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EXHIBIT 1.1
SEQUOIA MORTGAGE TRUST ______
Collateral Mortgage Bonds
UNDERWRITING AGREEMENT
________ __, 199_
The Firm or Firms
of Underwriters named
on the signature page hereof
Ladies and Gentlemen:
Sequoia Mortgage Funding Corporation, a Delaware corporation (the
"Company") and a wholly-owned limited purpose subsidiary of Redwood Trust,
Inc., a Maryland corporation ("Redwood Trust"), proposes to cause Sequoia
Mortgage Trust _______ (the "Issuer") to issue and sell to you (each, an
"Underwriter") the Issuer's Collateralized Mortgage Bonds (the "Bonds") having
the characteristics set forth in the Prospectus Supplement (as defined below),
secured by a trust estate consisting primarily of [mortgage notes and the
related mortgages acquired by the Issuer (the "Pledged Mortgages")] and related
property (collectively, the "Trust Estate"). The [Pledged Mortgages] will be of
the type and will have the characteristics described in the Prospectus
Supplement, subject to the variances,
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ranges, minimums and maximums set forth in the Prospectus
Supplement.
The Issuer is a statutory business trust established under the laws of the
State of Delaware pursuant to the Amended and Restated Deposit Trust Agreement,
dated as of ________ __, 199_ (the "Trust Agreement"), between the Company and
_________________, as owner trustee (the "Owner Trustee"). The Issuer was
formed for the sole purpose of issuing the Bonds [and the Investor Certificate
(as defined in the Prospectus Supplement)]. The Bonds will be issued pursuant
to the Indenture, dated as of _________ 1, 199_ (the "Indenture"), between the
Issuer and ________________________________, as bond trustee (the "Bond
Trustee"). The [Pledged Mortgages] will be serviced pursuant to the Master
Servicing Agreement, dated as of _________ 1, 199_ (the "Master Servicing
Agreement"), among the Issuer, the Bond Trustee and ______________, a
____________ corporation, as master servicer (in such capacity, the "Master
Servicer"). Certain administrative and clerical services will be provided to
the Issuer by Redwood Trust (in such capacity, the "Manager") pursuant to the
Management Agreement, dated as of ________ 1, 199_ (the "Management
Agreement"), between the Issuer
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and the Manager. The Trust Agreement, the Management Agreement, the Indenture,
the Master Servicing Agreement and this Agreement are sometimes referred to
herein collectively as the "Transaction Documents." Capitalized terms used but
not otherwise defined herein shall have the respective meanings ascribed
thereto in the Indenture.
1. Representations and Warranties. The Company and Redwood Trust, jointly
and severally, represent and warrant to, and agree with, each Underwriter that:
(i) A registration statement on Form S-3 (File No. 333-22681),
including a prospectus, has been filed with the Securities and Exchange
Commission (the "Commission") and has become effective under the
Securities Act of 1933, as amended (the "Act"). Such registration
statement, as amended at the date of this Agreement, meets the
requirements set forth in Rule 415(a)(1)(x) under the Act. As of the
Closing Date (as hereinafter defined), no stop order suspending the
effectiveness of such registration statement has been issued and no
proceedings for that purpose have been initiated or, to the knowledge of
the Company or Redwood Trust, threatened by the Commission. The
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prospectus in the form in which it will be used in connection with the
offering of the Bonds is proposed to be supplemented by a prospectus
supplement dated the date hereof relating to the Bonds and, as so
supplemented, to be filed with the Commission pursuant to Rule 424 under
the Act. (Such registration statement is hereinafter referred to as the
"Registration Statement"; such prospectus supplement, as first filed with
the Commission, is hereinafter referred to as the "Prospectus Supplement";
and such prospectus, in the form in which it will first be filed with the
Commission in connection with the offering of the Bonds, including the
documents incorporated therein as of the time of such filing and as
supplemented by the Prospectus Supplement, is hereinafter referred to as
the "Prospectus"). Any reference herein to the Registration Statement, a
preliminary prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein pursuant to Item
12 of Form S-3 which were filed under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), on or before the date on which the
Registration Statement, as amended, became effective or
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the issue date of any preliminary prospectus or the date on which the
Prospectus is filed pursuant to Rule 424(b) under the Act, as the case may
be, deemed to be incorporated therein by reference.
(ii) The Registration Statement, the Prospectus and the Indenture, as
of the date of the Prospectus Supplement will conform, and the
Registration Statement, the Prospectus as revised, amended or supplemented
and filed with the Commission prior to the termination of the offering of
the Bonds, and the Indenture, as of their respective effective or issue
dates, will conform in all material respects to the requirements of the
Act and the Trust Indenture Act of 1939, as amended (the "TIA"), and the
respective rules and
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regulations of the Commission thereunder applicable to such documents as
of such respective dates, and the Registration Statement, the Prospectus
as revised, amended or supplemented and filed with the Commission as of
the Closing Date, and the Indenture will conform in all material respects
to the requirements of the Act and the TIA and the respective rules and
regulations of the Commission thereunder applicable to such documents as
of the Closing Date. The Registration Statement, at the time it became
effective, did not include any 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 as of the
date of the Prospectus Supplement, and the Prospectus as revised, amended
or supplemented and filed prior to the Closing Date, as of the Closing
Date, will not include any untrue statement of a material fact and will
not omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the Company and Redwood Trust make
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no representations, warranties or agreements as to (x) the part of the
Registration Statement which shall constitute the Statement of Eligibility
and Qualification on Form T-1 (with respect to the Bonds) of the Bond
Trustee under the TIA, except statements therein or omissions therefrom
made in reliance upon information furnished in writing to the Bond Trustee
by or on behalf of the Company or Redwood Trust expressly for use therein
or (y) the information contained in or omitted from the Prospectus or any
revision or amendment thereof or supplement thereto in reliance upon and
in conformity with information furnished in writing to the Company by or
on behalf of any Underwriter specifically for use in connection with the
preparation of the Prospectus or any revision or amendment thereof or
supplement thereto, such information being defined as the "Underwriter
Information" in Section 10 hereof.
(iii) The Bonds conform in all material respects to the description
thereof contained in the Prospectus, and each of the Bonds, when validly
executed, authenticated, issued and delivered in accordance with the
Indenture and paid for in accordance with this Agreement, will be duly and
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validly issued and outstanding and entitled to the benefits and security
afforded by the Indenture and will constitute legal, valid and binding
obligations of the Issuer, enforceable in accordance with their terms and
the terms of the Indenture, except as the same may be limited by
bankruptcy, insolvency, reorganization or other similar laws affecting
enforcement of creditors' rights generally and by general principles of
equity. Each Bond of the Classes indicated to be "mortgage related
securities" under the heading "Summary--Legal Investment" in the
Prospectus Supplement will, when issued, be a "mortgage related security"
as such term is defined in Section 3(a)(41) of the Exchange Act.
(iv) This Agreement has been duly authorized, executed and delivered
by each of the Company and Redwood Trust. The Trust Agreement has been,
and as of the Closing Date, each of the other Transaction Documents to
which the Company or Redwood Trust is a party, will have been, duly
authorized, executed and delivered by the Company or Redwood Trust, as
applicable, and will conform in all material respects to the descriptions
thereof contained in the Prospectus and,
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assuming the valid execution and delivery thereof by the other parties
thereto, each Transaction Document to which the Company or Redwood Trust
is a party will constitute a legal, valid and binding agreement of the
Company or Redwood Trust, as applicable, enforceable in accordance with
its terms, except as the same may be limited by bankruptcy, insolvency,
reorganization or other similar laws affecting creditors' rights generally
and by general principles of equity.
