Exhibit 1.1
UNDERWRITING AGREEMENT
October 16, 1997
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
XXXXXXXXX & COMPANY, INC.
as Representatives of the several Underwriters
c/o Friedman, Billings, Xxxxxx & Co., Inc.
0000 00xx Xxxxxx Xxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Dear Sirs:
Imperial Credit Commercial Mortgage Investment Corp. (the "Company")
confirms its agreements with Friedman, Billings, Xxxxxx & Co., Inc.,
Xxxxxxxxx & Company, Inc., and each of the other Underwriters listed in
Schedule I hereto (collectively, the "Underwriters"), for whom Friedman,
Billings, Xxxxxx & Co., Inc. and Xxxxxxxxx & Company, Inc. are acting as
representatives (in such capacity, the "Representatives"), with respect
to (i) the sale by the Company, and the purchase by the Underwriters,
acting severally and not jointly, of the respective numbers of shares of
Common Stock, par value $0.0001 per share, of the Company ("Common
Stock"), totaling 30,000,000, set forth in Schedule I hereto and (ii) the
grant by the Company to the Underwriters, acting severally and not jointly,
of the option described in Section 1(b) hereof to purchase all or any part
of 4,500,000 additional shares of Common Stock to cover over-allotments, if
any. The 30,000,000 shares of Common Stock (the "Initial Shares") to be
purchased by the Underwriters and all or any part of the 4,500,000 shares
of Common Stock subject to the option described in Section 1(b) hereof that
the Underwriters elect to purchase (the "Option Shares") are hereinafter
called, collectively, the "Shares." The Company acknowledges that at its
request, the Underwriters have reserved (i) 2,970,000 of the Initial Shares
for sale to Imperial Credit Industries, Inc. ("Imperial Credit"), at the
initial public offering price of the Shares net of any underwriting
discounts or commissions, (ii) up to 500,000 of the Initial Shares for sale
to certain directors, officers and employees of the Company, Imperial
Credit Commercial Asset Management Corporation (the "Manager") and
Imperial Credit to be identified by the Company at the initial public
offering price of the Shares net of any underwriting discounts or
commissions, and (iii) up to 250,000 of the Initial Shares for sale to
certain other persons to be identified by the Company at the initial public
offering price of the Shares.
The Company has filed with the Securities and Exchange Commission (the
"Commission"), a registration statement on Form S-11 (No. 333-32683) and
a related preliminary prospectus for the registration of the Shares under
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the Securities Act of 1933, as amended (the "Securities Act"), and the
rules and regulations thereunder (the "Securities Act Regulations"). The
Company has prepared and filed such amendments thereto, if any, and such
amended preliminary prospectuses, if any, as may have been required to the
date hereof, and will file such additional amendments thereto and such
amended prospectuses as may hereafter be required. The registration
statement has been declared effective under the Securities Act by the
Commission. The registration statement as amended at the time it became
effective (including all information deemed to be a part of the
registration statement at the time it became effective pursuant to Rule
430A(b) of the Securities Act Regulations) is hereinafter called the
"Registration Statement," except that, if the Company files a post-
effective amendment to such registration statement which becomes effective
prior to the Closing Time (as defined below), "Registration Statement"
shall refer to such registration statement as so amended. Any registration
statement filed by the Company pursuant to Rule 462(b) of the Securities
Act Regulations is hereinafter called the "Rule 462(b) Registration
Statement," and after such filing the term "Registration Statement"
shall include the 462(b) Registration Statement. Each prospectus included
in the registration statement, or amendments thereof, before it became
effective under the Securities Act and any prospectus filed with the
Commission by the Company with the consent of the Underwriters pursuant to
Rule 424(a) of the Securities Act Regulations is hereinafter called the
"Preliminary Prospectus." The term "Prospectus" means the final
prospectus, as first filed with the Commission pursuant to paragraph (1) or
(4) of Rule 424(b) of the Securities Act Regulations.
The Company understands that the Underwriters propose to make a public
offering of the Shares at the initial public offering price set forth in
the Prospectus as soon as the Representatives deem advisable after this
Agreement has been executed and delivered.
The Company and the Underwriters agree as follows:
1. Sale and Purchase:
(a) Initial Shares. Upon the basis of the warranties and representations
and other terms and conditions herein set forth, the Company agrees to sell
to each Underwriter, severally and not jointly, and each Underwriter
agrees, severally and not jointly, to purchase from the Company, at the
purchase price per share of $15.00, that proportion of the number of
Initial Shares set forth opposite such Underwriter's name in Schedule I,
plus any additional number of Initial Shares which such Underwriter may
become obligated to purchase pursuant to the provisions of Section 8
hereof, subject to such adjustments among the Underwriters as the
Representatives in their sole discretion shall make to eliminate any sales
or purchases of fractional shares. The Underwriters may from time to time
increase or decrease the public offering price after the initial public
offering to such extent as the Underwriters may determine.
(b) Option Shares. In addition, upon the basis of the warranties and
representations and other terms and conditions herein set forth, the
Company hereby grants an option to the Underwriters, severally and not
jointly, to purchase from the Company that number of Option Shares up to
the maximum number of Option Shares of Common Stock at the purchase price
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per share set forth in paragraph (a) above plus any additional number of
Option Shares which such Underwriter may become obligated to purchase
pursuant to the provisions of Section 8 hereof. The option hereby
granted will expire 30 days after the date hereof and may be exercised in
whole or in part from time to time only for the purpose of covering over-
allotments which may be made in connection with the offering and
distribution of the Initial Shares upon notice by the Representatives to
the Company setting forth the number of Option Shares as to which the
several Underwriters are then exercising the option and the time and date
of payment and delivery for such Option Shares. Any such time and date of
delivery (a "Date of Delivery") shall be determined by the
Representatives, but shall not be later than seven full business days nor
earlier than two full business days after the exercise of said option, nor
in any event prior to the Closing Time, as hereinafter defined, unless
otherwise agreed by the Representatives and the Company. If the option is
exercised as to all or any portion of the Option Shares, each of the
Underwriters, acting severally and not jointly, will purchase that
proportion of the total number of Option Shares then being purchased which
the number of Initial Shares set forth in Schedule I opposite the name of
such Underwriter bears to the total number of Initial Shares, subject in
each case to such adjustments as the Representatives in their discretion
shall make to eliminate any sales or purchases of fractional shares.
2. Payment and Delivery:
(a) Initial Shares. Payment of the purchase price for the Initial Shares
shall be made to the Company by wire transfer or certified or official bank
check payable in federal (same-day) funds at the office of Hunton &
Xxxxxxxx, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (unless another place
shall be agreed upon by the Representatives and the Company) against
delivery of the certificates for the Initial Shares to the Representatives
for the respective accounts of the Underwriters. Unless postponed pursuant
to the proviso to this sentence or Section 8 or 10, such payment and
delivery shall be made at 10:00 a.m., New York City time, on the third
(fourth, if this Agreement is executed and delivered after 4:30 p.m. (New
York City time) on the date hereof) business day after the date hereof;
provided, however, that if the Company has not made available to the
Representatives copies of the Prospectus by not later than 10:00 a.m. (New
York City time) on the second business day following execution and delivery
of this Agreement, the Representatives may, in their sole discretion,
postpone such payment and delivery until no later than two (2) full business
days following delivery of copies of the Prospectus to the Representatives.
