceeding
for that purpose. Copies of such registration statement and amendments and of
the Official Statement and Prospectus have been delivered to the
Representative. A final Official Statement and Prospectus relating to the Bonds
containing information permitted to be omitted at the time of effectiveness by
Rule 430A will be filed by Doral Financial with the Commission in accordance
with Rule 424(b) of the Rules and Regulations promptly after execution and
delivery of this Agreement. The term "Registration Statement" means the
registration statement as amended at the time it became effective (the
"Effective Date"), including all financial statements and schedules and all
exhibits and documents incorporated therein by reference and all information
contained in
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the Official Statement and Prospectus filed with the Commission pursuant to
Rule 424(b) of the Rules and Regulations and deemed to be included therein as
of the Effective Date by Rule 430A of the Rules and Regulations and including
any registration statement filed pursuant to Rule 462(b) of the Rules and
Regulations (a "Rule 462 Registration Statement") increasing the size of the
offering. References herein to any document or other information incorporated
by reference in the Registration Statement shall include documents or other
information incorporated by reference in the Official Statement and Prospectus.
References herein to the Preliminary Official Statement and Prospectus or the
Official Statement and Prospectus shall be deemed to include all documents and
information incorporated by reference therein and shall be deemed to refer to
and include any documents and information filed after the date of such
Preliminary Official Statement and Prospectus or such Official Statement and
Prospectus, as the case may be, and so incorporated by reference under the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
(f) On the date that the Registration Statement containing
the Preliminary Official Statement and Prospectus was filed with the
Commission, on the date that the Official Statement and Prospectus is first
filed with the Commission pursuant to Rule 424(b), at all-times subsequent to
and including the day of the Closing and when any post-effective amendment to
the Registration Statement becomes effective or any amendment or supplement to
the Official Statement and Prospectus is filed with the Commission, the
Registration Statement, the Preliminary Official Statement and Prospectus and
the Official Statement and Prospectus (as amended or as supplemented if Doral
Financial shall have filed with the Commission any amendment or supplement
thereto), including the financial statements included or incorporated by
reference in the
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Official Statement and Prospectus, did or will comply with all applicable
provisions of the Securities Act and the Rules and Regulations and did or will
contain all statements required to be stated therein in accordance with the
Securities Act and the Rules and Regulations. On the Effective Date and when
any post-effective amendment to the Registration Statement becomes effective,
no part of the Registration Statement or any such amendment did or will contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading. At the Effective Date, at the date the Official
Statement and Prospectus or any amendment or supplement to the Official
Statement and Prospectus is filed with the Commission, and at the day of the
Closing, the Official Statement and Prospectus did not or will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading. The foregoing representations and warranties in
this Section 6(f) do not apply to any statements or omissions made in reliance
on and in conformity with information relating to the Underwriters furnished in
writing to Doral Financial by the Representative specifically for inclusion in
the Preliminary Official Statement and Prospectus or the Official Statement and
Prospectus under the heading "Plan of Distribution". There are no contracts or
other documents required to be filed as exhibits to the Registration Statement
by the Securities Act or the Rules and Regulations that have not been so filed.
The documents which are incorporated by reference in any Preliminary Official
Statement and Prospectus or the Official Statement and Prospectus or from which
information is so incorporated by reference, when they became effective or were
filed with the Commission, as the case may be, complied in all material
respects with the requirements of the Securities Act and the Rules
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and Regulations or the Exchange Act and the rules and regulations thereunder,
as applicable, and did not, when such documents were so filed, contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, and any
documents so filed and incorporated by reference subsequent to the effective
date of the Registration Statement shall, when they are filed with the
Commission, conform in all material respects with the requirements of the
Securities Act and the Rules and Regulations and the Exchange Act and the rules
and regulations thereunder, as applicable.
(g) Except as described in the Registration Statement and the
Official Statement and Prospectus, there is no action, suit, proceeding,
inquiry or investigation at law or in equity or before or by any court, public
board or body pending or, to the knowledge of Doral Financial or of the
Borrower, threatened (A) to restrain or enjoin the issuance or delivery of any
of the Bonds, the application of the proceeds thereof, or the execution,
delivery or performance of the Loan and Guaranty Agreement, the Continuing
Disclosure Agreement or this Agreement; (B) in any way contesting the corporate
existence or powers of Doral Financial or the Borrower; (C) in any way
contesting or affecting the payment, collection or application of the revenues
pursuant to the Loan and Guaranty Agreement; or (D) except as described in the
Registration Statement and the Official Statement and Prospectus, against or
affecting Doral Financial or the Borrower, wherein an unfavorable decision,
ruling or finding would materially adversely affect the transactions
contemplated by this Agreement, or the Official Statement and Prospectus, or
which, in any way, would materially adversely affect the validity or
enforceability of the Bonds, the
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Loan and Guaranty Agreement, the Continuing Disclosure Agreement or this
Agreement, or any other agreement or instrument to which Doral Financial or the
Borrower is a party and which is used or contemplated for use in connection
with the transactions contemplated hereby or by the Official Statement and
Prospectus or would have a material adverse effect on the condition, business,
financial or otherwise, of Doral Financial or the Borrower.