(v) Each of the Company and Redwood Trust has been duly incorporated
and is validly existing as a corporation in good standing under the laws
of its respective State of incorporation, and each of the Company and
Redwood Trust is duly qualified to do business as a foreign corporation
and is in good standing under the laws of each jurisdiction where the
character of its respective properties or the nature of its respective
activities makes such qualification necessary, except such jurisdictions,
if any, in which the failure to be so qualified will not have a material
adverse effect on the condition (financial or otherwise), earnings,
regulatory affairs, business affairs, business prospects or
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properties of Redwood Trust or the Company; each of Redwood Trust and the
Company holds all material licenses, certificates and permits from all
governmental authorities necessary for the conduct of its respective
business as described in the Prospectus; and each of the Company and
Redwood Trust have the corporate power and authority to own its respective
properties and conduct its respective business as described in the
Prospectus and to enter into and perform its respective obligations under
each Transaction Document to which it is a party.
(vi) Neither the issuance, delivery or sale of the Bonds, nor the
consummation of any other of the transactions contemplated herein, nor the
execution and delivery of the Transaction Documents by the Company and
Redwood Trust and compliance with the provisions of the Transaction
Documents, will conflict with or result in the breach of any material term
or provision of the certificate of incorporation or by-laws of the Company
or Redwood Trust, and neither the Company nor Redwood Trust is in breach
or violation of or in default (nor has an event occurred which with notice
or lapse of time or both would constitute a default) under the
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terms of (i) any indenture, contract, lease, mortgage, deed of trust,
note, agreement or other evidence of indebtedness or other agreement,
obligation or instrument to which the Company or Redwood Trust is a party
or by which it or its respective properties are bound, or (ii) any law,
decree, order, rule or regulation applicable to the Company or Redwood
Trust of any court or supervisory, regulatory, administrative or
governmental agency, body or authority, or arbitrator having jurisdiction
over the Company or Redwood Trust, or its respective properties, the
default in or the breach or violation of which would have a material
adverse effect on the Company or Redwood Trust, the Issuer or the Bonds or
on the ability of the Company or Redwood Trust to perform its respective
obligations under the Transaction Documents to which it is a party; and
neither the delivery of the Bonds, nor the consummation of any other of
the transactions contemplated herein, nor the compliance with the
provisions of the Transaction Documents will result in such a breach,
violation or default which would have such a material adverse effect.
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(vii) No filing or registration with, notice to, or consent,
approval, authorization or order or other action of any court or
governmental authority or agency is required for the consummation by the
Company and Redwood Trust of the transactions contemplated by the
Transaction Documents to which it is a party (other than as required under
"blue sky" or state securities laws, as to which no representations and
warranties are made by the Company or Redwood Trust), except such as have
been, or will have been prior to the Closing Date, obtained under the Act
and the TIA[, and such recordations of the assignment of the Pledged
Mortgages to the Bond Trustee (to the extent such recordations are
required pursuant to the Master Servicing Agreement or the Indenture) that
have not yet been completed].
(viii) There is no action, suit or proceeding before or by any court,
administrative or governmental agency now pending to which the Company or
Redwood Trust is a party, or to the best knowledge of the Company or
Redwood Trust, threatened against the Company or Redwood Trust, which
could reasonably result individually or in the aggregate in any material
adverse change in the condition (financial or
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otherwise), earnings, regulatory affairs, business affairs, business
prospects or properties of the Company or Redwood Trust or could
reasonably interfere with or materially and adversely affect the
consummation of the transactions contemplated in the Transaction
Documents.
(ix) At the time of execution and delivery of the Indenture, (1) the
Issuer will own the [Pledged Mortgages] being pledged to the Bond Trustee
pursuant thereto, free and clear of any lien, mortgage, pledge, charge,
encumbrance, adverse claim or other security interest (collectively,
"Liens"), except to the extent permitted in the Indenture, and will not
have assigned to any person other than the Bond Trustee any of its right,
title or interest in the [Pledged Mortgages], (2) the Issuer will have the
power and authority to pledge the Trust Estate to the Bond Trustee and to
transfer the Bonds to you and will have duly authorized such action by all
necessary corporate action, (3) upon execution and delivery by the Issuer
to the Bond Trustee of the Indenture, and delivery of the Bonds to the
Issuer, the Bond Trustee will have a valid, perfected security interest of
first priority in the Trust Estate free of Liens other than
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Liens permitted by the Indenture and (4) upon payment and delivery of the
Bonds to you, you will acquire ownership of the Bonds, free of Liens other
than Liens permitted by the Indenture or created or granted by you.
(x) Any taxes, fees and other governmental charges in connection with
the execution, delivery and issuance of the Transaction Documents and the
Bonds have been or will be paid by the Issuer, the Company or Redwood
Trust at or prior to the Closing Date[, except for fees for recording
assignments of the Pledged Mortgages to the Bond Trustee pursuant to the
Master Servicing Agreement or the Indenture that have not yet been
completed, which fees will be paid by or on behalf of Redwood Trust in
accordance with the Master Servicing Agreement].
[(xi) The Master Servicer or any subservicer who will be servicing
any Pledged Mortgages pursuant to the Master Servicing Agreement is
qualified to do business in all jurisdictions in which its activities as
servicer or subservicer of the Pledged Mortgages serviced by it require
such qualification except where failure to be so qualified
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will not have a material adverse effect on such servicing activities.]
[(xii) The execution and delivery by the Master Servicer of the
Master Servicing Agreement is within the corporate power of the Master
Servicer and has been duly authorized by all necessary corporate action on
the part of the Master Servicer. Neither the execution and delivery by the
Master Servicer of such instrument, nor the consummation by the Master
Servicer of the transactions therein contemplated, nor compliance by the
Master Servicer with the provisions thereof, will conflict with or result
in a material breach of, or constitute a material default (or an event
which with notice or lapse of time, or both, would constitute such a
default) under any of the provisions of any statute, rule, regulation,
judgment, decree or order of any court or any public, governmental or
regulatory agency or body having jurisdiction over the Master Servicer, or
any of the terms or provisions of any material indenture, mortgage,
contract, agreement, franchise, license, permit or other instrument to
which the Master Servicer is a party or by which it or any of its
properties or businesses may be
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bound, or result in the creation or imposition of any lien, charge or
encumbrance upon any of its properties pursuant to the terms of any such
indenture, mortgage, contract or other instrument.]
[(xiii) The Master Servicing Agreement when executed and delivered as
contemplated thereby, will have been duly executed and delivered by the
Master Servicer; and the Master Servicing Agreement will constitute, when
so executed and delivered, a legal, valid and binding instrument
enforceable against the Master Servicer in accordance with its terms,
except as the same may be limited by bankruptcy, reorganization,
insolvency or other similar laws affecting creditors' rights generally and
by general principles of equity.]
[(xiv) The representations and warranties made by the Master Servicer
in the Master Servicing Agreement will be true and correct at the time
made and at the Closing Date.]
(xv) At the Closing Date, the execution and delivery of the Indenture
by the Owner Trustee will have been duly authorized by the Company and
upon due execution and delivery thereof by the parties thereto the
Indenture will
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constitute a legal, valid and binding agreement enforceable in accordance
with its terms, except as the same may be limited by bankruptcy,
reorganization, insolvency or other similar laws affecting creditors'
rights generally and by general principles of equity.
