Exhibit 1.1
EXECUTION COPY
$700,000,000
IMC HOME EQUITY LOAN OWNER TRUST 1998-2
Adjustable Rate Home Equity Loan Asset Backed Notes,
Series 1998-2
UNDERWRITING AGREEMENT
March 20, 1998
BEAR, XXXXXXX & CO. INC.
As representative of the several underwriters
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Bear Xxxxxxx Asset Backed Securities, Inc. (the "Depositor"), a Delaware
corporation, has authorized (i) the creation of IMC Home Equity Loan Owner Trust
1998-2, a Delaware business trust (the "Issuer"), pursuant to the Owner Trust
Agreement, dated as of March 1, 1998 (the "Trust Agreement"), between the
Depositor and Wilmington Trust Company ("Wilmington Trust"), as owner trustee
(the "Owner Trustee") and (ii) the issuance and sale of $700,000,000 aggregate
original principal amount of the Issuer's Adjustable Rate Home Equity Loan Asset
Backed Notes Series 1998-2 (the "Notes"). The Notes will evidence non-recourse
obligations of, and will be issued by, the Issuer pursuant to the terms of the
Indenture, dated as of March 1, 1998 (the "Indenture"), between the Issuer and
The Chase Manhattan Bank, as indenture trustee (the "Indenture Trustee").
Pursuant to the Trust Agreement, the Issuer also will issue certificates
evidencing the residual interest in the Issuer (the "Residual Interest"). The
Residual Interest and the Notes are sometimes collectively referred to as the
"Securities."
The Notes will be secured by a trust estate (the "Trust Estate")
consisting primarily of a pool of adjustable-rate and fixed-rate home equity
loans secured by mortgages or deeds of trust creating first and second liens on
primarily one- to four-family residential properties (the "Home Equity Loans")
and such amounts as may be held by the Indenture Trustee in any accounts for the
Owners. The Notes will be secured by (i) the Home Equity Loans in an amount of
approximately $525,000,000 as of the close of business on March 1, 1998 (the
"Cut-Off Date") and (ii) funds deposited in the Pre-Funding Account and the
Capitalized Interest Account. The Home Equity Loans will be sold by IMC Mortgage
Company ("IMC") to the Depositor, and by the Depositor to the Issuer pursuant to
the Sale and Servicing Agreement, dated as of March 1, 1998 (the "Sale and
Servicing Agreement"), among IMC, as seller (the "Seller") and as servicer (the
"Servicer"), the Depositor, the Indenture Trustee and the Issuer.
Pursuant to the Sale and Servicing Agreement, the Servicer will service the Home
Equity Loans on behalf of the Issuer.
The Notes will have the benefit of a financial guaranty insurance
policy (the "Insurance Policy") issued by MBIA Insurance Corporation (the "Note
Insurer"), issued pursuant to the Insurance Agreement, dated as of March 1, 1998
(the "Insurance Agreement") among the Seller, the Servicer, the Depositor, the
Indenture Trustee and the Note Insurer. The Note Insurer, the Seller, the
Depositor, Bear, Xxxxxxx & Co. Inc., PaineWebber Incorporated, Deutsche Xxxxxx
Xxxxxxxx Inc. and X.X. Xxxxxx Securities Inc. as Underwriters, also will enter
into an Indemnification Agreement, dated as of March 31, 1998 (the
"Indemnification Agreement"). This Agreement, the Trust Agreement, the Sale and
Servicing Agreement, the Indenture, the Indemnification Agreement and the
Insurance Agreement are sometimes referred to herein collectively as the
"Agreements".
The Notes are more fully described in a Registration Statement
(hereinafter defined) which the Depositor has furnished to the Underwriters.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Agreements.
The Notes are being purchased by the Underwriters named in Schedule A
hereto (the "Underwriters"), and the Underwriters are purchasing, severally,
only the Notes set forth opposite their names in Schedule A, except that the
amounts purchased by the Underwriters may change in accordance with Section 10
of this Agreement. Bear, Xxxxxxx & Co. Inc. (the "Representative") is acting for
itself and as representative of the other Underwriters.
SECTION 1 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. 333-43091) has (i) been
prepared by the Depositor in conformity with the requirements of the
Securities Act of 1933 (the "Securities Act"), the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act") and the rules and
regulations (the "Rules and Regulations") of the United States
Securities and Exchange Commission (the "Commission") under the
Securities Act and the Trust Indenture Act, (ii) been filed with the
Commission under the Securities Act and (iii) become effective under the
Securities Act. Copies of such Registration Statement have been
delivered by the Depositor to the Underwriters. 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; and "Basic
Prospectus" means such final prospectus dated January 23, 1998; and
"Prospectus Supplement" means the final prospectus supplement relating
to the Notes, to be filed with the Commission pursuant to paragraph (2),
(3) or (5) of Rule 424(b) of the Rules
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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 and 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, the Rules and Regulations or the Trust Indenture Act
which have not been so filed or incorporated by reference therein on or
prior to the Effective Date of the Registration Statement other than
such documents or materials, if any, as any Underwriter delivers to the
Depositor pursuant to Section 8(D) hereof for filing on Form 8-K. The
conditions for use of Form S-3, as set forth in the General Instructions
thereto, have been satisfied.
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, the Trust Indenture 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 (x) the Seller Information (as hereinafter
defined) or (y) written information furnished to the Depositor in
writing by the Underwriters expressly for use therein. The only
information furnished by the Underwriters or on behalf of the
Underwriters for use in connection with the preparation of the
Registration Statement or the Prospectus is described in Section 8(I)
hereof.
C. The documents incorporated by reference to 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
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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 (x) any Future
Seller Information (as hereinafter defined) or (y) 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 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 the State of Delaware 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 each
Agreement to which it is a party and to cause the Securities 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 any of the Agreements or the
Securities, (c) seeking to prevent the issuance of the Securities or the
consummation by the Depositor of any of the transactions contemplated by
the 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 Agreements or the Securities.
G. This Agreement has been, and each other Agreement to which the
Depositor is a party when executed and delivered as contemplated hereby
and thereby will have been, duly authorized, executed and delivered by
the Depositor, and this Agreement constitutes, and each such other
Agreement when executed and delivered as contemplated herein, will
constitute, legal, valid and binding instruments enforceable against the
Depositor in accordance with their respective terms, subject as to
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enforceability to (x) applicable bankruptcy, reorganization, insolvency
moratorium or other similar laws affecting creditors' rights generally,
(y) general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law), and (z) with respect to
rights of indemnity under this Agreement and the Indemnification
Agreement, limitations of public policy under applicable securities
laws.
H. The execution, delivery and performance of each Agreement to which
the Depositor is a party and the consummation of the transactions
contemplated hereby and thereby, and the issuance and delivery of the
Notes 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 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,
which breach or violation would have a material adverse effect on the
business, operations or financial condition of the Depositor.
I. [Reserved]
J. The direction by the Depositor to the Owner Trustee to execute, issue
and deliver and the direction by the Depositor to the Indenture Trustee
to authenticate the Notes has been duly authorized by the Depositor, and
assuming the Owner Trustee and the Indenture Trustee have been duly
authorized to do so, when executed, authenticated, issued and delivered
in accordance with the Indenture, the Notes will be validly issued and
outstanding and will be entitled to the benefits provided by the
Indenture.