(h) The Loan and Guaranty Agreement, the Continuing
Disclosure Agreement and this Agreement, when executed and delivered by Doral
Financial and the Borrower, will be legal, valid and binding obligations of
Doral Financial and the Borrower enforceable in accordance with their terms,
except to the extent enforcement thereof may be limited by bankruptcy,
insolvency, or other similar laws affecting creditors' rights generally or by
general principles of equity (regardless of whether such enforceability shall
be considered in a proceeding in equity or at law).
(i) (i) The execution, delivery and performance by Xxxxx
Financial and the Borrower of this Agreement, the Registration Statement, the
Official Statement and Prospectus, the Loan and Guaranty Agreement, the
Continuing Disclosure Agreement and the borrowings under the Loan and Guaranty
Agreement:
(A) have been duly authorized by all requisite
corporate action;
(B) will not violate (1) any provision of law or any
order of any court or any rule, regulation or order of any other
agency of government, (2) the Certificate of Incorporation or by-laws
of Doral Financial or of the Borrower, or (3) any indenture, agreement
or other instrument
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to which Doral Financial or the Borrower is a party, or by which it or
any of its properties are or may be bound;
(C) will not be in conflict with, result in a breach
of or constitute (alone or with notice or lapse of time or both) a
default under any indenture, agreement or other instrument referred to
in clause (B)(3) above; and
(D) will not result in the creation or imposition of
any lien, charge or encumbrance of any nature whatsoever upon any of
the property or assets of Doral Financial or the Borrower, except as
contemplated by the Registration Statement and the Official Statement
and Prospectus; and
(ii) no registration with or consent or approval of, or other
action by, any Federal, state, Commonwealth or other governmental authority or
regulatory body, foreign or domestic, is required in connection with the
execution, delivery and performance by Doral Financial or the Borrower of this
Agreement, the Loan and Guaranty Agreement or the Continuing Disclosure
Agreement.
(j) The Borrower and Doral Financial agree and consent that
the Bond Trustee shall have, pursuant to the provisions of the Trust Agreement,
a valid assignment of all payments due to, and certain other rights of, the
Authority under the Loan and Guaranty Agreement, subject to no prior rights of
other creditors.
(k) Doral Financial and the Borrower have received and there
remain currently in full force and effect all governmental consents and
approvals necessary at this time which would constitute a condition precedent
to, or the failure to obtain which
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would materially adversely affect, the performance by the Borrower of its
obligations under the Loan and Guaranty Agreement, the Continuing Disclosure
Agreement or this Agreement.
(l) Doral Financial and the Borrower have received and there
remain currently in full force and effect all permits, licenses, accreditations
and certifications necessary to conduct their businesses as presently being
conducted. No consent, approval, authorization or order of, or any filing or
declaration with, any governmental body is required for the consummation of the
transactions contemplated by this Agreement or in connection with the issuance
and sale of the Bonds, except such as have been obtained and such as may be
required under the securities laws of the Commonwealth or the various states of
the United States or the by-laws and rules of the National Association of
Securities Dealers, Inc. (the "NASD") in connection with the purchase and
distribution by the Underwriters of the Bonds.
(m) Neither Doral Financial nor the Borrower is a party to
any contract or agreement or subject to any charter or other restriction not
disclosed in the Official Statement and Prospectus, the performance of or
compliance with which may have a material adverse effect on the condition or
business, financial or otherwise, of Doral Financial or of the Borrower.
(n) Doral Financial and the Borrower have deemed the
Preliminary Official Statement and Prospectus "final" as of its date within the
meaning of paragraph (b)(4) of the Rule and omitted therefrom only information
permitted to be omitted therefrom by the Rule.
(o) Any certificate signed by an authorized
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representative of Doral Financial or of the Borrower delivered to the Authority
or the Underwriters shall be deemed a representation and warranty by Doral
Financial or the Borrower to such parties as to the statements made therein.
7. COVENANTS OF DORAL FINANCIAL AND THE BORROWER. Doral Financial and
the Borrower, jointly and severally, agree to the following:
(a) No amendment or supplement to the Registration Statement
or the Official Statement and Prospectus will be filed, either prior to the
Effective Date or thereafter, during such period as the Official Statement and
Prospectus is required by law to be delivered in connection with the sale of
the Bonds, unless a copy thereof shall first have been submitted to the
Representative within a reasonable period of time prior to the filing thereof
and the Representative shall not have objected thereto in good faith.
(b) Doral Financial will notify the Representative promptly,
and will confirm such advice in writing, (i) when any post-effective amendment
to the Registration Statement becomes effective, (ii) of any request by the
Commission for amendments or supplements to the Registration Statement or the
Official Statement and Prospectus or for additional information, (iii) of the
issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the initiation of any proceedings for that
purpose or the threat thereof, (iv) of the happening of any event that in the
judgment of the Doral Financial makes any statement of a material fact made in
the Registration Statement or the Official Statement and Prospectus untrue or
that requires the making of any changes in the Registration Statement or the
Official Statement and Prospectus in order to make the statements therein,
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in light of the circumstances in which they are made, not misleading and (v) of
receipt by Xxxxx Financial or the Borrower of any other communication from the
Commission relating to the Borrower, Doral Financial, the Registration
Statement, any Preliminary Official Statement and Prospectus or the Official
Statement and Prospectus. If at any time the Commission shall issue any order
suspending the effectiveness of the Registration Statement, Doral Financial
will make every reasonable effort to obtain the withdrawal of such order at the
earliest possible moment.
