Exhibit 1.1
EQUIVANTAGE ACCEPTANCE CORP.
EQUIVANTAGE INC.
AND
PRUDENTIAL SECURITIES INCORPORATED
As Representative of the Several Underwriters
UNDERWRITING AGREEMENT
FOR
EQUIVANTAGE HOME EQUITY LOAN TRUST 1996-4
HOME EQUITY LOAN ASSET-BACKED CERTIFICATES,
CLASS A FIXED RATE CERTIFICATES
November 19, 1996
TABLE OF CONTENTS
Page
----
SECTION I. Representations and Warranties of the Company............... 2
SECTION II. Purchase and Sale........................................... 6
SECTION III. Delivery and Payment........................................ 6
SECTION IV. Offering by the Underwriters................................ 6
SECTION V. Covenants of the Company.................................... 6
SECTION VI. Condition to the Underwriters' Obligations.................. 9
SECTION VII. Payment of Expenses......................................... 19
SECTION VIII. Indemnification and Contribution............................ 20
SECTION IX. Representations, Warranties and Agreements to
Survive Delivery.......................................... 24
SECTION X. Default by One or More of the Underwriters.................. 24
SECTION XI. Termination of Agreement.................................... 25
SECTION XII. Notices..................................................... 25
SECTION XIII. Persons Entitled to the Benefit of this Agreement........... 25
SECTION XIV. Survival.................................................... 25
SECTION XV. Definition of the Term "Business Day"....................... 25
SECTION XVI. Governing Law; Submission to Jurisdiction................... 25
SECTION XVII. Counterparts................................................ 26
SECTION XVIII. Headings.................................................... 26
SECTION XIX. Amendments and Waivers...................................... 26
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EQUIVANTAGE HOME EQUITY LOAN TRUST 1996-4
HOME EQUITY LOAN ASSET-BACKED CERTIFICATES,
CLASS A FIXED RATE CERTIFICATES
UNDERWRITING AGREEMENT
November 19, 1996
Prudential Securities Incorporated
as Representative of the
several Underwriters
1 New York Xxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
EquiVantage Acceptance Corp. (the "Company"), a Delaware
corporation, has authorized the issuance and sale of Home Equity Loan
Asset-Backed Certificates, Class A (the "Offered Certificates"), Class B (the
"Class B Certificates") and the Class R Certificates (the "Class R
Certificates," together with the Class B Certificates, the "Subordinated
Certificates," and collectively with the Offered Certificates, the
"Certificates"), evidencing interests in a pool of home equity loans (the "Home
Equity Loans"). The Home Equity Loans are secured primarily by first lien deeds
of trust or mortgages on one- to four-family residential properties.
Only the Offered Certificates are being purchased by the
Underwriters named in Schedule A hereto, and the Underwriters are purchasing,
severally, only the Offered Certificates set forth opposite their names in
Schedule A, except that the amounts purchased by the Underwriters may change in
accordance with Section X of this Agreement. Prudential Securities Incorporated
is acting as representative of the several Underwriters and in such capacity, is
hereinafter referred to as the "Representative."
The Certificates will be issued under a pooling and servicing
agreement (the "Pooling and Servicing Agreement'), dated as of November 1, 1996
among the Company, as Seller (the "Seller"), EquiVantage Inc. (a corporation
organized under the laws of Delaware, ("EquiVantage Inc.")) as Servicer (the
"Servicer") and Norwest Bank Minnesota, National Association, as trustee (the
"Trustee"). The Certificates will evidence fractional undivided interests in the
trust (the "Trust"). The assets of the Trust will initially include, among other
things, a pool of Home Equity Loans and such amounts as may be held by the
Trustee in the Certificate Account (the "Certificate Account"), the Principal
and Interest Account (the "P&I Account") and any other accounts held by the
Trustee for the Trust. The Home Equity Loans
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will be acquired from EquiVantage Inc. pursuant to a Master Loan Transfer
Agreement dated November 1, 1996, and related Conveyance Agreement dated
November 22, 1996 (the "Conveyance Agreement," together the "Purchase
Agreements"). The Offered Certificates will initially represent an undivided
ownership interest in the pool of Home Equity Loans in an amount of $80,000,000
(approximate) as of the close of business on November 1, 1996, or if any Home
Equity Loan was originated subsequent to November 1, 1996 but prior to the
Closing Date, the date of origination of such Home Equity Loan (the "Cut-Off
Date"). The Offered Certificates will also have the benefit of a Certificate
Insurance Policy (the "Certificate Insurance Policy") issued by Financial
Guaranty Insurance Corporation, a New York stock insurance company (the
"Certificate Insurer"). The Certificate Insurance Policy will be issued pursuant
to the insurance and indemnity agreement (the "Insurance Agreement") dated as of
November 1, 1996 among the Certificate Insurer, the Company, the Servicer and
the Trustee. A form of the Pooling and Servicing Agreement has been filed as an
exhibit to the Registration Statement (hereinafter defined).
The Certificates are more fully described in a Registration
Statement which the Company has furnished to the Underwriters. Capitalized terms
used but not defined herein shall have the meanings given to them in the Pooling
and Servicing Agreement.
SECTION I. Representations and Warranties of the Company. The
Company represents and warrants to, and agrees with the Underwriters that:
A. A Registration Statement on Form S-3 (No. 33-99364), has (i) been
prepared by the Company in conformity with the requirements of the Securities
Act of 1933 (the "Securities Act") and the rules and regulations (the "Rules and
Regulations") of the United States Securities and Exchange Commission (the
"Commission") thereunder, (ii) been filed with the Commission under the
Securities Act and (iii) become effective under the Securities Act. Copies of
such Registration Statement have been delivered by the Company to the
Representative. As used in this Agreement, "Effective Time" means the date and
the time as of which such Registration Statement, or the most recent
post-effective amendment thereto, if any, was declared effective by the
Commission; "Effective Date" means the date of the Effective Time; "Registration
Statement" means such registration statement, at the Effective Time, including
any documents incorporated by reference therein at such time; "Basic Prospectus"
means such final prospectus dated May 7, 1996; and "Prospectus Supplement" means
the final prospectus supplement relating to the Offered Certificates, to be
filed with the Commission pursuant to paragraphs (2), (3) or (5) of Rule 424(b)
of the Rules and Regulations. "Prospectus" means the Basic Prospectus together
with the Prospectus Supplement. Reference made herein to the Prospectus shall be
deemed to refer to and include any documents incorporated by reference therein
pursuant to Item 12 of Form S-3 under the Securities Act as of the date of the
Prospectus, any reference to any amendment or supplement to the Prospectus shall
be deemed to refer to and include any document filed under the Securities
Exchange Act of 1934 (the "Exchange Act") after the date of the Prospectus and
incorporated by reference in the Prospectus, and any reference to any amendment
to the Registration Statement shall be deemed to include any report of the
Company filed with the Commission pursuant to section 13(a) or 15(d) of the
Exchange Act after the Effective Time that is incorporated by reference in the
Registration Statement. The Commission has not issued any order preventing or
suspending the use of the Prospectus. There are not contracts or documents of
the Company which are required to be filed as exhibits to the Registration
Statement pursuant to the Securities Act or the Rules and Regulations which have
not been so filed or incorporated by reference therein on or prior to the
Effective Date of the Registration Statement other than such documents or
materials, if any, as any Underwriter delivers to the Company pursuant to
Section VIII D hereof for filing on Form 8-K.
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B. The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the Commission, as
the case may be, conform in all respects to the requirements of the Securities
Act and the Rules and Regulations. The Registration Statement, as of the
Effective Date thereof and of any amendment thereto, did not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading. The
Prospectus as of its date, and as amended or supplemented as of the Closing Date
does not and will not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided
that no representation or warranty is made as to information contained in or
omitted from the Registration Statement or the Prospectus in reliance upon and
in conformity with written information furnished to the Company in writing by
the Underwriters expressly for use therein.
C. The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Securities Act or
the Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus, when such
documents become effective or are filed with the Commission, as the case may be,
will conform in all material respects to the requirements of the Securities Act
or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided that no representation
is made as to documents deemed to be incorporated by reference in the Prospectus
as the result of filing a Form 8-K at the request of the Underwriters except to
the extent such documents reflect information furnished by the Company to the
Underwriters for the purpose of preparing such documents.
D. Since the respective dates as of which information is given in
the Prospectus, there has not been any material adverse change, or any
development involving a prospective material adverse change, in the general
affairs, management, financial condition, or results of operations of the
Company, otherwise than as set forth or contemplated in the Prospectus as
supplemented or amended as of the Closing Date.