(xvi) As of the Closing Date, the Owner Trustee will have assigned,
pledged and delivered to the Bond Trustee under the Indenture all of its
right, title and interest in and to, among other things, (i) the [Pledged
Mortgages], and (ii) cash and/or other assets, if any, in the amount set
forth in the Indenture.
(xvii) The [Pledged Mortgages] conform in all material respects to
the description thereof contained in the Prospectus.
(xviii) At the Closing Date, the Owner Trustee will own (i) the
[Pledged Mortgages] listed in Schedule A to the Indenture and (ii) the
money or other assets specified or referred to in the granting clauses of
such Indenture (to the extent specified therein) as being pledged to the
Bond Trustee at the Closing Date (together, the "Initial Collateral"),
free and clear of any liens or encumbrances,
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other than liens in favor of the Underwriters or any of their
affiliates which will be released upon consummation of, or
concurrently with, the Closing and the lien of the Indenture and the
Trust Agreement; the Owner Trustee has corporate power and authority
to assign, pledge and deliver the Initial Collateral to the Bond
Trustee under the Indenture, and will have duly authorized such
assignment, pledge and delivery to the Bond Trustee by all necessary
corporate action.
(xix) At the Closing Date, each [Pledged Mortgage] listed on
Schedule A to the Indenture relating to the Bonds will have been duly
and validly assigned, pledged and delivered to the Bond Trustee, or
its nominee, and together with such assignment, pledge and delivery
of each [Pledged Mortgage], the filing of a UCC-1 financing statement
with respect to the Indenture in the office of the Secretary of State
of the State of ___________ and in such other jurisdictions, if any,
as the Company deems appropriate and the possession by the Bond
Trustee, or its nominee, of the Initial Collateral not represented by
contract rights or insurance policies and of the monies and/or other
assets, if
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any, specified in the Indenture, will create as security for
repayment of the Bonds a valid, perfected first security interest in
the Initial Collateral. The information set forth with respect to the
[Pledged Mortgages] in Schedule A to the Indenture will be, as of the
Closing Date, true and correct in all material respects.
(xx) The Trust Agreement is effective to establish the Issuer as
a statutory business trust under and pursuant to the laws of the
State of Delaware.
(xxi) None of the Company, Redwood Trust or the Issuer is doing
business with Cuba.
2. Purchase and Sale. Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company agrees to
direct the Owner Trustee, on behalf of the Issuer, to sell, and each
Underwriter agrees, severally and not jointly, to purchase from the Issuer, the
respective initial Class Principal Amount of each Class of Bonds to be
purchased by such Underwriter as specified in the Prospectus Supplement. The
purchase price at which each Underwriter will purchase its Bonds shall be as
set forth in a separate pricing letter dated the date hereof between such
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Underwriter and the Company (each, a "Pricing Letter"), and the terms of each
such Pricing Letter are hereby incorporated herein by reference as if such
terms were stated herein in their entirety. References herein to this
"Agreement" shall include the terms of each Pricing Letter.
3. Delivery and Payment. The Bonds shall be delivered at the office, on
the date and at the time specified in the Prospectus Supplement, which place,
date and time may be changed by agreement between the Underwriters and the
Company (such date and time of delivery of and payment for the Bonds being
hereinafter referred to as the "Closing Date"). Delivery of the Bonds shall be
made to each of the Underwriters as against their respective payment of the
purchase price therefor to or upon the order of the Issuer [in immediately
available federal funds]. The Bonds shall be registered in such names and in
such denominations as the respective Underwriters may have requested or as
required by book-entry registration not less than two full business days prior
to the Closing Date. The Company agrees to cause the Bonds to be made available
for inspection, checking and packaging in New York, New York, on the business
day prior to the Closing Date.
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4. Offering by Underwriters. It is understood that the Underwriters
propose to offer the Bonds for sale as set forth in the Prospectus and that you
will not offer, sell or otherwise distribute the Bonds (except for the sale
thereof in exempt transactions) in any state in which the Bonds are not exempt
from registration under "blue sky" or state securities laws (except where the
Bonds will have been qualified for offering and sale at your direction under
such "blue sky" or state securities laws).
5. Agreements. The Company agrees with each Underwriter that:
(a) The Company will cause the Prospectus to be filed with the Commission
pursuant to Rule 424 under the Act and, if necessary, within 15 days of the
Closing Date, will file a report on Form 8-K setting forth specific information
concerning the [Pledged Mortgages], and will promptly advise each Underwriter
when the Prospectus has been so filed, and, prior to the termination of the
offering of the Bonds, will also promptly advise each Underwriter (i) when any
amendment to the Registration Statement has become effective or any revision of
or supplement to the Prospectus has been so filed (unless such amendment,
revision or supplement does not relate to the Bonds or
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the Issuer), (ii) of any request by the Commission for any amendment of the
Registration Statement or the Prospectus or for any additional information
(unless such amendment or request for additional information does not relate to
the Bonds or the Issuer), (iii) of any written notification received by the
Company of the suspension of qualification of the Bonds for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose and (iv) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or the institution or, to the
knowledge of the Company, the threatening of any proceeding for that purpose.
The Company will use its best efforts to prevent the issuance of any such stop
order and, if issued, to obtain as soon as possible the withdrawal thereof.
Except as otherwise provided in Section 5(b) hereof, the Company will not file
prior to the termination of such offering any amendment to the Registration
Statement or any revision of or supplement to the Prospectus (other than any
such amendment, revision or supplement which does not relate to Bonds or the
Issuer) which shall be disapproved by the Underwriters after reasonable notice
and review of such filing.
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(b) If, at any time when a prospectus relating to the Bonds is required to
be delivered under the Act (i) any event occurs as a result of which the
Prospectus as then amended or supplemented would include any untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein in the light of the circumstances under which they were made
not misleading, or (ii) it shall be necessary to revise, amend or supplement
the Prospectus to comply with the Act or the rules and regulations of the
Commission thereunder, the Company promptly will notify each Underwriter and
will, upon the request of any Underwriter, or may, after consultation with each
Underwriter, prepare and file with the Commission a revision, amendment or
supplement which will correct such statement or omission or effect such
compliance, and furnish without charge to each Underwriter as many copies as
such Underwriter may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such statement
or omission or effect such compliance.
(c) The Company will furnish to each Underwriter and counsel to the
Underwriters, without charge, conformed copies of the Registration Statement
(including exhibits thereto) and, so
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long as delivery of a prospectus relating to the Bonds is required under the
Act, as many copies of the Prospectus and any revisions or amendments thereof
or supplements thereto as may be reasonably requested.
(d) The Company will, as between itself and the Underwriters, pay all
expenses incidental to the performance of the obligations of the Company or the
Issuer under this Agreement, including without limitation (i) expenses of
preparing, printing and reproducing the Registration Statement, the Prospectus,
the Transaction Documents and the Bonds, (ii) the cost of delivering the Bonds
to the Underwriters, (iii) the fees charged by securities rating agencies for
rating the Bonds, (iv) all transfer taxes, if any, with respect to the sale and
delivery of the Bonds to the Underwriters, (v) the fees and expenses of the
Owner Trustee and the Bond Trustee, (vi) any expenses for the qualification of
the Bonds under "blue sky" or state securities laws, including filing fees and
the fees and disbursements of counsel for such Underwriter in connection
therewith and in connection with the preparation of any Blue Sky Survey and
(vii) all other costs and expenses incidental to the performance by the Company
or the Issuer of their respective obligations hereunder
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which are not otherwise specifically provided for in this subsection. It is
understood that, except as provided in this paragraph (d) and in Section 9
hereof, each Underwriter will pay all of its own expenses, including (i) the
fees of any counsel to such Underwriter, (ii) any transfer taxes on resale of
any of the Bonds by it and (iii) any advertising expenses connected with any
offers that such Underwriter may make.