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 Securities and the
sale of the Notes to the Underwriters, or the consummation by the
Depositor of the other transactions contemplated by the 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 Notes 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 the
Depositor has not received notice of any proceedings relating to the
revocation or modification of any such license, certificate, authority
or permit which if
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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 Sale and Servicing
Agreement, the Depositor will: (i) have beneficial title to the Home
Equity Loans conveyed by the Seller, free and clear of any lien,
mortgage, pledge, charge, encumbrance, adverse claim or other security
interest (collectively, "Liens"); (ii) not have assigned to any person
any of its right or title in the Home Equity Loans or in the Sale and
Servicing Agreement or in the Notes being issued pursuant to the
Indenture and (iii) have the power and authority to sell its interest in
the Home Equity Loans to the Issuer and to sell the Notes to the
Underwriters. Upon execution and delivery of the Sale and Servicing
Agreement by the Issuer, the Issuer will have acquired beneficial
ownership of all of the Depositor's right, title and interest in and to
the Home Equity Loans. Upon execution and delivery of the Indenture by
the Issuer and the Indenture Trustee, the Indenture Trustee will have a
valid and perfected security interest in the Trust Estate free of any
other Liens. Upon delivery to the Underwriters of the Notes, the
Underwriters will have good title to the Notes, free of any Liens.
N. [RESERVED]
O. [RESERVED]
P. [RESERVED]
Q. Neither the Depositor nor the Issuer is an "investment company"
within the meaning of such term under the Investment Company Act of 1940
(the "1940 Act") and the rules and regulations of the Commission
thereunder.
R. [RESERVED]
S. At the Closing Date, the Notes shall have been rated in the
respective rating categories by the nationally recognized rating
agencies, as described in the Prospectus Supplement under "Ratings".
T. Any taxes, fees and other governmental charges in connection with the
execution, delivery and issuance of each Agreement and the Securities
have been paid or will be paid at or prior to the Closing Date.
U. At the Closing Date, each of the representations and warranties of
the Depositor set forth in each Agreement to which it is a party will be
true and correct in all material respects.
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Any certificate signed by an officer of the Depositor and delivered to
an Underwriter or counsel for the Underwriters in connection with an offering of
the Notes 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 1 are made.
SECTION 1A. Representations and Warranties of the Seller. The Seller
represents and warrants to, and agrees with the Depositor and the Underwriters
that:
A. [RESERVED]
B. The Prospectus Supplement and any further amendments or supplements
to the Prospectus Supplement will, when they are filed with the
Commission, conform in all respects to the requirements of the
Securities Act, the Trust Indenture Act and the Rules and Regulations.
The Seller Information (as defined in Section 8 I.) 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.
C. The documents regarding the Trust and the Home Equity Loans filed
after the Closing Date and incorporated by reference to 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 the Seller Information is
given, there has not been any material adverse change in the general
affairs, management, financial condition, or results of operations of
the Seller, otherwise than as set forth or contemplated in the Seller
Information as supplemented or amended as of the Closing Date.
E. The Seller has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Florida 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 each
Agreement to which it is a party.
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F. There are no actions, proceedings or investigations pending with
respect to which the Seller has received service of process before or
threatened by any court, administrative 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 or financial condition of the
Seller, (b) asserting the invalidity of any of the Agreements or the
Securities, (c) seeking to prevent the issuance of the Securities or the
consummation by the Seller of any of the transactions contemplated by
the 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 Agreements or the Securities.
G. This Agreement has been, and each other Agreement to which the Seller
is a party when executed and delivered as contemplated hereby and
thereby will have been, duly authorized, executed and delivered by the
Seller, and this Agreement constitutes, and each such other Agreement
when executed and delivered as contemplated herein, will constitute,
legal, valid and binding instruments enforceable against the Seller in
accordance with their respective terms, subject as to enforceability to
(x) applicable bankruptcy, reorganization, insolvency moratorium or
other similar laws affecting creditors' rights generally, (y) general
principles of equity (regardless of whether enforcement is sought in a
proceeding in equity or at law), and (z) with respect to rights of
indemnity under this Agreement and the Indemnification Agreement,
limitations of public policy under applicable securities laws.
H. The execution, delivery and performance of each Agreement to which
the Seller is a party and the consummation of the transactions
contemplated hereby and 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, by which the Seller is bound or to which any of the properties 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 any 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.
I. The Seller has no reason to believe that Coopers & Xxxxxxx L.L.P. are
not independent public accountants with respect to the Seller as
required by the Securities Act and the Rules and Regulations.
J. [RESERVED]
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K. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of the
United States is required for the consummation by the Seller of the
transactions contemplated by the 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 Notes by the Underwriters or as have
been obtained.
L. The Seller 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 the Seller has
not received notice of any proceedings relating to the revocation or
modification of any such license, certificate, authority or permit which
if decided adversely to the Seller 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 Sale and Servicing
Agreement, the Seller will: (i) have good title to the Initial Home
Equity Loans conveyed by the Seller, free and clear of any lien,
mortgage, pledge, charge, encumbrance, adverse claim or other security
interest (collectively, "Liens"); (ii) not have assigned to any person
any of its right or title in the Initial Home Equity Loans, in the Sale
and Servicing Agreement and (iii) have the power and authority to sell
its interest in the Home Equity Loans to the Depositor. Upon execution
and delivery of the Sale and Servicing Agreement by the Depositor, the
Depositor will have acquired beneficial ownership of all of the Seller's
right, title and interest in and to the Initial Home Equity Loans.
N. At the time of execution and delivery of any Subsequent Transfer
Agreement, the Seller will: (i) have good title to the Subsequent Home
Equity Loans conveyed by the Seller, free and clear of any Liens; (ii)
not have assigned to any person any of its right or title in the
Subsequent Home Equity Loans or in the Sale and Servicing Agreement; and
(iii) have the power and authority to sell the Subsequent Home Equity
Loans to the Issuer. Upon execution and delivery of the Subsequent
Transfer Agreement by the Issuer, the Issuer will acquire beneficial
ownership of all of the Seller's right, title and interest in and to the
Subsequent Home Equity Loans.
O. As of the Cut-Off Date, each of the Initial Home Equity Loans will
meet the eligibility criteria described in the Prospectus and will
conform to the descriptions thereof contained in the Prospectus.
P. As of any Subsequent Transfer Date, each of the Subsequent Home
Equity Loans will meet the eligibility criteria described in the
Prospectus and will conform to the descriptions thereof contained in the
Prospectus.
Q. [RESERVED]
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R. At the Closing Date, the Notes and each Agreement will conform in all
material respects to the descriptions thereof contained in the
Prospectus Supplement.
S. [RESERVED]
T. [RESERVED]
U. At the Closing Date, each of the representations and warranties of
the Seller set forth in each Agreement to which it is a party will be
true and correct in all material respects.
Any certificate signed by an officer of the Seller and delivered to the
Depositor or an Underwriter or their respective counsel in connection with an
offering of the Notes 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 1A are made.