E. The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of its jurisdiction of
incorporation, is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification, and has all
power and authority necessary to own or hold its properties, to conduct the
business in which it is engaged and to enter into and perform its obligations
under this Agreement, the Pooling and Servicing Agreement and the Insurance
Agreement or the Purchase Agreements and to cause the Certificates to be issued.
F. There are no actions, proceedings or investigations pending with
respect to which the Company has received service of process before or
threatened by any court, administrative agency or other tribunal to which the
Company is a party or of which any of its properties is the subject (a) which if
determined adversely to the Company would have a material adverse effect on the
business or financial condition of the Company, (b) asserting the invalidity of
this Agreement, the Pooling and Servicing Agreement, the Insurance Agreement or
the Certificates, or the Purchase Transfer Agreements, (c) seeking to prevent
the issuance of the Certificates or the consummation by the Company of any of
the transactions
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contemplated by the Pooling and Servicing Agreement, the Insurance Agreement or
this Agreement, or the Purchase Transfer Agreement, as the case may be, (d)
which might individually or in the aggregate materially and adversely affect the
performance by the Company of its obligations under, or the validity or
enforceability of, the Pooling and Servicing Agreement, this Agreement, and the
Insurance Agreement or the Certificates or the Purchase Agreements or (e) which
might adversely affect the federal income tax attributes of the Certificates as
described in the Prospectus.
G. This Agreement has been, and the Pooling and Servicing Agreement,
the Purchase Agreements and the Insurance Agreement, when executed and delivered
as contemplated hereby and thereby will have been, duly authorized, executed and
delivered by the Company, and this Agreement constitutes, and the Pooling and
Servicing Agreement and the Insurance Agreement when executed and delivered as
contemplated herein, will constitute legal, valid and binding instruments
enforceable against the Company in accordance with their respective terms,
subject as to enforceability to (x) applicable bankruptcy, reorganization,
insolvency, moratorium or other similar laws affecting creditors' rights
generally, (y) general principles of equity (regardless of whether enforcement
is sought in a proceeding in equity or at law), and (z) with respect to rights
of indemnity under this Agreement and the Insurance Agreement, limitations of
public policy under applicable securities laws.
H. The execution, delivery and performance of this Agreement, the
Pooling and Servicing Agreement, the Purchase Agreements and the Insurance
Agreement by the Company and the consummation of the transactions contemplated
hereby and thereby, compliance with the provisions thereof, and the issuance and
delivery of the Certificates do not and will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party, by which the Company is
bound or to which any of the properties or assets of the Company or any of its
subsidiaries is subject, which breach or violation would have a material adverse
effect on the business, operations or financial condition of the Company, nor
will such actions result in any violation of the provisions of the articles of
incorporation or by-laws of the Company or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its properties or assets, which breach or violation would
have a material adverse effect on the business, operations or financial
condition of the Company. The Company is not a party to, bound by, or in breach
or violation of, any indenture or other agreement or instrument, or subject to
or in violation of any statute, order, rule or regulation of any court,
governmental agency or body or other tribunal having jurisdiction over the
Company, which materially and adversely affects, or is reasonably likely in the
future to materially and adversely affect, (i) the ability of the Company to
perform its obligations under this Agreement and the Insurance Agreement or (ii)
the business, operations, results of operations, financial position, income,
properties or assets of the Company.
I. The Company has no reason to know that KPMG Peat Marwick LLP are
not independent public accountants with respect to the Company as required by
the Securities Act and the Rules and Regulations.
J. The direction by the Company to the Trustee to execute,
authenticate, issue and deliver the Certificates has been duly authorized by the
Company, and assuming the Trustee has been duly authorized to do so, when
executed, authenticated, issued and delivered by the Trustee in accordance with
the Pooling and Servicing Agreement, the Certificates will be validly issued and
outstanding and will be entitled to the benefits provided by the Pooling and
Servicing Agreement.
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K. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the United
States is required for the issuance of the Certificates and the sale of the
Offered Certificates to the Underwriters, or the consummation by the Company of
the other transactions contemplated by this Agreement, the Pooling and Servicing
Agreement, the Purchase Agreements and the Insurance Agreement, except such
consents, approvals, authorizations, registrations or qualifications as may be
required under State securities or Blue Sky laws in connection with the purchase
and distribution of the Offered Certificates by the Underwriters or as have been
obtained.
L. The Company possesses all material licenses, certificates,
authorities or permits issued by the appropriate state, Federal or foreign
regulatory agencies or bodies necessary to conduct the business now conducted by
it and as described in the Prospectus, and there are no proceedings pending with
respect to which the Company has received service of process or, to the best
knowledge of the Company threatened, relating to the revocation or modification
of any such license, certificate, authority or permit which if decided adversely
to the Company would, singly or in the aggregate, materially and adversely
affect the conduct of its business, operations or financial condition.
M. At the time of execution and delivery of the Pooling and
Servicing Agreement, the Company will: (i) have good title to the Home Equity
Loans conveyed by the Seller, free and clear of any lien, mortgage, pledge,
charge, encumbrance, adverse claim or other security interest (collectively,
"Liens"); (ii) not have assigned to any person any of its right or title in the
Home Equity Loans, in the Pooling and Servicing Agreement or in the Certificates
being issued pursuant thereto; and (iii) have the power and authority to sell
its interest in the Home Equity Loans to the Trustee and to sell the Offered
Certificates to the Underwriters. Upon execution and delivery of the Pooling and
Servicing Agreement by the Trustee, the Trustee will have acquired beneficial
ownership of all of the Company's right, title and interest in and to the Home
Equity Loans. Upon delivery to the Underwriters of the Offered Certificates, the
Underwriters will have good title to the Offered Certificates, free of any
Liens.
N. As of the Cut-Off Date, each of the Home Equity Loans will meet
the eligibility criteria described in the Prospectus and will conform to the
descriptions thereof contained in the Prospectus in all material respects.
O. Neither the Company nor the Trust created by the Pooling and
Servicing Agreement is an "investment company" within the meaning of such term
under the Investment Company Act of 1940 (the "1940 Act") and the rules and
regulations of the Commission thereunder.
P. At the Closing Date, the Offered Certificates, the Purchase
Agreements and the Pooling and Servicing Agreement will conform in all material
respects to the descriptions thereof contained in the Prospectus. The Offered
Certificates will be duly and validly authorized and, when duly and validly
executed, authenticated, issued and delivered in accordance with the Pooling and
Servicing Agreement and sold to the Underwriters as provided herein, will be
validly issued and outstanding and entitled to the benefits of the Pooling and
Servicing Agreement.
Q. At the Closing Date, the Offered Certificates shall have been
rated in the highest rating category by at least two nationally recognized
rating agencies.
R. Any taxes, fees and other governmental charges in connection with
the execution, delivery and issuance of this Agreement, the Pooling and
Servicing Agreement, the Insurance Agreement and the Certificates have been paid
or will be paid at or prior to the Closing Date.
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S. At the Closing Date, each of the representations and warranties
of the Company set forth in the Pooling and Servicing Agreement and the
Insurance Agreement will be true and correct in all material respects.
T. The transfer of the Home Equity Loans to the Trust at the Closing
Date will be treated by the Company for financial accounting and reporting
purposes as a sale of assets and not as a pledge of assets to secure debt.
U. The Company 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, or (ii) any notification with respect to the suspension
of the qualification of the Certificates for sale in any jurisdiction or the
initiating or threatening of any proceeding for such purpose.
Any certificate signed by an officer of the Company and delivered to
the Representative or counsel for the Representative in connection with an
offering of the Offered Certificates shall be deemed, and shall state that it
is, a representation and warranty as to the matters covered thereby to each
person to whom the representations and warranties in this Section I are made.
SECTION II. Purchase and Sale. The commitment of the Underwriters to
purchase the Offered Certificates pursuant to this Agreement shall be deemed to
have been made on the basis of the representations and warranties herein
contained and shall be subject to the terms and conditions herein set forth. The
Company agrees to instruct the Trustee to issue the Offered Certificates and
agrees to sell to the Underwriters, and the Underwriters agree (except as
provided in Sections X and XI hereof) severally and not jointly to purchase from
the Company the aggregate initial principal amounts or percentage interests of
the Class A Certificates set forth opposite their names on Schedule A, at the
purchase price or prices set forth in Schedule A.
