Exhibit 1.1
AMRESCO RESIDENTIAL SECURITIES CORPORATION
AND
XXXXXX XXXXXXX & CO. INCORPORATED
As Representative of the several Underwriters
UNDERWRITING AGREEMENT
FOR
AMRESCO RESIDENTIAL SECURITIES CORPORATION MORTGAGE LOAN TRUST
1998-3
MORTGAGE LOAN PASS THROUGH CERTIFICATES, SERIES 1998-3
Class A-7 Certificates
Class A-8 Certificates
Class M-1A Certificates
Class M-2A Certificates
Class B-1A Certificates
Class B-1F Certificates
September 15, 0000
XXXXXXX XXXXXXXXXXX SECURITIES CORPORATION MORTGAGE LOAN TRUST
1998-3
MORTGAGE LOAN PASS THROUGH CERTIFICATES, SERIES 1998-3
UNDERWRITING AGREEMENT
----------------------
September 15, 1998
Xxxxxx Xxxxxxx & Co. Incorporated
as Representative of the
several Underwriters
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Ladies and Gentlemen:
AMRESCO Residential Securities Corporation (the "Depositor"), a
Delaware corporation, has authorized the issuance and sale of Mortgage Loan
Pass-Through Certificates, Series 1998-3, Class A-1, Class X-0, Xxxxx X-0, Class
A-4, Class A-5, Class A-6, Class A-7, Class A-8 (the "Class A Certificates"),
Class M-1A (the "Class M-1 Certificates"), Class M-2A (the "Class M-2
Certificates" and, collectively with the Class M-1 Certificates, the "Mezzanine
Certificates"), Class B-1F and Class B-1A (the "Class B-1 Certificates"), Class
C-FIO and Class C-AIO Certificates (collectively, the "Class C-IO Certificates"
and, collectively, with the Mezzanine Certificates and the Class B-1
Certificates, the "Subordinate Certificates") and the Class S Certificates, the
Class D and the Class R Certificates (the "Retained Certificates," and,
collectively with the Class A Certificates and the Subordinate Certificates, the
"Certificates"), evidencing interests in a pool of fixed and adjustable rate
mortgage loans (the "Mortgage Loans"). The Mortgage Loans are secured primarily
by first and second deeds of trust or mortgages on one- to four-family
residential properties. The Class A-7 Certificates, Class A-8 Certificates, the
Mezzanine Certificates and the Class B-1 Certificates (collectively, the
"Offered Certificates") will be publicly offered pursuant to the Prospectus
described below. The Class A-1, Class A-2, Class A-3, Class A-4, Class A-5 and
Class A-6 Certificates will be sold pursuant to a Purchase Agreement (the
"Purchase Agreement") by the Depositor to the Federal Home Loan Mortgage
Corporation ("Xxxxxxx Mac"), which will in turn issue pass-through certificates
to be underwritten by you on the date hereof. The Class C-IO Certificates and
the Retained Certificates will not be publicly offered.
Only the Offered Certificates are being purchased by the Underwriters
named in Schedule A hereto, and the Underwriters are purchasing, severally, only
the Offered Certificates set forth opposite their names in Schedule A, except
that the amounts purchased by the Underwriters may change in accordance with
Section X of this Agreement. Xxxxxx Xxxxxxx & Co. Incorporated is acting as
representative of the several Underwriters and, in such capacity, is hereinafter
referred to as the "Representative."
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The Certificates will be issued under a Pooling and Servicing
Agreement, dated as of September 1, 1998 (the "Pooling and Servicing Agreement")
among the Depositor, AMRESCO Residential Capital Markets, Inc., as Seller (the
"Seller"), as Master Servicer (the "Master Servicer") and Special Servicer
("Special Servicer"), AMRESCO Residential Mortgage Corporation, as Servicer (the
"Servicer"), Xxxxxxx Mac, as Guarantor, and Norwest Bank Minnesota, National
Association, as trustee (the "Trustee"). The Certificates will evidence
fractional undivided interests in the trust (the "Trust"). The assets of the
Trust will initially include, among other things, a pool of fixed and adjustable
rate Mortgage Loans (the "Mortgage Loans") and any accounts held by the Trustee
for the Trust. The Mortgage Loans will be acquired, in part, from the various
Originators pursuant to the various "Transfer Agreements" as such term is
defined in the Pooling and Servicing Agreement.
The Offered Certificates are more fully described in a Registration
Statement which the Depositor has furnished to the Underwriters. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Pooling and Servicing Agreement. For purposes of this Agreement, "Business Day"
means any day on which the New York Stock Exchange, Inc. is open for trading.
SECTION I. Representations and Warranties of the Depositor. The
Depositor represents and warrants to, and agrees with the Underwriters that:
A. A Registration Statement on Form S-3 (No. 333-30759) has (i) been
prepared by the Depositor in conformity with the requirements of the Securities
Act of 1933, as amended (the "Securities Act"), and the rules and regulations
(the "Rules and Regulations") of the United States Securities and Exchange
Commission (the "Commission") thereunder, (ii) been filed with the Commission
and (iii) become effective under the Securities Act. Copies of such Registration
Statement have been delivered by the Depositor to the Representative. As used in
this Agreement, "Effective Time" means the date and the time as of which such
Registration Statement, or the most recent post-effective amendment thereto, if
any, was declared effective by the Commission; "Effective Date" means the date
of the Effective Time; "Registration Statement" means such registration
statement, at the Effective Time, including any documents incorporated by
reference therein at such time; "Basic Prospectus" means such final prospectus
dated September 4, 1997; and "Prospectus Supplement" means the final prospectus
supplement relating to the Offered Certificates, to be filed with the Commission
pursuant to paragraphs (2), (3) or (5) of Rule 424(b) of the Rules and
Regulations. "Prospectus" means the Basic Prospectus together with the
Prospectus Supplement. Reference made herein to the Prospectus shall be deemed
to refer to and include any documents incorporated by reference therein pursuant
to Item 12 of Form S-3 under the Securities Act as of the date of the
Prospectus, any reference to any amendment or supplement to the Prospectus shall
be deemed to refer to and include any document filed under the Securities
Exchange Act of 1934 (the "Exchange Act") after the date of the Prospectus and
incorporated by reference in the Prospectus, and any reference to any amendment
to the Registration Statement shall be deemed to include any report of the
Depositor filed with the Commission pursuant to Section 13(a) or 15(d) of the
Exchange Act after the Effective Time that is incorporated by reference in the
Registration Statement. The Commission has not issued any order preventing or
suspending the use of the Prospectus. There are no contracts or documents of the
Depositor which are required to be filed as exhibits to the Registration
Statement pursuant to the Securities Act or the Rules and Regulations which have
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not been so filed or incorporated by reference therein on or prior to the
Effective Date of the Registration Statement other than such documents or
materials, if any, as any Underwriter delivers to the Depositor pursuant to
Section VIII D hereof for filing on Form 8-K.
B. The Registration Statement conforms, and the Prospectus and any
further amendments or supplements to the Registration Statement or the
Prospectus will, when they become effective or are filed with the Commission, as
the case may be, conform in all respects to the requirements of the Securities
Act and the Rules and Regulations. The Registration Statement, as of the
Effective Date thereof and of any amendment thereto, did not contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading. The
Prospectus as of its date, and as amended or supplemented as of the Closing Date
does not and will not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; provided
that no representation or warranty is made as to information contained in or
omitted from the Registration Statement or the Prospectus in reliance upon and
in conformity with written information furnished to the Depositor in writing by
the Underwriters expressly for use therein.
C. The documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Securities Act or
the Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus, when such
documents become effective or are filed with the Commission, as the case may be,
will conform in all material respects to the requirements of the Securities Act
or the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; provided that no representation
is made as to documents deemed to be incorporated by reference in the Prospectus
as the result of filing a Form 8-K at the request of the Underwriters except to
the extent such documents reflect information furnished by the Depositor to the
Underwriters for the purpose of preparing such documents.
D. Since the respective dates as of which information is given in the
Prospectus, there has not been any material adverse change, or any development
involving a prospective material adverse change, in the general affairs,
management, financial condition, or results of operations of the Depositor,
otherwise than as set forth or contemplated in the Prospectus as supplemented or
amended as of the Closing Date.
E. The Depositor has been duly incorporated and is validly existing as
a corporation in good standing under the laws of its jurisdiction of
incorporation, is duly qualified to do business and is in good standing as a
foreign corporation in each jurisdiction in which its ownership or lease of
property or the conduct of its business requires such qualification, and has all
power and authority necessary to own or hold its properties, to conduct the
business in which it is engaged and to enter into and perform its obligations
under this Agreement, the Pooling and
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Servicing Agreement and the Purchase Agreement (collectively, the "Depositor
Agreements") and to cause the Certificates to be issued.
F. There are no actions, proceedings or investigations pending with
respect to which the Depositor has received service of process before or
threatened by any court, administrative agency or other tribunal to which the
Depositor is a party or of which any of its properties is the subject (a) which
if determined adversely to the Depositor would have a material adverse effect on
the business or financial condition of the Depositor, (b) asserting the
invalidity of the Depositor Agreements or the Certificates, (c) seeking to
prevent the issuance of the Certificates or the consummation by the Depositor of
any of the transactions contemplated by the Depositor Agreements, (d) which
might individually or in the aggregate materially and adversely affect the
performance by the Depositor of its obligations under, or the validity or
enforceability of, the Depositor Agreements or the Certificates or (e) which
might adversely affect the federal income tax attributes of the Certificates as
described in the Prospectus.
G. This Agreement has been, and the other Depositor Agreements, when
executed and delivered as contemplated hereby, will have been, duly authorized,
executed and delivered by the Depositor, and this Agreement constitutes, and the
other Depositor Agreements when executed and delivered as contemplated hereby,
will constitute, legal, valid and binding instruments enforceable against the
Depositor in accordance with their respective terms, subject as to
enforceability to (x) applicable bankruptcy, reorganization, insolvency,
moratorium or other similar laws affecting creditors' rights generally, (y)
general principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law), and (z) with respect to rights of indemnity
under this Agreement, limitations of public policy under applicable securities
laws.