The time at which such payment and delivery are actually made is
hereinafter sometimes called the "Closing Time." Unless the
Representatives elect to take delivery of the Initial Shares by credit
through full fast transfer to the accounts at The Depository Trust Company
designated by the Representatives, certificates for the Initial Shares
shall be delivered to the Representatives in definitive form registered in
such names and in such denominations as the Representatives shall specify
at least one full business day prior to the Closing Time., and shall be
made available to the Representatives for the purpose of expediting the
checking thereof at or before 3:00 P.M. , New York City time, on the
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business day preceding the Closing Time.
(b) Option Shares. In addition, payment of the purchase price for the
Option Shares shall be made to the Company by wire transfer or certified or
official bank check payable in federal (same-day) funds at the office of
Hunton & Xxxxxxxx, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (unless
another place shall be agreed upon by the Representatives and the Company)
against delivery of the certificates for the Option Shares to the
Representatives for the respective accounts of the Underwriters. Such
payment and delivery shall be made at 10:00 a.m., New York City time, on
each Date of Delivery. Unless the Representatives elect to take delivery
of the Option Shares by credit through full fast transfer to the accounts at
The Depository Trust Company designated by the Representatives,
certificates for the Option Shares shall be delivered to the
Representatives in definitive form registered in such names and in such
denominations as the Representatives shall specify at least one full
business day prior to the applicable Date of delivery, and shall be made
available to the Representatives for the purpose of expediting the checking
thereof at or before 3:00 P.M. , New York City time, on the business day
preceding such Date of Delivery.
3. Representations and Warranties of the Company:
The Company represents and warrants to the Underwriters that:
(a) each of the Registration Statement and any Rule 462(b) Registration
Statement has become effective under the Securities Act and no stop order
suspending the effectiveness of the Registration Statement or any Rule
462(b) Registration Statement has been issued under the Securities Act and
no proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Company, are contemplated by the Commission; any
request on the part of the Commission for additional information has been
complied with; and the Commission has not issued any order preventing or
suspending the use of any Preliminary Prospectus;
(b) the Registration Statement complies and the Prospectus and any further
amendments or supplements thereto will, when they become effective or are
filed with the Commission, as the case may be, comply in all material
respects with the requirements of the Securities Act and the Securities Act
Regulations; the Registration Statement did not, and any amendment thereto
will not, in each case as of the applicable effective date, 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; and the Prospectus and any amendment or supplement thereto
will not, as of the applicable filing date and at Closing Time and on each
Date of Delivery (if any), contain an 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, however, that this representation and warranty shall
not apply to any statement in or omission from the Registration Statement
or the Prospectus made in reliance upon and in conformity with information
furnished to the Company in writing by any Underwriter through the
Representatives expressly for use in the Registration Statement or the
Prospectus;
(c) each Preliminary Prospectus in paper format was and the Prospectus in
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paper format delivered to the Underwriters for use in connection with this
offering will be identical to the electronic submission thereof transmitted
to the Commission pursuant to Regulation S-T of the Securities Act
Regulations, except to the extent permitted by such Regulation S-T;
(d) the Company is a corporation duly organized and validly existing under
the laws of the State of Maryland, with full corporate power and authority
to own its properties and conduct its business as described in the
Registration Statement and the Prospectus, and to execute and deliver this
Agreement and the Management Agreement (the "Management Agreement"), to
be entered into at or prior to the Closing Time between the Company and the
Manager, in substantially the form filed as an exhibit to the Registration
Statement; Imperial Credit Mortgage Securitization Corp. (the
"Subsidiary") has been duly organized and is validly existing under the
laws of the State of California with full corporate power and authority to
own its properties and conduct its business as described in the
Registration Statement and the Prospectus, and the Company has no
subsidiaries other than the Subsidiary;
(e) the authorized and outstanding capital stock of the Company was at the
date indicated as set forth in the Prospectus under the caption
"Capitalization" and conforms in all material respects to the statements
relating thereto contained in the Registration Statement and the Prospectus,
the Initial Shares and the Option Shares, if any, have been duly authorized
for issuance and sale to the Underwriters pursuant to this Agreement and,
when issued and delivered by the Company against payment therefor in
accordance with the terms of this Agreement, will be duly and validly issued
and fully paid and nonassessable, will be sold free and clear of any pledge,
lien, security interest, encumbrance, claim or equitable interest and will
be the only outstanding shares of Common Stock; and no preemptive right, co-
sale right, registration right, right of first refusal or other similar
right of shareholders exists with respect to any of the Initial Shares or
Option Shares or the issuance and sale thereof; all issued and outstanding
shares of capital stock of the Subsidiary have been duly authorized and
validly issued and are fully paid and nonassessable, and were not issued in
violation of or subject to any preemptive rights or other rights to
subscribe for or purchase securities and all such shares issued an
outstanding at any time were and are owned exclusively by the Company free
and clear of any pledge, lien, security interest, encumbrance, claim or
equitable interest; except as disclosed in the Registration Statement and
the financial statements of the Company and the related notes thereto
included in the Registration Statement, neither the Company nor the
Subsidiary has outstanding any options to purchase, or any preemptive rights
or other rights to subscribe for or to purchase, any securities or
obligations convertible into, or any contracts or commitments to issue or
sell, shares of its capital stock or any such options, rights, convertible
securities or obligations;
(f) the Company and the Subsidiary are duly qualified or licensed by and in
good standing in each jurisdiction in which they conduct their respective
businesses or own or lease property and in which the failure, individually
or in the aggregate, to be so licensed or qualified could have a material
adverse effect on the operations, business or condition (financial and
other) of the Company and the Subsidiary, taken as a whole; and each of the
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Company and the Subsidiary is in compliance in all material respects with
the laws, rules and regulations enacted or promulgated by such
jurisdictions, except where the failure to comply would not have a material
adverse effect on the operations, business or condition (financial or
otherwise) of the Company and the Subsidiary, taken as a whole;
(g) neither the Company nor the Subsidiary is in breach of, or in default
under (nor has any event occurred which with notice, lapse of time, or both
would constitute a breach of, or default under), its articles of
incorporation, by-laws or other constituent documents or in the performance
or observance of any obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, loan agreement, note, lease or other
agreement or instrument to which it is a party or by which it is bound,
except for such breaches or defaults as would not have a material adverse
effect on the operations, business or condition (financial and other) of
the Company and the Subsidiary, taken as a whole; and the execution,
delivery and performance of this Agreement and the Management Agreement and
consummation of the transactions contemplated hereby and thereby will not
conflict with, or result in any breach of or constitute a default under