Doral Financial and the Borrower will prepare the Official Statement
and Prospectus in a form approved by the Representative and will file such
Official Statement and 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 execution and delivery of this Agreement or, if applicable,
such earlier time as may be required by Rule 430A(a)(3) under the Securities
Act. If Doral Financial has omitted any information from the Registration
Statement pursuant to Rule 430A, Doral Financial will use its best efforts to
comply with the provisions of and make all requisite filings with the
Commission pursuant to said Rule 430A and to notify the Representatives
promptly of all such filings.
(c) If Doral Financial elects to rely upon Rule 462(b) of the
Rules and Regulations, the Company shall file the Rule 462(b) Registration
Statement with the Commission in compliance with Rule 462(b) of the Rules and
Regulations by 10:00 p.m., Washington, D.C. time, on the date of this
Agreement, and Doral Financial shall at the time of filing, either pay to the
Commission the filing fee for the Rule 462(b) Registration Statement or give
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irrevocable instructions for the payment of such fee pursuant to Rule 111 (b)
of the Rules and Regulations.
(d) If, at any time when the Official Statement and
Prospectus relating to the Bonds is required to be delivered under the
Securities Act or the Rule, any event occurs as a result of which, in the
judgment of Doral Financial or the Borrower or in the opinion of counsel for
the Underwriters, the Official Statement and Prospectus, as then amended or
supplemented, would include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or the
Registration Statement, 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 not misleading, or if for any other reason it is
necessary at any time to amend or supplement the Official Statement and
Prospectus or the Registration Statement to comply with the Securities Act or
the Rules and Regulations, Doral Financial will promptly notify the
Representative thereof and, subject to Section 7(a) hereof, will prepare and
file with the Commission, at Doral Financial=s expense, an amendment to the
Registration Statement or an amendment or supplement to the Official Statement
and Prospectus that corrects such statement or omission or effects such
compliance.
(e) Doral Financial and the Borrower will comply with all the
provisions of all undertakings contained in the Registration Statement.
(f) The Borrower will apply the proceeds from the sale of the
Bonds as provided in and subject to all of the terms and
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provisions of the Loan and Guaranty Agreement and the Official Statement and
Prospectus.
(g) Between the date of this Agreement and the date of the
Closing, not, without the prior written consent of the Underwriters, to offer
or issue any industrial revenue bonds exempted to Puerto Rico residents, direct
or contingent, nor to cause any adverse change of a material nature in the
financial position, results of operations or condition, in either case, other
than in the ordinary course of business and except as disclosed in the Official
Statement and Prospectus.
(h) Doral Financial and the Borrower will provide the
Underwriters with sufficient copies of any supplement or amendment to the
Official Statement and Prospectus as the Representative reasonably requests so
as to enable the Underwriters to comply with the provisions of paragraph (b)(4)
of the Rule. The Borrower shall be under no obligation to determine whether the
number of copies requested by the Representative of any amendment or supplement
to the Official Statement and Prospectus pursuant to the preceding sentence
shall be sufficient to enable the Underwriters to comply with the requirements
of the Rule. The Representative shall promptly notify the Borrower of the end
of the underwriting period (as defined in the Rule).
(i) The Borrower and Doral Financial will furnish such
information and execute such instruments as the Underwriters may reasonably
request (i) to (A) qualify the Bonds for offer and sale under the Blue Sky or
other securities laws and regulations of such states and other jurisdictions in
the United States as the Underwriters may designate and (B) determine the
eligibility of the Bonds for investment under the laws of such states and other
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jurisdictions and (ii) to continue such qualifications in effect so long as
required for the distribution of the Bonds, provided that Doral Financial or
the Borrower shall not be required to execute a general consent to service of
process or qualify to do business in connection with any such qualification or
determination in any such jurisdiction.
(j) The Borrower and Doral Financial will advise the
Underwriters immediately of receipt by Doral Financial of the Borrower of any
notification with respect to the suspension of the qualification of the Bonds
for sale in any jurisdiction or the initiation or threat of any proceeding for
that purpose.
(k) The Borrower and Doral Financial will use their best
efforts to obtain when needed all consents, approvals, authorizations and
orders of governmental or regulatory authorities that are required for the
performance of their obligations under the Loan and Guaranty Agreement.
(l) As soon as practicable, Doral Financial will make
generally available to its security holders and to the Representative an
earnings statement or statements of Doral Financial and its subsidiaries which
will satisfy the provisions of Section 11(a) of the Act and Rule 158 under the
Act.
(m) The Borrower and Doral Financial will provide, or direct
the provision of, all information that may be required by the Commission
pursuant to the Rule and any future amendments thereto to the extent such
amendments are deemed applicable to the Borrower, Doral Financial and/or the
Bonds.