SECTION 2 Purchase and Sale. The commitment of the Underwriters to
purchase the Notes 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 Issuer to issue the Notes and agrees to sell to each Underwriter,
and each Underwriter agrees (except as provided in Sections 10 and 11 hereof)
severally and not jointly to purchase from the Depositor the aggregate initial
principal amounts of the Notes set forth opposite their names on Schedule A, at
the purchase price or prices set forth in Schedule A. The Underwriters may offer
the Notes to certain dealers at such price less a concession not in excess of
the amount set forth in Schedule A. The Underwriters may allow and such dealers
may reallow a discount to certain dealers not in excess of the amount set forth
in Schedule A.
SECTION 3 Delivery and Payment. Delivery of and payment for the Notes to
be purchased by the Underwriters shall be made at the offices of Stroock &
Stroock & Xxxxx LLP, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such other
place as shall be agreed upon by the Representative and the Depositor at 10:00
A.M. New York City time on March 31, 1998, or at such other time or date as
shall be agreed upon in writing by the Representative and the Depositor (such
date being 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 Notes shall be made to the Representative for the
accounts of the applicable Underwriters against payment of the purchase price
thereof. The Notes shall be in such authorized denominations and registered in
such names as the Representative may request in writing at least two business
days prior to the Closing Date. The Notes will be made available for examination
by the Representative no later than 2:00 P.M. New York City time on the first
business day prior to the Closing Date.
SECTION 4 Offering by the Underwriters. It is understood that, subject
to the terms and conditions hereof, the Underwriters propose to offer the Notes
for sale to the public as set
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forth in the Prospectus.
SECTION 5 Covenants of the Depositor and IMC. The Depositor and, with
respect to the provisions of Section I and J. below, IMC each 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 Notes; 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 Notes 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 Notes, and
if at such time any events shall have occurred as a result of which the
Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact
necessary in order
11
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 the Underwriters'
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 Notes at any time nine months or more after the
Effective Time, upon the request of the Underwriters but at their
expense, the Depositor shall prepare and deliver to the Underwriters as
many copies as the Underwriters may reasonably request of an amended or
supplemented Prospectus complying with Section 10(a)(3) of the
Securities Act.
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, the Trust Indenture Act
or requested by the Commission.
E. The Depositor will cause any Computational Materials (as defined
below) with respect to the Offered Certificates which are delivered by
any Underwriter to the Depositor to be filed with the Commission on a
Current Report on Form 8-K (the "Form 8-K -- Computational Materials")
at or before the time of filing of the Prospectus pursuant to Rule
424(b) under the 1933 Act; provided, however, that the Depositor shall
have no obligation to file any materials which, in the reasonable
determination of the Depositor after consultation with such Underwriter,
(i) are not required to be filed pursuant to the Xxxxxx Letters (as
defined below) or (ii) contain any erroneous information or 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; it being understood, however, that the Depositor shall have
no obligation to review or pass upon the accuracy or adequacy of, or to
correct, any Computational Materials provided by any Underwriter to the
Depositor as aforesaid. For purposes hereof, as to each Underwriter, the
term "Computational Materials" shall mean those materials delivered by
an Underwriter to the Depositor within the meaning of the no-action
letter dated May 20, 1994 issued by the Division of Corporation Finance
of the Commission to Xxxxxx, Peabody Acceptance Corporation I and
certain affiliates and the no-action letters dated May 27, 1994 and
February 17, 1995, each issued by the Division of Corporation Finance of
the Commission to the Public Securities Association (all three of such
letters, the "Xxxxxx Letters") for which the filing of such material is
a condition of the relief granted in such letters.
F. To furnish the Underwriters and counsel for the Underwriters, prior
to filing
12
with the Commission, and to obtain the consent of the Underwriters for
the filing of the following documents relating to the Notes: (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.
G. To make generally available to holders of the Notes 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 Issuer (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.
H. To use its best efforts, in cooperation with the Underwriters, to
qualify the Notes 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 Notes. 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 Notes have been so qualified.
I. Unless the Underwriters shall otherwise have given their written
consent, no pass-through certificates or debt instruments backed by home
equity loans or other similar securities representing interest in or
secured by other mortgage-related assets originated or owned by IMC or
an affiliate shall be publicly offered, sold nor shall IMC enter into
any contractual arrangements that contemplate the public offering or
sale of such securities for a period of seven (7) business days
following the commencement of the offering of the Notes to the public.
J. So long as the Notes shall be outstanding and IMC shall be the
Servicer, IMC shall cause the Indenture Trustee, pursuant to the Sale
and Servicing Agreement, to deliver to the Underwriters as soon as such
statements are furnished to the Owners: (i) the annual statement as to
compliance delivered to the Indenture Trustee pursuant to Section 4.16
of the Sale and Servicing Agreement; (ii) the annual statement of a firm
of independent public accountants furnished to the Indenture Trustee
pursuant to Section 4.17 of the Sale and Servicing Agreement; (iii) the
monthly servicing report furnished to the Trustee pursuant to Section
3.08 of the Sale and Servicing Agreement; and (iv) the monthly reports
furnished to the Noteholders pursuant to Section 3.09 of the Indenture.
K. To apply the net proceeds from the sale of the Notes in the manner
set forth in the Prospectus.
SECTION 6 Conditions to the Underwriters' Obligations. The obligations
of the Underwriters to purchase the Notes pursuant to this Agreement are subject
to: (i) the accuracy
13
on and as of the Closing Date of the representations and warranties on the part
of the Depositor and IMC herein contained; (ii) the performance by the Depositor
and IMC of all of its respective obligations hereunder; and (iii) 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.
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 Stroock & Stroock & Xxxxx 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 Agreements, the Issuer, the
Notes, the Registration Statement and the Prospectus, and all other
legal matters relating to this Agreement and the transactions
contemplated hereby shall be satisfactory in all respects to the
Underwriters and their counsel, and the Depositor and IMC shall have
furnished to such counsel all documents and information that they may
reasonably request to enable them to pass upon such matters.
X. Xxxxxxx & Stroock & Xxxxx 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 Securities Act; to the best of such
counsel's knowledge, no stop order suspending the effectiveness
of the Registration Statement has been issued and not withdrawn
and no proceedings for that purpose have been instituted or
threatened and not terminated; and the Registration Statement,
the Prospectus and each amendment or supplement thereto, as of
their respective effective or issue dates (other than the
financial and statistical information contained therein, as to
which such counsel need express no opinion), complied
14
as to form in all material respects with the applicable
requirements of the Securities Act and the rules and regulations
thereunder.
3. To the best of such counsel's knowledge, 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 Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended and complies with the
requirements of the Trust Indenture Act and the applicable Rules
and Regulations.
5. Neither the Depositor nor the Issuer is an "investment
company" or under the "control" of an "investment company" as
such terms are defined in the 1940 Act.
6. The Notes, when duly and validly executed, authenticated and
delivered in accordance with the Indenture and delivered to the
Underwriters and paid for in accordance with the Underwriting
Agreement, will be entitled to the benefits of the Indenture.
7. The statements set forth in the Basic Prospectus under the
captions "Description of The Securities," "Servicing of Loans"
and "The Agreements", as modified by the statements" and in the
Prospectus Supplement under the captions "Description of the
Notes" and "Administration," to the extent such statements
purport to summarize certain provisions of the Notes or of the
Agreements, are fair and accurate in all material respects.