SECTION III. Delivery and Payment. Delivery and payment for the
Offered Certificates to be purchased by the Underwriters shall be made at the
offices of Xxxxx Xxxxxxxxxx, or at such other place as shall be agreed upon by
the Company at 10:00 a.m. New York City time on November 22, 1996 or at such
other time or date as shall be agreed upon in writing by the Representative and
the Company (such date being referred to as the "Closing Date"). Payment shall
be made to the Company by wire transfer of same day funds payable to the account
of the Company. Delivery of the Offered Certificates shall be made to the
Representative for the accounts of the Underwriters against payment of the
purchase price thereof. The Certificates shall be in such authorized
denominations and registered in such names as the Underwriters may request in
writing at least two business days prior to the Closing Date. The Offered
Certificates will be made available for examination by the Representative no
later than 2:00 p.m. New York City time on the first business day prior to the
Closing Date.
SECTION IV. Offering by the Underwriters. It is understood that,
subject to the terms and conditions hereof, the Underwriters propose to offer
the Offered Certificates for sale to the public as set forth in the Prospectus.
SECTION V. Covenants of the Company. The Company agrees as follows:
A. To prepare the Prospectus in a form approved by the Underwriters
and to file such Prospectus pursuant to Rule 424(b) under the Securities Act not
later than the Commission's close of business on the second business day
following the availability of the Prospectus to the Underwriters; to make no
further amendment or any supplement to the Registration Statement or to the
Prospectus prior
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to the Closing Date except as permitted herein; to advise the Underwriters,
promptly after it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective prior to the Closing
Date or any supplement to the Prospectus or any amended Prospectus has been
filed prior to the Closing Date and to furnish the Underwriters with copies
thereof; to file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
the Prospectus and, for so long as the delivery of a prospectus is required in
connection with the offering or sale of the Offered Certificates; to promptly
advise the Underwriters of its receipt of notice of the issuance by the
Commission of any stop order or of: (i) any order preventing or suspending the
use of the Prospectus; (ii) the suspension of the qualification of the Offered
Certificates for offering or sale in any jurisdiction; (iii) the initiation of
or threat of any proceeding for any such purpose; (iv) any request by the
Commission for the amending or supplementing of the Registration Statement or
the Prospectus or for additional information. In the event of the issuance of
any stop order or of any order preventing or suspending the use of the
Prospectus or suspending any such qualification, the Company promptly shall use
its best efforts to obtain the withdrawal of such order by the Commission.
B. To furnish promptly to the Underwriters and to counsel for the
Underwriters a signed copy of the Registration Statement as originally filed
with the Commission, and of each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith.
C. To deliver promptly to the Underwriters such number of the
following documents as the Underwriters shall reasonably request: (i) conformed
copies of the Registration Statement as originally filed with the Commission and
each amendment thereto (in each case including exhibits); (ii) the Prospectus
and any amended or supplemented Prospectus; and (iii) any document incorporated
by reference in the Prospectus (including exhibits thereto). If the delivery of
a prospectus is required at any time prior to the expiration of nine months
after the Effective Time in connection with the offering or sale of the Offered
Certificates, and if at such time any events shall have occurred as a result of
which the Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the
Securities Act or the Exchange Act, the Company shall notify the Underwriters
and, upon any Underwriter's request, shall file such document and prepare and
furnish without charge to the Underwriters and to any dealer in securities as
many copies as the Underwriters may from time to time reasonably request of an
amended Prospectus or a supplement to the Prospectus which corrects such
statement or omission or effects such compliance, and in case the Underwriters
are required to deliver a Prospectus in connection with sales of any of the
Offered Certificates at any time nine months or more after the Effective Time,
upon the request of an Underwriter but at its expense, the Company shall prepare
and deliver to such Underwriter as many copies as such Underwriter may
reasonably request of an amended or supplemented Prospectus complying with
Section 10(a)(3) of the Securities Act. If such amendment or supplement to the
Prospectus is required to be contained in a post-effective amendment to the
Registration Statement, the Company will use its best efforts to cause such
amendment of the Registration Statement to be made effective as soon as
possible.
D. To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Company or the Underwriters, be required by the
Securities Act or requested by the Commission.
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E. To furnish the Underwriters and counsel for the Underwriters,
prior to filing with the Commission, and to obtain the consent of the
Underwriters for the filing of the following documents relating to the
Certificates: (i) amendment to the Registration Statement or supplement to the
Prospectus, or document incorporated by reference in the Prospectus, or (ii)
Prospectus pursuant to Rule 424 of the Rules and Regulations.
F. To make generally available to holders of the Offered
Certificates as soon as practicable, but in any event not later than 90 days
after the close of the period covered thereby, a statement of earnings of the
Trust (which need not be audited) complying with Section 11(a) of the Securities
Act and the Rules and Regulations (including, at the option of the Company, Rule
158) and covering a period of at least twelve consecutive months beginning not
later than the first day of the first fiscal quarter following the Closing Date.
G. To use its best efforts, in cooperation with the Underwriters, to
qualify the Offered Certificates for offering and sale under the applicable
securities laws of such states and other jurisdictions of the United States or
elsewhere as the Underwriters may designate, and maintain or cause to be
maintained such qualifications in effect for as long as may be required for the
distribution of the Offered Certificates. The Company will file or cause the
filing of such statements and reports as may be required by the laws of each
jurisdiction in which the Offered Certificates have been so qualified.
H. So long as the Offered Certificates shall be outstanding the
Company shall cause the Trustee, pursuant to the Pooling and Servicing
Agreement, to deliver to the Underwriters as soon as such statements are
furnished to the Trustee: (i) the annual statement as to compliance delivered to
the Trustee pursuant to Section 8.16 of the Pooling and Servicing Agreement;
(ii) the annual statement of a firm of independent public accountants furnished
to the Trustee pursuant to Section 8.17 of the Pooling and Servicing Agreement;
(iii) the monthly servicing report furnished to the Trustee pursuant to Section
7.8 and Section 8.1 of the Pooling and Servicing Agreement; (iv) the monthly
reports furnished to the Certificateholders pursuant to Section 7.8 of the
Pooling and Servicing Agreement; and (v) from time to time, any other
information concerning the Trust filed with any government or regulatory
authority that is otherwise publicly available, as the Representative may
reasonably request.
I. To apply the net proceeds from the sale of the Offered
Certificates in the manner set forth in the Prospectus.
J. During a period of seven calendar days from the Closing Date,
neither the Company nor any trust established, directly or indirectly, by the
Company will, without the Representative's prior written consent (which consent
shall not be unreasonably withheld), offer or sell mortgage pass-through
certificates backed by mortgage loans, except pursuant to this Agreement.
K. The Company will enter into the applicable agreements, to which
it is a party pursuant to the Pooling and Servicing Agreement, on or prior to
the Closing Date and will cause to be delivered to the Trustee the Insurance
Policy issued by the Certificate Insurer.
L. The Company will cause the Computational Materials (as defined in
Section VIII(D) below) with respect to the Certificates which are delivered to
the Company as provided in Section VIII(D) below to be filed with the Commission
on a Current Report on Form 8-K (the "Current Report") not later than the date
on which such materials are required to be filed pursuant to the Xxxxxx/PSA
Letters (as defined in Section VIII(D) below).
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SECTION VI. Condition to the Underwriters' Obligations. The
obligations of the Underwriters to purchase the Offered Certificates pursuant to
this Agreement are subject to: (i) the accuracy on and as of the Closing Date of
the representations and warranties on the part of the Company herein contained
(including those representations and warranties set forth in the Pooling and
Servicing Agreement and incorporated herein); (ii) the performance by the
Company of all of its obligations hereunder; (iii) the accuracy of the
statements of the Company made in any certificate or other document delivered
pursuant to the provisions hereof; and (iv) the following conditions as of the
Closing Date:
A. The Underwriters shall have received confirmation of the
effectiveness of the Registration Statement. No stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission. Any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus shall
have been complied with. The Prospectus shall have been filed pursuant to Rule
424(b).
B. The Underwriters shall not have discovered and disclosed to the
Company on or prior to the Closing Date that the Registration Statement or the
Prospectus or any amendment or supplement thereto contains an untrue statement
of a fact or omits to state a fact which, in the opinion of Xxxxx Xxxxxxxxxx,
counsel for the Underwriters, is material and is required to be stated therein
or is necessary to make the statements therein not misleading.
C. All corporate proceedings and other legal matters relating to the
authorization, form and validity of this Agreement, the Pooling and Servicing
Agreement, the Insurance Agreement, the Purchase Agreements, the Certificates,
the Registration Statement and the Prospectus, and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
satisfactory in all respects to counsel for the Underwriters, and the Company
shall have furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters. The Representative
shall have received the Pooling and Servicing Agreement and the Offered
Certificates in form and substance satisfactory to the Representative, duly
executed by all signatories required pursuant to the respective terms thereof.