H. The execution, delivery and performance of the Depositor Agreements
by the Depositor and the consummation of the transactions contemplated hereby
and thereby, compliance with the provisions thereof, and the issuance and
delivery of the Certificates do not and will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument to which the Depositor is a party, by which the
Depositor is bound or to which any of the properties or assets of the Depositor
or any of its subsidiaries is subject, which breach or violation would have a
material adverse effect on the business, operations or financial condition of
the Depositor, nor will such actions result in any violation of the provisions
of the articles of incorporation or by-laws of the Depositor (which breach or
violation would have a material adverse effect on the business, operations or
financial condition of the Depositor), or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Depositor or any of its properties or assets. The Depositor is not a party
to, bound by, or in breach or violation of, any indenture or other agreement or
instrument, or subject to or in violation of any statute, order, rule or
regulation of any court, governmental agency or body or other tribunal having
jurisdiction over the Depositor, which materially and adversely affects, or is
reasonably likely in the future to materially and adversely affect, (i) the
ability of the Depositor to perform its obligations under the Depositor
Agreements or (ii) the business, operations, results of operations, financial
position, income, properties or assets of the Depositor.
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I. The Depositor has no reason to know that Deloitte & Touche, LLP are
not independent public accountants with respect to the Depositor as required by
the Securities Act and the Rules and Regulations.
J. The direction by the Depositor to the Trustee to execute,
authenticate, issue and deliver the Certificates has been duly authorized by the
Depositor, and assuming the Trustee has been duly authorized to do so, when
executed, authenticated, issued and delivered by the Trustee in accordance with
the Pooling and Servicing Agreement, the Certificates will be validly issued and
outstanding and will be entitled to the benefits provided by the Pooling and
Servicing Agreement.
K. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the United
States is required for the issuance of the Certificates and the sale of the
Offered Certificates to the Underwriters, or the consummation by the Depositor
of the other transactions contemplated by the Depositor Agreements, except such
consents, approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the purchase
and distribution of the Offered Certificates by the Underwriters or as have been
obtained.
L. The Depositor possesses all material licenses, certificates,
authorities or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct the business now conducted by
it and as described in the Prospectus, and there are no proceedings pending with
respect to which the Depositor has received service of process or, to the best
knowledge of the Depositor threatened, relating to the revocation or
modification of any such license, certificate, authority or permit which if
decided adversely to the Depositor would, singly or in the aggregate, materially
and adversely affect the conduct of its business, operations or financial
condition.
M. At the time of execution and delivery of the Pooling and Servicing
Agreement, the Depositor will: (i) have good title to the Mortgage Loans
conveyed by the Seller, free and clear of any lien, mortgage, pledge, charge,
encumbrance, adverse claim or other security interest (collectively, "Liens");
(ii) not have assigned to any person any of its right or title in the Mortgage
Loans, in the Pooling and Servicing Agreement or in the Certificates being
issued pursuant thereto; and (iii) have the power and authority to sell its
interest in the Mortgage Loans to the Trustee and to sell the Offered
Certificates to the Underwriters. Upon execution and delivery of the Pooling and
Servicing Agreement by the Trustee, the Trustee will have acquired beneficial
ownership of all of the Depositor's right, title and interest in and to the
Mortgage Loans. Upon delivery to the Underwriters of the Offered Certificates,
the Underwriters will have good title to the Offered Certificates, free of any
Liens.
N. As of the Closing Date, each of the Mortgage Loans will meet the
eligibility criteria described in the Prospectus and will conform to the
descriptions thereof contained in the Prospectus.
O. Neither the Depositor nor the Trust is an "investment company"
within the meaning of such term under the Investment Company Act of 1940 and the
rules and regulations of the Commission thereunder (the "1940 Act").
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P. At the Closing Date, the Offered Certificates and the Pooling and
Servicing Agreement will conform in all material respects to the descriptions
thereof contained in the Prospectus.
Q. At the Closing Date, the Class A Certificates shall have been rated
in the highest rating category by Xxxxx'x Investors Service, Inc. ("Moody's")
and Fitch IBCA, Inc. ("Fitch"). In addition, the Class M-1, Class M-2 and Class
B-1 Certificates shall receive ratings of at least "Xx0," "X0" and "Baa3,"
respectively from Moody's and at least "AA," "A" and "BBB," respectively, from
Fitch.
R. Any taxes, fees and other governmental charges in connection with
the execution, delivery and issuance of the Depositor Agreements and the
Certificates have been paid or will be paid at or prior to the Closing Date.
S. At the Closing Date, each of the representations and warranties of
the Depositor set forth in the Pooling and Servicing Agreement will be true and
correct in all material respects.
T. The transfer of the Mortgage Loans to the Trust at the Closing Date
will be treated by the Depositor for financial accounting and reporting purposes
as a sale of assets and not as a pledge of assets to secure debt.
U. The Depositor is not aware of (i) any request by the Commission for
any further amendment of the Registration Statement or the Prospectus or for any
additional information, or (ii) any notification with respect to the suspension
of the qualification of the Certificates for sale in any jurisdiction or the
initiating or threatening of any proceeding for such purpose.
V. The Pooling and Servicing Agreement is not required to be qualified
under the Trust Indenture Act of 1939, as amended (the "1939 Act").
Any certificate signed by an officer of the Depositor and delivered to
the Representative or counsel for the Representative in connection with an
offering of the Offered Certificates shall be deemed, and shall state that it
is, a representation and warranty as to the matters covered thereby to each
person to whom the representations and warranties in this Section I are made.
SECTION II. Purchase and Sale. The commitment of the Underwriters to
purchase the Offered Certificates pursuant to this Agreement shall be deemed to
have been made on the basis of the representations and warranties herein
contained and shall be subject to the terms and conditions herein set forth. The
Depositor agrees to instruct the Trustee to issue the Offered Certificates and
agrees to sell to the Underwriters, and the Underwriters agree (except as
provided in Sections X and XI hereof) severally and not jointly to purchase from
the Depositor the aggregate initial principal amounts or percentage interests of
the Offered Certificates set forth opposite their names on Schedule A, at the
purchase price or prices set forth in Schedule A.
SECTION III. Delivery and Payment. Delivery of and payment for the
Offered Certificates to be purchased by the Underwriters shall be made at
offices of AMRESCO, Inc. in Dallas, Texas, or at such other place as shall be
agreed upon by the Representative and the Depositor at 10:00 A.M. central
standard time on September 29, 1998 or at such other time or date as shall be
agreed upon in writing by the Representative and the Depositor (such date being
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referred to as the "Closing Date"). Payment shall be made to the Depositor by
wire transfer of same day funds payable to the account of the Depositor.
Delivery of the Offered Certificates shall be made to the Representative for the
accounts of the Underwriters against payment of the purchase price thereof. The
Certificates shall be in such authorized denominations and registered in such
names as the Underwriters may request in writing at least two Business Days
prior to the Closing Date. The Offered Certificates will be made available for
examination by the Representative no later than 2:00 p.m. eastern time on the
first Business Day prior to the Closing Date.
SECTION IV. Offering by the Underwriters.
A. It is understood that, subject to the terms and conditions hereof,
the Underwriters propose to offer the Offered Certificates for sale to the
public as set forth in the Prospectus.
B. It is understood that the Underwriters may prepare and provide to
prospective investors certain Computational Materials and ABS Term Sheets (as
defined below) in connection with the offering of the Offered Certificates,
subject to the following conditions:
1. In connection with the use of Computational Materials, the
Underwriters shall comply with all applicable requirements of the
No-Action Letter, dated May 20, 1994, issued by the Division of
Corporation Finance of the Commission to Xxxxxx, Xxxxxxx Acceptance
Corporation I, Xxxxxx, Peabody & Co. Incorporated and Xxxxxx Structured
Asset Corporation, as made applicable to other issuers and underwriters
by the Division of Corporation Finance of the Commission in response to
the request of the Public Securities Association ("PSA"), dated May 23,
1994 (collectively, the "Xxxxxx/PSA Letters"), as well as the PSA
Letter referred to below. In connection with the use of ABS Term
Sheets, the Underwriters shall comply with all applicable requirements
of the No-Action Letter, dated February 17, 1995, issued by the
Division of Corporation Finance to the Commission to PSA (the "PSA
Letter" and, together with the Xxxxxx/PSA Letters, the "No-Action
Letters").
2. The term "Computational Materials" as used herein shall
have the meaning given to such term in the No-Action Letters, but shall
include only those Computational Materials that have been prepared or
delivered to prospective investors by or at the direction of the
Underwriters. The terms "ABS Term Sheets," "Collateral Term Sheets" and
"Structural Term Sheets" as used herein shall have the meanings given
to such terms in the PSA Letter, but shall include only those ABS Term
Sheets, Collateral Term Sheets or Structural Term Sheets that have been
prepared or delivered to prospective investors by or at the direction
of the Underwriters.
3. All Computational Materials and ABS Term Sheets provided to
prospective investors that are required to be filed pursuant to the
No-Action Letters shall bear a legend on each page in a form previously
agreed upon by the Depositor and the Underwriters.
4. Any Computational Materials and ABS Term Sheets are subject
to review by and approval of the Depositor prior to their distribution
to any prospective investors
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and a copy of such Computational Materials and ABS Term Sheets
as are delivered to prospective investors shall, in addition
to the foregoing delivery requirements, be delivered to the
Depositor simultaneously with delivery to prospective
investors.
5. The Underwriters shall provide to the Depositor, for filing
on Form 8-K as provided in Section V.M, copies (in such format as
required by the Depositor) of all Computational Materials and ABS Term
Sheets that are required to be filed with the Commission pursuant to
the No-Action Letters. Each delivery of Computational Materials or ABS
Term Sheets to the Depositor pursuant to this paragraph shall be
effected by delivering a copy of such material to counsel for the
Depositor on behalf of the Depositor and one copy of such materials to
the Depositor. The Underwriters may provide copies of the foregoing in
a consolidated or aggregate form that includes all information required
to be filed. All Computational Materials and ABS Term Sheets described
in this Section must be provided to the Depositor not later than 10:00
a.m., New York time, on the Business Day before the date on which
filing thereof is required pursuant to the terms of this Agreement.
Each Underwriter agrees that it will not provide to any investor or
prospective investor in the Offered Certificates any Computational
Materials or ABS Term Sheets on or after the day on which Computational
Materials and ABS Term Sheets are required to be provided to the
Depositor pursuant to this Section (other than copies of Computational
Materials or ABS Term Sheets previously submitted to the Depositor in
accordance with this Section for filing pursuant to Section V.M),
unless such Computational Materials or ABS Term Sheets are preceded or
accompanied by the delivery of a Prospectus to such investor or
prospective investor.