8. The statements set forth in the Prospectus and the Prospectus
Supplement under the captions "ERISA Considerations" and "Federal
Income Tax Consequences" to the extent that they relate to the
Notes and constitute matters of federal law, provide a fair and
accurate summary of such law or conclusions.
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
15
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; or (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 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.
X. Xxxxx & Xxxxxx shall have furnished to the Underwriters their written
opinion, as counsel to the Seller, addressed to the Underwriters and
dated the Closing Date, in form and substance satisfactory to the
Underwriters, to the effect that:
1. The Agreements conform in all material respects to the
descriptions thereof contained in the Prospectus Supplement.
2. For federal income tax purposes, the Notes will be treated as
debt obligations of the Issuer, and the Issuer will not be
characterized as an association (or publicly traded partnership)
taxable as a corporation.
3. The Notes will, when issued, conform to the descriptions
thereof contained in the Prospectus Supplement.
4. The execution of the Sale and Servicing Agreement is
sufficient to convey all of IMC's right, title and interest in
the Initial Home Equity Loans to the Depositor and following the
consummation of the transaction contemplated by Section 2 of the
Sale and Servicing Agreement, the transfer of the Initial Home
Equity Loans by IMC to the Depositor is a sale thereof.
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 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.
F. The Underwriters shall have received the favorable opinion, dated the
Closing Date, of Xxxxx & Xxxxxx, special counsel to the Seller,
addressed to the Depositor and satisfactory to Standard & Poor's, a
division of the XxXxxx-Xxxx Companies, Xxxxx'x Investors Service, Inc.
and the Underwriters, with respect to certain matters relating to the
transfer of the Initial Home Equity Loans to the Depositor and such
counsel shall
16
have consented to the reliance on such opinion by Standard & Poor's, a
division of the XxXxxx-Xxxx Companies, Xxxxx'x Investors Service, Inc.
and the Underwriters as though such opinion had been addressed to each
such party.
G. The Underwriters shall have received the favorable opinion, dated the
Closing Date, of Stroock & Stroock & Xxxxx LLP, special counsel to the
Depositor, addressed to the Depositor and satisfactory to Standard &
Poor's, a division of the XxXxxx-Xxxx Companies, Xxxxx'x Investors
Service, Inc. and the Underwriters, with respect to certain matters
relating to the transfer of the Initial Home Equity Loans from the
Depositor to the Issuer, and such counsel shall have consented to the
reliance on such opinion by Standard & Poor's, a division of the
XxXxxx-Xxxx Companies, Xxxxx'x Investors Service, Inc. and the
Underwriters as though such opinion had been addressed to each such
party.
X. Xxxxxxxx X. Xxxxxx, P.A., special counsel for IMC, in IMC's capacity
as both Seller and Servicer under the Sale and Servicing Agreement,
shall have furnished to the Underwriters their written opinion,
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. IMC has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of
Florida and has duly authorized all actions contemplated hereby.
2. IMC has full power and authority to serve in the capacity of
seller and servicer of the Home Equity Loans as contemplated in
the Sale and Servicing Agreement and to transfer the Home Equity
Loans to the Depositor as contemplated in the Sale and Servicing
Agreement and has the requisite power and authority and legal
right to own the Residual Interest.
3. This Agreement and the Sale and Servicing Agreement have been
duly authorized, executed and delivered by IMC and, assuming the
due authorization, execution and delivery of such agreements by
the other parties thereto, constitute the legal, valid and
binding agreements of IMC, enforceable against IMC in accordance
with their 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
17
IMC is required for the consummation by IMC of the transactions
contemplated by the Sale and Servicing Agreement, except such
consents, approvals, authorizations, registrations and
qualifications as have been obtained.
5. Neither the transfer of the Home Equity Loans by IMC to the
Depositor, nor the execution, delivery or performance by IMC of
the Sale and Servicing Agreement and the transactions
contemplated thereby (A) conflict with or result in a breach of,
or constitute a default under, (i) any term or provision of the
formation documents of IMC, as applicable; (ii) any term or
provision of any material agreement, deed of trust, mortgage loan
agreement, contract, instrument or indenture, or other agreement
to which IMC is a party or is bound or to which any of the
property or assets of IMC or any of its subsidiaries is subject;
(iii) to the best of such firm's knowledge without independent
investigation any order, judgment, writ, injunction or decree of
any court or governmental authority having jurisdiction over IMC;
or (iv) any law, rule or regulations applicable to IMC; or (B) to
the best of such firm's knowledge without independent
investigation, results in the creation or imposition of any lien,
charge or encumbrance upon the Trust Estate or upon the Notes.
6. There are, to the best of such counsel's knowledge without
independent investigation, no actions, proceedings or
investigations pending with respect to which IMC has received
service of process or threatened against IMC before any court,
administrative agency or other tribunal (a) asserting the
invalidity of any of the Agreements or the Notes, (b) seeking to
prevent the consummation of any of the transactions contemplated
by the Agreements or (c) which would materially and adversely
affect the performance by IMC of its obligations under, or the
validity or enforceability of, the Sale and Servicing Agreement
or this Agreement.
I. The documents listed in Schedule B hereto shall have been executed
and delivered and the Underwriters shall be entitled to rely on any such
opinions as though the same were addressed to the Underwriters.
J. The Underwriters shall have received an opinion of Xxxxxxxx, Xxxxxx &
Finger, counsel to the Owner Trustee, dated the Closing Date, in form
and substance satisfactory to the Underwriters and counsel for the
Underwriters, to the effect that:
1. The Owner Trustee is a Delaware banking corporation duly
incorporated and validly existing under the laws of the State of
Delaware.
2. The Owner Trustee has the full power and authority to accept
the office of owner trustee under the Trust Agreement and to
enter into and perform its obligations under the Trust Agreement
and the transactions
18
contemplated thereby.
3. The execution and delivery of the Trust Agreement by the Owner
Trustee and the performance by the Owner Trustee of its
obligations under the Trust Agreement have been duly authorized
by all necessary action of the Owner Trustee and the Trust
Agreement has been duly executed and delivered by the Owner
Trustee.
4. The Trust Agreement constitutes valid and binding obligations
of the Owner Trustee enforceable against the Owner Trustee in
accordance with its terms, except as the enforceability thereof
may be (a) limited by bankruptcy, insolvency, reorganization,
moratorium, liquidation or other similar laws affecting the
rights of creditors generally, and (b) subject to general
principals of equity (regardless of whether such enforceability
is considered in a proceeding in equity or at law).
5. The execution and delivery by the Owner Trustee of the Trust
Agreement and the consummation of the transactions contemplated
thereby do not require any consent, approval or authorization of,
or any registration or filing with, any applicable governmental
authority of the State of Delaware which has not been obtained or
done.