D. Xxxxx Xxxxxxxxxx, shall have furnished to the Underwriters their
written opinion, as counsel to the Company, addressed to the Underwriters and
dated the Closing Date, in form and substance satisfactory to the Underwriters,
to the effect that:
1. The conditions to the use by the Company of a registration
statement on Form S-3 under the Securities Act, as set forth in the
General Instructions to Form S-3, have been satisfied with respect to the
Registration Statement and the Prospectus.
2. The Registration Statement and any amendments thereto have
become effective under the 1993 Act; to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the Registration
Statement has been issued and not withdrawn and no proceedings for that
purpose have been instituted or threatened and not terminated; and the
Registration Statement, the Prospectus and each amendment or supplement
thereto, as of their respective effective or issue dates (other than the
financial and statistical information contained therein, as to which such
counsel need express no opinion), complied as to form in all material
respects with the applicable requirements of the 1933 Act and the rules
and regulations thereunder, and such counsel does not know of any
amendment to the Registration Statement required to be filed.
9
3. There are no material contracts, indentures or other
documents of a character required to be described or referred to in the
Registration Statement or the Prospectus or to be filed as exhibits to the
Registration Statement other than those described or referred to therein
or filed or incorporated by reference as exhibits thereto.
4. The statements set forth in the Basic Prospectus under the
caption "Description of the Securities" and in the Prospectus Supplement
under the captions "Description of the Certificates" and "The Pooling and
Servicing Agreement," to the extent such statements purport to summarize
certain provisions of the Certificates or of the Pooling and Servicing
Agreement, are fair and accurate in all material respects.
5. The statements set forth in the Basic Prospectus and the
Prospectus Supplement under the captions "ERISA Considerations," "Certain
Federal Income Tax Consequences," "Legal Investment Matters" and "Certain
Legal Aspects of Mortgage Loans and Related Matters," to the extent that
they constitute matters of federal law, provide a fair and accurate
summary of such law or conclusions.
6. The Pooling and Servicing Agreement and the Purchase
Agreements conform in all material respects to the description thereof
contained in the Prospectus and 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 of 1940, as amended.
7. Assuming that the Trustee causes certain assets of the
Trust Estate, as the Trustee has covenanted to do in the Pooling and
Servicing Agreement, to be treated as a "real estate mortgage investment
conduit" ("REMIC"), as such term is defined in the Internal Revenue Code
of 1986, as amended (the "Code"), and the parties to the Pooling and
Servicing Agreement comply with the terms thereof, such assets of the
Trust Estate will be treated as a REMIC, the Offered Certificates and the
Class B Certificates will be treated as the "regular interests" in the
Trust and the Class R Certificates will be treated as the sole "residual
interest" in the REMIC. Neither the Trust nor certain assets and accounts
are subject to tax upon its income or assets by any taxing authority of
the State of New York or the City of New York.
8. To the best of such counsel's knowledge, there are no
actions, proceedings or investigations pending that would adversely affect
the status of the Trust Estate as a REMIC.
9. As a consequence of the qualification of the Trust Estate
as a REMIC, the Offered Certificates will be treated as "qualifying real
property loans" under Section 593(d) of the Code, "regular. . .interest(s)
in a REMIC" under Section 7701(a)(19)(C) of the Code and "real estate
assets" under Section 856(c) of the Code in the same proportion that the
assets in the Trust consist of qualifying assets under such Sections. In
addition, as a consequence of the qualification of the Trust Estate as a
REMIC, interest on the Offered Certificates will be treated as "interest
on obligations secured by mortgages on real property" under Section 856(c)
of the Code to the extent that such Offered Certificates are treated as
"real estate assets" under Section 856(c) of the Code.
10. The Certificates will, when issued, conform to the
description thereof contained in the Prospectus.
10
Such counsel shall also have furnished to the Underwriters a written
statement, addressed to the Underwriters and dated the Closing Date, in form and
substance satisfactory to the Underwriters to the effect that no facts have come
to the attention of such counsel which lead them to believe that: (a) the
Registration Statement, at the time such Registration Statement became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein misleading (except as to financial or statistical data
contained in the Registration Statement); (b) the Prospectus, as of its date and
as of the Closing Date, contained or contains an untrue statement of a material
fact or omitted or omits to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (except as to
statements set forth in the Prospectus Supplement under the caption "The
Certificate Insurer"); or (c) any document incorporated by reference in the
Prospectus or any further amendment or supplement to any such incorporated
document made by the Company prior to the Closing Date (other than any document
filed at the request of an Underwriter to the extent such document relates to
Computational Materials) contained, as of the time it became effective or was
filed with the Commission, as the case may be, an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
In rendering such opinion or making such statement, such counsel may
rely, as to matters of fact, on certificates of responsible officers of the
Company. Such opinions and written statements may also assume the due
authorization, execution and delivery of the instruments and documents referred
to therein by the parties thereto other than the Company.
E. The Underwriters have received the favorable opinion, dated the
Closing Date, of Xxxxx Xxxxxxxxxx, special counsel to the Company, addressed to
the Company and satisfactory to the Certificate Insurer, Standard & Poor's, A
Division of The XxXxxx-Xxxx Companies, Xxxxx'x Investors Service Inc. and the
Underwriters, with respect to certain matters relating to the transfer of the
Home Equity Loans to the Company and from the Company to the Trust, and such
counsel shall have consented to reliance on such opinion by the Certificate
Insurer, Standard & Poor's, A Division of The XxXxxx-Xxxx Companies, Xxxxx'x
Investors Service, Inc. and the Underwriters as though such opinion had been
addressed to each such party.
F. Xxxxx Xxxxxxxx, Esq., counsel to the Servicer, shall have
furnished to the Underwriters her written opinion, as counsel to the Servicer,
addressed to the Underwriters and the Company and dated the Closing Date, in
form and substance satisfactory to the Underwriters, to the effect that:
1. The Servicer is validly existing in good standing as a
corporation under the laws of its State of incorporation.
2. The Servicer has full corporate power and authority to
serve in the capacity of servicer of the related Home Equity Loans as
contemplated in the Pooling and Servicing Agreement.
3. The Pooling and Servicing Agreement and the Insurance
Agreement have been duly authorized, executed and delivered by the
Servicer, and, assuming the due authorization, execution and delivery of
such agreements by the other parties thereto, constitute the legal, valid
and binding agreements of the Servicer, enforceable against it in
accordance with their terms, subject as to enforceability to (x)
bankruptcy, insolvency, reorganization, moratorium, receivership
11
or other similar laws now or hereafter in effect relating to creditors'
rights generally and (y) the qualification that the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion, with respect to such
remedies, of the court before which any proceedings with respect thereto
may be brought.
4. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body having
jurisdiction over the Servicer is required for the consummation by either
of them of the transactions contemplated by the Pooling and Servicing
Agreement and the Insurance Agreement, except such consents, approvals,
authorizations, registrations and qualifications as have been obtained.
5. The execution, delivery or performance by the Servicer of
the Pooling and Servicing Agreement or the Insurance Agreement and the
transactions contemplated thereby do not (A) conflict with or result in a
breach of, or constitute a default under, (i) any term or provision of the
certificate of incorporation or by-laws of the Servicer; (ii) any term or
provision of any material agreement, deed of trust, mortgage loan
agreement, contract, instrument or indenture, or other agreement to which
the Servicer is a party or is bound or to which any of the property or
assets of the Servicer or any of its subsidiaries is subject; (iii) to the
best of the Servicer's knowledge without independent investigation any
order, judgment, writ, injunction or decree of any court or governmental
authority having jurisdiction over the Servicer; or (iv) any law, rule or
regulations applicable to the Servicer; or (B) to the best of such firm's
knowledge without independent investigation, results in the creation or
imposition of any lien, charge or encumbrance upon the Trust Estate or
upon the Certificates.
6. There are no actions, proceedings or investigations pending
with respect to which the Servicer has received service of process before,
or to the best of such counsel's knowledge without independent
investigation, threatened against the Servicer by any court,
administrative agency or other tribunal (a) asserting the validity of the
Pooling and Servicing Agreement, the Insurance Agreement or the
Certificates, (b) seeking to prevent the consummation of any of the
transactions contemplated by the Pooling and Servicing Agreement or (c)
which would materially adversely affect the performance by the Servicer of
its obligations under, or the validity or enforceability of, the Pooling
and Servicing Agreement, or the Insurance Agreement.