6. All information included in the Computational Materials and
ABS Term Sheets shall be generated based on substantially the same
methodology and assumptions that are used to generate the information
in the Prospectus Supplement as set forth therein; provided, however,
that the Computational Materials and ABS Term Sheets may include
information based on alternative methodologies or assumptions specified
therein. If any Computational Materials or ABS Term Sheets that are
required to be filed were based on assumptions with respect to the
Mortgage Loans that are incorrect, that differ from the final
information about the Mortgage Pool in any material respect or on
Certificate structuring terms that were revised in any material respect
prior to the printing of the Prospectus, to the extent the Prospectus
Supplement does not specifically correct such inaccuracies, the
Underwriters shall prepare revised Computational Materials or ABS Term
Sheets, as the case may be, based on the final information about the
Mortgage Pool and structuring assumptions, circulate such revised
Computational Materials or ABS Term Sheets, as the case may be, to all
recipients of the preliminary versions thereof that indicated orally to
an Underwriter that they would purchase all or any portion of the
Offered Certificates and include such revised Computational Materials
or ABS Term Sheets (marked "as revised") in the materials delivered to
the Depositor pursuant to IV.B.5.
7. The Depositor shall not be obligated to file any
Computational Materials or ABS Term Sheets that (i) in the reasonable
determination of the Depositor and the Underwriters and their
respective counsel are not required to be filed pursuant to the
No-Action Letters or (ii) have been determined to contain any material
error or omission,
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provided that, at the request of an Underwriter, the Depositor will
file Computational Materials or ABS Term Sheets that contain a material
error or omission if clearly marked "superseded by materials dated
_____________" and accompanied by corrected Computational Materials or
ABS Term Sheets that are marked "material previously dated
__________________, as corrected." In the event that at any time when a
prospectus relating to the Offered Certificates is required to be
delivered under the Securities Act, any Computational Materials or ABS
Term Sheets are determined, in the reasonable judgment of the Depositor
or the Underwriters to contain a material error or omission, the
applicable Underwriter shall prepare a corrected version of such
Computational Materials or ABS Term Sheets, shall circulate such
corrected version of such Computational Materials or ABS Term Sheets to
all recipients of the prior version thereof that either indicated
orally to such Underwriter that they would purchase all or any portion
of the Offered Certificates, or actually purchased all or any portion
thereof, and shall deliver copies of such Computational Materials or
ABS Term Sheets (marked "as corrected") to the Depositor for filing
with the Commission is a subsequent Form 8-K submission (subject to the
Depositor's obtaining an accountant's comfort letter in respect of such
corrected Computational Materials or ABS Term Sheets, which shall be at
the expense of the applicable Underwriter or Underwriters).
C. Each Underwriter represents and warrants and agrees with the
Depositor that, as of the date hereof and as of the Closing Date, that: (i) the
Computational Materials and ABS Term Sheets furnished to the Depositor pursuant
to Section IV.B.5 constitute (either in original, aggregated or consolidated
form) all of the materials furnished to prospective investors by the Underwriter
prior to the time of delivery thereof to the Depositor that are required to be
filed with the Commission with respect to the Offered Certificates in accordance
with the No-Action Letters, and such Computational Materials and ABS Term Sheets
comply with the requirements of the No-Action Letters; (ii) on the date any such
Computational Materials and ABS Term Sheets with respect to such Certificates
(or any written or electronic materials furnished to prospective investors on
which the Computational Materials and ABS Term Sheets are based) were last
furnished to each prospective investor and on the date of delivery thereof to
the Depositor pursuant to Section IV.B.5 and on the related Closing Date, such
Computational Materials and ABS Terms Sheets (or materials) were accurate in all
material respects when read in conjunction with the Prospectus (taking into
account the assumptions explicitly set forth in the Computational Materials),
except to the extent of any errors therein that are caused by errors in the
Mortgage Pool information provided to the Underwriters by the Depositor; (iii)
the Underwriters have not and will not represent to potential investors that any
Computational Materials or ABS Term Sheets were prepared or disseminated on
behalf of the Depositor; and (iv) all Computational Materials and ABS Term
Sheets (or underlying materials distributed to prospective investors on which
the Computational Materials and ABS Term Sheets were based) contained and will
contain the legend in the form previously agreed upon by the Depositor and the
Underwriters as required by Section IV.B.3.
Notwithstanding the foregoing, the Underwriters make no representation
or warranty as to whether any Computational Materials or ABS Term Sheets (or any
written or electronic materials furnished to prospective investors on which the
Computational Materials or ABS Term Sheets are based) included or will include
any inaccurate statement resulting directly
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from any error contained in the Mortgage Pool information provided to the
Underwriters by the Depositor.
D. If an Underwriter does not provide any Computational Materials or
ABS Term Sheets to the Depositor pursuant to Section IV.B.4, the Underwriter
shall be deemed to have represented, as of the Closing Date, that it did not
provide any prospective investors with any information in written or electronic
form in connection with the offering of the Offered Certificates that is
required to be filed with the Commission in accordance with the No-Action
Letters.
SECTION V. Covenants of the Depositor. The Depositor agrees as follows:
A. To prepare the Prospectus in a form approved by the Underwriters and
to file such Prospectus pursuant to Rule 424(b) under the Securities Act not
later than the Commission's close of business on the second Business Day
following the availability of the Prospectus to the Underwriters; to make no
further amendment or any supplement to the Registration Statement or to the
Prospectus prior to the Closing Date except as permitted herein; to advise the
Underwriters, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective
prior to the Closing Date or any supplement to the Prospectus or any amended
Prospectus has been filed prior to the Closing Date and to furnish the
Underwriters with copies thereof; to file promptly all reports and any
definitive proxy or information statements required to be filed by the Depositor
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and, for so long as the
delivery of a prospectus is required in connection with the offering or sale of
the Offered Certificates; to promptly advise the Underwriters of its receipt of
notice of the issuance by the Commission of any stop order or of: (i) any order
preventing or suspending the use of the Prospectus; (ii) the suspension of the
qualification of the Offered Certificates for offering or sale in any
jurisdiction; (iii) the initiation of or threat of any proceeding for any such
purpose; (iv) any request by the Commission for the amending or supplementing of
the Registration Statement or the Prospectus or for additional information. In
the event of the issuance of any stop order or of any order preventing or
suspending the use of the Prospectus or suspending any such qualification, the
Depositor promptly shall use its best efforts to obtain the withdrawal of such
order by the Commission.
B. To furnish promptly to the Underwriters and to counsel for the
Underwriters a signed copy of the Registration Statement as originally filed
with the Commission, and of each amendment thereto filed with the Commission,
including all consents and exhibits filed therewith.
C. To deliver promptly to the Underwriters such number of the following
documents as the Underwriters shall reasonably request: (i) conformed copies of
the Registration Statement as originally filed with the Commission and each
amendment thereto (in each case including exhibits); (ii) the Prospectus and any
amended or supplemented Prospectus; and (iii) any document incorporated by
reference in the Prospectus (including exhibits thereto). If the delivery of a
prospectus is required at any time prior to the expiration of nine months after
the Effective Time in connection with the offering or sale of the Offered
Certificates, and if at such time any events shall have occurred as a result of
which the Prospectus as then amended or supplemented
10
would include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made when such Prospectus is delivered,
not misleading, or, if for any other reason it shall be necessary during such
same period to amend or supplement the Prospectus or to file under the Exchange
Act any document incorporated by reference in the Prospectus in order to comply
with the Securities Act or the Exchange Act, the Depositor shall notify the
Underwriters and, upon any Underwriter's request, shall file such document and
prepare and furnish without charge to the Underwriters and to any dealer in
securities as many copies as the Underwriters may from time to time reasonably
request of an amended Prospectus or a supplement to the Prospectus which
corrects such statement or omission or effects such compliance, and in case the
Underwriters are required to deliver a Prospectus in connection with sales of
any of the Offered Certificates at any time nine months or more after the
Effective Time, upon the request of an Underwriter but at its expense, the
Depositor shall prepare and deliver to such Underwriter as many copies as such
Underwriter may reasonably request of an amended or supplemented Prospectus
complying with Section 10(a)(3) of the Securities Act. If such amendment or
supplement to the Prospectus is required to be contained in a post-effective
amendment to the Registration Statement, the Depositor will use its best efforts
to cause such amendment of the Registration Statement to be made effective as
soon as possible.
D. To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the Prospectus
that may, in the judgment of the Depositor or the Underwriters, be required by
the Securities Act or requested by the Commission.
E. To furnish the Underwriters and counsel for the Underwriters, prior
to filing with the Commission, and to obtain the consent of the Underwriters for
the filing of the following documents relating to the Certificates: (i)
amendment to the Registration Statement or supplement to the Prospectus, or
document incorporated by reference in the Prospectus, or (ii) Prospectus
pursuant to Rule 424 of the Rules and Regulations.
F. To make generally available to holders of the Offered Certificates
as soon as practicable, but in any event not later than 90 days after the close
of the period covered thereby, a statement of earnings of the Trust (which need
not be audited) complying with Section 11(a) of the Securities Act and the Rules
and Regulations (including, at the option of the Depositor, Rule 158) and
covering a period of at least twelve consecutive months beginning not later than
the first day of the first fiscal quarter following the Closing Date.
G. To use its best efforts, in cooperation with the Underwriters, to
qualify the Offered Certificates for offering and sale under the applicable
securities laws of such states and other jurisdictions of the United States or
elsewhere as the Underwriters may designate, and maintain or cause to be
maintained such qualifications in effect for as long as may be required for the
distribution of the Offered Certificates. The Depositor will file or cause the
filing of such statements and reports as may be required by the laws of each
jurisdiction in which the Offered Certificates have been so qualified.