6. Neither the consummation by the Owner Trustee of the
transactions contemplated in the Trust Agreement, nor the
fulfillment of the terms thereof by the Owner Trustee will
conflict with, result in a breach or violation of, or constitute
a default under the Articles of Association, By-Laws or other
organizational documents of the Owner Trustee
K. The Underwriters shall have received an opinion of Xxxxxxxx, Xxxxxx &
Finger, special Delaware counsel for the Issuer dated the Closing Date,
in form and substance satisfactory to the Underwriters and counsel for
the Underwriters, to the effect that:
1. The Trust Agreement is the legal, valid and binding agreement
of the Owner Trustee, and the Depositor, enforceable against the
Owner Trustee, and the Depositor in accordance with its terms
subject to (i) applicable bankruptcy, insolvency, moratorium,
receivership, reorganization, fraudulent conveyance and similar
laws relating to and affecting the rights and remedies of
creditors generally, (ii) principles of equity (regardless of
whether considered and applied in a proceeding in equity or at
law), and (iii) the effect of applicable public policy on the
enforceability of provisions relating to indemnification or
contribution.
2. The Certificate of Trust has been duly filed with the
Secretary of
19
State of the State of Delaware. The Issuer as been duly formed
and is validly existing as a business trust under the Delaware
Business Trust Act.
3. The Issuer has the power and authority under the Trust
Agreement and the Delaware Business Trust Act to execute, deliver
and perform its obligations under the Trust Agreement, the
Indenture, the Sale and Servicing Agreement, the Notes and the
Residual Interests and to issue the Securities.
4. The Issuer has duly authorized and executed the Trust
Agreement, the Indenture, the Sale and Servicing Agreement, the
Notes and the Residual Interests.
5. The Trust has the power under the Trust Agreement and the
Delaware Business Trust Act to pledge the Trust Estate to the
Indenture Trustee as security for the Notes.
6. The Notes have been executed, authorized and delivered by the
Owner Trustee upon the order of the Depositor in accordance with
the Trust Agreement and the Indenture.
7. To the extent that Article 9 of the Uniform Commercial Code as
in effect in the State of Delaware (the "Delaware UCC") is
applicable (without regard to conflicts of laws principles), and
assuming that the security interest created by the Indenture in
the Collateral has been duly created and has attached, upon the
filing of a UCC-1 financing statement with the Secretary of State
of the State of Delaware, the Indenture Trustee will have a
perfected security interest in such Collateral and the proceeds
thereof; and such security interest will be prior to any other
security interest granted by the Trust that is perfected solely
by the filing of financing statements under the Delaware UCC,
excluding purchase money security interests under ss.9-312 of the
Delaware UCC and temporarily perfected security interests in
proceeds under ss.9-306 of the Delaware UCC.
8. No re-filing or other action is necessary under the Delaware
UCC in the State of Delaware in order to maintain the perfection
of the security interest referenced above except for the filing
of continuation statements at five-year intervals.
9. Under ss.3805(b) of the Delaware Business Trust Act, no
creditor of any holder of the Residual Interest shall have any
right to obtain possession of, or otherwise exercise legal or
equitable remedies with
20
respect to, the property of the Trust except in accordance with
the terms of the Trust Agreement subject to (i) applicable
bankruptcy, insolvency, moratorium, receivership, reorganization,
fraudulent conveyance and similar laws relating to and affecting
the rights and remedies of creditors generally, (ii) principles
of equity (regardless of whether considered and applied in a
proceeding in equity or at law), and (iii) the effect of
applicable public policy on the enforceability of provisions
relating to indemnification or contribution.
10. Under ss.3805(c) of the Delaware Business Trust Act, and
assuming that the Sale and Servicing Agreement conveys good title
to the Home Equity Loans to the Issuer as a true sale and not as
a security arrangement, the Issuer, rather than the holders of
the Residual Interest, is the owner of the Home Equity Loans
subject to (i) applicable bankruptcy, insolvency, moratorium,
receivership, reorganization, fraudulent conveyance and similar
laws relating to and affecting the rights and remedies of
creditors generally, (ii) principles of equity (regardless of
whether considered and applied in a proceeding in equity or at
law), and (iii) the effect of applicable public policy on the
enforceability of provisions relating to indemnification or
contribution.
11. The execution and delivery by the Owner Trustee of the Trust
Agreement and, on behalf of the Issuer, of the Indenture and the
Sale and Servicing Agreement do not require any consent, approval
or authorization of, or any registration or filing with, any
governmental authority of the State of Delaware, except for the
filing of the Certificate of Trust with the Secretary of State.
12. Neither the consummation by the Owner Trustee of the
transactions contemplated by the Trust Agreement or, on behalf of
the Trust, the transactions contemplated by the Trust Agreement,
Indenture and the Sale and Servicing Agreement nor the
fulfillment of the terms thereof by the Owner Trustee will
conflict with or result in a breach or violation of any law of
the State of Delaware.
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Underwriters. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the Federal law of the United States of America and the
laws of the State of Delaware.
L. The Underwriters shall have received the favorable opinion dated the
Closing Date, from Xxxxx Xxxx, counsel to the Note Insurer, in form and
scope satisfactory to counsel for the Underwriters, substantially to the
effect that:
21
1. The Note Insurer is a monoline insurance company duly
incorporated, validly existing, and in good standing under the
laws of the State of New York. The Note Insurer is validly
licensed and authorized to issue the Insurance Policy and perform
its obligations under the Insurance Agreement in accordance with
the terms thereof, under the laws of the State of New York.
2. The Note Insurer has the corporate power to execute and
deliver, and to take all action required of it under the
Insurance Agreement and the Insurance Policy.
3. The execution, delivery and performance by the Note Insurer of
the Insurance Policy, the Indemnification Agreement and Insurance
Agreement does not require the consent or approval of, the giving
of notice to, the prior registration with, or the taking of any
other action in respect of any state or other governmental agency
or authority which has not previously been obtained
or effected.
4. The Insurance Policy, the Indemnification Agreement and
Insurance Agreement have been duly authorized, executed and
delivered by the Note Insurer and constitute the legal, valid and
binding agreement of the Note Insurer, enforceable against the
Note Insurer in accordance with its terms subject, as to
enforcement, to (x) bankruptcy, reorganization, insolvency,
moratorium and other similar laws relating to or affecting the
enforcement of creditors' rights generally, including, without
limitation, laws relating to fraudulent transfers or conveyances,
preferential transfers and equitable subordination, presently or
from time to time in effect and general principles of equity
(regardless of whether such enforcement is considered in a
proceeding in equity or at law), as such laws may be applied in
any such proceeding with respect to the Note Insurer and (y) the
qualification that the remedy of specific performance and other
forms of equitable relief may be subject to equitable defenses
and to the discretion of the court before which any proceedings
with respect thereto may be brought.
5. To the extent the Insurance Policy constitutes a security
within the meaning of Section 2(1) of the Securities Act, it is a
security that is exempt from the registration requirements of the
Act.
6. The information set forth under the caption, "The Note
Insurer" in the Prospectus Supplement, insofar as such
information constitutes a description of the Insurance Policy,
accurately summarizes such Insurance Policy.
M. The Underwriters shall have received the favorable opinion of counsel
to the Indenture Trustee, dated the Closing Date, addressed to the
Underwriters and in form
22
and scope satisfactory to counsel to the Underwriters, to the effect
that:
1. The Indenture Trustee is a banking corporation duly
incorporated and validly existing under the laws of the State of
New York.
2. The Indenture Trustee has the full corporate trust power to
execute, deliver and perform its obligations under the Indenture
3. The execution and delivery by the Indenture Trustee of the
Indenture and the performance by the Indenture Trustee of its
obligations under the Indenture have been duly authorized by all
necessary corporate action of the Indenture Trustee.