G. Xxxxx Xxxxxxxx, Esq., counsel to the Company shall have furnished
to the Underwriters such counsel's written opinion, addressed to the
Underwriters and dated the Closing Date, in form and substance satisfactory to
the Underwriters, to the effect that:
1. The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Delaware
and is duly qualified to do business and is in good standing as a foreign
corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification
(except where any such failure would not have a material adverse effect on
the Company's ability to perform its obligations under this Agreement, the
Pooling and Servicing Agreement or the Insurance Agreement), and has all
power and authority necessary to own or hold its properties and to conduct
the business in which it is engaged and to enter into and perform its
obligations under this Agreement, the Pooling and Servicing Agreement and
the Insurance Agreement, and cause the Certificates to be issued.
12
2. The Company is not in violation of its articles of
incorporation or by-laws or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company is a party or by which it or its
properties may be bound, which default might result in any material
adverse change in the financial condition of the Company or which might
materially and adversely affect the properties or assets, taken as a
whole, of the Company.
3. This Agreement, the Pooling and Servicing Agreement, the
Indemnification Agreement, the Insurance Agreement and the Purchase
Agreements have been duly authorized, executed and delivered by the
Company and, assuming the due authorization, execution and delivery of
such agreements by the other parties thereto, such agreements constitute
valid and binding obligations, enforceable against the Company in
accordance with their respective terms, subject as to enforceability to
(x) bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights generally,
(y) general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (z) with respect to rights
of indemnity under this Agreement and the Insurance Agreement, limitations
of public policy under applicable securities laws.
4. The execution, delivery and performance of this Agreement,
the Pooling and Servicing Agreement, the Insurance Agreement and the
Purchase Agreements by the Company, the consummation of the transactions
contemplated hereby and thereby, and the issuance and delivery of the
Certificates (i) do not and will not conflict with or result in a breach
or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Company is a party or by which the
Company is bound or to which any of the property or assets of the Company
or any of its subsidiaries is subject, which breach or violation would
have a material adverse effect on the business, operations or financial
condition of the Company, (ii) nor will such actions result in a violation
of the provisions of the articles of incorporation or by-laws of the
Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of
its properties or assets, which breach or violation would have a material
adverse effect on the business, operations or financial condition of the
Company, and (iii) nor will such actions result in the creation or
imposition of any lien, charge or encumbrance upon the Trust Estate or
upon the Certificates, except as otherwise contemplated by the Pooling and
Servicing Agreement.
5. The direction by the Company to the Trustee to execute,
issue, authenticate and deliver the Certificates has been duly authorized
by the Company and, assuming that the Trustee has been duly authorized to
do so, when executed by the Company and authenticated and delivered by the
Trustee in accordance with the Pooling and Servicing Agreement, the
Certificates will be validly issued and outstanding and will be entitled
to the benefits of the Pooling and Servicing Agreement.
6. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the
United States is required for the issuance of the Certificates, and the
sale of the Offered Certificates to the Underwriters, or the consummation
by the Company of the other transactions contemplated by this Agreement,
the Pooling and Servicing Agreement and the Insurance Agreement, except
such consents, approvals, authorizations, registrations or qualifications
as may be required under the 1933 Act or State
13
securities or Blue Sky laws in connection with the purchase and
distribution of the Offered Certificates by the Underwriters or as have
been previously obtained.
7. There are no actions, proceedings or investigations pending
with respect to which the Company has received service of process before
or, to the best of such counsel's knowledge, without independent
investigation, threatened by any court, administrative agency or other
tribunal to which the Company is a party or of which any of its properties
is the subject: (a) which if determined adversely to the Company would
have a material adverse effect on the business, results of operations or
financial condition of the Company; (b) asserting the invalidity of the
Pooling and Servicing Agreement, the Insurance Agreement or the
Certificates; (c) seeking to prevent the issuance of the Certificates or
the consummation by the Company of any of the transactions contemplated by
the Pooling and Servicing Agreement, the Insurance Agreement or this
Agreement, as the case may be; or (d) which might materially and adversely
affect the performance by the Company of its obligations under, or the
validity or enforceability of, the Pooling and Servicing Agreement, the
Insurance Agreement, this Agreement or the Certificates.
8. The Certificates have been duly and validly authorized and
issued, and, immediately prior to the sale of the Offered Certificates to
the Underwriters, such Certificates are owned by the Company, free and
clear of all Liens.
9. The Company has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of Delaware
and is duly qualified to do business and is in good standing as a foreign
corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification, and
has all power and authority necessary to own or hold its properties and to
conduct the business in which it is engaged and to enter into and perform
its obligations under the Purchase Agreements.
10. The Company is not in violation of its articles of
incorporation or by-laws or in default in the performance or observance of
any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company is a party or by which it or its
properties may be bound, which default might result in any material
adverse changes in the financial condition, earnings, affairs or business
of the Company or which might materially and adversely affect the
properties or assets, taken as a whole, of the Company.
11. The Purchase Agreements have been duly authorized,
executed and delivered by the Company and, assuming the due authorization,
execution and delivery of such agreements by the parties thereto, such
agreements will constitute valid and binding obligations, enforceable
against the Company in accordance with their respective terms, subject as
to enforceability to (x) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally, (y) general principles of equity (regardless
of whether enforcement is sought in a proceeding in equity or at law).
12. The execution, delivery and performance of the Purchase
Agreements by the Company and the consummation of the transactions
contemplated thereby do not and will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument to which the Company is a party or by which
the Company is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, which breach or
14
violation would have a material adverse effect on the business, operations
or financial condition of the Company, nor will such actions result in a
violation of the provisions of the articles of incorporation or by-laws of
the Company or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or any
of its properties or assets, which breach or violation would have a
material adverse effect on the business, operations or financial condition
of the Company.
H. The Underwriters shall have received the favorable opinion of
counsel (which may be in-house counsel) to the Trustee, dated the Closing Date,
addressed to the Underwriters and in form and scope satisfactory to counsel to
the Underwriters, to the effect that:
1. The Trustee is a banking association duly incorporated and
validly existing under the laws of the United States of America.
2. The Trustee has the full corporate trust power to execute,
deliver and perform its obligations under the Pooling and Servicing
Agreement.
3. The execution and delivery by the Trustee of the Pooling
and Servicing Agreement and the performance by the Trustee of its
obligations under the Pooling and Servicing Agreement have been duly
authorized by all necessary corporate actions of the Trustee.
4. The Pooling and Servicing Agreement is a valid and legally
binding obligation of the Trustee enforceable against the Trustee.
5. The execution and delivery by the Trustee of the Pooling
and Servicing Agreement does not (a) violate the organization certificate
of the Trustee or the By-laws of the Trustee, (b) to such counsel's
knowledge, violate any judgment, decree or order of any Minnesota or
United States federal court or other Minnesota or United States federal
governmental authority by which the Trustee is bound or (c) assuming the
non-existence of any judgment, decree or order of any court or other
governmental authority that would be violated by such execution and
delivery, violate any Minnesota or United States federal statute, rule or
regulation or require any consent, approval or authorization of any
Minnesota or United States federal court or other Minnesota or United
States federal governmental authority.
6. The Certificates have been duly authenticated, executed and
delivered by the Trustee.
7. If the Trustee were acting in the stead of the Servicer
under the Pooling and Servicing Agreement as of the date of such opinion,
the Trustee would have the full corporate trust power to perform the
obligations of the Servicer under the Pooling and Servicing Agreement; and
8. To the best of such counsel's knowledge, there are no
actions, proceedings or investigations pending or threatened against or
affecting the Trustee before or by any court, arbitrator, administrative
agency or other governmental authority which, if decided adversely to the
Trustee, would materially and adversely affect the ability of the Trustee
to carry out the transactions contemplated in the Pooling and Servicing
Agreement.
15
I. The Underwriters shall have received a favorable opinion or
opinions, dated the date of the Closing Date, of counsel for the Underwriters,
with respect to the issue and sale of the Offered Certificates, this Agreement,
the Prospectus and such other related matters as the Underwriters may reasonably
require.
J. The Underwriters shall have received the favorable opinion dated
the Closing Date, from in-house counsel to the Certificate Insurer in form and
scope satisfactory to counsel for the Underwriters, substantially to the effect
that:
1. The Certificate Insurer is a stock insurance corporation
duly incorporated, validly existing, and in good standing under the laws
of the State of New York. The Certificate Insurer is validly licensed and
authorized to issue the Certificate Insurance Policy and perform its
obligations under the Insurance Agreement in accordance with the terms
thereof, under the laws of the State of New York.