(e) So long as any Bonds are outstanding, upon request of any Underwriter,
the Company will furnish, or will cause to be furnished, to such Underwriter,
as soon as available, a copy of (i) the annual statement of compliance
delivered by the Master Servicer to the Bond Trustee under the Master Servicing
Agreement, (ii) the annual independent public accountants' servicing report
furnished to the Bond Trustee pursuant to the Master Servicing Agreement, (iii)
the annual statement of compliance delivered to the Bond Trustee pursuant to
the Indenture, (iv) each report regarding the Bonds filed with the Commission
under the Exchange Act or mailed to the holders of the Bonds and (v) from time
to time, such other information concerning the Bonds which may be furnished by
the Company or the
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Master Servicer without undue expense and without violation
of applicable law.
(f) The Company will file or cause to be filed a current report on Form
8-K for purposes of filing any Computational Materials furnished to the Company
by any Underwriter prior to the time of filing of the Prospectus as provided in
Section 5(a) hereof and will include therein all Computational Materials so
furnished. In addition, the Company will file or cause to be filed all reports
with respect to the Trust Estate required to be filed under the Exchange Act
when the same are required thereby to be so filed.
(g) For a period ending on the later of the Closing Date or the date on
which any price restrictions on the sale of the Bonds are terminated, the
Company shall not offer or sell, or announce the offering of, or cause any
trust created by the Company to offer or sell, or announce the offering of, any
debt securities, without the prior written consent of the Underwriters.
(h) Redwood Trust covenants with each Underwriter and with the Company
that it shall notify you and the Company of the occurrence of any material
events respecting the activities,
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affairs or condition, financial or otherwise, of Redwood Trust and its
subsidiaries and, if as a result of any such event it is necessary, in the
opinion of counsel, to amend or supplement the Prospectus in order to make the
Prospectus not misleading in the light of the circumstances existing at the
time it is delivered to a purchaser, Redwood Trust will forthwith supply such
information to the Company as shall be necessary for the Company to prepare an
amendment or supplement to the Prospectus so that, as so amended or
supplemented, the Prospectus will not 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 existing at the time it is delivered
to a purchaser, not misleading.
6. Conditions to the Obligations of Underwriters. The obligation of each
Underwriter to purchase the Bonds to be purchased by it as indicated in the
related Pricing Letter shall be subject to the accuracy in all material
respects of the representations and warranties on the part of the Company and
Redwood Trust contained herein as of the date hereof and as of the Closing
Date, to the accuracy of the statements of the Company and Redwood Trust made
in any officer's certificate
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pursuant to the provisions hereof, to the performance in all material respects
by the Company and Redwood Trust of its obligations hereunder and to the
following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted and be pending or shall have been threatened, any requests for
additional information on the part of the Commission (to be included in the
Registration Statement or in the Prospectus or otherwise) shall have been
complied with to the reasonable satisfaction of the Underwriters, and the
Prospectus shall have been filed or transmitted for filing with the Commission
not later than the time the same is required to be filed or transmitted for
filing pursuant to the rules and regulations of the Commission.
(b) The Company shall have furnished to the Underwriters a certificate,
dated the Closing Date, of the Company, signed by the Chairman of the Board or
the President and the principal financial or accounting officer of the Company,
to the effect that each signer of such certificate has carefully examined the
Registration Statement, the Prospectus and this Agreement and that:
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(i) The representations and warranties of the Company herein are true
and correct in all material respects on and as of the Closing Date with
the same effect as if made on the Closing Date, and the Company has
complied with all agreements and satisfied all the conditions on its part
to be performed or satisfied at or prior to the Closing Date;
(ii) No stop order suspending the effectiveness of the Registration
Statement has been issued, and no proceedings for that purpose have been
instituted and are pending or, to the knowledge of such officer, have been
threatened as of the Closing Date; and
(iii) Nothing has come to the attention of such officer that would
lead such officer to believe that the Prospectus (other than any
Computational Materials incorporated therein by reference) contains any
untrue statement of a material fact or omits to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(c) Redwood Trust shall have furnished to the Underwriters a certificate,
dated the Closing Date, of Redwood Trust, signed by the Chairman of the Board
or President and the
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principal financial or accounting officer of Redwood Trust, to the effect that
each signer of such certificate has carefully examined the Registration
Statement, the Prospectus and this Agreement and that:
(i) The representations and warranties of Redwood Trust herein are
true and correct in all material respects on and as of the Closing Date
with the same effect as if made on the Closing Date, and Redwood Trust has
complied with all agreements and satisfied all the conditions on its part
to be performed or satisfied at or prior to the Closing Date;
(ii) No stop order suspending the effectiveness of the Registration
Statement has been issued, and no proceedings for that purpose have been
instituted and are pending or, to the knowledge of such officer, have been
threatened as of the Closing Date; and
(iii) Nothing has come to the attention of such officer that would
lead such officer to believe that the Prospectus (other than any
Computational Materials incorporated therein by reference) contains any
untrue statement of a material fact or omits to state any material fact
necessary in order
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to make the statements therein, in the light of the circumstances under
which they were made, not misleading.