4. The Indenture is a valid and legally binding obligation of the
Indenture Trustee enforceable against the Trustee.
5. The execution and delivery by the Indenture Trustee of the
Indenture does not (a) violate the Organization Certificate of
the Trustee or the Bylaws of the Indenture Trustee, (b) to such
counsel's knowledge, violate any judgment, decree or order of any
New York or United States federal court or other New York or
United States federal governmental authority by which the
Indenture Trustee is bound or (c) assuming the non-existence of
any judgment, decree or order of any court or other governmental
authority that would be violated by such execution and delivery,
violate any New York or United States federal statute, rule or
regulation or require any consent, approval or authorization of
any New York or United States federal court or other New York or
United States federal governmental authority.
6. The Notes have been duly authenticated and delivered by the
Indenture Trustee.
7. If the Indenture Trustee were acting as Servicer under Sale
and Servicing Agreement as of the date of such opinion, the
Indenture Trustee would have the full corporate trust power to
perform the obligations of the Servicer under the Sale and
Servicing Agreement; and
8. To the best of such counsel's knowledge, there are no actions,
proceedings or investigations pending or threatened against or
affecting the Indenture Trustee before or by any court,
arbitrator, administrative agency or other governmental authority
which, if decided adversely to the Indenture Trustee, would
materially and adversely affect the ability of the Indenture
Trustee to carry out the transactions contemplated in the
Indenture.
23
N. 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 Notes, the
Registration Statement, this Agreement, the Prospectus and such other
related matters as the Underwriters may reasonably require.
O. IMC 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 IMC, stating as it relates to such entity:
1. The representations and warranties made by such entity in the
Agreements to which it is a party are true and correct as of the
Closing Date; and such entity has complied with all agreements
contained herein which are to have been complied with on or prior
to the Closing Date.
2. The Seller Information is true and accurate in all material
respects and nothing has come to his or her attention that would
lead such officer to believe that the Seller Information includes
any untrue statement of a material fact or omits to state a
material fact necessary to make the statements therein not
misleading.
3. There has been no amendment or other document filed affecting
the Certificate of Incorporation or bylaws of such entity since
_______10, 199_ and no such amendment has been authorized. No
event has occurred since March 1, 1998 which has affected the
good standing of such entity under the laws of the State of
Florida.
4. 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 such entity from December 31, 1998.
P. The Indenture Trustee shall have furnished to the Underwriters a
certificate of the Indenture Trustee, signed by one or more duly
authorized officers of the Indenture Trustee, dated the Closing Date, as
to the due authorization, execution and delivery of the Indenture by the
Indenture Trustee and the acceptance by the Indenture Trustee of the
trusts created thereby and the due authentication and delivery of the
Notes by the Indenture Trustee thereunder and such other matters as the
Representative shall reasonably request.
Q. The Notes shall have been rated in the respective rating categories
and by the nationally recognized statistical rating organizations
described in the Prospectus Supplement under "Ratings."
R. IMC shall have furnished to the Underwriters such further
information,
24
certificates and documents as the Underwriters may reasonably have
requested not less than three full business days prior to the Closing
Date.
S. 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 Notes 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 Notes as herein
contemplated shall be satisfactory in form and substance to the
Underwriters and counsel for the Underwriters.
T. 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 Underwriters, impractical or inadvisable to proceed with
the public offering or delivery of the Notes on the terms and in the
manner contemplated in the Prospectus.
U. The Underwriters shall have received from Coopers & Xxxxxxx LLP and
Deloitte & Touche LLP, certified public accountants, a letter dated the
date of the Prospectus Supplement and a letter dated the date hereof and
satisfactory in form and substance to the Underwriters and their
counsel, to the effect that they have performed certain specified
procedures, all of which have been agreed to by the Underwriters, as a
result of which they determined that certain information of an
accounting, financial or statistical nature set forth in the Prospectus
Supplement on the cover page thereof and under the captions "Summary of
Terms - The Home Equity Loans", "Risk Factors Risk of Home Equity Loan
Coupon Rates Reducing the Note Rate," "The Seller and Servicer -
General", "The Seller and Servicer - Delinquency, Loan Loss and
Foreclosure Information" and "The Home Equity Loan Pool - General,"
agrees with the records of IMC excluding any questions of legal
interpretation.
If any condition specified in this Section 6 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the
25
Depositor and IMC 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 7.
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 the Underwriters and their counsel.
SECTION 7 Payment of Expenses. IMC agrees to pay: (a) the costs incident
to the authorization, issuance, sale and delivery of the Notes and any taxes
payable in connection therewith; (b) the costs incident to the preparation,
printing and filing under the Securities Act of any amendments and exhibits to
the Registration Statement in connection with the transactions contemplated
hereby; (c) the costs of distributing the Registration Statement as originally
filed and each amendment thereto and any post-effective amendments thereof
(including, in each case, exhibits), the Prospectus and any amendment or
supplement to the Prospectus or any document incorporated by reference therein,
all as provided in this Agreement; (d) the costs of reproducing and distributing
this Agreement; (e) the fees and expenses of qualifying the Notes under the
securities laws of the several jurisdictions designated by the Underwriters as
provided in Section 5(H) 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 Underwriters); (f) any fees charged by securities
rating services for rating the Notes; (g) the costs of the accountant's letters
referred to in Section 6(S) hereof; and (h) all other costs and expenses
incident to the performance of the obligations of IMC (including costs and
expenses of its counsel); provided that, except as provided in this Section 7,
the Underwriters shall pay their own costs and expenses, including the costs and
expenses of their counsel, any transfer taxes on the Notes which they may sell
and the expenses of advertising any offering of the Notes made by the
Underwriters, and the Underwriters shall pay the cost of any accountant's
letters relating to any Computational Materials (as defined in Section 5(E)
hereof).
If this Agreement is terminated by the Underwriters in accordance with
the provisions of Section 6 or Section 11, IMC shall cause the Underwriters to
be reimbursed for all reasonable out-of-pocket expenses, including fees and
disbursements of Stroock & Stroock & Xxxxx LLP, counsel for the Underwriters.
SECTION 8 Indemnification and Contribution. A. The Depositor agrees to
indemnify and hold harmless the Seller, each Underwriter and each person, if
any, who controls the Seller or such Underwriter within the meaning of Section
15 of the Securities 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 Notes), to which the Seller, 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 therein a
material fact
26
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 therein a material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading and
shall reimburse the Seller, such Underwriter and each such controlling person
promptly upon demand for any legal or other expenses reasonably incurred by the
Seller, 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, in
reliance upon and in conformity with (x) the Seller Information or Future Seller
Information or (y) written information furnished to the Depositor by or on
behalf of such Underwriter specifically for inclusion therein. The foregoing
indemnity agreement is in addition to any liability which the Depositor may
otherwise have to the Seller, any Underwriter or any controlling person of the
Seller or any such Underwriter. The only information furnished by the
Underwriters or on behalf of the Underwriters for use in connection with the
preparation of the Registration Statement or the Prospectus is described in
Section 8(I) hereof.