(nor constitute any event which with notice, lapse of time, or both would
constitute a breach of, or default under), (i) any provision of the
articles of incorporation, by-laws or other constituent documents of the
Company or the Subsidiary, or (ii) any provision of any license, indenture,
mortgage, deed of trust, bank loan or credit agreement or other agreement
or instrument to which the Company or the Subsidiary is a party or by which
the Company or the Subsidiary or any of their respective properties may be
bound or affected, or under any federal, state or local law, regulation or
rule or any decree, judgment or order applicable to the Company or the
Subsidiary, except, in the case of clauses (i) and (ii), for such breaches
or defaults which would not have a material adverse effect on the
operations, business or condition (financial and other), of the Company
and the Subsidiary, taken as a whole;
(h) this Agreement has been duly authorized, executed and delivered by the
Company and is a legal, valid and binding agreement of the Company
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, and by general principles of equity,
and except to the extent that the enforceability of the indemnification
provisions of Section 9 hereof may be limited by federal or state
securities laws or public policy considerations in other federal or state
laws; the Management Agreement has been duly authorized by the Company and
at the Closing Time will have been duly executed and delivered by the
Company and will constitute a valid and binding agreement of the Company
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting creditors' rights generally, and by general principles of equity,
whether considered at law or in equity;
(i) no approval, authorization, consent or order of or filing with any
federal, state or local governmental or regulatory commission, board, body,
authority or agency is required in connection with the sale of the Shares
as contemplated hereby other than (i) such as have been obtained, or will
be obtained at the Closing Time or the relevant Date of Delivery, as the
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case may be, under the Securities Act, (ii) such approvals as have been
obtained in connection with the approval of the inclusion of the Shares on
the Nasdaq National Market, and (iii) any necessary qualification under the
securities or blue sky laws of the various jurisdictions in which the
Shares are being offered by the Underwriters;
(j) KPMG Peat Marwick LLP, whose report on the balance sheet of the Company
is included in the Registration Statement and the Prospectus, are
independent public accountants as required by the Securities Act and the
Securities Act Regulations;
(k) the Company and the Subsidiary have all necessary licenses,
authorizations, consents and approvals and has made all necessary filings
required under any federal, state or local law, regulation or rule, and has
obtained all necessary authorizations, consents and approvals from other
persons, required in order to conduct its respective business, except to
the extent that any failure to have any such licenses, authorizations,
consents or approvals, to make any such filings or to obtain any such
authorizations, consents or approvals would not, alone or in the aggregate,
have a material adverse effect on the operations, business or condition
(financial and other) of the Company and the Subsidiary, taken as a whole;
neither the Company nor the Subsidiary is in violation of, or in default
under, any such license, authorization, consent or approval or any federal,
state or local law, regulation or rule or any decree, order or judgment
applicable to the Company or the Subsidiary, the effect of which could be
material and adverse to the operations, business or condition (financial
and other) of the Company and the Subsidiary, taken as a whole;
(l) all legal or governmental proceedings, contracts or documents of a
character required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement have
been so described or filed as required;
(m) there are no actions, suits or proceedings pending or, to the Company's
knowledge, threatened against the Company or the Subsidiary or any of their
respective properties, at law or in equity, or before or by any federal,
state, local or foreign governmental or regulatory commission, board, body,
authority or agency which could result in a judgment, decree or order
having a material adverse effect on the operations, business or condition
(financial and other) of the Company and the Subsidiary, taken as a whole;
(n) the balance sheet of the Company, including the notes thereto, included
in the Registration Statement and the Prospectus presents fairly the
financial position of the Company as of the date thereof and has been
prepared in conformity with generally accepted accounting principles
applied on a consistent basis;
(o) subsequent to the effective date of the Registration Statement and the
date of the Prospectus, and except as may be otherwise stated in the
Registration Statement or Prospectus, there has not been (i) any material
and unfavorable change, financial or otherwise, in the operations, business
or condition (financial and other) of the Company and the Subsidiary, taken
as a whole, (ii) any transaction, other than in the ordinary course of
business, which is material to the Company and the Subsidiary, taken as a
whole, contemplated or entered into by the Company or the Subsidiary or
(iii) any obligation, contingent or otherwise, directly or indirectly
incurred by the Company or the Subsidiary, other than in the ordinary
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course of business, which is material to the Company and the Subsidiary,
taken as a whole;
(p) the Company is not, and upon the sale of the Shares as herein
contemplated will not be, an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in the
Investment Company Act of 1940, as amended (the "Investment Company
Act"); the transactions contemplated by the Registration Statement and the
conduct of the Company of its business as set forth in the Registration
Statement will not cause the Company to become an "investment company"
subject to registration under the Investment Company Act;
(q) there are no persons with registration or other similar rights to have
any securities of the Company registered under the Securities Act; and
(r) the Company is organized in conformity with the requirements for
qualification as a real estate investment trust (a "REIT") under the
Internal Revenue Code of 1986, as amended (the "Code"), and the
organization and contemplated method of operation of the Company as set
forth in the Registration Statement and the Prospectus are such as to
enable the Company to meet the requirements for taxation as a REIT under
the Code.
4. Certain Covenants of the Company:
The Company hereby agrees with each Underwriter:
(a) to prepare the Prospectus in a form approved by the Underwriters and to
file such Prospectus with the Commission pursuant to Rule 424(b) of the
Securities Act Regulations not later than 10:00 a.m. (New York City time),
on the second business day following the execution and delivery of this
Agreement and to furnish promptly to the Underwriters as many copies of the
Prospectus (or of the Prospectus as amended or supplemented if the Company
shall have made any amendments or supplements thereto after the effective
date of the Registration Statement) as the Underwriters may reasonably
request for the purposes contemplated by the Securities Act Regulations;
(b) to advise the Representatives promptly and (if requested by the
Representatives) to confirm such advice in writing, when the Company learns
that the Registration Statement has become effective and when the Company
learns that any post-effective amendment thereto becomes effective under
the Securities Act Regulations;
(c) to advise the Representatives promptly, confirming such advice in
writing, of (i) any request by the Commission for amendments or supplements
to the Registration Statement or Prospectus or for additional information
with respect thereto, or (ii) the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or of any
order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus, or of the suspension of the qualification of the Shares for
offering or sale in any jurisdiction, or of the initiation or threatening
of any proceedings for any of such purposes and, if the Commission or any
other government agency or authority should issue any such order, to make
every reasonable effort to obtain the lifting or removal of such order as
soon as possible; to advise the Representatives promptly of any proposal to
amend or supplement the Registration Statement or Prospectus and to file no