H. So long as the Offered Certificates shall be outstanding, and
pursuant to the Pooling and Servicing Agreement, the Depositor shall cause the
Trustee or the Master Servicer,
11
as soon as such statements are furnished to the Trustee or the Master Servicer,
as applicable, to deliver to the Underwriters the following documents: (i) the
annual statement as to compliance delivered to the Trustee pursuant to Section
8.16 of the Pooling and Servicing Agreement; (ii) the annual statement of a firm
of independent public accountants furnished to the Trustee pursuant to Section
8.17 of the Pooling and Servicing Agreement; (iii) the Servicer's Monthly
Servicing Reports furnished by each Servicer to the Master Servicer pursuant to
Section 8.29(a) of the Pooling and Servicing Agreement, (iv) the Aggregate
Monthly Servicing Report furnished by the Master Servicer to the Trustee
pursuant to Section 8.29(g) of the Pooling and Servicing Agreement; (v) the
monthly reports furnished to the Owners of the Offered Certificates pursuant to
Section 7.09 of the Pooling and Servicing Agreement; and (vi) from time to time,
any other information concerning the Trust filed with any government or
regulatory authority that is otherwise publicly available, as the Representative
may reasonably request.
I. To apply the net proceeds from the sale of the Offered Certificates
in the manner set forth in the Prospectus.
J. During a period of seven calendar days from the Closing Date,
neither the Depositor nor any trust established, directly or indirectly, by the
Depositor will, without the Representative's prior written consent (which
consent shall not be unreasonably withheld), offer or sell mortgage pass-through
certificates backed by mortgage loans, except pursuant to this Agreement and the
Purchase Agreement.
K. The Depositor will enter into the applicable agreements, to which it
is a party pursuant to the Pooling and Servicing Agreement, on or prior to the
Closing Date.
L. To cause any Computational Materials with respect to the
Certificates that are delivered to the Depositor as provided in Section IV.B.5
to be filed with the Commission on a Current Report on Form 8-K at or before the
time of filing of the Prospectus pursuant to Rule 424(b) under the Securities
Act; to cause any ABS Term Sheets with respect to the Certificates that are
delivered to the Depositor as provided in Section IV.B.5 to be filed with the
Commission on one or more Current Reports on Form 8-K (i) at or before the time
of filing of the Prospectus pursuant to Rule 424(b) of the Rules and Regulations
in the case of Structural Term Sheets, and (ii) within two Business Days of
first use in the case of Collateral Term Sheets. Prior to any such filing of
Computational Materials or ABS Term Sheets (other than any Collateral Term
Sheets that are not based on Mortgage Pool information provided to the
Underwriters by the Depositor) by the Depositor, however, the Underwriters must
comply with their obligations pursuant to Section IV.B and the Depositor must
receive a letter from independent, certified public accountants, satisfactory in
form and substance to the Depositor and its counsel, to the effect that such
accountants have performed certain specified procedures, all of which have been
agreed to by the Depositor, as a result of which they determined that all
information that is included in the Computational Materials and ABS Term Sheets
(if any) provided by the Underwriters to the Depositor for filing on Form 8-K,
as provided in Section IV.B and this Section V.M, is accurate except as to such
matters that are not deemed by the Depositor to be material. The Depositor shall
file any corrected Computational Materials or ABS Term Sheets described in
Section IV.B.7 as soon as practicable following receipt thereof.
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M. To prepare the Information Circular relating to the Class A-1, Class
A-2, Class A-3, Class A-4, Class A-5 and Class A-6 Certificates (the
"Information Circular") in a form approved by the Underwriters.
SECTION VI. Conditions to the Underwriters' Obligations. The
obligations of the Underwriters to purchase the Offered Certificates pursuant to
this Agreement are subject to: (i) the accuracy on and as of the Closing Date of
the representations and warranties on the part of the Depositor herein contained
(including those representations and warranties set forth in the Pooling and
Servicing Agreement and incorporated herein); (ii) the performance by the
Depositor of all of its obligations hereunder; (iii) the accuracy of the
statements of the Depositor made in any certificate or other document delivered
pursuant to the provisions hereof; and (iv) the following conditions as of the
Closing Date:
A. The Underwriters shall have received confirmation of the
effectiveness of the Registration Statement. No stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission. Any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus shall
have been complied with. The Prospectus shall have been filed pursuant to Rule
424(b).
B. The Underwriters shall not have discovered and disclosed to the
Depositor on or prior to the Closing Date that the Registration Statement or the
Prospectus or any amendment or supplement thereto contains an untrue statement
of a fact or omits to state a fact which, in the opinion of Xxxxx Xxxxxxxxxx
LLP, counsel for the Underwriters, is material and is required to be stated
therein or is necessary to make the statements therein not misleading.
C. All corporate proceedings and other legal matters relating to the
authorization, form and validity of the Depositor Agreements, the Certificates,
the Registration Statement and the Prospectus, and all other legal matters
relating to the Depositor Agreements and the transactions contemplated hereby
shall be satisfactory in all respects to counsel for the Underwriters, and the
Depositor shall have furnished to such counsel all documents and information
that they may reasonably request to enable them to pass upon such matters. The
Representative shall have received the Depositor Agreements and the Offered
Certificates in form and substance satisfactory to the Representative, duly
executed by all signatories required pursuant to the respective terms thereof.
X. Xxxxx & Xxxxxx LLP shall have furnished to the Underwriters their
written opinion, as counsel to the Depositor, addressed to the Underwriters and
dated the Closing Date, in form and substance satisfactory to the Underwriters,
to the effect that:
1. The conditions to the use by the Depositor of a
registration statement on Form S-3 under the Securities Act, as set
forth in the General Instructions to Form S-3, have been satisfied with
respect to the Registration Statement and the Prospectus.
2. The Registration Statement and any amendments thereto have
become effective under the 1933 Act; to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and not
13
withdrawn and no proceedings for that purpose have been instituted or
threatened and not terminated; and the Registration Statement, the
Prospectus and each amendment or supplement thereto, as of their
respective effective or issue dates (other than the financial and
statistical information contained therein, as to which such counsel
need express no opinion), complied as to form in all material respects
with the applicable requirements of the 1933 Act and the rules and
regulations thereunder, and such counsel does not know of any amendment
to the Registration Statement required to be filed.
3. There are no material contracts, indentures or other
documents of a character required to be described or referred to in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement other than those described or referred to
therein or filed or incorporated by reference as exhibits thereto.
4. The statements set forth in the Basic Prospectus under the
captions "Description of The Securities" and in the Prospectus
Supplement under the captions "Description of The Offered Certificates"
and "The Pooling and Servicing Agreement," to the extent such
statements purport to summarize certain provisions of the Offered
Certificates or of the Pooling and Servicing Agreement, are fair and
accurate in all material respects.
5. The statements set forth in the Basic Prospectus and the
Prospectus Supplement under the captions "ERISA Considerations,"
"Certain Federal Income Tax Consequences," "Legal Investment Matters"
and, "Certain Legal Aspects of the Mortgage Assets" to the extent that
they constitute matters of federal law, provide a fair and accurate
summary of such law or conclusions.
6. The Pooling and Servicing Agreement conforms in all
material respects to the description thereof contained in the
Prospectus and the Pooling and Servicing Agreement is not required to
be qualified under the 1939 Act, and the Trust is not required to be
registered under the 1940 Act.
7. Neither the Depositor nor the Trust is an "investment
company" or under the "control" of an "investment company" as such
terms are defined in the 1940 Act.
8. Assuming that (a) the Trustee causes certain assets of the
Trust Estate, as the Trustee has covenanted to do in the Pooling and
Servicing Agreement, to be treated as a "real estate mortgage
investment conduit" ("REMIC"), as such term is defined in the Internal
Revenue Code of 1986, as amended (the "Code"), and (b) the parties to
the Pooling and Servicing Agreement comply with the terms thereof, the
Lower-Tier REMIC and the Upper-Tier REMIC will be treated as a REMIC,
each Class of the Offered Certificates, the Class C-IO Certificates,
the Class S Certificates and the Class D Certificates will be treated
as the "regular interests" in the Upper-Tier REMIC and the Class R
Certificates will be treated as the sole "residual interest" in the
Upper-Tier REMIC and each Lower-Tier Interest will be treated as the
"regular interests" in the Lower-Tier REMIC and the Lower-Tier REMIC
Residual Class will be the sole "residual interest" in the Lower-Tier
REMIC. Neither the Trust nor certain assets and accounts are
14
subject to tax upon its income or assets by any taxing authority of the
State of New York or the City of New York.
9. Assuming that the Class A-7 Certificates, the Class A-8
Certificates and the Class M-1A Certificates are rated at the time of
issuance in one of the two highest rating categories by a nationally
recognized statistical rating organization, such Certificates at such
time will be a "mortgage related security" as such term is defined in
Section 3(a)(41) of the Securities Exchange Act of 1934, as amended.
10. To the best of such counsel's knowledge, there are no
actions, proceedings or investigations pending that would adversely
affect the status of the Lower-Tier REMIC and the Upper-Tier REMIC as a
REMIC.
11. As a consequence of the qualification of the Upper-Tier
REMIC as a REMIC, the Offered Certificates will be treated as "regular
. . . interest(s) in a REMIC" under Section 7701(a)(19)(C) of the Code
and "real estate assets" under Section 856(c) of the Code in the same
proportion that the assets in the Trust consist of qualifying assets
under such Sections. In addition, as a consequence of the qualification
of the Upper-Tier REMIC and the Lower-Tier REMIC as a REMIC, interest
on the Offered Certificates will be treated as "interest on obligations
secured by mortgages on real property" under Section 856(c) of the Code
to the extent that such Offered Certificates are treated as "real
estate assets" under Section 856(c) of the Code.
12. The Certificates will, when issued, conform to the
description thereof contained in the Prospectus.
Such counsel shall also have furnished to the Underwriters a written
statement, addressed to the Underwriters and dated the Closing Date, in form and
substance satisfactory to the Underwriters to the effect that no facts have come
to the attention of such counsel which lead them to believe that: (a) the
Registration Statement, at the time such Registration Statement became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading (except as to financial or statistical data
contained in the Registration Statement); (b) the Prospectus, as of its date and
as of the Closing Date, contained or contains an untrue statement of a material
fact or omitted or omits to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; (c) any document
incorporated by reference in the Prospectus or any further amendment or
supplement to any such incorporated document made by the Depositor prior to the
Closing Date (other than any document filed at the request of an Underwriter to
the extent such document relates to Computational Materials) contained, as of
the time it became effective or was filed with the Commission, as the case may
be, an untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; or (d) the Information Circular, as of its date and as of the
Closing Date, contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
15
E. The Underwriters shall have received the favorable opinion, dated
the Closing Date, of Xxxxx & Xxxxxx LLP, special counsel to the Depositor,
addressed to the Depositor and satisfactory to Xxxxx'x, Fitch and the
Underwriters, with respect to certain matters relating to the transfer of the
Mortgage Loans to the Depositor and from the Depositor to the Trust, and such
counsel shall have consented to reliance on such opinion by Xxxxx'x, Fitch and
the Underwriters as though such opinion had been addressed to each such party.