8. THE CLOSING. At 10:00 a.m., Atlantic standard time, on
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___________, 1999, or at such later time or date as may be mutually agreed upon
by the Authority, the Borrower and the Underwriters (such date being herein
sometimes called the "Closing Date"), the Authority will cause the Bond Trustee
to deliver the Bonds to or for the account of the Underwriters in definitive
form and duly executed and authenticated, and, subject to the terms and
conditions hereof, the Underwriters will accept such delivery and pay the
purchase price for the Bonds in immediately available funds as set forth in
Paragraph 1 hereof to the Bond Trustee. Delivery of the Bonds shall be made to
DTC in such manner as shall be mutually agreed upon by the Authority, the
Borrower and the Representative. Delivery of the other documents provided for
herein to be made at the Closing and payment for the Bonds as aforesaid shall
take place at the office of Xxxxxxxxxxx, Xxxxxx & Xxxxxxx, San Xxxx, Puerto
Rico, or at such other place as shall have been mutually agreed upon by the
Authority, the Borrower and the Underwriters.
9. CONDITIONS OF UNDERWRITERS' OBLIGATION TO PURCHASE. The
obligation of the Underwriters to purchase and accept delivery of the Bonds is
subject to the accuracy of the representations and warranties of the Authority,
Doral Financial and the Borrower herein and in the Loan and Guaranty Agreement,
to the accuracy of the statements of officers or representatives of the
Authority, Doral Financial and the Borrower made pursuant to the provisions
hereof, to the performance by the Authority, Doral Financial and the Borrower
of their respective obligations hereunder to be performed at or prior to the
Closing, and to the following additional conditions precedent:
(a) The Official Statement and Prospectus, the Loan and
Guaranty Agreement, this Agreement, the Trust Agreement, the Continuing
Disclosure Agreement, the DTC Agreement and the Bonds
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shall have been duly authorized, executed and delivered, all in form
satisfactory to the Underwriters and shall constitute valid and binding
agreements of the parties thereto.
(b) The Representative shall have received (i) evidence,
reasonably satisfactory to the Representative, of the due authorization,
execution and delivery of, and executed copies of, the documents mentioned in
clause (a) of this Paragraph 9 by the parties thereto, (ii) an opinion of
counsel for Doral Financial and the Borrower acceptable in form and substance
to the Underwriters, (iii) appropriate certificates reasonably satisfactory to
the Representative covering litigation and compliance with laws and prior
agreements, and with respect to the status of all necessary permits and
requirements, and (iv) evidence that the Registration Statement has become
effective and is effective as of the date of the Closing.
(c) The Representative shall have received a copy, duly
certified by the Secretary or an Assistant Secretary of the Authority, of the
Bond Resolution and shall also have received certified copies of any required
approvals referred to in Paragraph 5(d) hereof.
(d) The Representative shall have received copies, duly
certified by the Secretary or an Assistant Secretary of Doral Financial and the
Borrower of the resolutions or other corporate action referred in Paragraph
6(i) hereof.
(e) The Representative shall have received an opinion of
counsel for the Authority acceptable in form and substance to the Underwriters,
acceptable in form and substance to the Underwriters.
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(f) The Representative shall have received the approving
opinion on the Bonds of Xxxxxxx, Xxxxxxxx & Xxxxxxxxx, LLP, Bond Counsel,
substantially in the form attached as Appendix IV to the Official Statement and
Prospectus and a supplemental opinion of Xxxxxxx, Xxxxxxxx & Xxxxxxxxx, LLP,
Bond Counsel, acceptable in form and substance to the Underwriters.
(g) The Representative shall have received a manually signed
copy of the letter, addressed to the Underwriters, dated the Closing Date, of
Pricewaterhouse Coopers LLP to the effect that such accounting firm reaffirms
as of such Closing Date and as though made at such date, the statements made in
the letter furnished to the Underwriters by such accountants pursuant to
paragraph 2(e) hereof, except that references to the date referred to in such
letter as the most recent date through which such accountants have performed
their work will be a date not more than five (5) business days prior to the
Closing Date.
(h) The Representative shall have received a certificate,
dated the Closing Date, of the Executive Director or the Assistant Executive
Director of the Authority to the effect that: (i) the Authority has duly
performed and complied with all agreements and conditions and all of its
obligations required to be performed at or prior to the Closing Date, each of
its representations and warranties contained herein and in the Loan and
Guaranty Agreement are true and correct as of the Closing Date and at the time
of Closing no event of default or default shall have occurred and be continuing
with respect to the Bonds; (ii) the Authority has duly adopted the Bond
Resolution and has authorized, by all necessary action, the execution,
delivery, receipt and due performance of this Agreement, the Bonds, the
Official Statement and Prospectus, the Trust Agreement, the Loan and Guaranty
Agreement, the DTC
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Agreement and any and all such other agreements and documents as may be
required to be executed, delivered and received by it in order carry out, give
effect to and consummate the transactions contemplated hereby and thereby;
(iii) no litigation is pending, or to his knowledge threatened, to restrain or
enjoin the issuance or sale of the Bonds or in any way affecting as to the
Authority any authority for or the validity of the Bonds, the Official
Statement and Prospectus, the Trust Agreement, the Loan and Guaranty Agreement,
this Agreement, the Bond Resolution, the DTC Agreement or in any way contesting
the Authority's existence or powers; and (iv) the adoption and performance by
the Authority of the Bond Resolution and the execution, delivery, receipt and
due performance of the Bonds, the Official Statement and Prospectus, the Trust
Agreement, the Loan and Guaranty Agreement, this Agreement, the DTC Agreement
and the other agreements contemplated hereby and the Authority's compliance
with the provisions hereof and thereof will not conflict with or constitute on
the Authority's part a breach of or a default under any existing law, court or
administrative regulation, decree or order or any agreement, indenture,
mortgage, lease or other instrument to which the Authority is subject or by
which it is or may be bound.