such amendment or supplement to which the Representatives shall reasonably
object in writing;
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(d) for a period of five years from the date of this Agreement, to furnish
to the Representatives, and to any Underwriter on written request, (i)
copies of all annual, quarterly, current and other reports or notices,
definitive proxy materials and other documents furnished to holders the
Common Stock or filed by the Company with the Commission, (ii) every
material press release that was generally released to shareholders, and
(iii) such other information of a public nature (and generally available to
holders of the Common Stock) regarding the Company as the Representatives
or such Underwriter may reasonably request in writing;
(e) to advise the Underwriters promptly of the happening of any event known
to the Company within the time during which a Prospectus relating to the
Shares is required to be delivered under the Securities Act Regulations
which, in the judgment of the Company, would require the making of any
change in the Prospectus then being used so that the Prospectus would not
include 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, in light of the circumstances under which they are made, not
misleading, and, during such time, at the Company's expense, to prepare and
furnish to the Underwriter promptly such amendments or supplements to the
Prospectus as may be necessary to reflect any such change and to furnish to
the Representatives a copy of such proposed amendment or supplement before
filing any such amendment or supplement with the Commission;
(f) to furnish promptly to the Representatives a signed copy of the
Registration Statement, as initially filed with the Commission and of each
amendment thereto (including all exhibits) and such number of conformed
copies of the foregoing as the Representatives may reasonably request;
(g) to use the net proceeds from the sale of the Shares in the manner
described under the caption "Use of Proceeds" in the Prospectus;
(h) to pay all expenses, out-of-pocket fees incurred and taxes (other than
any transfer taxes and the fees and disbursements of counsel for the
Underwriters except as set forth under Section 5 hereof and clause (iii)
below) in connection with (i) the preparation and filing of the
Registration Statement, each Preliminary Prospectus, the Prospectus, and
any amendments or supplements thereto, and the printing and furnishing of
copies of each thereof to the Underwriters and to dealers (including costs
of mailing and shipment), (ii) the preparation, issuance and delivery of
the certificates for the Shares to the Underwriters, including any stock or
other transfer taxes or duties payable upon the sale of the Shares to the
Underwriters, (iii) the word processing and/or printing of this Agreement,
the agreement among underwriters, any dealer agreements and any blue sky
surveys, and the reproduction and/or printing and furnishing of copies of
each thereof to the Underwriters and to dealers (including costs of mailing
and shipment), (iv) any filing for review of the underwriting terms of the
offering of the Shares by the NASD, (v) the fees and expenses of any
transfer agent or registrar for the Shares, (vi) the fees and expenses
incurred in connection with the inclusion of the Shares in the Nasdaq
National Market and (vii) the performance of the Company's other
obligations hereunder;
(i) to make generally available to its security holders as soon as
practicable, but not later than 90 days after the close of the period
covered thereby, an earnings statement (in form complying with the
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provisions of Rule 158 of the Securities Act Regulations) covering a period
of 12 months beginning not later than the first day of the first fiscal
quarter of the Company beginning after the "effective date" (as defined
in such Rule 158) of the Registration Statement;
(j) to use its best efforts to effect and maintain inclusion of the Shares
in the Nasdaq National Market and to file with The Nasdaq Stock Market
Inc. all documents and notices required of companies having securities
included in the Nasdaq National Market;
(k) except as described in the Prospectus, to refrain during a period of
120 days from the date of the Prospectus, without the prior written consent
of the Representatives, from (i) offering, pledging, selling, contracting
to sell, selling any option or contract to purchase, purchasing any option
or contract to sell, granting any option for the sale of, or otherwise
disposing of or transferring, directly or indirectly, any shares of Common
Stock or any securities convertible into or exchangeable for Common Stock,
or filing any registration statement under the Securities Act with respect
to any of the foregoing , and (ii) entering into any swap or any other
agreement or any transaction that transfers, in whole or in part, directly
or indirectly, the economic consequence of ownership of the Common Stock,
whether any such swap or transaction described in clause (i) or (ii) above
is to be settled by delivery of Common Stock or securities convertible into
or exchangeable for Common Stock, in cash or otherwise; and
(l) except as otherwise expressly permitted by its charter and bylaws, to
conduct its operations in a manner that will enable it to qualify as a REIT
under the Code and will not subject it to registration as an "investment
company" under the Investment Company Act.
5. Reimbursement of the Underwriters' Expenses:
If any Shares are not delivered at the Closing Time or any Date of
Delivery, as the case may be, for any reason other than default by one or
more of the Underwriters in its or their respective obligations hereunder,
the Company shall reimburse the Underwriters for all of their reasonable
out-of-pocket expenses relating to the transactions contemplated hereby,
including the fees and disbursements of their counsel.
6. Conditions of the Underwriters' Obligations:
The obligations of the Underwriters hereunder are subject (i) to the
accuracy of the representations and warranties of the Company herein
contained, as of the date hereof, the Closing Time and each Date of
Delivery; subject to any exceptions that, in the reasonable judgment of the
Representatives, are not material, (ii) to the accuracy of the statements
of the Company's officers made in any certificate pursuant to the
provisions hereof, as of the date of such certificate, subject to any
exceptions that, in the reasonable judgment of the Representatives, are not
material, (iii) to the performance by the Company of all of its covenants
and other obligations hereunder, and (iv) to the following further
conditions:
(a) No amendment or supplement to the Registration Statement or Prospectus
shall have been filed to which the Representatives shall have objected in
writing.
(b) At the Closing Time, the Shares shall have been approved for inclusion
on the Nasdaq National Market System.
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(c) At the Closing Time, the NASD shall not have raised any objection with
respect to the fairness and reasonableness of the underwriting terms and
arrangements.
(d) At the Closing Time, no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the Securities Act or
proceedings therefor initiated or threatened by the Commission nor any
order preventing or suspending the use of any Preliminary Prospectus or the
Prospectus shall have been issued by the Commission, and no suspension of
the qualification of the Shares for offering or sale in any jurisdiction,
or of the initiation or threatening of any proceedings for any of such
purposes, shall have occurred; and the Registration Statement and all
amendments thereto, or modifications thereof, if any, and the Prospectus
and all amendments or supplements thereto, or modifications thereof, if
any, shall not contain an untrue statement of material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein, in the light of the circumstances under which they
are made, not misleading.
(e) At the Closing Time, the Company and the Manager shall have executed
and delivered the Management Agreement, and the Company, Imperial Credit
Industries, Inc. ("Imperial") and Southern Pacific Bank ("SPB") shall
have executed and delivered an agreement or agreements (the "Acquisition
Agreements") for the acquisition by the Company from SPTL and Imperial
Credit of the Initial Investments, as defined in the Prospectus, each
(including the Management Agreement) in substantially the form filed as an
exhibit to the Registration Statement, and all conditions to closing
contained in the Acquisition Agreements shall have been satisfied (or, with
the approval of the Representatives, which shall not be unreasonably
withheld, waived).