F. General Counsel for the Servicer, shall have furnished to the
Underwriters a written opinion, as counsel to the Servicer, addressed to the
Underwriters and the Depositor and dated the Closing Date, in form and substance
satisfactory to the Underwriters, to the effect that:
1. The Servicer is validly existing in good standing as a
corporation under the laws of its state of incorporation.
2. The Servicer has full corporate power and authority to
serve in the capacity of servicer of the Mortgage Loans as contemplated
in the Pooling and Servicing Agreement.
3. The Pooling and Servicing Agreement has been duly
authorized, executed and delivered by the Servicer, and, assuming the
due authorization, execution and delivery of such agreement by the
other parties thereto, constitutes the legal, valid and binding
agreement of the Servicer, enforceable against the Servicer in
accordance with its terms, subject as to enforceability to (x)
bankruptcy, insolvency, reorganization, moratorium, receivership or
other similar laws now or hereafter in effect relating to creditors'
rights generally and (y) the qualification that the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion, with respect to
such remedies, of the court before which any proceedings with respect
thereto may be brought.
4. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body
having jurisdiction over the Servicer is required for the consummation
by the Servicer of the transactions contemplated by the Pooling and
Servicing Agreement, except such consents, approvals, authorizations,
registrations and qualifications as have been obtained.
5. The execution, delivery or performance by the Servicer of
the Pooling and Servicing Agreement and the transactions contemplated
thereby do not (A) conflict with or result in a breach of, or
constitute a default under, (i) any term or provision of the
certificate of incorporation or by-laws of the Servicer; (ii) any term
or provision of any material agreement, deed of trust, mortgage loan
agreement, contract, instrument or indenture, or other agreement to
which the Servicer is a party or is bound or to which any of the
property or assets of the Servicer or any of its subsidiaries is
subject; (iii) to the best of such counsel's knowledge without
independent investigation any order, judgment, writ, injunction or
decree of any court or governmental authority having jurisdiction over
the Servicer; or (iv) any law, rule or regulations applicable to the
Servicer; or (B) to the best of such counsel's knowledge without
independent investigation, results in the
16
creation or imposition of any lien, charge or encumbrance upon the
Trust Estate or upon the Certificates.
6. There are no actions, proceedings or investigations pending
or, to the best of such counsel's knowledge without independent
investigation, threatened against the Servicer before any court,
administrative agency or other tribunal (a) asserting the invalidity of
the Pooling and Servicing Agreement or the Certificates, (b) seeking to
prevent the consummation of any of the transactions contemplated by the
Pooling and Servicing Agreement or (c) which would materially and
adversely affect the performance by the Servicer of its obligations
under, or the validity or enforceability of, the Pooling and Servicing
Agreement.
G. Counsel for the Depositor, the Seller, the Master Servicer and the
Special Servicer (which may be in-house counsel) shall have furnished to the
Underwriters such counsel's written opinion, addressed to the Underwriters and
dated the Closing Date, in form and substance satisfactory to the Underwriters,
to the effect that:
1. The Depositor has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Delaware and is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which its
ownership or lease of property or the conduct of its business requires
such qualification (except where any such failure would not have a
material adverse effect on the Depositor's ability to perform its
obligations under the Depositor Agreements) and has all power and
authority necessary to own or hold its properties and to conduct the
business in which it is engaged and to enter into and perform its
obligations under the Depositor Agreements, and to cause the
Certificates to be issued.
2. The Depositor is not in violation of its articles of
incorporation or by-laws or in default in the performance or observance
of any material obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which the Depositor is a party or by which it or
its properties may be bound, which default might result in any material
adverse change in the financial condition of the Depositor or which
might materially and adversely affect the properties or assets, taken
as a whole, of the Depositor.
3. The Depositor Agreements have been duly authorized,
executed and delivered by the Depositor and, assuming the due
authorization, execution and delivery of such agreements by the other
parties thereto, such agreements constitute valid and binding
obligations, enforceable against the Depositor in accordance with their
respective terms, subject as to enforceability to (x) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, (y)
general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (z) with respect to
rights of indemnity under this Agreement, limitations of public policy
under applicable securities laws.
4. The execution, delivery and performance of the Depositor
Agreements by the Depositor, the consummation of the transactions
contemplated hereby and thereby,
17
and the issuance and delivery of the Certificates (i) do not and will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Depositor is a party or by which the Depositor
is bound or to which any of the property or assets of the Depositor or
any of its subsidiaries is subject, which breach or violation would
have a material adverse effect on the business, operations or financial
condition of the Depositor, (ii) nor will such actions result in a
violation of the provisions of the articles of incorporation or by-laws
of the Depositor, which breach or violation would have a material
adverse effect on the business, operations or financial condition of
the Depositor (or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the
Depositor or any of its properties or assets) and (iii) nor will such
actions result in the creation or imposition of any lien, charge or
encumbrance upon the Trust Estate or upon the Certificates, except as
otherwise contemplated by the Pooling and Servicing Agreement.
5. The direction by the Depositor to the Trustee to execute,
issue, authenticate and deliver the Certificates has been duly
authorized by the Depositor and, assuming that the Trustee has been
duly authorized to do so, when executed, authenticated and delivered by
the Trustee in accordance with the Pooling and Servicing Agreement, the
Certificates will be validly issued and outstanding and will be
entitled to the benefits of the Pooling and Servicing Agreement.
6. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of
the United States is required for the issuance of the Certificates, and
the sale of the Offered Certificates to the Underwriters, or the
consummation by the Depositor of the other transactions contemplated by
the Depositor Agreements, except such consents, approvals,
authorizations, registrations or qualifications as may be required
under the 1933 Act or state securities or Blue Sky laws in connection
with the purchase and distribution of the Offered Certificates by the
Underwriters or as have been previously obtained.
7. There are no actions, proceedings or investigations pending
with respect to which the Depositor has received service of process
before or, to the best of such counsel's knowledge, without independent
investigation, threatened by any court, administrative agency or other
tribunal to which the Depositor is a party or of which any of its
properties is the subject: (a) which if determined adversely to the
Depositor would have a material adverse effect on the business, results
of operations or financial condition of the Depositor; (b) asserting
the invalidity of the Pooling and Servicing Agreement or the
Certificates; (c) seeking to prevent the issuance of the Certificates
or the consummation by the Depositor of any of the transactions
contemplated by the Depositor Agreements; or (d) which might materially
and adversely affect the performance by the Depositor of its
obligations under, or the validity or enforceability of, the Depositor
Agreements or the Certificates.
18
8. The Certificates have been duly and validly authorized and
issued, and, immediately prior to the sale of the Offered Certificates
to the Underwriters, such Certificates are owned by the Depositor, free
and clear of all Liens.
9. The Seller has been duly organized and is validly existing
as a corporation in good standing under the laws of the State of
Delaware and is duly qualified to do business and is in good standing
as a foreign corporation in each jurisdiction in which its ownership or
lease of property or the conduct of its business requires such
qualification, and has all power and authority necessary to own or hold
its properties and to conduct the business in which it is engaged and
to enter into and perform its obligations under the Pooling and
Servicing Agreement, and the Guaranty dated September 29, 1998
(collectively, the "Seller Agreements").
10. The Seller is not in violation of its articles of
incorporation or by-laws or in default in the performance or observance
of any material obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which the Seller is a party or by which it or its
properties may be bound, which default might result in any material
adverse changes in the financial condition, earnings, affairs or
business of the Seller or which might materially and adversely affect
the properties or assets, taken as a whole, of the Seller.
11. The Seller Agreements have been duly authorized, executed
and delivered by the Seller and, assuming the due authorization,
execution and delivery of such agreements by the parties thereto other
than the Seller, such agreements will constitute valid and binding
obligations, enforceable against the Seller in accordance with their
respective terms, subject as to enforceability to (x) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally (y) general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law).
12. The execution, delivery and performance of the Seller
Agreements by the Seller and the consummation of the transactions
contemplated thereby do not and will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Seller is a party or by
which the Seller is bound or to which any of the property or assets of
the Seller or any of its subsidiaries is subject, which breach or
violation would have a material adverse effect on the business,
operations or financial condition of the Seller, nor will such actions
result in a violation of the provisions of the articles of
incorporation or by-laws of the Seller or any statute or any order,
rule or regulation of any court or governmental agency or body having
jurisdiction over the Seller or any of its properties or assets, which
breach or violation would have a material adverse effect on the
business, operations or financial condition of the Seller.
13. There are no actions, proceedings or investigations
pending with respect to which the Seller has received service of
process before or, to the best of such counsel's knowledge, without
independent investigation, threatened by any court, administrative
19
agency or other tribunal to which the Seller is a party or of which any
of its properties is the subject: (a) which if determined adversely to
the Seller would have a material adverse effect on the business,
results of operations or financial condition of the Seller; (b)
asserting the invalidity of the Pooling and Servicing Agreement or the
Certificates; (c) seeking to prevent the issuance of the Certificates
or the consummation by the Seller of any of the transactions
contemplated by the Seller Agreements; or (d) which might materially
and adversely affect the performance by the Seller of its obligations
under, or the validity or enforceability of, the Pooling and Servicing
Agreement or the Certificates.
14. The Master Servicer has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Delaware and is duly qualified to do business and is in good
standing as a foreign corporation in each jurisdiction in which its
ownership or lease of property or the conduct of its business requires
such qualification, and has all power and authority necessary to own or
hold its properties and to conduct the business in which it is engaged
and to enter into and perform its obligations under the Pooling and
Servicing Agreement.
15. The Master Servicer is not in violation of its articles of
incorporation or by-laws or in default in the performance or observance
of any material obligation, agreement, covenant or condition contained
in any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which the Master Servicer is a party or by which it
or its properties may be bound, which default might result in any
material adverse changes in the financial condition, earnings, affairs
or business of the Master Servicer or which might materially and
adversely affect the properties or assets, taken as a whole, of the
Master Servicer.
16. The Pooling and Servicing Agreement has been duly
authorized, executed and delivered by the Master Servicer and, assuming
the due authorization, execution and delivery of such agreement by the
parties thereto other than the Master Servicer, such agreements will
constitute valid and binding obligations, enforceable against the
Master Servicer in accordance with their respective terms, subject as
to enforceability to (x) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally (y) general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity
or at law).