(d) The Company shall have furnished to you an opinion, dated the Closing
Date, of Xxxxx & Xxxxx, special counsel to the Company, in form and substance
satisfactory to the Underwriters and counsel to the Underwriters, to the effect
that:
(i) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Delaware and
is duly qualified to do business in, and is in good standing as a foreign
corporation under the laws of, each jurisdiction where the character of
its properties or the nature of its activities makes such qualification
necessary, except such jurisdictions, if any, in which the failure to be
so qualified will not have a material adverse effect on the condition
(financial or otherwise), earnings, regulatory affairs, business affairs,
business prospects or properties of the Company; and the Company holds all
material licenses, certificates and permits from all governmental
authorities necessary for the conduct of its business as described in the
Prospectus;
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(ii) Each Transaction Document to which the Company is a party has
been duly authorized, executed and delivered by the Company;
(iii) No filing or registration with, notice to, or consent, approval,
authorization, order or other action of any governmental agency or body or
any court is required for the consummation by the Company or the Issuer of
the transactions contemplated by the terms of the Transaction Documents to
which each is a party except such as may be required under the "blue sky"
or state securities laws of any jurisdiction in connection with the
offering, sale or acquisition of the Bonds[, any recordations of the
[Pledged Mortgages] to the Bond Trustee (to the extent such recordations
are required pursuant to the Master Servicing Agreement or the Indenture)
that have not yet been completed and such other approvals as have been
obtained];
(iv) The issuance, delivery and sale of the Bonds to be purchased by
the Underwriters pursuant to this Agreement, the execution and delivery of
the Transaction Documents by the Company and the consummation of any of
the transactions contemplated by the terms of the Transaction Documents do
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not conflict with or result in a breach or violation of any material term
or provision of, or constitute a default under, the certificate of
incorporation or by-laws of the Company, or any indenture, contract,
lease, mortgage, deed of trust, note, agreement or other evidence of
indebtedness or other agreement, obligation or instrument to which the
Company is a party or by which it or its property is bound, or any statute
or any law, decree, order, rule or regulation applicable to the Company of
any court, regulatory body, administrative agency or governmental body
having jurisdiction over the Company or its properties;
(v) There are no legal or governmental actions, investigations or
proceedings pending to which the Company or the Issuer is a party, or, to
the best knowledge of such counsel, threatened against the Company or the
Issuer, (A) asserting the invalidity of any Transaction Document or the
Bonds, (B) seeking to prevent the issuance of the Bonds or the
consummation of any of the transactions contemplated by any Transaction
Document, (C) which might materially and adversely affect the performance
by the Company or the Issuer of its respective obligations under, or the
validity
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or enforceability of, any Transaction Document or the Bonds or (D) seeking
to affect adversely the Federal income tax attributes of the Bonds as
described in the Prospectus under the heading "Federal Income Tax
Consequences" or the state income tax attributes of the Bonds as described
in the Prospectus under the heading "State Tax Considerations;"
(vi) The Registration Statement and any amendments thereto have
become effective under the Act; to the best knowledge of such counsel, no
stop order suspending the effectiveness of the Registration Statement has
been issued and not withdrawn, 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 and the
Indenture, 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 Act and the TIA and the
respective rules and regulations thereunder;
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(vii) To the best knowledge of such counsel, 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;
(viii) Assuming that the Transaction Documents to which
the Company is a party have each been duly authorized, executed and
delivered by the parties thereto, each such Transaction Document
constitutes a valid, legal and binding agreement of the Company
enforceable against the Company in accordance with its terms, subject, as
to enforceability to bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally and to general
principles of equity regardless of whether enforcement is sought in a
proceeding in equity or at law;
(ix) Assuming that each of the Management Agreement and the Indenture
has been duly authorized, executed and delivered by the parties thereto,
each of the Management Agreement and the Indenture constitutes the valid,
legal and
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binding obligation of the parties thereto, enforceable against such
parties in accordance with their respective terms, subject, as to
enforceability to bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally and to general
principles of equity regardless of whether enforcement is sought in a
proceeding in equity or at law;
(x) The Bonds have been duly and validly authorized, executed and
delivered by the Issuer and, assuming due authorization, execution and
delivery of the Indenture by the parties thereto, when authenticated by
the Bond Trustee and delivered and paid for by you as provided in this
Agreement, the Bonds will constitute the legal, valid and binding
obligations of the Issuer, enforceable against the Issuer in accordance
with their terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights
generally and to general principles of equity regardless of whether
enforcement is sought in a proceeding in equity or at law; and the Bonds
are entitled to the benefits of the Indenture;
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(xi) The Bonds and the Transaction Documents conform in all material
respects to the descriptions thereof contained in the Prospectus;
(xii) The statements in the Prospectus and the Prospectus
Supplement, as the case may be, under the headings "Certain Legal Aspects
of the [Pledged Mortgages]," "ERISA Considerations" and "Legal
Investment," to the extent that they constitute matters of law or legal
conclusions with respect thereto, have been reviewed by such counsel and
are correct in all material respects;
(xiii) The Bonds indicated under the heading "Summary--Legal
Investment" in the Prospectus Supplement to be "mortgage related
securities" will be mortgage related securities, as defined in Section
3(a)(41) of the Exchange Act, so long as such Bonds are rated in one of the
two highest rating categories by at least one nationally recognized
statistical rating organization; and
(xiv) The Trust Estate created by the Indenture is not required to be
registered under the Investment Company Act of 1940, as amended.
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Such counsel shall also state that nothing has come to its attention
that would lead such counsel to believe that the Registration Statement,
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, as of the date of the Prospectus Supplement, and on the
Closing Date, 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; it being understood that such counsel need
express no view as to (i) financial and statistical information contained
therein or (ii) any description in the Prospectus of any third party
providing credit enhancement to the Bonds.
Such opinion may express its reliance as to factual matters on the
representations and warranties made by, and on certificates or other
documents furnished by officers of, the parties to the Transaction
Documents. Such opinion may be qualified as an opinion only on the laws of
the State of New York, the State of California, the State of Delaware and
the
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federal law of the United States. To the extent that such firm relies upon the
opinion of other counsel in rendering any portion of its opinion, the opinion of
such other counsel shall be attached to and delivered with the opinion of such
firm that is delivered to you.
(e) The Company shall have furnished to the Underwriters an opinion, dated
the Closing Date, of Giancarlo & Xxxxxx, A Professional Corporation, special
tax counsel to the Company, in form and substance satisfactory to the
Underwriters and counsel to the Underwriters, to the effect that:
(i) The statements in the Prospects and the Prospectus Supplement, as
the case may be, under the headings "Summary -- Federal Income Tax
Consequences," "-- ERISA Matters," "Federal Income Tax Consequences,"
"State Tax Considerations" and "ERISA Matters," to the extent that they
constitute matters of law or legal conclusions with respect thereto, have
been reviewed by such counsel and are correct in all material respects;
and
(ii) For Federal and California income tax purposes, the Bonds will
be treated as indebtedness.
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(f) Redwood Trust shall have furnished to the Underwriters an opinion,
dated the Closing Date, of Xxxxx & Xxxxx, special counsel to Redwood Trust, in
form and substance satisfactory to the Underwriters and counsel to the
Underwriters, to the effect that:
(i) Redwood Trust has been duly incorporated 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 in, and is in good standing as a
foreign corporation under the laws of, each jurisdiction where the
character of its properties or the nature of its activities makes such
qualification necessary, except such jurisdictions, if any, in which the
failure to be so qualified will not have a material adverse effect on the
condition (financial or otherwise), earnings, regulatory affairs, business
affairs, business prospects or properties of Redwood Trust; and Redwood
Trust holds all material licenses, certificates and permits from all
governmental authorities necessary for the conduct of its business as
described in the Prospectus;
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(ii) Each Transaction Document to which Redwood Trust is a party has
been duly authorized, executed and delivered by Redwood Trust;
(iii) Assuming that the Transaction Documents to which Redwood Trust
is a party have each been duly authorized, executed and delivered by the
parties thereto, each such Transaction Document constitutes a valid, legal
and binding agreement of Redwood Trust, enforceable against Redwood Trust
in accordance with its terms, subject, as to enforceability to bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally and to general principles of equity regardless
of whether enforcement is sought in a proceeding in equity or at law;
(iv) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by Redwood
Trust of the transactions contemplated by the terms of the Transaction
Documents to which Redwood Trust is a party except such as may be required
under the "blue sky" or state securities laws of any jurisdiction in
connection with the offering, sale or
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acquisition of the Bonds[, any recordations of the assignment of the
Pledged Mortgages to the Bond Trustee (to the extent such recordations are
required pursuant to the Master Servicing Agreement or the Indenture) that
have not yet been completed] and such other approvals as have been
obtained;
(v) The consummation of any of the transactions contemplated by the
terms of the Transaction Documents do not conflict with or result in a
breach or violation of any material term or provision of, or constitute a
default under, the charter or by-laws of Redwood Trust, or, to the best
knowledge of such counsel, any indenture or other agreement or instrument
to which Redwood Trust is a party or by which it is bound, or any statute
or regulation applicable to Redwood Trust or any order of any court,
regulatory body, administrative agency or governmental body having
jurisdiction over Redwood Trust; and
(vi) There are no legal or governmental actions, investigations or
proceedings pending to which Redwood Trust is a party, or, to the best
knowledge of such counsel, threatened against Redwood Trust, (A) asserting
the
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invalidity of any Transaction Document or (B) which might materially and
adversely affect the performance by Redwood Trust of its obligations
under, or the validity or enforceability of, any Transaction Document to
which Redwood Trust is a party. Such opinion may express its reliance as
to factual matters on the representations and warranties made by, and on
certificates or other documents furnished by officers of, the parties to
the Transaction Documents.