(f) At the Closing Time, the Representatives shall have received:
(i) the opinion, dated as of the Closing Time, of Xxxxxxxxxxxx Xxxx &
Xxxxxxxxx, counsel for the Company, in form and substance reasonably
satisfactory to counsel for the Underwriters, to the effect that:
(A) the Company is a corporation duly organized and validly existing under
the laws of the State of Maryland, with full corporate power and authority
to own its properties and conduct its business as described in the
Registration Statement and the Prospectus, and to execute and deliver this
Agreement and the Management Agreement; the Subsidiary has been duly
organized and is validly existing under the laws of the State of California
with full corporate power and authority to own its properties and conduct
its business as described in the Registration Statement and the Prospectus;
the Company has no subsidiaries other than the Subsidiary; and all of the
capital stock of the Subsidiary issued and outstanding at any time was and
is owned exclusively by the Company;
(B) the Manager is a corporation duly organized and validly existing under
the laws of the State of California, with full corporate power and
authority to conduct its business as described in the Registration
Statement and the Prospectus, and to execute and deliver the Management
Agreement; the Manager has no subsidiaries; and all of the issued and
outstanding capital stock of the Manager is owned by Imperial Credit;
(C) the Company and the Subsidiary are duly qualified or licensed by and in
good standing in each jurisdiction in which they conduct their respective
11
businesses or own or lease property and in which the failure, individually
or in the aggregate, to be so licensed or qualified could have a material
adverse effect on the operations, business or condition (financial and
other) of the Company and the Subsidiary, taken as a whole; and, to the
best of such counsel's knowledge and information, each of the Company and
the Subsidiary is in compliance with the laws, orders, rules, regulations
and directives issued or administered by such jurisdictions, except where
the failure to so comply would not have a material adverse effect on the
operations, business and condition (financial and other) of the Company and
the Subsidiary, taken as a whole;
(D) the Company has authorized and outstanding capital stock as set forth
in the Prospectus under "Capitalization" (except for subsequent issuances,
if any, pursuant to transactions referred to in the Prospectus including,
without limitation, granting of stock options);
(E) the Shares have been duly and validly authorized by all necessary
corporate action and, when issued and delivered pursuant to this Agreement
against payment of the consideration therefor, the Shares will be validly
issued, fully paid and nonassessable, free and clear of any pledge, lien,
encumbrance, security interest, or other claim, and will be the only shares
of Common Stock outstanding;
(F) the issuance and sale of the Shares by the Company is not subject to
preemptive or other similar rights arising by operation of law, under the
charter or by-laws of the Company or under any agreement known to such
counsel to which the Company or the Subsidiary is a party or, to such
counsel's knowledge, otherwise;
(G) this Agreement has been duly authorized, executed and delivered by the
Company;
(H) the Management Agreement has been duly authorized, executed and
delivered by the Company and the Manager and constitutes the valid and
binding agreement of each of the Company and the Manager enforceable in
accordance with its terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally, and by general principles of equity, considered at law or
in equity (such opinion may contain appropriate and customary exceptions
for the enforceability of any non-competition agreements contained
therein);
(I) the Registration Statement is effective under the Securities Act and,
to the best of such counsel's knowledge and information, no stop order
suspending the effectiveness of the Registration Statement has been issued
under the Securities Act or proceedings therefor initiated or threatened by
the Commission;
(J) the Registration Statement and the Prospectus, as of their respective
effective or issue dates, comply as to form in all material respects with
the requirements of the Securities Act and the Securities Act Regulations;
it being understood, however, that no opinion need be rendered with respect
to the financial statements, schedules and other financial and statistical
data included in the Registration Statement or the Prospectus or state
securities or blue sky laws;
(K) to the best of such counsel's knowledge, no authorization, approval or
consent of any court or governmental authority or agency is required that
has not been obtained in connection with the consummation by the Company of
12
the transactions contemplated by this Agreement; it being understood,
however, that no opinion need be rendered with respect to state securities
or blue sky laws;
(L) to the best of such counsel's knowledge, the execution and delivery of
this Agreement and the Management Agreement by the Company and the
consummation of the transactions contemplated herein and therein and
compliance by the Company with its obligations hereunder and thereunder
will not conflict with or constitute a breach of, or default under or
result in the creation or imposition of any lien, charge or encumbrance
upon any property or assets of the Company or the Subsidiary pursuant to
any contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company or the Subsidiary is a party or by which
either of them may be bound or to which any of the property or assets of
the Company or the Subsidiary is subject, nor will such action result in
violation of the provisions of the charter or bylaws of the Company or any
law, administrative regulation or court decree known to such counsel;
provided that such opinion may include appropriate and customary exceptions
for the enforceability of any non-competition agreements contained therein;
(M) the statements under the captions "Legal and Tax Risks," "Description
of Capital Stock," "Certain Provisions of ICCMIC's Charter and Bylaws,"
"Federal Income Tax Considerations" and "ERISA Considerations" in the
Prospectus, insofar as such statements describe legal documents or
statutes, rules or regulations, constitute fair summaries thereof;
(N) to the best of such counsel's knowledge, except as set forth in the
Registration Statement, no holders of Common Stock or other securities of
the Company have registration rights with respect to securities of the
Company;
(O) on the basis of such assumptions as to investment of such minimum
percentages of their respective assets in such types of investments as such
counsel shall specify, and other assumptions as such counsel shall specify,
the Company and the Subsidiary are not now and after the sale of the Shares
to be sold hereunder and application of the net proceeds from such sale as
described in the Prospectus under the caption "Use of Proceeds," neither of
them will be, an "investment company", or an entity "controlled" by an
"investment company" as such terms are defined in the Investment Company Act
of 1940, as amended; and
(P) the form of certificate evidencing the Common Stock filed as an exhibit
to the Registration Statement complies with all applicable statutory law
and all requirements of the Nasdaq National Market.
In rendering their opinion, Xxxxxxxxxxxx Xxxx & Xxxxxxxxx may rely as to
matters of Maryland law upon the opinion of Piper & Marbury L.L.P. or other
counsel reasonably satisfactory to the Underwriters. The Representatives
will accept an opinion of Piper & Marbury L.L.P. , dated as of the Closing
Time and in form and substance reasonably acceptable to counsel for the
Underwriters, addressing the matters of Maryland law implicated in the
description of the opinion of Xxxxxxxxxxxx Xxxx & Xxxxxxxxx in subsection
(f)(i) of this Section, in which case the opinion of Xxxxxxxxxxxx Xxxx &
Xxxxxxxxx is permitted to state that such counsel express no opinion as to
the laws of any jurisdiction other than the United States of America and
the State of California.
13
(ii) a letter, dated as of the Closing Time, of Xxxxxxxxxxxx Xxxx &
Xxxxxxxxx, addressed to the Representatives stating that such
Representatives are entitled to rely on the opinion filed with the
Registration Statement as Exhibit 8.1;
(iii) the favorable opinion, dated as of the Closing Time, of Cadwalader,
Xxxxxxxxxx & Xxxx, in form and substance reasonably satisfactory to counsel
for the Underwriters, to the effect that nothing has come to their
attention that would lead them to believe that statements in the Prospectus
under the captions "Initial Investments" and "Yield Considerations
Relating to the Initial MBS Interests" (excluding, in each case, the
financial statements, schedules and other financial and statistical data
included therein, as to which such counsel need express no belief), at the
time the Registration Statement became effective or at the Closing Time,
contained or contains an untrue statement of a material fact or omitted or
omits to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; and
(iv) the opinion, dated as of the Closing Time, of Hunton & Xxxxxxxx,
counsel for the Underwriters, to the effect that:
(A) the Company is a corporation duly organized and validly existing under
the laws of the State of Maryland, with full corporate power and authority
to own its properties and conduct its business as described in the
Registration Statement and the Prospectus, and to execute and deliver this
Agreement;
(B) the Shares have been duly and validly authorized by all necessary
corporate action and, when issued and delivered pursuant to this Agreement
against payment of the consideration therefor, the Shares will be validly
issued, fully paid and nonassessable, free and clear of any pledge, lien,
encumbrance, security interest, or other claim;
(C) the issuance and sale of the Shares by the Company is not subject to
preemptive or other similar rights arising by operation of law, under the
charter or by-laws of the Company or under any agreement known to such
counsel to which the Company or the Subsidiary is a party or, to such
counsel's knowledge, otherwise;
(D) this Agreement has been duly authorized, executed and delivered by the
Company;
(E) the Registration Statement is effective under the Securities Act and,
to the best of such counsel's knowledge and information, no stop order
suspending the effectiveness of the Registration Statement has been issued
under the Securities Act or proceedings therefor initiated or threatened by
the Commission;
(F) the Registration Statement and the Prospectus, as of their respective
effective or issue dates, comply as to form in all material respects with
the requirements of the Securities Act and the Securities Act Regulations;
it being understood, however, that no opinion need be rendered with respect
to the financial statements, schedules and other financial and statistical
data included in the Registration Statement or the Prospectus; and
(G) the Shares conform in all material respects to the statements relating
thereto contained in the Prospectus.
In rendering their opinion, Hunton & Xxxxxxxx may rely as to matters of
Maryland law upon the opinion of Piper & Marbury L.L.P.