17. The execution, delivery and performance of the Pooling and
Servicing Agreement by the Master Servicer and the consummation of the
transactions contemplated thereby do not and will not conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which the Master
Servicer is a party or by which the Master Servicer is bound or to
which any of the property or assets of the Master Servicer or any of
its subsidiaries is subject, which breach or violation would have a
material adverse effect on the business, operations or financial
condition of the Master Servicer, nor will such actions result in a
violation of the provisions of the articles of incorporation or by-laws
of the Master Servicer or any statute or any order, rule or regulation
of any court or governmental agency or body having jurisdiction over
the Master Servicer or any of its properties or assets, which
20
breach or violation would have a material adverse effect on the
business, operations or financial condition of the Master Servicer.
18. There are no actions, proceedings or investigations
pending with respect to which the Master Servicer has received service
of process before or, to the best of such counsel's knowledge, without
independent investigation, threatened by any court, administrative
agency or other tribunal to which the Master Servicer is a party or of
which any of its properties is the subject: (a) which if determined
adversely to the Master Servicer would have a material adverse effect
on the business, results of operations or financial condition of the
Master Servicer; (b) asserting the invalidity of the Pooling and
Servicing Agreement or the Certificates; (c) seeking to prevent the
issuance of the Certificates or the consummation by the Master Servicer
of any of the transactions contemplated by the Pooling and Servicing
Agreement or this Agreement, as the case may be; or (d) which might
materially and adversely affect the performance by the Master Servicer
of its obligations under, or the validity or enforceability of, the
Pooling and Servicing Agreement or the Certificates.
H. The Underwriters shall have received the favorable opinion of
Xxxxxxx X. Xxxxxx, Senior Counsel for the Trustee or of Hunton & Xxxxxxxx,
counsel to the Trustee, dated the Closing Date, addressed to the Underwriters
and in form and scope satisfactory to counsel to the Underwriters, to the effect
that:
1. The Trustee is a national banking association duly
incorporated and validly existing under the laws of the United States
of America.
2. The Trustee has the full corporate trust power to execute,
deliver and perform its obligations under the Pooling and Servicing
Agreement.
3. The execution and delivery by the Trustee of the Pooling
and Servicing Agreement and the performance by the Trustee of its
obligations under the Pooling and Servicing Agreement have been duly
authorized by all necessary corporate action of the Trustee.
4. The Pooling and Servicing Agreement is a valid and legally
binding obligation of the Trustee enforceable against the Trustee.
5. The execution and delivery by the Trustee of the Pooling
and Servicing Agreement does not (a) violate the organization
certificate of the Trustee or the By-laws of the Trustee, (b) to such
counsel's knowledge, violate any judgment, decree or order of United
States federal court or United States federal governmental authority by
which the Trustee is bound or (c) assuming the non-existence of any
judgment, decree or order of any court or other governmental authority
that would be violated by such execution and delivery, violate United
States federal statute, rule or regulation or require any consent,
approval or authorization of United States federal court or United
States federal governmental authority.
6. The Certificates have been duly authenticated, executed and
delivered by the Trustee.
21
7. If the Trustee were acting in the stead of the Servicer
under the Pooling and Servicing Agreement as of the date of such
opinion, the Trustee would have the full corporate trust power to
perform the obligations of the Servicer under the Pooling and Servicing
Agreement.
8. To the best of such counsel's knowledge, there are no
actions, proceedings or investigations pending or threatened against or
affecting the Trustee before or by any court, arbitrator,
administrative agency or other governmental authority which, if decided
adversely to the Trustee, would materially and adversely affect the
ability of the Trustee to carry out the transactions contemplated in
the Pooling and Servicing Agreement.
I. The Underwriters shall have received the favorable opinion or
opinions, dated the date of the Closing Date, of counsel for the Underwriters,
with respect to the issue and sale of the Offered Certificates, this Agreement,
the Prospectus and such other related matters as the Underwriters may reasonably
require.
J. The Depositor shall have furnished to the Underwriters a
certificate, dated the Closing Date and signed by the Chairman of the Board, the
President or a Vice President of the Depositor to the extent that the signer of
such certificate has carefully examined the Registration Statement (excluding
any documents incorporated therein by reference) and the Depositor Agreements
and that, to the best of his or her knowledge based upon reasonable
investigation:
1. The representations and warranties of the Depositor in the
Depositor Agreements and all related agreements are true and correct as
of the Closing Date; and the Depositor has complied with all agreements
and satisfied all the conditions on its part which are to have been
complied with on or prior to the Closing Date.
2. There has been no amendment or other document filed
affecting the certificate of incorporation or bylaws of the Depositor
since November 9, 1995 and no such amendment has been authorized. No
event has occurred since September 1, 1998, which has affected the good
standing of the Depositor under the laws of the State of Delaware.
3. There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Depositor from June 30, 1998.
4. There are no actions, suits or proceedings pending with
respect to which it has received service of process or, to the best of
such officer's knowledge, threatened against or affecting the Depositor
which if adversely determined, individually or in the aggregate, would
be reasonably likely to adversely affect the Depositor's obligations
under the Depositor Agreements in any material way; and no merger,
liquidation, dissolution or bankruptcy of the Depositor is pending or
contemplated.
K. The Trustee shall have furnished to the Underwriters a certificate
of the Trustee, signed by one or more duly authorized officers of the Trustee,
dated the Closing Date, as to the due authorization, execution and delivery of
the Pooling and Servicing Agreement by the Trustee and the acceptance by the
Trustee of the trusts created thereby and the due execution,
22
authentication and delivery of the Certificates by the Trustee thereunder and
such other matters as the Representative shall reasonably request.
L. The Class A Certificates shall have been rated "Aaa" by Xxxxx'x and
"AAA" by Fitch. The Class M-1, Class M-2 and Class B-1 Certificates shall have
been rated "Xx0," "X0" and "Baa3," respectively, by Xxxxx'x and "AA," "A" and at
least "BBB," respectively, by Fitch.
M. The Depositor shall have furnished to the Underwriters such further
information, certificates and documents as the Underwriters may reasonably have
requested not less than three full Business Days prior to the Closing Date.
N. Prior to the Closing Date, counsel for the Underwriters shall have
been furnished with such documents and opinions as they may reasonably require
for the purpose of enabling them to pass upon the issuance and sale of the
Certificates as herein contemplated and related proceedings or in order to
evidence the accuracy and completeness of any of the representations and
warranties, or the fulfillment of any of the conditions, herein contained, and
all proceedings taken by the Depositor in connection with the issuance and sale
of the Certificates as herein contemplated shall be satisfactory in form and
substance to the Underwriters and counsel for the Underwriters.
O. Subsequent to the execution and delivery of this Agreement, none of
the following shall have occurred: (i) trading in securities generally on the
New York Stock Exchange, the American Stock Exchange or the over-the counter
market shall have been suspended or minimum prices shall have been established
on either of such exchanges or such market by the Commission, by such exchange
or by any other regulatory body or governmental authority having jurisdiction;
(ii) a banking moratorium shall have been declared by federal or state
authorities; (iii) the United States shall have become engaged in hostilities,
there shall have been an escalation of hostilities involving the United States
or there shall have been a declaration of a national emergency or war by the
United States; or (iv) there shall have occurred such a material adverse change
in general economic, political or financial conditions (or the effect of
international conditions on the financial markets of the United States shall be
such) as to make it in each of the instances set forth in clauses (i), (ii),
(iii) and (iv) herein, in the reasonable judgment of the Representative,
impractical or inadvisable to proceed with the public offering or delivery of
the Certificates on the terms and in the manner contemplated in the Prospectus.
P. The Representative shall have received a letter from Deloitte &
Touche, LLP, dated on or before the Closing Date, in form and substance
satisfactory to the Representative and special counsel for the Underwriters,
addressed to each of the Underwriters to the effect that they have performed
certain specified procedures requested by the Representative with respect to the
information set forth in the Prospectus and certain matters relating to the
Depositor.
Q. The Representative and special counsel for the Underwriters shall
have received copies of any opinions of counsel supplied to the rating
organizations relating to any matters with respect to the Certificates. Any such
opinions shall be dated the Closing Date and addressed to each of the
Underwriters or accompanied by reliance letters to the Representative or shall
state that each of the Underwriters may rely upon them.
23
R. There has not occurred any change, or any development involving a
prospective change, in the condition, financial or otherwise, or in the
earnings, business or operations, since June 30, 1998, of the Depositor and its
subsidiaries, that is in the Representative's judgment material and adverse and
that makes it in the Representative's judgment impracticable to market the
Offered Certificates on the terms and in the manner contemplated in the
Prospectus.
S. Xxxxxxx Mac and the Depositor shall have consummated the
transactions contemplated by the Purchase Agreement, and the Depositor shall
have performed all of its obligations thereunder that were to have been
performed by the Closing Date specified therein.
T. The Depository Agreement, dated as of October 24, 1990 as amended
(the "Depository Agreement") between Xxxxxxx Mac and the Depositor shall have
been duly authorized, executed and delivered, the Giant Participation
Certificates and Other Pass-Through Participation Certificates Agreement, dated
as of January 1, 1997, and the Terms Supplement, dated as of September 29, 1998
(together, the "Pass-Through Agreement") shall have been duly authorized,
adopted and executed, and each of the foregoing shall be in full force and
effect.
U. At or prior to the Closing, the Representative shall have received
the following documents, in each satisfactory in form and substance to the
Representative and to counsel for the Underwriters:
1. Copies of all resolutions and certificates of Xxxxxxx Mac
relating to the authorization, creation and sale of the Structured
Pass-Through Certificates ("SPCs") duly certified by appropriate
officials of Xxxxxxx Mac, together with copies of the Depository
Agreement and the Pass-Through Agreement.
2. A copy of the Xxxxxxx Mac Act and Bylaws of Xxxxxxx Mac as
of the Closing Date, certified by the Secretary or Assistant Secretary
of Xxxxxxx Mac.