Such opinion may assume the due authorization, execution and delivery
of the instruments and documents referred to therein by the parties thereto
other than Redwood Trust. Such opinion may be qualified as an opinion only on
the laws of the States of Maryland, Delaware and California and the federal law
of the United States. To the extent that such counsel relies upon the opinion
of other counsel in rendering any portion of its opinion, the opinion of such
other counsel shall be attached to and delivered with the opinion of such
counsel that is delivered to the Underwriters.
(g) The Master Servicer shall have furnished to the Underwriters an
opinion, dated the Closing Date, of _____________, counsel to the Master
Servicer, in form and
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substance satisfactory to the Underwriters and counsel to the
Underwriters, to the effect that:
(i) The Master Servicer has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
__________ and is duly qualified to do business in, and is in good
standing as a foreign corporation under the laws of each jurisdiction
where the character of its properties or the nature of its activities
makes such qualification necessary, except such jurisdictions, if any, in
which the failure to be so qualified will not have a material adverse
effect on the condition (financial or otherwise), earnings, regulatory
affairs, business affairs, business prospects or properties of the Master
Servicer; and the Master Servicer holds all material licenses,
certificates and permits from all governmental authorities necessary for
the conduct of its business as described in the Prospectus;
(ii) Each Transaction Document to which the Master Servicer is a
party has been duly authorized, executed and delivered by the Master
Servicer;
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(iii) No consent, approval, authorization or order of any _________
court or governmental agency or body is required for the consummation by
the Master Servicer of the transactions contemplated by the terms of the
Transaction Documents to which the Master Servicer is a party except any
such as may be required under the "blue sky" or state securities laws of
any jurisdiction in connection with the offering, sale or acquisition of
the Bonds[, any recordations of the assignment of the Pledged Mortgages to
the Bond Trustee (to the extent such recordations are required pursuant to
the Master Servicing Agreement or the Indenture) that have not yet been
completed] and such other approvals as have been obtained;
(iv) The consummation of any of the transactions contemplated by the
terms of the Transaction Documents do not conflict with or result in a
breach or violation of any material term or provision of, or constitute a
default under, the charter or by-laws of the Master Servicer, or, to the
best knowledge of such counsel, any indenture or other agreement or
instrument to which the Master Servicer is a party or by which it is
bound, or any statute or regulation
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applicable to the Master Servicer or any order of any court, regulatory
body, administrative agency or governmental body having jurisdiction over
the Master Servicer; and
(v) There are no legal or governmental actions, investigations or
proceedings pending to which the Master Servicer is a party, or, to the
best knowledge of such counsel, threatened against the Master Servicer,
(A) asserting the invalidity of any Transaction Document or (B) which
might materially and adversely affect the performance by the Master
Servicer of its obligations under, or the validity or enforceability of,
any Transaction Document to which the Master Servicer is a party.
Such opinion may express its reliance as to factual matters on the
representations and warranties made by, and on certificates or other documents
furnished by officers of, the parties to the Transaction Documents. Such
opinion may assume the due authorization, execution and delivery of the
instruments and documents referred to therein by the parties thereto other than
the Master Servicer. Such opinion may be qualified as an opinion only on the
laws of the States of Delaware and _________ and the federal law of the United
States.
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To the extent that such counsel relies upon the opinion of other counsel in
rendering any portion of its opinion, the opinion of such other counsel shall
be attached to and delivered with the opinion of such counsel that is delivered
to the Underwriters.
(h) The Underwriters shall have received a copy of each opinion delivered
to the Bond Trustee pursuant to Section 2.12 of the Indenture together with a
letter, addressed to the Underwriters and dated the Closing Date, permitting
the Underwriters to rely on such opinions as if the same were addressed to the
Underwriters.
(i) The Underwriters shall have received from their counsel such opinion
or opinions, dated the Closing Date, with respect to the issuance and sale of
the Bonds, the Registration Statement and the Prospectus, and such other
related matters as you may reasonably require.
(j) The Company's independent accountants, [Deloitte & Touche LLP] shall
have furnished to the Underwriters a letter or letters addressed to the
Underwriters and dated as of or prior to the date of first use of the
Prospectus Supplement in the form and reflecting the performance of the
procedures previously agreed to by the Company and the Underwriters.
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(k) Subsequent to the date hereof, there shall not have occurred any
change, or any development involving a prospective change in or affecting the
business or properties of Redwood Trust, the Company or the Issuer which in
your reasonable judgment materially impairs the investment quality of the Bonds
so as to make it impractical or inadvisable to proceed with the public offering
or the delivery of the Bonds as contemplated by the Prospectus.
(l) The Bonds shall be rated not lower than the required ratings set forth
under the heading "Ratings" in the Prospectus Supplement, such ratings shall
not have been rescinded and no public announcement shall have been made that
any such required rating of the Bonds has been placed under review (otherwise
than for possible upgrading).
(m) The Underwriters shall have received copies of any opinions of counsel
supplied to the rating agencies relating to certain matters with respect to the
Bonds. Any such opinions shall be dated the Closing Date and addressed to the
Underwriters or accompanied by reliance letters addressed to the Underwriters.
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(n) The Investor Certificate shall have been duly and validly issued and
shall be outstanding under the Trust Agreement.
(o) The Bond Trustee shall have furnished to the Underwriters an opinion
dated the Closing Date, of counsel to the Bond Trustee (who may be an employee
of the Bond Trustee), in form and substance satisfactory to the Underwriters
and counsel to the Underwriters, to the effect that:
(i) The Bond Trustee has full corporate power and authority to
execute and deliver the Indenture and the Master Servicing Agreement and
to perform its obligations thereunder and to authenticate and deliver the
Bonds;
(ii) The Indenture and the Master Servicing Agreement have been duly
authorized, executed and delivered by the Bond Trustee;
(iii) Each of the Indenture and the Master Servicing Agreement is a
legal, valid and binding obligation of the Bond Trustee, enforceable
against the Bond Trustee in accordance with its respective terms, subject
to applicable bankruptcy, insolvency, reorganization, moratorium,
receivership, conservatorship and similar laws affecting the
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rights of creditors generally, and subject, as to enforceability, to
general principles of equity, regardless of whether such enforcement is
considered in a proceeding at law or in equity; and
[(iv) In the event that the Master Servicer defaults in its
obligation to make Advances pursuant to the Master Servicing Agreement,
the Bond Trustee is not, as of the date hereof, prohibited by any
provision of its articles of incorporation or by-laws from assuming,
pursuant to the Master Servicing Agreement, the obligation to make such
Advances.]
Such opinion may express its reliance as to factual matters on the
representations and warranties made by, and on certificates or other documents
furnished by officers of, the parties to the Transaction Documents. Such
opinion may assume the due authorization, execution and delivery of the
instruments and documents referred to therein by the parties thereto other than
the Bond Trustee or its affiliates. Such opinion may be qualified as an opinion
only on the laws of _________________ ________________ and the federal law of
the United States. To the extent that such counsel relies upon the opinion of
other
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counsel in rendering any portion of its opinion, the opinion of such
other counsel shall be attached to and delivered with the opinion of such
counsel that is delivered to the Underwriters.