(i) The Representative shall have received a certificate,
dated the Closing Date, of an authorized representative of Doral Financial and
of the Borrower to the effect that (i) each of the representations and
warranties of the Borrower contained in this Agreement, the Loan and Guaranty
Agreement and the Continuing Disclosure Agreement is true and correct as of the
Closing Date, (ii) each of the agreements of the Borrower to be complied with
and each of the obligations to be performed by Xxxxx Financial and the Borrower
under this Agreement, the Loan and Guaranty Agreement or the Continuing
Disclosure Agreement on or
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prior to the Closing Date have been complied with and performed, (iii) the
conditions or acts that are disclosed in the Official Statement and Prospectus
as occurring prior to the Closing Date have occurred, (iv) as of the Closing
Date and except as may be disclosed in the Official Statement and Prospectus,
there has been no material adverse change in the financial position of Doral
Financial or the Borrower since the date of the financial statements
incorporated by reference in the Official Statement and Prospectus, (v) no
event of default under this Agreement or the Loan and Guaranty Agreement, or
event which with giving of notice or lapse of time or both would constitute an
event of default under any such document, has occurred and is continuing or
will occur as a result of the transactions to take place at Closing, and (vi)
no event affecting Doral Financial or the Borrower has occurred since the date
of the Official Statement and Prospectus that either makes untrue or incorrect
in any material respect any statement or information concerning Doral Financial
or the Borrower contained in the Official Statement and Prospectus or is not
reflected in the Official Statement and Prospectus but should be reflected
therein or that is necessary to make the statements and information therein
concerning the Borrower not misleading.
(j) The Representative shall have received an opinion of
X'Xxxxx & Xxxxxx, counsel to the Underwriters, acceptable in form and substance
to the Underwriters.
(k) The Representative shall have received a copy of the
certificate of incorporation of Doral Financial and of the Borrower, as
amended, certified as of a recent date by the appropriate officer of the
Commonwealth, together with certificates dated as of a recent date from the
Secretary of State of the Commonwealth as to the existence and good standing of
Doral
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Financial and of the Borrower under the laws of the Commonwealth and copies of
the by-laws of Doral Financial and of the Borrower certified by the Secretary
or an Assistant Secretary of Doral Financial and the Borrower.
(l) The Representative shall have received written evidence
that the Bonds have been issued a rating of "BBB-" by Standard & Poor's Ratings
Services ("S&P"), of "BBB" by Xxxx & Xxxxxx ("D&P") and of "Baa3" by Xxxxx'x
Investors Service ("Moody's").
(m) The Representative shall have received evidence as to the
good standing of Doral Financial and its banking, mortgage banking and
securities subsidiaries from the Commissioner of Financial Institutions of
Puerto Rico.
(n) The Underwriters shall have received such other
documentation, certificates and opinions as may be reasonably required by the
Underwriters.
10. INDEMNIFICATION AND CONTRIBUTION.
(a) Doral Financial and the Borrower agree to indemnify and
hold harmless the Authority, the Underwriters, any member, officer, official,
employee or agent of the Authority or the Underwriters, and each person, if
any, who controls the Authority or Underwriters within the meaning of the
Securities Act or the Exchange Act (collectively, for purposes of this Section
10(a), the "Indemnified Parties"), against any and all losses, claims, damages,
liabilities or expenses, joint or several, to which any of the Indemnified
Parties may become subject, under either of said Acts or otherwise, insofar as
such losses, claims, damages or
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liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue or misleading statement of a material fact contained in Section 6 of
this Agreement, (ii) any untrue statement or alleged untrue statement of any
material fact contained in (A) any Preliminary Official Statement and
Prospectus, the Registration Statement or the Official Statement and
Prospectus, or any amendment or supplement to the Registration Statement or the
Official Statement and Prospectus or (B) any application or other document, or
any amendment or supplement thereto, executed by Doral Financial or the
Borrower or based upon written information furnished by or on behalf of Doral
Financial or the Borrower filed in any jurisdiction in order to qualify the
Bonds under the securities or blue sky laws thereof or filed with the
Commission or any securities association or securities exchange (each, an
"Application"), or (iii) the omission or alleged omission to state in any
Preliminary Official Statement and Prospectus, the Registration Statement or
the Official Statement and Prospectus, or any amendment or supplement to the
Registration Statement or the Official Statement and Prospectus or any
Application a material fact required to be stated therein or necessary in order
to make the statements made therein, in the light of the circumstances under
which they were made, not misleading, including the aggregate amount paid in
settlement of any litigation commenced or threatened arising from a claim based
upon any such untrue statement or omission if such settlement is effected with
the written consent of Doral Financial and the Borrower, and will reimburse
each such Indemnified Party for any legal or other expenses reasonably incurred
in connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that (1) Doral Financial or the
Borrower will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement
or omission or
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alleged untrue statement or omission made in any of such documents in reliance
upon and in conformity with written information furnished to Doral Financial or
the Borrower by the Authority or the Underwriters specifically for use therein;
and (2) this indemnity shall not apply to any losses, claims, damages,
liabilities or expenses arising out of or based upon any such untrue statement
or any such omission if such statement or omission was corrected by a
supplement or amendment to the Official Statement and Prospectus delivered to
the Underwriters prior to the sale of the Bonds to the person asserting the
loss. This indemnity agreement will be in addition to any liability which Doral
Financial or the Borrower may otherwise have. Doral Financial or the Borrower
will not, without the prior written consent of each of the Underwriters, settle
or compromise or consent to the entry of any judgment in any pending or
threatened claim, action, suit or proceeding in respect of which
indemnification may be sought hereunder (whether or not such Underwriter is a
party to such claim, action, suit or proceeding), unless such settlement,
compromise or consent includes an unconditional release of each Underwriter and
each member, officer, official, employee, agent and controlling person of such
Underwriter from all liability arising out of such claim, action, suit or
proceeding.