B. IMC agrees to indemnify and hold harmless the Depositor, each of its
directors, each of its officers who signed the Registration Statement, each
Underwriter and each person, if any, who controls the Depositor or such
Underwriter within the meaning of Section 15 of the Securities Act against any
and all loss, claim, damage or liability, or any action in respect thereof, to
which the Depositor, any Underwriter 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 Registration Statement, or any amendment thereof or
supplement thereto, (ii) the omission or alleged omission to state therein 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 therein 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, 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 the Seller Information or Future Seller Information,
and shall reimburse the Depositor, each Underwriter and any such director,
officer or controlling person for any legal or other expenses reasonably
incurred by the Depositor, any Underwriter or any director, officer or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which IMC may otherwise have to the Depositor, any
27
Underwriter or any such director, officer or controlling person. The Seller
Information and Future Seller Information is described in Section 8(I) hereof.
C. Each Underwriter severally agrees to indemnify and hold harmless the
Depositor, each of its directors, each of its officers who signed the
Registration Statement, IMC and each person, if any, who controls the Depositor
or IMC within the meaning of Section 15 of the Securities Act against any and
all loss, claim, damage or liability, or any action in respect thereof, to which
the Depositor, IMC 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
Registration Statement, or any amendment thereof or supplement thereto, (ii) the
omission or alleged omission to state therein 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 therein 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, 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, IMC and
any such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Depositor, IMC or any director, officer or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred. The foregoing indemnity agreement is in addition to any
liability which any Underwriter may otherwise have to the Depositor, IMC or any
such director, officer or controlling person. The only information furnished by
the Underwriters or on behalf of the Underwriters for use in connection with the
preparation of the Registration Statement or the Prospectus is described in
Section 8(I) hereof.
D. Promptly after receipt by any indemnified party under this Section 8
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 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify an indemnifying party shall not relieve it from any liability which it
may have under this Section 8 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 8.
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
28
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 8 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 (i) the
related Underwriter, if the indemnified parties under this Section 8 consist of
one or more Underwriters or any of its or their controlling persons, (ii) the
Depositor, if the indemnified parties under this Section 8 consist of the
Depositor or any of the Depositor's directors, officers or controlling persons
or (iii) by IMC, if the indemnified parties under this Section 8 consist of IMC
or any of its controlling persons.
Each indemnified party, as a condition of the indemnity agreements
contained in Section 8A., 8B., and 8C., shall use its best efforts to cooperate
with the indemnifying party in the defense of any such action or claim. No
indemnifying party shall be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment for the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
Notwithstanding the foregoing paragraph, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel, 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
29
request prior to the date of such settlement.
E. Each Underwriter agrees to provide the Depositor no later than two
Business Days prior to the day on which the Prospectus Supplement is required to
be filed pursuant to Rule 424 with a copy of any Computational Materials (as
defined in Section 5(E) hereof) produced by such Underwriter for filing with the
Commission on Form 8-K.
F. Each Underwriter severally agrees, assuming all Seller Information is
accurate and complete in all material respects, 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 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 and agrees
to reimburse each such indemnified party for any legal or other expenses
reasonably incurred by him, her or it in connection with investigating or
defending or preparing to defend any such loss, claim, damage, liability or
action as such expenses are incurred. The obligations of an Underwriter under
this Section 8F. shall be in addition to any liability which such Underwriter
may otherwise have.
The procedures set forth in Section 8D. shall be equally applicable to
this Section 8F.
G. If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8A., 8B., 8C. or 8F. 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 IMC, the Depositor and the related Underwriter, respectively, from
the offering of the related Notes 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 8D, 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 IMC, the Depositor and the related
Underwriter, respectively, with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations.
The relative benefits of IMC, the Depositor and an Underwriter shall be
deemed to be in such proportion as the total net proceeds from the offering
(before deducting expenses) received by IMC, or retained the Depositor, as
applicable, bear to the total underwriting discounts and commissions as set
forth on the cover page of the Prospectus Supplement received by such
Underwriter.
30
The Depositor, IMC and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this Section 8G. 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
8G. shall be deemed to include, for purposes of this Section 8G, 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 8, in no case shall any Underwriter be
responsible for any amount in excess of the amount of the underwriting discounts
and commissions received by such Underwriter in connection with its purchase of
the Notes. 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.
H. For purposes of this Section 8, as to each Underwriter the term
"Computational Materials" means such portion, if any, of the information
delivered to the Depositor by such Underwriter pursuant to Section 8(D) for
filing with the Commission on Form 8-K as:
(i) is not contained in the Prospectus without taking into account
information incorporated therein by reference through a Form 8-K --
Computational Materials; and
(ii) does not constitute Seller Information.
I. Each Underwriter confirms that the information regarding such
Underwriter set forth in the last paragraph on the cover page of the Prospectus
Supplement, the information regarding such Underwriter set forth under the
caption "Underwriting" in the Prospectus Supplement and the Computational
Materials (other than to the extent such information is based on Seller
Information) furnished by such Underwriter is correct, and the parties hereto
acknowledge that such information constitutes the only information furnished in
writing by or on behalf of any Underwriter for use in connection with the
preparation of the Registration Statement or the Prospectus. For purposes of
this Agreement "Seller Information" means (i) any computer tape (or other
information) furnished to any Underwriter by or on behalf of the Seller and
Servicer concerning the assets comprising the Trust Estate and (ii) the
Prospectus Supplement, other than (x) the information under the caption "The
Depositor" and (y) the information referred to in the preceding sentence. For
purposes of this agreement, "Future Seller Information" means statements to
Noteholders filed on Form 8-K as provided in the Sale and Servicing Agreement.
SECTION 9 Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in certificates of officers of IMC or the Depositor
submitted pursuant hereto shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of
31
the Underwriters or controlling persons thereof, or by or on behalf of IMC or
the Depositor and shall survive delivery of any Notes to the Underwriters.
SECTION 10 Default by One or More of the Underwriters. If one or more of
the Underwriters participating in the public offering of the Notes shall fail at
the Closing Date to purchase the Notes which it is (or they are) obligated to
purchase hereunder (the "Defaulted Notes"), then the non-defaulting Underwriters
shall have the right, within 24 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 Notes in such amounts as
may be agreed upon and upon the terms herein set forth. If, however, the
Underwriters have not completed such arrangements within such 24-hour period,
then:
(i) if the aggregate principal amount of Defaulted Notes does not exceed
10% of the aggregate principal amount of the Notes 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 principal amount of Defaulted Notes exceeds 10% of
the aggregate principal amount of the Notes 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 10 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 10, each of the Underwriters and the Depositor shall have the right to
postpone the Closing Date for a period not exceeding five 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 11 Termination of Agreement. The Underwriters may terminate this
Agreement immediately upon notice to the Depositor and IMC, at any time at or
prior to the Closing Date if any of the events or conditions described in
Section 6(T) of this Agreement shall occur and be continuing. In the event of
any such termination, the covenant set forth in Section 5(G), the provisions of
Section 7, the indemnity agreement set forth in Section 8, and the provisions of
Sections 9 and 15 shall remain in effect.
SECTION 12 [RESERVED]
SECTION 13 Notices. All statements, requests, notices and agreements
hereunder shall be in writing, and:
32
A. if to the Underwriters, shall be delivered or sent by mail, telex or
facsimile transmission to Bear, Xxxxxxx & Co. Inc., 000 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 Attention: General Counsel.