14
In rendering their opinions required by subsections (f)(i) and (f)(iv),
respectively, of this Section, Xxxxxxxxxxxx Xxxx & Xxxxxxxxx and Xxxxxx &
Xxxxxxxx shall each additionally contain statements to the effect that
nothing has come to their attention that would lead them to believe that
the Registration Statement (excluding the financial statements, schedules
and other financial and statistical data included therein, as to which such
counsel need express no belief), at the time it became effective, contained
an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading, or that the Prospectus (excluding the financial statements,
schedules and other financial and statistical data included therein, as to
which such counsel need express no belief), at the such time or at Closing
Time, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that Xxxxxxxxxxxx Xxxx & Xxxxxxxxx and
Xxxxxx & Xxxxxxxx need express no belief as to the statements in the
Prospectus under the captions "Initial Investments" and "Yield
Considerations Relating to the Initial MBS Interests."
(g) At the Closing Time, the Representatives shall have received a
certificate of the President and Chief Executive Officer and the Secretary
of the Company, dated as of the Closing Time, to the effect that the
representations and warranties in Section 3 are true and correct with the
same force and effect as though made at the date of such certificate,
subject to any exceptions that, in the reasonable judgment of the
Representatives, are not material.
(h) At the Closing Time, there shall not have been, since the date hereof
or since the respective dates as of which information is given in the
Prospectus, any material adverse change in the operations, business or
condition, financial and other, of the Company and the Subsidiary, taken as
a whole; and no transaction which is material and unfavorable to the
Company shall have been entered into by the Company or the Subsidiary, the
effect of which, in the reasonable opinion of the Representatives, is so
material and adverse as to make it impractical or inadvisable to proceed
with the public offering or delivery of the Shares being delivered at the
Closing Time or Date of Delivery.
(i) At the time of execution and delivery of this Agreement, the
Representatives shall have received from KPMG Peat Marwick LLP a letter
dated such date, in form and substance satisfactory to the Representatives,
to the effect that (i) they are independent accountants with respect to the
Company within the meaning of the Securities Act and the Securities Act
Regulations; (ii) it is their opinion that the balance sheet of the Company
included in the Registration Statement and the Prospectus and covered by
their opinion therein complies in form in all material respects with the
applicable accounting requirements of the Securities Act and the Securities
Act Regulations; (iii) based upon limited procedures set forth in detail in
such letter, nothing came to their attention that caused them to believe
that, at a specified date not more than five days prior to the date of this
Agreement, there has been any change in the assets, liabilities or
stockholders' equity of the Company, as compared with the amounts shown in
the balance sheet included in the Registration Statement and the
15
Prospectus; and (iv) in addition to the audit referred to in their opinion
and the limited procedures referred to in clause (iii) above, they have
carried out certain specified procedures, not constituting an audit, with
respect to certain amounts, percentages and financial information included
in the Registration Statement and the Prospectus and specified by the
Representatives, and have found such amounts, percentages and financial
information to be in agreement with the relevant accounting, financial and
other records of the Company identified in such letter.
(j) At the Closing Time, the Representatives shall have received from KPMG
Peat Marwick LLP a letter dated as of the Closing Time to the effect that
they reaffirm the statements made in the letter furnished pursuant to
subsection (i) of this Section, except that the "specified date" referred
to shall be a date not more than five days prior to the Closing Time.
(k) At the time of execution and delivery of this Agreement, the Company
shall have received from each executive officer of the Company listed
under the caption "The Company" in the Prospectus and each director of the
Company a written agreement (a "Lock-up Agreement") to the effect that
such person will not, for a period of 120 days from the date that the
Registration Statement is declared effective by the Commission, offer to
sell, contract to sell, or otherwise sell, dispose of, loan, or grant any
rights with respect to (collectively, a "Disposition") any shares of Common
Stock, any options or warrants to purchase any shares of Common Stock or any
securities convertible into, exercisable for or exchangeable for shares of
Common Stock (collectively, "Securities") now owned or hereafter acquired
directly by such person or any affiliate or with respect to which such
person has or hereafter acquires the power of Disposition, otherwise than
(i) as a bona fide gift or gifts, provided the donee or donees thereof agree
in writing to be bound by this restriction, (ii) with respect to up to 85%
of such Securities in connection with pledges to secure obligations for
borrowed money, or (iii) with the prior written consent of Friedman,
Billings, Xxxxxx & Co., Inc.; and copies of such Lock-up Agreements shall
have been provided to the Representatives.
(l) In the event the Underwriters exercise their option to purchase all or
any portion of the Option Shares, the representations and warranties of the
Company contained herein and the statements in any certificates furnished
by the Company hereunder shall be true and correct as of each Date of
Delivery, and the Representatives shall have received:
(i) a certificate, dated such Date of Delivery, of the President and Chief
Executive Officer and the Secretary of the Company, in their capacities as
such, confirming that the certificate delivered at Closing Time pursuant to
subsection (g) of this Section remains true and correct as of such Date of
Delivery; subject to any exceptions that, in the reasonable judgment of the
Representatives, are not material ;
(ii) the opinions of Xxxxxxxxxxxx Xxxx & Xxxxxxxxx (and, if the Company or
its counsel shall so elect, the opinion of Piper & Marbury L.L.P.) and
Cadwalader, Xxxxxxxxxx & Xxxx, each in form and substance reasonably
satisfactory to counsel for the Underwriters, dated such Date of Delivery,
relating to the Option Shares and otherwise substantially to the same
effect as the opinions required or permitted by subsections (f)(i), (f)(ii)
and (f)(iii) of this Section;
16
(iii) the opinion of Hunton & Xxxxxxxx, dated such Date of Delivery,
relating to the Option Securities and otherwise to the same effect as the
opinion required by subsection (f)(iv) of this Section; and
(iv) a letter from KPMG Peat Marwick LLP, in form and substance
satisfactory to the Representatives and dated such Date of Delivery,
substantially the same in scope and substance as the letter furnished to
the Representatives pursuant to subsection (i) of this Section, except that
the "specified date" in the letter furnished pursuant to this subsection
(l)(iv) shall be a date not more than five days prior to such Date of
Delivery.
(m) The Company shall have furnished counsel for the Underwriters with such
documents and (as they relate to California and Maryland law) opinions as
they may reasonably request for the purpose of enabling them to pass upon
the issuance and sale of the Shares as herein contemplated and related
proceedings, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained as of the Closing Time or any Date of Delivery.
(n) The Company shall have furnished to the Representatives such other
documents, certificates and opinions as to the accuracy and completeness of
any statement in the Registration Statement and the Prospectus or any
amendment or supplement thereto as of the Closing Time or any Date of
Delivery as the Underwriters may reasonably request.
(o) The Company shall have performed such of its respective obligations
under this Agreement as are to be performed by the terms hereof at or
before the Closing Time or the relevant Date of Delivery.
7. Termination:
(a) If the sale to the Underwriters of the Shares, as contemplated by
this Agreement, is not carried out by the Underwriters for any reason
permitted under this Agreement or if such sale is not carried out because
the Company is unable to comply with any of the terms of the Agreement,
then the Company shall not be under any obligation or liability under this
Agreement (except to the extent provided in Section 9 hereof) and the
Underwriters shall be under no obligation or liability to the Company under
this Agreement (except to the extent provided under Section 9 hereunder) or
to one another hereunder; provided that if the Underwriters terminate this
Agreement because a condition specified in Section 6 shall not have been
fulfilled when and as required to be fulfilled, then the Company also shall
be liable to the extent provided in Section 5.