Doral Financial and the Borrower acknowledge that the
information set forth in the Official Statement and Prospectus under the
caption "Plan of Distribution" related to stabilization and passive market
making legends constitutes the only information furnished in writing by or on
behalf of the Underwriters specifically for use in the Official Statement and
Prospectus. In addition, Doral Financial and the Borrower acknowledge that the
information set forth in the Official Statement and Prospectus under the
captions "AFICA," "GOVERNMENT DEVELOPMENT BANK FOR PUERTO
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RICO" and "LEGAL INVESTMENT" constitutes the only information furnished in
writing by or on behalf of the Authority specifically for use in the Official
Statement and Prospectus.
(b) The Underwriters agree to indemnify and hold harmless the
Authority, Doral Financial, the Borrower, any member, director, officer,
official, employee or agent of the Authority, Doral Financial or the Borrower,
and each person, if any, who controls the Authority, Doral Financial or the
Borrower within the meaning of the Securities Act or the Exchange Act
(collectively, for purposes of this Section 10(b), the "Indemnified Parties"),
against any and all losses, claims, damages, liabilities or expenses, joint or
several, to which the Indemnified Parties may become subject, under either of
said Acts or otherwise, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any untrue or
misleading statement of a material fact contained in the Preliminary Official
Statement and Prospectus, the Registration Statement or the Official Statement
and Prospectus, or any omission or alleged omission from the Preliminary
Official Statement and Prospectus, the Registration Statement or the Official
Statement and Prospectus, or any amendment or supplement to the Registration
Statement or the Official Statement and Prospectus of a material fact required
to be stated therein or necessary in order to make the statements made therein,
in the light of the circumstances under which they were made, not misleading,
but only so far as any such statement or omission was made in reliance upon and
in conformity with written information, if any, as was furnished in writing by
the Underwriters for use therein.
(c) The Authority agrees to indemnify and hold harmless the
Underwriters, Doral Financial, the Borrower, any member,
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officer, official, employee or agent of the Underwriters, Doral Financial or
the Borrower, and each person, if any, who controls the Underwriters, Doral
Financial or the Borrower within the meaning of the Securities Act of the
Exchange Act (collectively, for purposes of this Section 10(c), the
"Indemnified Parties"), against any and all losses, claims, damages,
liabilities or expenses, joint or several, to which any such Indemnified Party
may become subject, under either of said Acts or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue or misleading statement of a material fact
contained in any Preliminary Official Statement and Prospectus, the
Registration Statement or the Official Statement and Prospectus, or caused by
any omission or alleged omission from any Preliminary Official Statement and
Prospectus, the Registration Statement or the Official Statement and
Prospectus, or any amendment or supplement to the Registration Statement or the
Official Statement and Prospectus of a material fact required to be stated
therein or necessary in order to make the statements made therein, in the light
of the circumstances under which they were made, not misleading, but only to
the extent that any such statement or omission relates to the information
appearing under the captions "AFICA," "GOVERNMENT DEVELOPMENT BANK FOR PUERTO
RICO" and "LEGAL INVESTMENT".
(d) If the indemnification provided for in the above
subsections (a), (b) and (c) of this Section 10 is for any reason unavailable
(other than for a reason specified in this Section 10) or insufficient to hold
harmless an Indemnified Party under sections (a), (b) or (c) above with respect
to losses covered by such subsection, then each indemnifying party shall
contribute to the damages paid by such Indemnified Party (A) in such proportion
as is appropriate to reflect the relative benefits received by the
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Borrower and Doral Financial (collectively), the Authority and the Underwriters
from the offering of the Bonds or (B) if the allocation provided by clause (A)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (A) above, but
also the relative liability of the Borrower and Doral Financial (collectively),
the Authority and the Underwriters in connection with the statements or
omissions which resulted in such damages, as well as any other relevant
equitable considerations. The relative benefits received by the Borrower and
Doral Financial (collectively), the Authority and the Underwriters shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by each one bear to each other. The
relative benefits received by the Borrower and Doral Financial shall be deemed
to be equal to the total net proceeds from the offering of the Bonds (after
deducting only the underwriting discount and the Authority's Administrative
Fee). The relative benefits received by the Authority shall be deemed to be
equal to its Administrative Fee and the relative benefits received by the
Underwriters shall be deemed to be equal to their total underwriting discount
or commissions, as set forth in this Bond Purchase Agreement. The relative
liability of each Indemnified Party shall be determined by reference to, among
other things, whether the untrue statement of a material fact or the omission
to state a material fact relates to information supplied by the Borrower or
Doral Financial (collectively), the Authority or the Underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The Authority, the
Borrower, Doral Financial and the Underwriters agree that it would not be just
and equitable if their respective obligations to contribute pursuant to this
subsection (d) were to be determined by pro rata allocation of
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36
the aggregate damages or by any other method of allocation which does not take
into account the equitable considerations referred to above. For purposes of
this subsection (d) the term "damages" shall include any legal or other
expenses reasonably incurred by an Indemnified Party in connection with
investigating or defending against any action or claim which is the subject of
the contribution provisions of this subsection (d). Notwithstanding the
provisions of this subsection (d), the Underwriters shall not be required to
contribute any amount in excess of the total underwriting discount received by
them and the Authority shall not be required to contribute any amounts in
excess of the Administrative Fee payable to the Authority. No person guilty of
fraudulent misrepresentations (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 in connection with the issuance of
the Bonds.