B. if to IMC, shall be delivered or sent by mail, telex or facsimile
transmission to IMC Mortgage Company, 0000 Xxxx Xxxxxx Xxxxxx, Xxxxx,
Xxxxxxx 00000-0000 Attention: Xxxxxx Xxxxxxxxx (Fax: (000) 000-0000);
and
C. if to the Depositor, shall be delivered or sent by mail, telex or
facsimile transmission to Bear Xxxxxxx Asset Backed Securities, Inc. c/o
Bear Xxxxxxx & Co. Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
SECTION 14 Persons Entitled to the Benefit of this Agreement. This
Agreement shall inure to the benefit of and be binding upon the Underwriters,
IMC 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 IMC or 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
14, any legal or equitable right, remedy or claim under or in respect of this
Agreement or any provision contained herein.
SECTION 15 Survival. The respective indemnities, representations,
warranties and agreements of IMC, the Depositor and the Underwriters contained
in this Agreement, or made by or on behalf of them, respectively, pursuant to
the shall survive the delivery of and payment for the Notes 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.
SECTION 16 Definition of the Term "Business Day". For purposes of this
Agreement, "Business Day" means any day on which the New York Stock Exchange,
Inc. is open for trading.
SECTION 17 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
33
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 18 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 19 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.
34
If the foregoing correctly sets forth the agreement between the
Depositor, IMC and the Underwriters, please indicate your acceptance in the
space provided for the purpose below.
Very truly yours,
BEAR XXXXXXX ASSET BACKED
SECURITIES, INC.
By: /s/ Xxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Managing Director
IMC MORTGAGE COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx
------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
CONFIRMED AND ACCEPTED, as
of the date first above written:
BEAR, XXXXXXX & CO INC.
Acting on its own behalf and as
Representative of the several Underwriters
By: /s/ Xxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Managing Director
35
SCHEDULE A
Underwriters Principal Amount
------------ ----------------
Bear, Xxxxxxx & Co. Inc. $210,000,000
PaineWebber Incorporated $210,000,000
Deutche Xxxxxx Xxxxxxxx Inc. $140,000,000
X.X. Xxxxxx Securities $140,000,000
Total $700,000,000
Purchase Price Percentage
99.75%
Selling Concession Reallowance Discount
------------------ --------------------
0.15% 0.10%
36
SCHEDULE B
(a) An Issuer Order authorizing the authentication and delivery of
the Notes by the Indenture Trustee.
(b) All of the items of Collateral which shall be delivered to the
Indenture Trustee or its designee.
(c) An executed counterpart of the Trust Agreement.
(d) Opinions of Counsel addressed to the Indenture Trustee and the
Note Insurer to the effect that:
(i) all instruments furnished to the Indenture Trustee as
conditions precedent to the authentication of the Notes
by the Indenture Trustee pursuant to the Indenture
conform to the requirements of the Indenture and
constitute all the documents required to be delivered
thereunder for the Indenture Trustee to authenticate the
Notes;
(ii) all conditions precedent provided for in the Indenture
relating to the authentication of the Notes have been
complied with;
(iii) the Owner Trustee has power and authority to execute,
deliver and perform its obligations under the Trust
Agreement;
(iv) the Issuer has been duly formed, is validly existing as a
business trust under the laws of the State of Delaware,
12 Del. C. Section 3801, et seq., and has power,
authority and legal right to execute and deliver the
Indenture, the Insurance Agreement and the Sale and
Servicing Agreement;
(v) assuming due authorization, execution and delivery
thereof by the Indenture Trustee, the Indenture is the
valid, legal and binding obligation of the Issuer,
enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, arrangement,
moratorium, fraudulent or preferential conveyance and
other similar laws of general application affecting the
rights of creditors generally and to general principles
of equity (regardless of whether such enforcement is
considered in a proceeding in equity or at law);
(vi) the Notes, when executed and authenticated as provided
herein and delivered against payment therefor, will be
the valid, legal and binding obligations of the Issuer
pursuant to the terms of the Indenture, entitled
37
to the benefits of the Indenture, and will be enforceable
in accordance with their terms, subject to bankruptcy,
insolvency, reorganization, arrangement, moratorium,
fraudulent or preferential conveyance and other similar
laws of general application affecting the rights of
creditors generally and to general principles of equity
(regardless of whether such enforcement is considered in
a proceeding in equity or at law);
(vii) the Trust Agreement authorizes the Issuer to Grant the
Collateral to the Indenture Trustee as security for the
Notes and the Owner Trustee has taken all necessary
action under the Trust Agreement to Grant the Collateral
to the Indenture Trustee;
(viii) the Indenture has been duly qualified under the Trust
Indenture Act and the Notes have been registered under
the Securities Act;
(ix) the Indenture, together with the Grant of the Collateral
to the Indenture Trustee, creates a valid security
interest in the Collateral in favor of the Indenture
Trustee for the benefit of the Owners;
(x) such action has been taken with respect to delivery of
possession of the Collateral, and with respect to the
execution and filing of the Indenture and any financing
statements as are necessary to make effective and to
perfect a first priority security interest created by the
Indenture in the Collateral in favor of the Indenture
Trustee, except that with respect to the Mortgage Notes,
possession of such Mortgage Notes must be maintained by
the Indenture Trustee or an agent of the Indenture
Trustee (other than the Issuer, an Affiliate of the
Issuer, or a "securities intermediary," as defined in
Section 8.102 of the UCC); and
(xi) no authorization, approval or consent of any governmental
body having jurisdiction in the premises which has not
been obtained by the Issuer is required to be obtained by
the Issuer for the valid issuance and delivery of the
Notes, except that no opinion need be expressed with
respect to any such authorizations, approvals or consents
as may be required under any state securities "blue sky"
laws.
(e) An Officer's Certificate complying with the requirements of
Section 11.1 of the Indenture and stating that:
(i) the Issuer is not in Default under this Indenture and the
issuance of the Notes applied for will not result in any
breach of any of the terms, conditions or provisions of,
or constitute a default under, the Trust Agreement, any
indenture, mortgage, deed of trust or other agreement or
instrument to which the Issuer is a party or by which it
is bound, or any
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order of any court or administrative agency entered in
any proceeding to which the Issuer is a party or by which
it may be bound or to which it may be subject, and that
all conditions precedent provided in the Indenture
relating to the authentication and delivery of the Notes
applied for have been complied with;
(ii) the Issuer is the owner of all of the Initial Home Equity
Loans, has not assigned any interest or participation in
the Initial Home Equity Loans (or, if any such interest
or participation has been assigned, it has been released)
and has the right to Grant all of the Home Equity Loans
to the Indenture Trustee;
(iii) the Issuer has Granted to the Indenture Trustee all of
its right, title, and interest in the Collateral, and has
delivered or caused the same to be delivered to the
Indenture Trustee;
(iv) attached thereto are true and correct copies of letters
signed by Xxxxx'x and Standard & Poor's confirming that
the Notes have been rated "Aaa" and "AAA" by Xxxxx'x and
Standard & Poor's, respectively; and
(v) all conditions precedent provided for in the Indenture
relating to the authentication of the Notes have been
complied with.
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