(b) The obligations of the several Underwriters hereunder shall be
subject to termination in the absolute discretion of the Representatives,
at any time prior to the Closing Time or any Date of Delivery, if trading
in securities on the New York Stock Exchange shall have been suspended or
minimum prices or other material limitation in trading in securities
generally shall have been established on the New York Stock Exchange or
Nasdaq, or if a banking moratorium shall have been declared either by the
United States or New York state or California state authorities, or if the
United States shall have declared war in accordance with its constitutional
processes or there shall have occurred any material outbreak or escalation
of hostilities or other national or international calamity or crisis of such
magnitude in its effect on the financial markets of the United States as, in
17
the judgment of the Representatives, make it impractical or inadvisable to
proceed with the public offering or the delivery of the Shares on the terms
and in the manner contemplated in the Prospectus.
(c) If the Representatives elect to terminate this Agreement as provided in
this Section 7, the Company and the Underwriters shall be notified promptly
by letter, facsimile, telefax or telegram.
8. Increase in Underwriters' Commitments:
If any Underwriter shall default at Closing Time or on a Date of Delivery
in its obligation to take up and pay for the Shares to be purchased by it
under this Agreement on such date and if the total number of Shares which
such Underwriter shall have agreed but failed to take up and pay for does
not exceed 10% of the total number of Shares to be purchased on such date,
each non-defaulting Underwriter shall take up and pay for (in addition to
the number of Shares which it is obligated to purchase on such date
pursuant to this Agreement) the portion of the total number of Shares
agreed to be purchased by the defaulting Underwriter on such date in the
proportion that its underwriting obligations hereunder bears to the
underwriting obligations of all non-defaulting Underwriters. Without
relieving any defaulting Underwriter from its obligations hereunder, the
Company agrees with the non-defaulting Underwriters that it will not sell
any Shares hereunder on such date unless all of the Shares to be purchased
on such date are purchased on such date by the Underwriters (or by
substituted Underwriters selected by the Representatives with the approval
of the Company or selected by the Company with the approval of the
Representatives).
If a new Underwriter or Underwriters are substituted for a defaulting
Underwriter in accordance with the foregoing provision, the Company or the
non-defaulting Underwriters shall have the right to postpone the Closing
Time or the relevant Date of Delivery for a period not exceeding five
business days in order that any necessary changes in the Registration
Statement and Prospectus and other documents may be effected.
The term "Underwriter" as used in this Agreement shall refer to and
include any Underwriter substituted under this Section 8 with the like
effect as if such substituted Underwriter had originally been named in this
Agreement.
9. Indemnity by the Company and the Underwriters:
(a) The Company agrees to indemnify, defend and hold harmless each
Underwriter and any person who controls any Underwriter within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act, from
and against any loss, expense, liability or claim (including the reasonable
cost of investigation) which, jointly or severally, any such Underwriter or
controlling person may incur under the Securities Act, the Exchange Act or
otherwise, insofar as such loss, expense, liability or claim arises out of
or is based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or in the
Registration Statement as amended by any post-effective amendment thereof
by the Company) or in a Prospectus (the term Prospectus for the purpose of
this Section 9 being deemed to include any Preliminary Prospectus, the
Prospectus and the Prospectus as amended or supplemented by the Company),
18
or arises out of or is based upon any omission or alleged omission to state
a material fact required to be stated in such Registration Statement or
necessary to make the statements made in the Registration Statement not
misleading or arises out of or is based on an omission or alleged omission
to state a material fact required to be stated in the Prospectus or
necessary to make the statements therein, in light of circumstances under
which they were made, not misleading, except insofar as any such loss,
expense, liability or claim arises out of or is based upon any untrue
statement or alleged untrue statement of a material fact contained in and
in conformity with information furnished in writing by the Underwriters
through the Representatives to the Company expressly for use in such
Registration Statement or such Prospectus, or arises out of or is based
upon any omission or alleged omission to state a material fact in
connection with such information required to be stated in either such
Registration Statement or Prospectus or necessary to make such information
not misleading, provided, however, that the indemnity agreement contained
in this subsection (a) with respect to any Preliminary Prospectus shall not
inure to the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) with respect to any person asserting any such
loss, expense, liability or claim which is the subject thereof if any
subsequent Preliminary Prospectus or the Prospectus corrected any such
alleged untrue statement or omission and if such Underwriter failed to send
or give a copy of such subsequent Preliminary Prospectus or the Prospectus,
as the case may be, to such person at or prior to the written confirmation
of the sale of Shares to such person, unless such failure resulted from
non-compliance by the Company with Section 4(a).
If any action is brought against an Underwriter or controlling person in
respect of which indemnity may be sought against the Company pursuant to
the preceding paragraph, such Underwriter shall promptly notify the Company
in writing of the institution of such action and the indemnifying party
shall assume the defense of such action, including the employment of
counsel and payment of expenses. Such Underwriter or controlling person
shall have the right to employ its or their own counsel in any such case,
but the fees and expenses of such counsel shall be at the expense of such
Underwriter or such controlling person unless the employment of such
counsel shall have been authorized in writing by the indemnifying party in
connection with the defense of such action or the indemnifying party shall
not have employed counsel to have charge of the defense of such action
within a reasonable time or such indemnified party or parties shall have
reasonably concluded (based on the advice of counsel) that there may be
defenses available to it or them which are different from or additional to
those available to the indemnifying party (in which case the indemnifying
party shall not have the right to direct the defense of such action on
behalf of the indemnified party or parties), in any of which events such
reasonable fees and expenses shall be borne by the indemnifying party and
paid as incurred (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel for
the Underwriters or controlling persons in any one action or series of
related actions in the same jurisdiction representing the indemnified
parties who are parties to such action). Anything in this paragraph to the
contrary notwithstanding, the indemnifying party shall not be liable for
19
any settlement of any such claim or action effected without the written
consent of the indemnifying party.
(b) Each Underwriter agrees, severally and not jointly, to indemnify,
defend and hold harmless the Company, its directors and officers and any
person who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any
loss, expense, liability or claim (including the reasonable cost of
investigation) which, jointly or severally, the Company or any such person
may incur under the Securities Act, the Exchange Act or otherwise, insofar
as such loss, expense, liability or claim arises out of or is based upon
any untrue statement or alleged untrue statement of a material fact
contained in and in conformity with information furnished in writing by
such Underwriter through the Representatives to the Company expressly for
use in the Registration Statement (or in the Registration Statement as
amended by any post-effective amendment thereof by the Company) or in a
Prospectus, or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such information
required to be stated either in such Registration Statement or Prospectus
or necessary to make such information not misleading.
If any action is brought against the Company or any such person in respect
of which indemnity may be sought against any Underwriter pursuant to the
foregoing paragraph, the Company or such person shall promptly notify the
Representatives in writing of the institution of such action and the
Representatives, on behalf of the Underwriters, shall assume the defense of
such action, including the employment of counsel and payment of expenses.