(e) In case any action shall be brought against one or more
of the Indemnified Parties based upon the Official Statement and Prospectus and
in respect of which indemnity may be sought against the indemnifying party, the
Indemnified Parties shall promptly notify the indemnifying party in writing,
and the indemnifying party may assume the defense thereof, including the
employment of counsel, the payment of all expenses and the right to negotiate
and consent to settlement, but the omission so to notify the indemnifying party
will not relieve it from any liability which it may have to an Indemnified
Party otherwise than under this Section 10, unless, and only to the extent
that, such omission results in the forfeiture of substantial rights or defenses
by the indemnifying parties. Any one or more of the Indemnified Parties shall
have the right to employ separate counsel in any such action and to participate
in the defense thereof, but the fees and
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37
expenses of such counsel shall be at the expense of such Indemnified Party or
Indemnified Parties unless the employment of such counsel has been specifically
authorized in writing by the indemnifying or contributing party or parties or
the indemnifying or contributing party or parties shall not have employed
counsel to assume the defense of such action promptly after receiving notice
thereof, or such Indemnified Party or Indemnified Parties shall have reasonably
concluded that there may be defenses available to it or them which are
different from or additional to those available to the indemnifying or
contributing party or parties (in which case the indemnifying or contributing
party or parties shall not have the right to direct the defense of such action
on behalf of the Indemnified Party), in any of which events such fees and
expenses of separate counsel for the Indemnified Party shall be borne by the
indemnifying or contributing party or parties. The indemnifying party shall not
be liable for any settlement of any such action effected without its consent by
any of the Indemnified Parties.
11. SURVIVAL OF REPRESENTATIONS AND OBLIGATIONS. The respective
agreements, representations, warranties and other statements of the Authority,
Doral Financial, the Borrower and the Underwriters and their respective
officers set forth in or made pursuant hereto will remain in full force and
effect, regardless of any investigation, or statement as to the results
thereof, made by or on behalf of the Underwriters, the Borrower, Doral
Financial or the Authority, and will survive delivery of and payment for the
Bonds.
12. TERMINATION OF BOND PURCHASE AGREEMENT. The Representative
may terminate this Agreement, in its absolute discretion, without liability
therefor, by notice given to the Authority, Doral
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Financial and the Borrower prior to the Closing if, at any time prior to the
Closing:
(a) Any fact shall exist or any event shall have occurred
that, in the opinion of the Representative, makes the Registration Statement or
the Official Statement and Prospectus contain an untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading;
(b) Any extraordinary event shall have occurred or shall
exist affecting current Commonwealth, national or international economic,
financial or other conditions or affecting Doral Financial or the Borrower
which, in the reasonable opinion of the Representative, materially adversely
affects the market for the Bonds or the sale, at the contemplated offering
prices, by the Underwriters of the Bonds;
(c) A war or other similar hostilities directly involving the
United States shall have occurred, which in the reasonable opinion of the
Representative, materially adversely affects the market for the Bonds or the
sale, at the contemplated offering prices, by the Underwriters of the Bonds;
(d) A general banking moratorium shall have been declared by
authorities of the United States or the Commonwealth;
(e) Any rating of the Bonds shall have been downgraded or
withdrawn by S&P, D&P or Xxxxx'x;
(f) The New York Stock Exchange or other national securities
exchange, or any governmental authority, shall impose
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any material restrictions not now in force or being enforced with respect to
the Bonds or obligations of the general character of the Bonds or securities
generally, or shall materially increase restrictions now in force, including
those relating to the extension of credit by, or charges to the net capital
requirements of, underwriters;
(g) Any legislation, ordinance, rule or regulation shall be
introduced in, or be enacted by, any governmental body, department or agency in
the Commonwealth, or decision by any court of competent jurisdiction within the
Commonwealth shall be rendered which, in the reasonable opinion of the
Representative, materially adversely affects the market for the Bonds or the
sale, at the contemplated offering prices, by the Underwriters of the Bonds;
(h) Any amendment to the Official Statement and Prospectus is
proposed by the Borrower or Doral Financial or deemed necessary by Bond Counsel
or counsel to the Underwriters pursuant to Paragraph [ ] hereof which, in the
reasonable opinion of the Representative, materially adversely affects the
market for the Bonds or the sale, at the contemplated offering prices, by the
Underwriters of the Bonds; or
(k) The Authority, Doral Financial or the Borrower shall be
unable to satisfy the conditions to the obligations of the Underwriters to
purchase, to accept delivery of and to pay for the Bonds contained in this
Agreement.