3. A certificate, dated the Closing Date, of the Vice
President--Structured Finance or the Director--Structured Finance of
Xxxxxxx Mac to the effect that, (a) to the best knowledge of such
official, (i) the representations and warranties of Xxxxxxx Mac
contained in the Underwriting Agreement between Xxxxxxx Mac and the
Underwriters are true and correct on and as of the Closing Date as if
such representations and warranties had been made on and as of the
Closing Date, (ii) Xxxxxxx Mac has complied with all the terms of the
Pass-Through Agreement and the Depository Agreement to be complied with
by it prior to or concurrently with the Closing and (b)(i) the Assets
underlying the SPCs have been, as of the Closing Date, identified to
each Pass-Through Pool on the books and records of Xxxxxxx Mac (ii) no
other property of Xxxxxxx Mac has been identified to each such
Pass-Through Pool and (iii) Xxxxxxx Mac has been identified as the
holder of each of the Assets included in each such Pass-Through Pool.
4. An opinion, dated the Closing Date, addressed to Xxxxxxx
Mac and the Underwriters, of Maud Mater, Esq., Executive Vice
President--General Counsel and Secretary of Xxxxxxx Mac, reasonably
satisfactory to the Representative.
5. An opinion, dated the Closing Date, addressed to the
Underwriters, of Xxxxx Xxxxxxxxxx LLP, counsel to the Underwriters,
with respect to the creation and sale of the
24
SPCs, the Offering Circular relating to the SPCs (the "Offering
Circular) and other related matters as the Representative may
reasonably request.
V. In addition, Deloitte & Touche LLP shall have provide to the
Representative and Xxxxxxx Mac at the time of delivery of the Offering Circular
to the Representative, a letter, dated the date of this Underwriting Agreement
in form and substance satisfactory to the Representative, with respect to
certain information provided by Xxxxxxx Mac and contained in the Offering
Circular concerning the SPCs, and, at the Closing, a letter, dated the Closing
Date, in form and substance satisfactory to the Representative, with respect to
the calculation of certain other information concerning the SPCs.
W. Subsequent to the respective dates as of which information is given
in the Offering Circular, there shall not have been any change or any
development involving a prospective change in or affecting the business,
financial condition or properties of Xxxxxxx Mac which change or development is,
in the reasonable opinion of the Representative, so material and adverse as to
make it impracticable or inadvisable to proceed with the offering.
X. The executed copies of the Pass-Through Agreement as authorized,
adopted and executed by Xxxxxxx Mac shall have been delivered to the
Representative or their counsel.
Y. Xxxxxxx Mac shall not have been required to prepare an amendment or
supplement to the Offering Circular, which amendment supplement addresses
matters that are, in the reasonable opinion of the Representative, so material
and adverse as to make it impracticable to proceed with the offering and sale of
the SPCs as contemplated by Xxxxxxx Mac and the Representative in preparing the
Offering Circular. It is understood and agreed that Xxxxxxx Mac and the
Underwriter shall endeavor in good faith to revise the terms of the SPCs in
order to avoid the adverse effects of the matters addressed by such amendment or
supplement, provided that such revisions shall not have a material and adverse
effect on the offering and sale of the SPCs, in the aggregate, or on any Class
of SPCs other than the Class or Classes that were materially and adversely
affected by the matters addressed in the amendment or supplement referred to in
the preceding sentence.
If any condition specified in this Section VI shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Depositor at any time at or prior to the
Closing Date, and such termination shall be without liability of any party to
any other party except as provided in Section VII.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to counsel for the Underwriters.
SECTION VII. Payment of Expenses. If the transaction closes, or if the
transaction fails to close other than as a result of a failure of the
Underwriters to perform hereunder, the Depositor, agrees to pay: (a) the costs
incident to the authorization, issuance, sale and delivery of the Certificates
and any taxes payable in connection therewith; (b) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto (including the Prospectus);
(c) the costs of
25
distributing the Registration Statement as originally filed and each amendment
thereto and any post-effective amendments thereof (including, in each case,
exhibits), the Prospectus and any amendment or supplement to the Prospectus or
any document incorporated by reference therein, all as provided in this
Agreement; (d) the costs and expenses of printing and distributing the
Information Circular; (e) the costs of reproducing and distributing this
Agreement; (f) the fees and expenses of qualifying the Certificates under the
securities laws of the several jurisdictions as provided in Section V(G) hereof
and of preparing, printing and distributing a Blue Sky Memorandum and a Legal
Investment Survey (including related fees and expenses of counsel to the
Representative); (g) any fees charged by securities rating services for rating
the Offered Certificates; (h) the cost of the accountant's letter relating to
the Prospectus except for expenses relating to the accountant's audit of the
loan files; and (i) all other costs and expenses incident to the performance of
the obligations of the Depositor (including costs and expenses of its counsel);
provided that, except as provided in this Section VII, the Underwriters shall
pay their own costs and expenses, including the costs and expenses of their
counsel, any transfer taxes on the Offered Certificates which they may sell and
the expenses of advertising any offering of the Offered Certificates made by the
Underwriters, and the Underwriters shall pay the cost of any accountant's
comfort letters which such Underwriters choose to request relating to any
Computational Materials (as defined herein).
If this Agreement is terminated by the Underwriters in accordance with
the provisions of Section VI or Section XI, whether or not the transactions
contemplated hereunder are consummated, the Depositor shall cause the
Underwriters to be reimbursed for all reasonable out-of-pocket expenses except
that the Depositor shall not be obligated under this Agreement to reimburse such
Underwriter for reasonable out-of-pocket expenses, excluding fees and
disbursements of counsel for such Underwriter, if this Agreement is terminated
by any Underwriter in accordance with Section VI.O herein.
SECTION VIII. Indemnification and Contribution. A. The Depositor agrees
to indemnify and hold harmless each Underwriter and each person, if any, who
controls such Underwriter within the meaning of Section 15 of the Securities Act
or Section 12 of the Exchange Act from and against any and all loss, claim,
damage or liability, joint or several, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or action
relating to purchases and sales of the Offered Certificates), to which such
Underwriter or any such controlling person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, or
any amendment thereof or supplement thereto, (ii) the omission or alleged
omission to state in the Registration Statement a material fact required to be
stated therein or necessary to make the statements therein not misleading, (iii)
any untrue statement or alleged untrue statement of a material fact contained in
the Prospectus, or any amendment thereof or supplement thereto, or (iv) the
omission or alleged omission to state in the Prospectus a material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, (v) any untrue
statement or alleged untrue statement of a material fact contained in the
Information Circular, or any amendment thereof or supplement thereto, (vi) the
omission or alleged omission to state in the Information Circular 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 or
(vii) any untrue statement of a
26
material fact in the computational materials used by the Underwriters in
marketing the Xxxxxxx Mac Structured Pass-Through Certificates, Series T-014
which is a result of Seller Provided Information which is not accurate and
complete in all material respects and shall reimburse such Underwriter and each
such controlling person promptly upon demand for any legal or other expenses
reasonably incurred by such Underwriter or such controlling person in connection
with investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Depositor shall not be liable in any such case to the extent
that any such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in the Prospectus, or any amendment thereof or supplement
thereto, or the Registration Statement, or any amendment thereof or supplement
thereto, or the Information Statement, or any amendment thereof or supplement
thereto, in reliance upon and in conformity with written information furnished
to the Depositor by or on behalf of such Underwriter specifically for inclusion
therein (except to the extent that any untrue statement or alleged untrue
statement or omission or alleged omission is a result of Seller Provided
Information which is not accurate and complete in all material respects). The
foregoing indemnity agreement is in addition to any liability which the
Depositor may otherwise have to any Underwriter or any controlling person of any
of such Underwriter.
B. Each Underwriter severally agrees to indemnify and hold harmless the
Depositor, each of its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Depositor
within the meaning of Section 15 of the Securities Act or Section 12 of the
Exchange Act against any and all loss, claim, damage or liability, or any action
in respect thereof, to which the Depositor or any such director, officer or
controlling person may become subject, under the Securities Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in the Prospectus, or any amendment thereof or supplement
thereto, or (ii) the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements in the
Prospectus, when considered in conjunction with the Prospectus, and in the light
of the circumstances under which they were made, not misleading, but in each
case only to the extent that the untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
written information furnished to the Depositor by or on behalf of such
Underwriter specifically for inclusion therein, and shall reimburse the
Depositor and any such director, officer or controlling person for any legal or
other expenses reasonably incurred by the Depositor or any director, officer or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred, provided, however, that no Underwriter shall be liable to
the extent that such untrue statements or alleged untrue statement or omission
or alleged omission is a result of Seller Provided Information that is not
accurate and complete in all material respects. The foregoing indemnity
agreement is in addition to any liability which any Underwriter may otherwise
have to the Depositor or any such director, officer or controlling person.
C. Promptly after receipt by any indemnified party under this Section
VIII of notice of any claim or the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against any
indemnifying party under this Section VIII, notify the indemnifying party in
writing of the claim or the commencement of that action; provided,
27
however, that the failure to notify an indemnifying party shall not relieve it
from any liability which it may have under this Section VIII except to the
extent it has been materially prejudiced by such failure and, provided further,
that the failure to notify any indemnifying party shall not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section VIII.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except to the extent
provided in the next following paragraph, the indemnifying party shall not be
liable to the indemnified party under this Section VIII for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel; or (iii) the
indemnifying party has failed to assume the defense of such action and employ
counsel reasonably satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to one local counsel per jurisdiction) at any time for all such
indemnified parties, which firm shall be designated in writing by the related
Underwriter, if the indemnified parties under this Section VIII consist of one
or more Underwriters or any of its or their controlling persons, or the
Depositor, if the indemnified parties under this Section VIII consist of the
Depositor or any of the Depositor's directors, officers or controlling persons.
Each indemnified party, as a condition of the indemnity agreements
contained in Section VIII.A and B, shall use its best efforts to cooperate with
the indemnifying party in the defense of any such action or claim. No
indemnifying party shall be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment for the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
Notwithstanding the foregoing paragraph, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of
28
counsel, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnified party in accordance with such request prior to the
date of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and indemnity could have been sought hereunder by such indemnified
party, unless such settlement includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such proceeding.
D. Each Underwriter severally and not jointly agrees to indemnify and
hold harmless the Depositor, each of the Depositor's officers and directors and
each person who controls the Depositor within the meaning of Section 15 of the
Securities Act and Section 12 of the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement of a material fact contained in the Computational
Materials provided by such Underwriter, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, when considered in
conjunction with the Prospectus, and in the light of the circumstances under
which they were made, not misleading, and agrees to reimburse each such
indemnified party for any legal or other expenses reasonably incurred by him,
her or it in connection with investigating or defending or preparing to defend
any such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that no Underwriter shall be liable to the extent that such
untrue statements or alleged untrue statement or omission or alleged omission is
a result of Seller Provided Information that is not accurate and complete in all
material respects. The obligations of an Underwriter under this Section VIII.D
shall be in addition to any liability which such Underwriter may otherwise have.