The Company or such person shall have the right to employ its own counsel
in any such case, but the fees and expenses of such counsel shall be at the
expense of the Company or such person unless the employment of such counsel
shall have been authorized in writing by the Representatives in connection
with the defense of such action or the Representatives shall not have
employed counsel to have charge of the defense of such action within a
reasonable time or such indemnified party or parties shall have reasonably
concluded (based on the advice of counsel) that there may be defenses
available to it or them which are different from or additional to those
available to the Underwriters (in which case the Representatives shall not
have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and
expenses shall be borne by such Underwriter and paid as incurred (it being
understood, however, that the Underwriters shall not be liable for the
expenses of more than one separate counsel in any one action or series of
related actions in the same jurisdiction representing the indemnified
parties who are parties to such action). Anything in this paragraph to the
contrary notwithstanding, no Underwriter shall be liable for any settlement
of any such claim or action effected without the written consent of such
Underwriter.
(c) If the indemnification provided for in this Section 9 is unavailable to
an indemnified party under subsections (a) and (b) of this Section 9 in
respect of any losses, expenses, liabilities or claims referred to therein,
then each applicable indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, expenses, liabilities or
20
claims (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on
the other hand from the offering of the Shares 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 of the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, expenses,
liabilities or claims, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and the Underwriters on the other shall be deemed to be in the same
proportion as the total proceeds from the offering (net of underwriting
discounts and commissions but before deducting expenses) received by the
Company bear to the underwriting discounts and commissions received by the
Underwriters. The relative fault of the Company on the one hand and of the
Underwriters on the other shall be determined by reference to, among other
things, whether the untrue statement or alleged untrue statement of a
material fact or omission or alleged omission relates to information
supplied by the Company or by the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The amount paid or payable by a party
as a result of the losses, claims, damages and liabilities referred to
above shall be deemed to include any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or
defending any claim or action.
(d) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in subsection (c)
above. Notwithstanding the provisions of this Section 9, no Underwriter
shall be required to contribute any amount in excess of the amount by which
the total price at which the Shares underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. 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. The
Underwriters' obligations to contribute pursuant to this Section 9 are
several in proportion to their respective underwriting commitments and not
joint.
(e) The indemnity and contribution agreements contained in this Section 9
and the covenants, warranties and representations of the Company contained
in this Agreement shall remain in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, or any person who
controls any Underwriter within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act, or by or on behalf of the Company,
its directors and officers or any person who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, and shall survive any termination of this Agreement (other
21
than termination hereof pursuant to Section 7 before the sale and delivery
of the Initial Shares) or the sale and delivery of the Shares. The Company
and each Underwriter agree promptly to notify the others of the
commencement of any litigation or proceeding against it and, in the case of
the Company, against any of the Company's officers and directors, in
connection with the sale and delivery of the Shares, or in connection with
the Registration Statement or Prospectus.
10. Default by the Company.
If the Company shall fail at the Closing Time or on any Date of Delivery to
sell and deliver the number of Shares that Company is obligated to sell
hereunder on such date, then the Underwriters may, at the option of the
Representatives by notice from the Representatives to the Company,
terminate this Agreement without any liability on the part of any non-
defaulting party except that the provisions of Sections 4(h), 5 and 9 shall
remain in full force and effect. No action taken pursuant to this Section
10 shall relieve the Company from liability, if any, in respect of such
default.
In the event of a default by the Company as referred to in this Section 10,
the Representatives shall have the right to postpone the Closing Time or
the relevant Date of Delivery for a period not exceeding seven days in
order to effect any required change in the Registration Statement or
Prospectus or in any other documents or arrangements.
11. Notices:
Except as otherwise herein provided, all statements, requests, notices and
agreements shall be in writing or by telegram and, if to the Underwriters,
shall be sufficient in all respects if delivered or sent to Friedman,
Billings, Xxxxxx & Co., Inc., 0000 00xx Xxxxxx Xxxxx, Xxxxxxxxx, Xxxxxxxx
00000, Attention: Compliance Department; and if to the Company, shall be
sufficient in all respects if delivered to the Company at the offices of
the Company at 00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000, Xxx Xxxxxxx,
Xxxxxxxxxx 00000, Attention: President and Chief Executive Officer and
Secretary.
12. GOVERNING LAW:
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES.
13. Headings:
The section headings in this Agreement have been inserted as a matter of
convenience of reference and are not a part of this Agreement.
14. Parties in Interest:
The Agreement herein set forth has been and is made solely for the benefit
of the Underwriters and the Company and the controlling persons, directors
and officers referred to in Section 9 hereof, and their respective
successors, assigns, executors and administrators. No other person,
partnership, association or corporation (including a purchaser, as such
purchaser, from any of the Underwriters) shall acquire or have any right
22
under or by virtue of this Agreement.
15. Counterparts:
This Agreement may be signed by the parties in counterparts which together
shall constitute one and the same agreement among the parties.
If the foregoing correctly sets forth the understanding among the Company
and the Underwriters, please so indicate in the space provided below for
the purpose, whereupon this letter shall constitute a binding agreement
among the Company and the Underwriters.
Very truly yours,
IMPERIAL CREDIT COMMERCIAL MORTGAGE INVESTMENT CORP.
/s/ Xxxx X. Xxxxxx
By: Xxxx X. Xxxxxx
President and Chief Executive Officer
Accepted and agreed to as
of the date first above written:
FRIEDMAN, BILLINGS, XXXXXX & CO., INC.
XXXXXXXXX & COMPANY, INC.
For themselves and as Representatives of the other
Underwriters named in Schedule I hereto.
By: Friedman, Billings, Xxxxxx & Co. Inc.
/s/ Xxxxx Xxxxxxxxx
Xxxxx Xxxxxxxxx
Managing Director
23
Schedule I
Underwriter No. of Shares
----------- --------------
Friedman, Billings, Xxxxxx & Co., Inc. 12,150,000
Xxxxxxxxx & Company, Inc. 12,150,000
Bear, Xxxxxxx & Co., Inc. 300,000
Xxxxx & Company 300,000
Credit Suisse First Boston Corporation 300,000
Xxxxxxx, Sachs & Co. 300,000
Xxxxxx Brothers Inc. 300,000
X.X. Xxxxxx Securities Ltd. 300,000
NationsBanc Xxxxxxxxxx Securities 300,000
PaineWebber Incorporated 300,000
Prudential Securities Incorporated 300,000
Xxxxx Xxxxxx Inc. 300,000
Advest, Inc. 150,000
Xxxxxxx Xxxxx & Company, L.L.C. 150,000
Xxxxx Xxxxxx & Co., Inc. 150,000
Xxxxxxx, Xxxxxx & Co. 150,000
Xxxxxx/Xxxxxxx/Imperial LLC 150,000
Xxxxxxxx & Xxxxxxxx, Incorporated 150,000
Equitable Securities Corporation 150,000
EVEREN Securities, Inc. 150,000
Xxxxxxxxxx & Co., Inc. 150,000
Xxxxxx Xxxxxx Xxxxxxxx & Co., Inc. 150,000
Xxxx Xxxxx Xxxx Xxxxxx, Incorporated 150,000
XxXxxxxx & Company Securities, Inc. 150,000
The Ohio Company 150,000
Xxxxx Xxxxxxx Inc. 150,000
The Xxxxxxx Companies Incorporated 150,000
Stifle, Nicolaus & Company Incorporated 150,000
Sutro & Co. Incorporated 150,000
Xxxxxx Xxxxxxx Incorporated 150,000
----------
Total 30,000,000