(p) The Owner Trustee shall have furnished to the Underwriters an opinion
dated the Closing Date, of counsel to the Owner Trustee (who may be an employee
of the Owner Trustee), in form and substance satisfactory to the Underwriters
and counsel to the Underwriters, to the effect that:
(i) The Owner Trustee has full corporate power and authority to
execute and deliver the Transaction Documents to which it is a party and
to perform its obligations thereunder and to execute and deliver the Bonds
and the Investor Certificate;
(ii) The Transaction Documents to which the Owner Trustee is a party
and the Investor Certificate have been duly authorized, executed and
delivered by the Owner Trustee; and
(iii) Each of the Trust Agreement and the Investor Certificate is a
legal, valid and binding obligation of the Owner Trustee, enforceable
against the Owner Trustee in accordance with its respective terms, subject
to applicable
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bankruptcy, insolvency, reorganization, moratorium, receivership,
conservatorship and similar laws affecting the rights of creditors
generally, and subject, as to enforceability, to general principles of
equity, regardless of whether such enforcement is considered in a
proceeding at law or in equity.
Such opinion may express its reliance as to factual matters on the
representations and warranties made by, and on certificates or other documents
furnished by officers of, the parties to the Transaction Documents. Such
opinion may assume the due authorization, execution and delivery of the
instruments and documents referred to therein by the parties thereto other than
the Owner Trustee or its affiliates. Such opinion may be qualified as an
opinion only on the laws of the State of Delaware and the federal law of the
United States. To the extent that such counsel relies upon the opinion of other
counsel in rendering any portion of its opinion, the opinion of such other
counsel shall be attached to and delivered with the opinion of such counsel
that is delivered to the Underwriters.
(q) The Company shall have furnished to the Underwriters such further
information, certificates and documents
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as the Underwriters may reasonably have requested, and all proceedings in
connection with the transactions contemplated by this Agreement and all
documents incident hereto shall be in all material respects satisfactory in
form and substance to the Underwriters and their counsel.
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided in this Agreement, this
Agreement and all obligations of an Underwriter hereunder may be canceled at,
or at any time prior to, the Closing Date by such Underwriter. Notice of such
cancellation shall be given to the Company in writing, or by telephone or
telegraph confirmed in writing.
7. Termination. This Agreement shall be subject to termination in your
absolute discretion, by notice given to the Company prior to delivery of and
payment for the Bonds, if prior to such time (i) trading in securities
generally on the New York Stock Exchange shall have been suspended or
materially limited, (ii) a general moratorium on commercial banking activities
in New York shall have been declared by either Federal or New York State
authorities, or (iii) there shall have occurred any material outbreak or
escalation of hostilities or other calamity or crisis
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the effect of which on the financial markets is such as to make it, in your
judgment after consultation with the Company, impracticable to market the Bonds
on the terms specified in this Agreement.
8. Representations and Indemnities to Survive. The respective agreements,
representations, warranties, indemnities and other statements of the Company
and Redwood Trust and their respective officers and of each Underwriter set
forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of any Underwriter
or the Company and Redwood Trust, and will survive delivery of and payment for
the Bonds. The provisions of Section 5(d), Section 9, Section 12 and Section 13
hereof shall survive the termination or cancellation of this Agreement.
9. Reimbursement of Underwriter Expenses. If for any reason, other than
default by any Underwriter in its obligation to purchase the Bonds or
termination by any Underwriter pursuant to Section 7 hereof, the Bonds are not
delivered as provided herein, the Company and Redwood Trust jointly and
severally agree to reimburse each Underwriter for all out-of-pocket expenses of
such Underwriter, including reasonable fees and disbursements of
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its counsel, reasonably incurred by such Underwriter in making preparations for
the purchase, sale and delivery of the Bonds, but the Company and Redwood Trust
shall then be under no further liability to any Underwriter with respect to the
Bonds, except as provided in Section 5(d) hereof.
10. Certain Definitions. For purposes of this Agreement, the following
terms shall have the respective meanings set forth below:
Computational Materials: Computer generated tables and/or charts
displaying, with respect to any Class or Classes of Bonds, any of the
following: yield; average life; duration; expected maturity; interest rate
sensitivity; loss sensitivity; cash flow characteristics; background
information regarding the [Pledged Mortgages]; proposed structure; decrement
tables; or similar information (tabular or otherwise) of a statistical,
mathematical, tabular or computational nature.
Company Prospectus Information: All information contained or incorporated
in the Prospectus other than the Underwriter Information.
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Company Registration Information: All information contained or
incorporated in the Registration Statement other than the Underwriter
Information.
Seller Mortgage Loan Information: Information relating to the [Pledged
Mortgages] furnished by or on behalf of the Company or Redwood Trust to the
Underwriters, upon which the mathematical calculations reflected in the
Computational Materials of such Underwriter are based.
Spread: The excess, if any, of (i) the purchase prices paid by investors
to an Underwriter for the Bonds over (ii) the purchase price paid by such
Underwriter to the Issuer for the Bonds purchased by such Underwriter.
Underwriter Information: The only written information furnished by or on
behalf of an Underwriter to the Company specifically for use in connection with
the preparation of the Registration Statement or the Prospectus, such
information being (i) the information relating to the Underwriter set forth in
the Prospectus Supplement in [the last two paragraphs of the cover page thereof
and in the second sentence in the first paragraph and the second paragraph
under the caption "Method of Distribution"] therein and (ii) any Computational
Materials
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prepared by the Underwriter, furnished to the Company and included in the Form
8-K; provided, however, that such Computational Materials shall not include any
Seller Mortgage Loan Information or any errors in the mathematical calculations
reflected in such Computational Materials to the extent such errors result from
such Seller Mortgage Loan Information.
11. Computational Materials. Each Underwriter which desires to furnish
Computational Materials to the Company shall furnish [two (2)] copies thereof[,
together with a computer diskette therefor in XXXXX format,] to Xxxxx & Xxxxx
no later than 3:00 p.m. New York City time on the business day prior to the day
on which the Prospectus Supplement is being cleared for printing. In addition,
each Underwriter which has so furnished Computational Materials to the Company
hereby represents as to the materials it has furnished as follows:
(a) The Computational Materials so furnished by such Underwriter include
all Computational Materials prepared by such Underwriter that:
(i) are generated based on assumptions regarding the payment
priorities and characteristics of a Class of Bonds that is actually issued
and purchased by an Underwriter; and
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(ii) are provided to prospective investors under the following
conditions prior to the time of filing of the Prospectus pursuant to Rule
424(b):
(A) in the case of each prospective investor that has orally
indicated to such Underwriter that it will purchase all or a portion
of the Class of Bonds to which such Computational Materials relate,
the Computational Materials relating to such Class that are sent to
such prospective investor; and (B) for any other prospective
investor, all Computational Materials that are sent to such
prospective investor after the structure for the Bonds is finalized;
provided, however, that the Computational Materials so furnished need not
include any Computational Materials that relate to abandoned structures or
that are furnished to prospective investors prior to the time that the
structure of the Bonds is finalized where such investors have not
indicated to such Underwriter their intention to purchase the Class or
Classes of Bonds described in such Computational Materials.
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(b) The Computational Materials included in the Underwriter Information
pursuant to the definition thereof do not contain an untrue statement of a
material fact or, when read in conjunction with the Prospectus as an integral
document, omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that no representation is made that the
Prospectus (exclusive of such Computational Materials and the Underwriter
Information provided by such Underwriter) does not include any untrue statement
of a material fact and does not omit to state any material fact necessary to
make the statements contained therein, in the light of the circumstances under
which they were made, not misleading.