The procedures set forth in Section VIII.C shall be equally applicable
to this Section VIII.D.
E. If the indemnification provided for in this Section VIII shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section VIII.A, B or D in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Depositor on the one hand and the related Underwriters on the
other from the offering of the related Offered Certificates or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law or if
the indemnified party failed to give the notice required under Section VIII.C,
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 Depositor on
the one hand and the related Underwriter on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations.
29
The relative benefits of an Underwriter and the Depositor shall be
deemed to be in such proportion as the total net proceeds from the offering
(before deducting expenses) received by the Depositor bear to the total
underwriting discounts and commissions received by the related Underwriter from
time to time in negotiated sales of the related Offered Certificates.
The relative fault of an Underwriter and the Depositor shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied or prepared by the Depositor or by such Underwriter, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission and other equitable
considerations.
The Depositor and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section VIII.E were to be determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purposes) or by any other method of allocation which does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Section
VIII.E shall be deemed to include, for purposes of this Section VIII.E, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim.
For purposes of this Section VIII, in no case shall any Underwriter
(except with respect to any document (other than the Computational Materials)
incorporated by reference into the Registration Statement or Prospectus at the
request of such Underwriter and except as may be provided in any agreement among
the Underwriters relating to the offering of the Offered Certificates) be
responsible for any amount in excess of (x) the amount received by such
Underwriter in connection with its resale of the Offered Certificates over (y)
the amount paid by such Underwriter to the Depositor for the Offered
Certificates by such Underwriter hereunder. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
The Depositor and each Underwriter expressly waive, and agree not to
assert, any defense to their respective indemnification and contribution
obligations under this Section VIII which they might otherwise assert based upon
any claim that such obligations are unenforceable under federal or state
securities laws or by reason of public policy.
"Seller-Provided Information" means any computer tape (or other
information) furnished to any Underwriter by the Seller concerning the assets
comprising the Trust.
SECTION IX. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in agreements delivered pursuant hereto or certificates
of officers of the Depositor submitted pursuant hereto shall remain operative
and in full force and effect, regardless of any investigation made by or on
behalf of the Underwriters or controlling persons thereof, or by or on behalf of
the Depositor and shall survive delivery of any Offered Certificates to the
Underwriters.
30
SECTION X. Default by One or More of the Underwriters. If one or more
of the Underwriters participating in the public offering of the Offered
Certificates shall fail at the Closing Date to purchase the Offered Certificates
which it is (or they are) obligated to purchase hereunder (the "Defaulted
Certificates"), then the non-defaulting Underwriters shall have the right,
within 48 hours thereafter, to make arrangements for one or more of the
non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Defaulted Certificates in such amounts as may be agreed
upon and upon the terms herein set forth (as used in this Agreement, the term
"Underwriter" includes any underwriter substituted for an Underwriter under this
Section X). If, however, the Underwriters have not completed such arrangements
within such 48-hour period, then:
(i) if the aggregate original principal amount of Defaulted
Certificates does not exceed 10% of the aggregate original principal amount of
the Offered Certificates to be purchased pursuant to this Agreement, the
non-defaulting Underwriters named in this Agreement shall be obligated to
purchase the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of all
such non-defaulting Underwriters, or
(ii) if the aggregate original principal amount of Defaulted
Certificates exceeds 10% of the aggregate original principal amount of the
Offered Certificates to be purchased pursuant to this Agreement, this Agreement
shall terminate, without any liability on the part of any non-defaulting
Underwriters.
No action taken pursuant to this Section X shall relieve any defaulting
Underwriter from the liability with respect to any default of such Underwriter
under this Agreement.
In the event of a default by any Underwriter as set forth in this
Section X, each of the Underwriters and the Depositor shall have the right to
postpone the Closing Date for a period not exceeding seven Business Days in
order that any required changes in the Registration Statement or Prospectus or
in any other documents or arrangements may be effected.
SECTION XI. Termination of Agreement. The Underwriters may terminate
this Agreement immediately upon notice to the Depositor, at any time at or prior
to the Closing Date if any of the events or conditions described in Section VI.O
of this Agreement shall occur and be continuing. In the event of any such
termination, the provisions of Section VII, the indemnity agreement set forth in
Section VIII, and the provisions of Sections IX and XIV shall remain in effect.
SECTION XII. Notices. All statements, requests, notices and agreements
hereunder shall be in writing, and:
A. if to the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission to the Representative at its address set forth above;
B. if to the Depositor, shall be delivered or sent by overnight mail or
facsimile transmission to 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, XX #000, Xxxxxx,
XX 00000-0000, Attn.: General Counsel, Fax No. 000-000-0000.
31
SECTION XIII. Persons Entitled to the Benefit of this Agreement. This
Agreement shall inure to the benefit of and be binding upon the Underwriters and
the Depositor, and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
the representations, warranties, indemnities and agreements contained in this
Agreement shall also be deemed to be for the benefit of the person or persons,
if any, who control any of the Underwriters within the meaning of Section 15 of
the Securities Act, and for the benefit of directors of the Depositor, officers
of the Depositor who have signed the Registration Statement and any person
controlling the Depositor within the meaning of Section 15 of the Securities
Act. Nothing in this Agreement is intended or shall be construed to give any
person, other than the persons referred to in this Section XIII, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
SECTION XIV. Survival. The respective indemnities, representations,
warranties and agreements of the Depositor and the Underwriters contained in
this Agreement, or made by or on behalf of them, respectively, pursuant to this
Agreement, shall survive the delivery of and payment for the Certificates and
shall remain in full force and effect, regardless of any investigation made by
or on behalf of any of them or any person controlling any of them. The
provisions of Sections V, VII and VIII hereof shall survive the termination or
cancellation of this Agreement.
SECTION XV. Governing Law; Submission to Jurisdiction. This Agreement
shall be governed by and construed in accordance with the laws of the State of
New York without giving effect to the conflict of law rules thereof.
The parties hereto hereby submit to the jurisdiction of the United
States District Court for the Southern District of New York and any court in the
State of New York located in the City and County of New York, and appellate
court from any thereof, in any action, suit or proceeding brought against it or
in connection with this Agreement or any of the related documents or the
transactions contemplated hereunder or for recognition or enforcement of any
judgment, and the parties hereto hereby agree that all claims in respect of any
such action or proceeding may be heard or determined in New York State court or,
to the extent permitted by law, in such federal court.
SECTION XVI. Counterparts. This Agreement may be executed in
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION XVII. Headings. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
SECTION XVIII. Amendments and Waivers. This Agreement may be amended,
modified, altered or terminated, and any of its provisions waived, only in a
writing signed on behalf of the Depositor and the Representative.
32
[Signature Page Follows]
33
If the foregoing correctly sets forth the agreement between the
Depositor and the Underwriters, please indicate your acceptance in the space
provided for the purpose below.
Very truly yours,
AMRESCO RESIDENTIAL SECURITIES
CORPORATION
By: /s/ Xxxxxx X. Cott
--------------------------
Name: Xxxxxx X. Cott
Title: Vice President
CONFIRMED AND ACCEPTED, as
of the date first above written:
XXXXXX XXXXXXX & CO. INCORPORATED
Acting on its own behalf and as
Representative of the several
Underwriters referred to in the
foregoing Agreement
By: /s/ Xxxx Xxxxxxxxx
--------------------------
Name: Xxxx Xxxxxxxxx
Title: Vice President
SCHEDULE A
Class of
Certificates Initial Principal Amount Purchase
Name of Purchased by the of Certificates Purchased Price
Underwriter Underwriters by Underwriters (% of Par)
----------- ---------------- ------------------------- ----------
Xxxxxx Xxxxxxx & Xx. X-0 $139,638,525.00 99.75%
Incorporated A-8 46,475,000.00 99.8248%
M-1A 18,086,250.00 99.70%
M-2A 15,752,750.00 99.60%
B-1F 2,061,800.00 99.37286%
B-1A 13,419,250.00 99.31%
-------------------
TOTAL $235,433,575.00
-----
AMRESCO Securities, Inc. A-7 $21,482,850.00 99.75%%
A-8 7,150,000.00 99.8248%
M-1A 2,782,500.00 99.70%
M-2A 2,423,500.00 99.60%
B-1F 317,200.00 99.37286%
B-1A 2,064,500.00 99.31%
-------------------
TOTAL $36,220,550.00
-----
Bear Xxxxxxx & Co. A-7 $42,965,700.00 99.75%
Incorporated A-8 14,300,000.00 99.8248%
M-1A 5,565,000.00 99.70%
M-2A 4,847,000.00 99.60%
B-1F 634,400.00 99.37286%
B-1A 4,129,000.00 99.31%
-------------------
TOTAL $72,441,100.00
-----
Credit Suisse First Boston A-7 $75,189,975.00 99.75%
Corporation A-8 25,025,000.00 99.8248%
M-1A 9,738,750.00 99.70%
M-2A 8,482,250.00 99.60%
B-1F 1,110,200.00 99.37286%
B-1A 7,225,750.00 99.31%
-------------------
TOTAL $126,771,925.00
-----
Class of
Certificates Initial Principal Amount Purchase
Name of Purchased by the of Certificates Purchased Price
Underwriter Underwriters by Underwriters (% of Par)
----------- ---------------- ------------------------- ----------
Deutsche Bank A-7 $75,189,975.00 99.75%
Securities Inc. A-8 25,025,000.00 99.8248%
M-1A 9,738,750.00 99.70%
M-2A 8,482,250.00 99.60%
B-1F 1,110,200.00 99.37286%
B-1A 7,225,750.00 99.31%
-------------------
TOTAL: $126,771,925.00
-----
Prudential Securities A-7 $75,189,975.00 99.75%
Incorporated. A-8 25,025,000.00 99.8248%
M-1A 9,738,750.00 99.70%
M-2A 8,482,250.00 99.60%
B-1F 1,110,200.00 99.37286%
B-1A 7,225,750.00 99.31%
-------------------
TOTAL $126,771,925.00
-----