2. The Certificate Insurer has the corporate power to execute
and deliver, and to take all action required of it under the Insurance
Agreement and the Certificate Insurance Policy.
3. The execution, delivery and performance by the Certificate
Insurer of the Certificate Insurance Policy, the Insurance Agreement and
the Indemnification Agreement is within the corporate power of the
Certificate Insurer and has been authorized by all necessary corporate
action on the part of the Certificate Insurer, and does not require the
consent or approval of, the giving of notice to, the prior registration
with, or the taking of any other action in respect of any state or other
governmental agency or authority which has not previously been obtained or
effected.
4. The Certificate Insurance Policy, the Insurance Agreement
and the Indemnification Agreement have been duly authorized, executed and
delivered by the Certificate Insurer and constitute the legal, valid and
binding agreement of the Certificate Insurer, enforceable against the
Certificate Insurer in accordance with its terms subject, as to
enforcement, to (x) bankruptcy, reorganization, insolvency, moratorium and
other similar laws relating to or affecting the enforcement of creditors'
rights generally, including, without limitation, laws relating to
fraudulent transfer or conveyances, preferential transfers and equitable
subordination, presently or from time to time in effect and general
principles of equity (regardless of whether such enforcement is considered
in a proceeding in equity or at law), as such laws may be applied in any
such proceeding with respect to the Certificate Insurer and (y) the
qualification that the remedy of specific performance and other forms of
equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceedings with respect thereto
may be brought.
5. To the extent the Certificate Insurance Policy constitutes
a security within the meaning of Section 2(l) of the Securities Act, it is
a security that is exempt from the registration requirements of the Act.
6. The information set forth under the caption "THE
CERTIFICATE INSURER" in the Prospectus Supplement, insofar as such
information constitutes a description of the Certificate Insurance Policy,
accurately summarizes the Certificate Insurance Policy.
16
K. The Company shall have furnished to the Underwriters a
certificate, dated the Closing Date and signed by the Chairman of the Board, the
President or a Vice President of the Company to the extent that the signer of
such certificate has carefully examined the Registration Statement (excluding
any documents incorporated therein by reference), the Pooling and Servicing
Agreement and this Agreement and that, to the best of his or her knowledge based
upon reasonable investigation:
1. The representations and warranties of the Company in this
Agreement, the Pooling and Servicing Agreement and all related agreements
are true and correct as of the Closing Date; and the Company has complied
with all agreements and satisfied all the conditions on its part which are
to have been complied with on or prior to the Closing Date.
2. There has been no amendment or other document filed
affecting the certificate of incorporation or bylaws of the Company since
September 30, 1996 and no such amendment has been authorized. No event has
occurred since November 19, 1996 which has affected the good standing of
the Company under the laws of the State of Delaware.
3. There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company from September 30, 1996.
4. There are no actions, suits or proceedings pending with
respect to which it has received service of process or, to the best of
such officer's knowledge, threatened against or affecting the Company
which if adversely determined, individually or in the aggregate, would be
reasonably likely to adversely affect the Company's obligations under the
Pooling and Servicing Agreement or this Agreement in any material way; and
no merger, liquidation, dissolution or bankruptcy of the Company is
pending or contemplated.
L. The Trustee shall have furnished to the Underwriters a
certificate of the Trustee, signed by one or more duly authorized officers of
the Trustee, dated the Closing Date, as to the due authorization, execution and
delivery of the Pooling and Servicing Agreement by the Trustee and the
acceptance by the Trustee of the trusts created thereby and the due execution,
authentication and delivery of the Certificates by the Trustee thereunder and
such other matters as the Representative shall reasonably request.
M. The Certificate Insurance Policy and the Insurance Agreement
shall have been issued by the Certificate Insurer and shall have been duly
authenticated by an authorized agent of the Certificate Insurer, if so required
under applicable state law or regulations.
N. The Offered Certificates shall have been rated "AAA" by
Standard & Poor's and "Aaa" by Xxxxx'x Investors Service.
O. The Company shall, by the Closing Date, have furnished to the
Underwriters such further information, certificates and documents as the
Underwriters may reasonably have requested pursuant to a request made not less
than three full business days prior to the Closing Date.
P. Prior to the Closing Date, counsel for the Underwriters shall
have been furnished with such documents and opinions as they may reasonably
require for the purpose of enabling them to pass upon the issuance and sale of
the Certificates as herein contemplated and related proceedings or in order to
evidence the accuracy and completeness of any of the representations and
warranties, or the
17
fulfillment of any of the conditions, herein contained, and all proceedings
taken by the Company in connection with the issuance and sale of the
Certificates as herein contemplated shall be satisfactory in form and substance
to the Underwriters and counsel for the Underwriters.
Q. Subsequent to the execution and delivery of this Agreement none
of the following shall have occurred: (i) trading in securities generally on the
New York Stock Exchange, the American Stock Exchange or the over-the-counter
market shall have been suspended or minimum prices shall have been established
on either of such exchanges or such market by the Commission, by such exchange
or by any other regulatory body or governmental authority having jurisdiction;
(ii) a banking moratorium shall have been declared by Federal or state
authorities; (iii) the United States shall have become engaged in hostilities,
there shall have been an escalation of hostilities involving the United States
or there shall have been a declaration of a national emergency or war by the
United Stats; or (iv) there shall have occurred such a material adverse change
in general economic, political or financial conditions (or the effect of
international conditions on the financial markets of the United States shall be
such) as to make it in each of the instances set forth in clauses (i), (ii),
(iii) and (iv) herein, in the reasonable judgment of the Underwriters,
impractical or inadvisable to proceed with the public offering or delivery of
the Certificates on the terms and in the manner contemplated in the Prospectus.
R. The Representative shall have received a letter from KPMG Peat
Marwick, LLP, dated on or before the Closing Date, in form and substance
satisfactory to the Representative and special counsel for the Underwriters,
addressed to each of the Underwriters to the effect that they have performed
certain specified procedures requested by the Representative with respect to the
information set forth in the Prospectus and certain matters relating to the
Company.
S. The Representative and special counsel for the Underwriters shall
have received copies of any opinions of counsel supplied to the rating
organizations relating to any matters with respect to the Certificates. Any such
opinions shall be dated the Closing Date and addressed to each of the
Underwriters or accompanied by reliance letters to the Representative or shall
state that each of the Underwriters may rely upon them.
T. On or prior to the Closing Date there shall not have occurred any
downgrading, nor shall any notice have been given of (A) any intended or
potential downgrading or (B) any review or possible change in rating the
direction of which has not been indicated, in the rating accorded the
Certificate Insurer's claims paying ability by any "nationally recognized
statistical rating organization," as such term is defined for purposes of the
Securities Act.
U. There has not occurred any change, or any development involving a
prospective change, in a condition, financial or otherwise, or in the earnings,
business or operations, since June 30, 1996, of (A) the Company and its
subsidiaries or (B) the Certificate Insurer, that is, in the Representative's
judgment, material and adverse and that makes it, in the Representative's
judgment, impracticable to market the Offered Certificates on the terms and in
the manner contemplated in the Prospectus.
If any conditions specified in this Section VI shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Company at any time at or prior to the
Closing Date, and such termination shall be without liability of any party to
any other party except as provided in Section VII.
18
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonable satisfactory
to counsel for the Underwriters.
SECTION VII. Payment of Expenses. If the transaction closes, or if
the transaction fails to close other than as a result of a failure of the
Underwriters to perform hereunder, the Company agrees to pay: (a) the costs
incident to the authorization, issuance, sale and delivery of the Certificates
and any taxes payable in connection therewith; (b) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto (including the Prospectus);
(c) the costs of distributing the Registration Statement as originally filed and
each amendment thereto and any post-effective amendments thereof (including, in
each case, exhibits), the Prospectus and any amendment or supplement to the
Prospectus or any document incorporated by reference therein, all as provided in
this Agreement; (d) the costs of reproducing and distributing this Agreement;
(e) the fees and expenses of qualifying the Certificates under the securities
laws of the several jurisdictions as provided in Section V(G) hereof and of
preparing, printing and distributing a Blue Sky Memorandum (including related
fees and expenses of counsel to the Representative); (f) any fees charged by
securities rating services for rating the Offered Certificates; (g) the cost of
the accountant's letter relating to the Prospectus; (h) the fees and expenses of
the Certificate Insurer (other than the fees payable pursuant to the Pooling and
Servicing Agreement); and (i) all other costs and expenses incident to the
performance of the obligations of the Company (including costs and expenses of
its counsel); provided that, except as provided in this Section VII, the
Underwriters shall pay their own costs and expenses, including the costs and
expenses of their counsel, any transfer taxes on the Offered Certificates which
they may sell and the expenses of advertising any offering of the Offered
Certificates made by the Underwriters, and the Underwriters shall pay the cost
of any accountant's comfort letters which such Underwriters choose to request
relating to any Computational Materials (as defined herein).