13. EXPENSES OF THE AUTHORITY, DORAL FINANCIAL AND THE BORROWER.
Whether or not the transactions contemplated hereby shall be consummated, the
Underwriters and the Authority shall be under no obligation to pay, and Doral
Financial and the Borrower
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shall pay, any and all reasonable expenses incident to the performance of the
obligations of the Authority, the Underwriters, Doral Financial or the Borrower
under this Agreement and the fulfillment of the conditions imposed hereunder
including but not limited to: (i) the cost of preparing, printing and
delivering the Bonds, the Preliminary Official Statement and Prospectus, the
Registration Statement and the Official Statement and Prospectus, the Trust
Agreement and the Loan and Guaranty Agreement and any amendments or supplements
thereto; (ii) the fees and disbursements of Bond Counsel; (iii) the fees and
disbursements of any counsel, auditors, engineers, consultants or other
retained by the Authority, Doral Financial or the Borrower in connection with
the transactions contemplated herein; (iv) the fees and disbursements of the
Bond Trustee and its counsel; (v) the charges made by rating agencies for the
rating of the Bonds; (vi) the expenses incurred by the Underwriters in
connection with the purchase of the Bonds and the transactions contemplated
herein, including the fees and disbursements of legal counsel retained by or on
behalf of the Underwriters; and (vii) any and all liability with respect to
amounts payable as a result of (A) any issuance, stamp, documentary, transfer
or similar taxes which may be determined to be payable in connection with the
execution and delivery of the Bonds, this Agreement, the Registration
Statement, the Official Statement and Prospectus, the Trust Agreement, the Loan
and Guaranty Agreement or any other ancillary agreement, or any modification,
amendment or alteration, of the terms or provisions of any of the foregoing,
and (B) any interest or penalties resulting from any delays in paying any of
such expenses, charges, disbursement, liabilities or taxes. The obligations of
the Borrower under this Paragraph 13 shall survive the delivery of and payment
for the Bonds.
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14. NOTICES. Any notice or other communication to be given to the
Authority, Doral Financial or the Borrower under this Agreement may be given by
delivering the same in writing at the address set forth above, and any notice
or other communication to be given to the Underwriters under this Agreement may
be given by delivering the same in writing to Popular Securities, Inc., Popular
Center Building, Suite 0000, Xxx Xxxx, Xxxxxx Xxxx 00000, Attention: President.
15. PARTIES IN INTEREST. This Agreement is made solely for the
benefit of the Authority, Doral Financial, the Borrower and the Underwriters
(including the successors or assigns of the Underwriters) and no other person
shall acquire or have any right hereunder or by virtue hereof.
16. NO ORAL CHANGE. This Agreement may not be changed orally, but
only by an agreement in writing and signed by the party against whom
enforcement of any waiver, change, modification or discharge is sought.
17. EFFECTIVENESS. This Agreement shall become effective upon the
execution hereof by the Authority, Doral Financial and the Borrower and shall
be valid and enforceable as of the time of delivery of such executed copy to
the Underwriters.
18. COUNTERPART EXECUTION. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which, when so executed and delivered, shall be an
original, but all of which counterparts shall together constitute but one and
the same instrument.
19. GOVERNING LAW. This Agreement is being made in the
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Commonwealth and for all purposes shall be construed and enforced in accordance
with the laws of the Commonwealth.
20. SEVERABILITY. In the event any provision of this Agreement
shall be held invalid or unenforceable by any court of competent jurisdiction,
such holding shall not invalidate or render unenforceable any other provision
hereof.
Very truly yours,
POPULAR SECURITIES, INC.
PAINEWEBBER INCORPORATED
OF PUERTO RICO
DORAL SECURITIES, INC.
XXXXXXX XXXXX & CO.
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXXX XXXXX XXXXXX INC.
BY: POPULAR SECURITIES, INC., AS
REPRESENTATIVE
By:
-----------------------------------
Name:
Title:
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The foregoing Bond Purchase Agreement is hereby accepted as of October __,
1999.
PUERTO RICO INDUSTRIAL, TOURIST,
EDUCATIONAL, MEDICAL AND ENVIRONMENTAL
CONTROL FACILITIES FINANCING AUTHORITY
By:
-----------------------------------
Name:
Title:
DORAL PROPERTIES, INC.
By:
-----------------------------------
Name:
Title:
DORAL FINANCIAL CORPORATION
By:
-----------------------------------
Name:
Title:
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SCHEDULE I
Principal Amount
of Bonds
Underwriter to be Purchased
----------- ---------------
POPULAR SECURITIES, INC. $
PAINEWEBBER INCORPORATED
OF PUERTO RICO
DORAL SECURITIES, INC.
XXXXXXX XXXXX & CO.
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXXX XXXXX XXXXXX INC. ------------
TOTAL $
------------
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