(c) The Computational Materials contain customary legends regarding the
assumptions on which they are based and the absence of assurances or
representations as to the actual rate or timing of principal payments or
prepayments on any of the [Pledged Mortgages] or the performance
characteristics of the Bonds, and a statement to the effect that the
Computational Materials were prepared by the applicable Underwriter in reliance
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on information regarding the [Pledged Mortgages] furnished by the Company.
(d) Neither the Company nor any of its affiliates participated in the
preparation of the Computational Materials other than by supplying the Seller
Mortgage Loan Information to the Underwriter.
(e) At or prior to the time any Computational Materials are furnished to
the Company for filing on the Form 8-K, the Underwriter furnishing such
Computational Materials will provide to the Company and such Underwriter a
letter, in form and substance reasonably satisfactory to the Company and such
Underwriter, of a firm of independent public accountants of national reputation
to the effect that such accountants have performed certain specified procedures
with respect to such Computational Materials and have found no exceptions,
other than such exceptions as are acceptable to the Company and the
Underwriter. The costs and expenses of such letter will be borne by _________.
12. Indemnification. (a) The Company and Redwood Trust jointly and
severally agree to indemnify and hold harmless
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each Underwriter and each person who controls an Underwriter within the meaning
of either the Act or the Exchange Act against any and all losses, claims,
damages or liabilities, joint or several, to which they may become subject
under the Act, the Exchange Act, or other federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained
in the Company Prospectus Information or the Company Registration Information
or in any revision or amendment thereof or supplement thereto or arise out of
or are based upon the omission or alleged omission to state in the Company
Registration Information or the Company Prospectus Information or in any
revision or amendment thereof or supplement thereto a material fact required to
be stated therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, and agrees to
reimburse each such indemnified party for any legal or other expenses
reasonably incurred by it or him, as incurred, in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that the Company
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and Redwood Trust shall not be liable to a particular Underwriter or any person
who controls such Underwriter to the extent that any misstatement or alleged
misstatement or omission or alleged omission was (i) made in reliance upon and
in conformity with the Underwriter Information and (ii) in the case of the
Company Prospectus Information, to the extent that such misstatement or
omission was corrected and such Underwriter did not deliver, at or prior to the
written confirmation of such sale, a copy of the Prospectus as then revised,
amended or supplemented in any case where such delivery is required by the Act
or the Exchange Act, if the Company has previously furnished copies thereof to
the Underwriters in accordance with the terms of this Agreement. This indemnity
agreement will be in addition to any liability which the Company or Redwood
Trust may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless the
Company, Redwood Trust and the Issuer, the officers of the Company who signed
the Registration Statement or any amendment thereof, the directors of the
Company, and each person who controls the Company, Redwood Trust or the Issuer
within the meaning of either the Act or the Exchange Act, to the same extent as
the foregoing indemnities from the Company and
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Redwood Trust to each Underwriter; provided, however, that an Underwriter will
be liable in any such case only to the extent that such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with the Underwriter Information; and provided, further,
that any such omission or alleged omission relating to
the Computational Materials included in the Underwriter Information pursuant to
the definition thereof shall be determined by reading such Computational
Materials in conjunction with the Prospectus as an integral document and in the
light of the circumstances under which such statements in the Computational
Materials and Prospectus were made. This indemnity agreement will be in
addition to any liability which any Underwriter may otherwise have.
(c) Promptly after receipt by an indemnified party under this Section 12
of notice of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party under
this Section 12, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
the indemnifying party from
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any liability which it may have to any indemnified party otherwise than under
this Section 12. In case any such action is brought against any indemnified
party and it notifies the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein, and to the extent
that it may elect by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party, to assume the
defense thereof, with counsel satisfactory to such indemnified party; provided,
however, that if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party or parties shall
have reasonably concluded that there may be legal defenses available to it or
them and/or other indemnified parties that are different from or additional to
those available to the indemnifying party, the indemnified party or parties
shall have the right to elect separate counsel to assert such legal defenses
and to otherwise participate in the defense of such action on behalf of such
indemnified party or parties. Upon receipt of notice from the indemnifying
party to such indemnified party of its election so to assume the defense of
such action and approval by the indemnified party of counsel, the indemnifying
party will
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not be liable for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof, unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next
preceding sentence (it being understood, however, that the indemnifying party
shall not be liable for the expenses of more than one separate counsel for each
of, and approved by, the Underwriter in the case of paragraph (a) of this
Section 12, representing the related indemnified parties under such paragraph
(a) who are parties to such action), (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action or (iii) the indemnifying party has authorized the employment of counsel
for the indemnified party at the expense of the indemnifying party; and except
that, if clause (i) or (iii) is applicable, such liability shall only be in
respect of the counsel referred to in such clause (i) or (iii). No indemnifying
party shall, without the consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
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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.
13. Contribution. (a) If the indemnification provided for in Section 12 is
unavailable or insufficient to hold harmless an indemnified party under Section
12, then each indemnifying party shall contribute to the amount paid or payable
by such indemnified party as a result of the losses, claims, damages or
liabilities referred to in Section 12 above in such proportion as is
appropriate to reflect the relative benefits received by the Company and
Redwood Trust on the one hand and the Underwriter on the other from the
offering of the Bonds 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 and Redwood Trust on the one hand and the
Underwriter on the other in connection with the statements or omissions or
alleged statements or alleged omissions which resulted in such losses, claims,
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damages or liabilities as well as any other relevant equitable considerations.
The relative benefits received by the Company and Redwood Trust on the one hand
and the Underwriters on the other shall be in such proportion so that the
Underwriters are responsible for an amount equal to the Spreads, and the
Company and Redwood Trust are responsible for the balance. The relative fault
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omissions or alleged
omission to state a material fact relates to information supplied by the
Company or Redwood Trust or by the Underwriters and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this Section 13(a) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
Section 13(a). An Underwriter shall not be required to contribute any amount in
excess of (x) the Spread of such Underwriter, over (y) the amount of any
damages which the
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applicable Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. The
obligation of any Underwriter to contribute under this Section 13 is several in
proportion to the portion of the Spread applicable to it. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
14. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and assigns, and no
other person will have any right or obligation hereunder.
15. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York.
16. Miscellaneous. Time shall be of the essence of this Agreement. This
Agreement supersedes all prior or contemporaneous agreements and understandings
relating to the subject matter hereof. Neither this Agreement nor any term
hereof may be changed, waived, discharged or terminated except by a writing
signed by the party against whom enforcement of such
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change, waiver, discharge or termination is sought. This Agreement may be
signed in any number of counterparts, each of which shall be deemed an
original, which taken together shall constitute one and the same instrument.
17. Notices. All communications hereunder shall be in writing and
effective only on receipt and, if sent to an Underwriter, shall be delivered to
the address specified on the signature page hereof; or if sent to the Company
or Redwood Trust, shall be delivered to 000 Xxxxxxx Xxxxxxx, Xxxx Xxxxxx,
Xxxxxxxxxx 00000, attention of Xxxxxxx X. Xxxxxx.
* * *
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If the foregoing is in accordance with your understanding of our agreement
please sign and return to the undersigned a counterpart hereof, whereupon this
Agreement and your acceptance shall represent a binding agreement by and among
the Company, Redwood Trust and each Underwriter relating to the Issuer's
Collateralized Mortgage Bonds _____.
Very truly yours,
SEQUOIA MORTGAGE FUNDING
CORPORATION
By:__________________________
Name:
Title:
REDWOOD TRUST, INC.
By:__________________________
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted.
[Underwriters]
By: ____________________________
Name:
Title:
Address:
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