If this Agreement is terminated by the Underwriters in accordance
with the provisions of Section VI or Section XI, whether or not the transactions
contemplated hereunder are consummated, the Company shall cause the Underwriters
to be reimbursed for all reasonable out-of-pocket expenses, including fees and
disbursements of Xxxxx Xxxxxxxxxx, counsel for the Underwriters, except that the
Company shall not be obligated under this Agreement to reimburse the
Underwriters for reasonable out-of-pocket expenses, excluding fees and
disbursements of Xxxxx Xxxxxxxxxx, counsel for the Underwriters, if this
Agreement is terminated by the Underwriters in accordance with Section VI(Q)
herein.
SECTION VIII. Indemnification and Contribution. A. The Company
agrees to indemnify and hold harmless each Underwriter and each person, if any,
who controls such Underwriter within the meaning of Section 15 of the Securities
Act or Section 12 of the Exchange Act from and against any and all loss, claim,
damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of the Offered Certificates), to which such
Underwriter or any such controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, or
any amendment thereof or supplement thereto, (ii) the omission or alleged
omission to state in the Registration Statement a material fact required to be
stated therein or necessary to make the statements therein not misleading, (iii)
any untrue statement or alleged untrue statement of a material fact contained in
the Prospectus, or any amendment thereof or supplement thereto, or (iv) the
omission or alleged omission to state in the Prospectus a material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading and shall
reimburse, as provided herein, such Underwriter and each such
19
controlling person promptly upon demand for any legal or other expenses
reasonably incurred by such Underwriter or such controlling person in connection
with investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in the Prospectus, or any amendment thereof or supplement
thereto, or the Registration Statement, or any amendment thereof or supplement
thereto, in reliance upon and in conformity with written information furnished
to the Company by or on behalf of such Underwriter specifically for inclusion
therein (except to the extent that any untrue statement or alleged untrue
statement or omission or alleged omission is a result of Seller Provided
Information which is not accurate and complete in all material respects). The
foregoing indemnity agreement is in addition to any liability which the Company
may otherwise have to any Underwriter or any controlling person of any such
Underwriter.
B. Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act against any and all loss, claim, damage or liability, joint or several, or
any action in respect thereof, (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of the Offered
Certificates), to which the Company or any such director, officer or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained in the Prospectus, or any amendment thereof or supplement thereto, or
(ii) the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements in the Prospectus, when
considered in conjunction with the Prospectus, and in the light of the
circumstances under which they were made, not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such Underwriter
specifically for inclusion therein, and shall reimburse, as provided herein, the
Company and any such director, officer or controlling person for any legal or
other expenses reasonably incurred by the Company or any director, officer or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which any Underwriter may otherwise have to the Company or any such
director, officer or controlling person.
C. Promptly after receipt by any indemnified party under this
Section VIII of notice of any claim or the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against any
indemnifying party under this Section VIII, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section VIII except to the extent it has
been materially prejudiced by such failure and, provided further, that the
failure to notify any indemnifying party shall not relieve it from any liability
which it may have to any indemnified party otherwise than under this Section
VIII except as otherwise provided by law.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except to the extent
provided in the next following paragraph, the indemnifying party shall not be
liable
20
to the indemnified party under this Section VIII for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) the named parties to any such proceeding
(including any impleaded parties) include both the indemnifying party and the
indemnified party and such indemnifying party shall have been advised by such
counsel that there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying party and in
the reasonable judgment of such counsel it is advisable for such indemnified
party to employ separate counsel; or (iii) the indemnifying party has failed to
assume the defense of such action and employ counsel reasonably satisfactory to
the indemnified party within a reasonably prompt period following the receipt of
notification in writing from the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to one local counsel per jurisdiction) which counsel shall be
reasonably acceptable to the indemnifying party at any time for all such
indemnified parties, which firm shall be designated in writing by the related
Underwriter, if the indemnified parties under this Section VIII consist of one
or more Underwriters or any of its or their controlling persons, or the Company,
if the indemnified parties under this Section VIII consist of the Company or any
of the Company's directors, officers or controlling persons.
Each indemnified party, as a condition of the indemnity agreements
contained in Section VIII(A) and (B), shall use its best efforts to cooperate
with the indemnifying party in the defense of any such action or claim. No
indemnifying party shall be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment for the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
Notwithstanding the foregoing paragraph, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as required by this
Agreement, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 45 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, (which consent shall not be unreasonably
withheld), effect any settlement of any pending or threatened proceeding in
respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
D. Computational Materials. Not later than 10:30 a.m. New York City
time, on the business day before the date on which the Current Report relating
to the Certificates is required to be filed
21
by the Company with the Commission pursuant to Section V(L) hereof, each
Underwriter shall deliver to the Company five complete copies of all materials,
if any, provided by such Underwriter to prospective investors in such
Certificates which constitute "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, Peabody Acceptance Corporation I, Xxxxxx,
Xxxxxxx & Co. Incorporated, and Xxxxxx Structured Asset Corporation, the
no-action letter dated May 27, 1994, issued by the Division of Corporation
Finance of the Commission to the Public Securities Association and the no-action
letter of February 17, 1995 issued by the Commission to the Public Securities
Association (collectively, the "Xxxxxx/PSA Letters") and the filing of which is
a condition of the relief granted in such letters (such materials being the
"Computational Materials"). Each delivery of Computational Materials to the
Company pursuant to this paragraph (a) shall be effected by delivering four
copies of such material to counsel for the Company on behalf of the Company and
one copy of such materials to the Company.
E. Each Underwriter severally and not jointly agrees, except to the
extent that the Seller Provided Information is not accurate and complete in all
material respects, to indemnify and hold harmless the Company, each of the
Company's officers and directors and each person who controls the Company within
the meaning of Section 15 of the Securities Act and Section 12 of the Exchange
Act against any and all losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) (including, but not limited to, any loss, claim, damage, liability or
action relating to purchases and sales of the Offered Certificates), arise out
of or are based upon any untrue statement of a material fact contained in the
Computational Materials provided by such Underwriter, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein, when
considered in conjunction with the Prospectus, and in the light of the
circumstances under which they were made, not misleading, except to the extent
that such untrue statement or omission is based upon the Seller Provided
Information and agrees to reimburse each such indemnified party for any legal or
other expenses reasonably incurred by him, her or it in connection with
investigating or defending or preparing to defend any such loss, claim, damage,
liability or action as such expenses are incurred. The obligations of an
Underwriter under this Section VIII(E) shall be in addition to any liability
which such Underwriter may otherwise have.
The procedures set forth in Section VIII(C) shall be equally
applicable to this Section VIII(E).
F. If the indemnification provided for in this Section VIII shall
for any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section VIII(A), (B) or (E) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the related Underwriters on the
other from the offering of the related Offered Certificates or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and the related Underwriter on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations.
The relative benefits of an Underwriter and the Company shall be
deemed to be in such proportion as the total net proceeds from the offering
(before deducting expenses) received by the
22
Company bear to the total underwriting discounts and commissions received by the
related Underwriter from time to time in negotiated sales of the related Offered
Certificates.
The relative fault of an Underwriter and the Company shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied or prepared by the Company or by such Underwriter, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission and other equitable
considerations.
The Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section VIII(F) were to be
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purposes) or by any other method of allocation which does not
take into account the equitable considerations referred to herein. The amount
paid or payable by an indemnified party as a result of the loss, claim, damage
or liability, or action in respect thereof, referred to above in this Section
VIII(F) shall be deemed to include, for purposes of this Section VIII(F), any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
For purposes of this Section VIII, in no case shall any Underwriter
(except with respect to any document (other than the Computational Materials)
incorporated by reference into the Registration Statement or Prospectus at the
request of such Underwriter and except as may be provided in any agreement among
the Underwriters relating to the offering of the Offered Certificates) be
responsible for any amount in excess of (x) the amount received by such
Underwriter in connection with its resale of the Offered Certificates over (y)
the amount paid by such Underwriter to the Company for the Offered Certificates
by such Underwriter hereunder. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
"Seller Provided Information" means any computer tape (or other
information provided to Underwriter for the purpose of preparation of the
Prospectus Supplement or Computational Materials) furnished to any Underwriter
by the Company concerning the assets comprising the Trust.
G. The Underwriters confirm that the information set forth in the
last paragraph on the front cover page of the Prospectus Supplement, the
information under the heading "Underwriting" therein and the Computational
Materials are correct, and the Company acknowledges that such information
constitutes the only information furnished in writing to the Company by or on
behalf of any Underwriter specifically for inclusion in the Registration
Statement and the Prospectus.
SECTION IX. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in agreements delivered pursuant hereto or certificates
of officers of the Company submitted pursuant hereto shall remain operative and
in full force and effect, regardless of any investigation made by or on behalf
of the Underwriters or controlling persons thereof, or by or on behalf of the
Company and shall survive delivery of any Offered Certificates to the
Underwriters.
SECTION X. Default by One or More of the Underwriters. If one or
more of the Underwriters participating in the public offering of the Offered
Certificates shall fail at the Closing Date to purchase the Offered Certificates
which it is (or they are) obligated to purchase hereunder (the "Defaulted
Certificates"), then the non-defaulting Underwriters shall have the right,
within 48 hours
23
thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Certificates in such amounts as may be agreed upon and upon the
terms herein set forth (as used in this Agreement, the term "Underwriter"
includes any underwriter substituted for an Underwriter under this Section X).
If, however, the Underwriters have not completed such arrangements within such
48-hour period, then:
(i) if the aggregate original principal amount of Defaulted
Certificates does not exceed 10% of the aggregate original principal
amount of the Offered Certificates to be purchased pursuant to this
Agreement, the non-defaulting Underwriters named in this Agreement shall
be obligated to purchase the full amount thereof in the proportions that
their respective obligations hereunder bear to the underwriting
obligations of all such non-defaulting Underwriters, or
(ii) if the aggregate original principal amount of Defaulted
Certificates exceeds 10% of the aggregate original principal amount of the
Offered Certificates to be purchased pursuant to this Agreement, this
Agreement shall terminate, without any liability on the part of any
non-defaulting Underwriters.
No action taken pursuant to this Section X shall relieve any
defaulting Underwriter from the liability with respect to any default of such
Underwriter under this Agreement.
In the event of a default by any Underwriter as set forth in this
Section X, each of the Underwriters and the Company shall have the right to
postpone the Closing Date for a period not exceeding seven Business Days in
order that any required changes in the Registration Statement or Prospectus or
in any other documents or arrangements may be effected.
SECTION XI. Termination of Agreement. The Underwriters may terminate
this Agreement immediately upon notice to the Company, at any time at or prior
to the Closing Date if any of the events or conditions described in Section
VI(Q) of this Agreement shall occur and be continuing. In the event of any such
termination, the provisions of Section VII, the indemnity agreement set forth in
Section VIII, and the provisions of Sections IX and XIV shall remain in effect.
SECTION XII. Notices. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(i) if to the Underwriters, shall be delivered or sent by mail,
telex or facsimile transmission to the Representative at its address set
forth above;
(ii) if to the Company, shall be delivered or sent by overnight mail
or facsimile transmission to 00000 Xxxxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx,
XX 00000, Attn.: General Counsel, Fax No. (000) 000-0000.
SECTION XIII. Persons Entitled to the Benefit of this Agreement.
This Agreement shall inure to the benefit and be binding upon the Underwriters
and the Company, and their respective successors. This Agreement and the terms
and provisions hereof are for the sole benefit of only those persons, except
that the representations, warranties, indemnities and agreements contained in
this Agreement shall also be deemed to be for the benefit of the person or
persons, if any, who control any of the Underwriters within the meaning of
Section 15 of the Securities Act, and for the benefit of directors of the
Company, officers of the Company who have signed the Registration Statement and
any person controlling the Company within the meaning of Section 15 of the
Securities Act. Nothing in this
24
Agreement is intended or shall be construed to give any person, other than the
persons referred to in this Section XIII, any legal or equitable right, remedy
or claim under or in respect of this Agreement or any provision contained
herein.
SECTION XIV. Survival. The respective indemnities, representations,
warranties and agreements of the Company and the Underwriters contained in this
Agreement, or made by or on behalf of them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Certificates and
shall remain in full force and effect, regardless of any investigation made by
or on behalf of any of them or any person controlling any of them. The
provisions of Sections V, VII and VIII hereof shall survive the termination or
cancellation of this Agreement.
SECTION XV. Definition of the Term "Business Day". For purposes of
this Agreement, "Business Day" means any day on which the New York Stock
Exchange, Inc. is open for trading.
SECTION XVI. Governing Law; Submission to Jurisdiction. This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York without giving effect to the conflict of law rules thereof.
The parties hereto submit to the jurisdiction of the United States
District Court for the Southern District of New York and any court in the State
of New York located in the City and County of New York, and appellate court from
any thereof, in any action, suit or proceeding brought against it or in
connection with this Agreement or any of the related documents or the
transactions contemplated hereunder or for recognition or enforcement of any
judgment, and the parties hereto hereby agree that all claims in respect of any
such action or proceeding may be heard or determined in New York State court or,
to the extent permitted by law, in such federal court.
SECTION XVII. Counterparts. This Agreement may be executed in
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION XVIII. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
SECTION XIX. Amendments and Waivers. This Agreement may be amended,
modified, altered or terminated, and any of its provisions waived, only in a
writing signed on behalf of the Company and the Representative.
25
If the foregoing correctly sets forth the agreement between the
Company and the Underwriters, please indicate your acceptance in the space
provided for the purpose below.
Very truly yours,
EQUIVANTAGE ACCEPTANCE CORP.
By:_____________________________________
Name: Xxxx X. Xxxxx
Title: President
CONFIRMED AND ACCEPTED, as of the date first above written:
PRUDENTIAL SECURITIES INCORPORATED,
Acting on its own behalf and as Representative
of the several Underwriters referred to in the
foregoing Agreement
By: ______________________________
Name:
Title:
[Underwriting Agreement]
SCHEDULE A
Principal
Class of Amount of
Certificates Certificates Purchase
Name of Purchased by the Purchased by Price
Underwriter Underwriters Underwriters (% of Par)
----------- ---------------- ------------ ----------
Prudential Securities Incorporated A $40,000,000 99.684375%
Salomon Brothers, Inc A $40,000,000 99.684375%
November 19, 1996
Prudential Securities Incorporated,
as Representative of the Several
Underwriters
Xxx Xxx Xxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This Guaranty is made by EquiVantage Inc., a Delaware corporation
with its principal office at 00000 Xxxxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx
00000 ("EquiVantage"), in favor of Prudential Securities Incorporated, in its
capacity as Representative Underwriter (the "Representative") of the several
Underwriters (the "Several Underwriters") in connection with the underwriting of
the Class A Certificates, with its principal office at 1 New York Plaza, 26th
Floor, New York, New York 10292.
As an inducement to you and in consideration of EquiVantage
Acceptance Corp. (the "Company") entering into the Underwriting Agreement
referred to below, EquiVantage Inc. hereby absolutely, unconditionally and
irrevocably guarantees the prompt performance of the obligations, including any
payment obligations, of the Company, a Delaware corporation with its principal
office at 00000 Xxxxxxxxx Xxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, under
Section VIII of the Underwriting Agreement, dated November 19, 1996, between the
Company and the Representative. This Guaranty is a guaranty of performance and
payment and not of collection. The obligations of EquiVantage Inc. hereunder
shall not be impaired by failure of Company to provide notice to EquiVantage
Inc. of any modification or amendment of said contract agreed to by the parties
thereto. This Guaranty shall exist notwithstanding the validity or
enforceability of any instrument evidencing any such obligations by reason of
the dissolution, liquidation, reorganization of the Company, or the commencement
against the Company of a case in bankruptcy or any other law affecting
creditors' rights generally or the seeking of a trustee, receiver, liquidator,
custodian or other similar official. EquiVantage Inc. hereby waives any
requirement that the Representative shall take legal action against the Company
before enforcing this Guaranty. This Guaranty may be amended only by an
instrument in writing executed by the undersigned and accepted in writing by the
Representative.
This Guaranty shall be governed by the laws of the State of New York
applicable to agreements made and to be performed in the State of New York
without giving effect to the conflict of law rules thereof.
IN WITNESS WHEREOF, EquiVantage Inc. has caused this Guaranty to be
executed by duly authorized corporate officers the day and year first above
written.
EQUIVANTAGE INC.
By: ____________________________________
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President
ACCEPTED this 19th day
of November, 1996
Prudential Securities Incorporated,
as Representative of the Several Underwriters
By:_________________________________
Name:
Title: