EXHIBIT 1
EXECUTION COPY
UNION FINANCIAL SERVICES-1, INC.
$745,000,000
Taxable Student Loan Asset-Backed Notes
(Series 1998)
UNDERWRITING AGREEMENT
December 16, 1998
Xxxxxxx Xxxxx Xxxxxx Inc.
as representative of the Underwriters
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Union Financial Services-1, Inc., a Nevada corporation (the "Company"),
proposes to sell to Xxxxxxx Xxxxx Barney Inc. (the "Representative") and the
other underwriters listed on Schedule A hereto (the "Underwriters"), pursuant to
the terms of this Underwriting Agreement, $745,000,000 aggregate principal
amount of its Taxable Student Loan Asset-Backed Notes, Series 1998 (the
"Notes"). Zions First National Bank, a national banking association, will act as
eligible lender (the "Eligible Lender") on behalf of the Company. The Notes will
be issued under a Second Amended and Restated Indenture of Trust dated as of
November 1, 1996 (as previously amended and supplemented, the "Master
Indenture") between the Company and Zions First National Bank, a national
banking association, as successor indenture trustee ("Trustee"), as supplemented
by the Series 1998 Supplemental Indenture of Trust (the "Indenture Supplement"
and collectively with the Master Indenture, the "Indenture"). Upon issuance, the
Notes will be secured by, among other things, Financed Eligible Loans (as
defined in the Sale Agreements referred to below) pledged to the Trustee and
described in the Prospectus (as defined in Section 3 below). The Financed
Eligible Loans are to be serviced by Union Bank and Trust Company (in this
capacity, the "Servicer") pursuant to an Amended and Restated Servicing
Agreement dated as of June 19, 1996, as amended (the "Servicing Agreement"),
between the Servicer and the Company. The Servicer has entered into subservicing
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agreements with (i) UNIPAC Service Corporation ("UNIPAC") dated as of January 1,
1995 (the "UNIPAC Servicing Agreement") as amended by the parties thereto on
March 1, 1996 and June 19, 1996(the "UNIPAC Servicing Amendment" and, along with
the UNIPAC Servicing Agreement, the "UNIPAC Subservicing Agreement") pursuant to
which UNIPAC will act as subservicer or, upon inability of the Servicer to do
so, as servicer with respect to certain of the Financed Eligible Loans and (ii)
InTuition, Inc. ("InTuition"), dated as of December 22, 1998 (the "InTuition
Subservicing Agreement"), pursuant to which InTuition will act as subservicer
with respect to certain of the Financed Eligible Loans. This Agreement, the Loan
Sale and Commitment Agreement, dated as of December 1, 1998, between Union Bank
and Trust Company, in its own right and in its capacity as trustee, and the
Company, the Loan Sale and Commitment Agreement, dated as of December 22, 1998,
between NEBHELP INC. and the Company and the Loan Sale Agreement, dated as of
December 22, 1998, among Union Bank and Trust Company, as trustee, InTuition
Holdings, Inc. ("IHI") and the Company (collective, the "Sale Agreements"), the
Servicing Agreement, the UNIPAC Subservicing Agreement, the InTuition Servicing
Agreement and the Indenture shall collectively hereinafter be referred to as the
"Basic Documents." Capitalized terms used herein without definition shall have
the meanings ascribed to them in the Indenture or the Prospectus.
The Company proposes, upon the terms and conditions set forth herein, to
sell to each of the Underwriters on the Closing Date (as hereinafter defined)
the aggregate principal amount of each Class of Notes set forth next to the name
of each Underwriter on Schedule A hereto.
The Company wishes to confirm as follows this agreement with the
Underwriters in connection with the purchase and resale of the Notes.
1. Agreements to Sell, Purchase and Resell. (a) The Company hereby
agrees, subject to all the terms and conditions set forth herein to sell to each
of the Underwriters and, upon the basis of the representations, warranties and
agreements of the Company herein contained and subject to all the terms and
conditions set forth herein, each of the Underwriters severally agrees to
purchase from the Company, such principal amount of the Classes of the Notes at
such respective purchase prices as are set forth on Schedule A hereto.
(b) It is understood that the Underwriters propose to offer the Notes
for sale to the public (which may include selected dealers) as set forth in the
Prospectus.
2. Delivery of the Notes and Payment Therefor. Delivery to the
Underwriters of and payment for the Notes shall be made at the office of Xxxxx
Xxxx, Denver, Colorado, at 11:00 a.m., Denver time, on December 22, 1998 (the
"Closing Date"). The place of such closing and the Closing Date may be varied by
agreement between the Representative and the Company.
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The Notes will be delivered to the Underwriters against payment of the
purchase price therefor to the Company in Federal Funds, by wire, or such other
form of payment as to which the parties may agree. Unless otherwise agreed to by
the Company and the Representative, each Class of Notes will be evidenced by a
single global security in definitive form and/or by additional definitive
securities, and will be registered, in the case of the global Classes of Notes,
in the name of Cede & Co. as nominee of The Depository Trust Company ("DTC"),
and in the other cases, in such names and in such denominations as the
Underwriters shall request prior to 1:00 p.m., New York City time, no later than
the business day preceding the Closing Date. The Notes to be delivered to the
Underwriters shall be made available to the Underwriters in Denver, Colorado,
for inspection and packaging not later than 9:30 a.m., Denver time, on the
business day next preceding the Closing Date.
3. Representations and Warranties of the Company. The Company represents
and warrants to each of the Underwriters that:
(a) A registration statement on Form S-3 (No. 333-28551), including a
prospectus and such amendments thereto as may have been required to the date
hereof, relating to the Notes and the offering thereof from time to time in
accordance with Rule 415 under the Securities Act of 1933, as amended (the
"Act"), has been filed with the Securities and Exchange Commission (the "SEC" or
the "Commission") and such registration statement, as amended, has become
effective; such registration statement, as amended, and the prospectus relating
to the sale of the Notes offered thereby constituting a part thereof, as from
time to time amended or supplemented (including the base prospectus, any
prospectus supplement filed with the Commission pursuant to Rule 424(b) under
the Act, the information deemed to be a part thereof pursuant to Rule 430A(b)
under the Act, and the information incorporated by reference therein) are
respectively referred to herein as the "Registration Statement" and the
"Prospectus"; and the conditions to the use of a registration statement on Form
S-3 under the Act, as set forth in the General Instructions to Form S-3, and the
conditions of Rule 415 under the Act, have been satisfied with respect to the
Registration Statement;
(b) On the effective date of the Registration Statement, the
Registration Statement and the Prospectus conformed in all respects to the
requirements of the Act, the rules and regulations of the SEC (the "Rules and
Regulations") and the Trust Indenture Act of 1939, as amended, and the rules and
regulations thereunder (the "Trust Indenture Act"), and, except with respect to
information omitted pursuant to Rule 430A of the Act, did not include any untrue
statement of a material fact or, in the case of the Registration Statement, omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading and, in the case of the Prospectus, omit
to state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, and on
the date of this Agreement, the Registration Statement and the Prospectus will
conform in all respects to the requirements of the Act, the Rules and
Regulations and the Trust Indenture Act, and neither of such documents included
or will include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that the foregoing does not apply to
statements in or omissions from the Registration Statement or the Prospectus
based upon written information furnished to the Company by the Underwriters,
specifically for use therein.
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(c) The Commission has not issued and, to the best knowledge of the
Company, is not threatening to issue any order preventing or suspending the use
of the Registration Statement.
(d) As of the Closing Date, each consent, approval, authorization or
order of, or filing with, any court or governmental agency or body which is
required to be obtained or made by the Company or its affiliates for the
consummation of the transactions contemplated by this Agreement shall have been
obtained, except as otherwise provided in the Basic Documents.
(e) The Master Indenture and the Indenture Supplement have been duly and
validly authorized by the Company and, upon their execution and delivery by the
Company and assuming due authorization, execution and delivery by the Trustee,
will be valid and binding agreements of the Company, enforceable in accordance
with their terms, except as enforcement thereof may be limited by bankruptcy,
insolvency or other similar laws affecting creditors' rights generally and
conform in all material respects to the description thereof in the Prospectus.
(f) The Notes have been duly authorized by the Company and the Notes to
be issued on the Closing Date, when executed by the Company and authenticated by
the Trustee in accordance with the Indenture, and delivered to the Underwriters
against payment therefor in accordance with the terms hereof, will have been
validly issued and delivered, and will constitute valid and binding obligations
of the Company entitled to the benefits of the Indenture and enforceable in
accordance with their terms, except as enforcement thereof may be limited by
bankruptcy, insolvency, moratorium, fraudulent conveyance or other similar laws
relating to or affecting creditors' rights generally and court decisions with
respect thereto, and the Notes will conform in all material respects to the
description thereof in the Prospectus.
(g) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Nevada with full corporate power
and authority to own, lease and operate its properties and to conduct its
business as conducted on the date hereof, and is duly registered and qualified
to conduct its business and is in good standing in each jurisdiction or place
where the nature of its properties or the conduct of its business requires such
registration or qualification, except where the failure so to register or
qualify does not have a material adverse effect on the condition (financial or
other), business, prospects, properties, net worth or results of operations of
the Company.
(h) Other than as contemplated by this Agreement or as disclosed in the
Prospectus, there is no broker, finder or other party that is entitled to
receive from the Company or any of its affiliates any brokerage or finder's fee
or other fee or commission as a result of any of the transactions contemplated
by this Agreement.
(i) There are no legal or governmental proceedings pending or, to the
knowledge of the Company threatened, against the Company, or to which the
Company or any of its properties is subject, that are not disclosed in the
Prospectus or that will not be disclosed in any subsequent amendment or
supplement to the Prospectus and which, if adversely decided, are reasonably
likely to materially affect the issuance of the Notes or the consummation of the
transactions contemplated hereby or by the Basic Documents.
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(j) Neither the offer, sale or delivery of the Notes by the Company nor
the execution, delivery or performance of this Agreement by the Company, nor the
consummation by the Company of the transactions contemplated hereby or thereby
(i) requires or will require any consent, approval, authorization or other order
of, or registration or filing with, any court, regulatory body, administrative
agency or other governmental body, agency or official (except for compliance
with the securities or Blue Sky laws of various jurisdictions, the qualification
of the Indenture under the Trust Indenture Act and such other consents,
approvals or authorizations as shall have been obtained prior to the Closing
Date) or conflicts or will conflict with or constitutes or will constitute a
breach of, or a default under, the organizational documents or bylaws of the
Company or (ii) conflicts or will conflict with or constitutes or will
constitute a breach of, or a default under, in any material respect, any
material agreement, indenture, lease or other instrument to which the Company is
a party or by which the Company or any of its properties may be bound, or
violates or will violate in any material respect any statute, law, regulation or
filing or judgment, injunction, order or decree applicable to the Company or any
of its properties, or will result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company pursuant to the
terms of any agreement or instrument to which it is a party or by which it may
be bound or to which any of its properties is subject other than as contemplated
by the Basic Documents.
(k) The Company has all requisite power and authority to execute,
deliver and perform its obligations under this Agreement; the execution and
delivery of, and the performance by the Company of its obligations under, this
Agreement have been duly and validly authorized by the Company and this
Agreement has been duly executed and delivered by the Company and constitutes
the valid and legally binding agreement of the Company, enforceable against the
Company in accordance with its terms, except as the enforcement hereof may be
limited by bankruptcy, insolvency, moratorium, fraudulent conveyance or other
similar laws relating to or affecting creditors' rights generally and court
decisions with respect thereto and subject to the applicability of general
principles of equity, and except as rights to indemnity and contribution
hereunder may be limited by Federal or state securities laws or principles of
public policy.
(l) Each Seller's assignment and delivery of Financed Eligible Loans to
the order of the Trustee on behalf of the Company as of the applicable sale date
described in the applicable Sale Agreement will vest in the Trustee on behalf of
the Company all of such Seller's right, title and interest therein, subject to
no prior lien, mortgage, security interest, pledge, adverse claim, charge or
other encumbrance.
(m) The Company's assignment of the Financed Eligible Loans to the
Trustee pursuant to the Indenture will vest in the Trustee, for the benefit of
the Noteholders, a first priority perfected security interest therein, subject
to no prior lien, mortgage, security interest, pledge, adverse claim, charge or
other encumbrance.
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(n) The Company is not, nor as a result of the issuance and sale of the
Notes as contemplated hereunder will it become, subject to registration as an
"investment company" under the Investment Company Act of 1940, as amended (the
"1940 Act").
(o) The representations and warranties made by the Company in any Basic
Document to which the Company is a party and made in any Officer's Certificate
of the Company will be true and correct at the time made and on and as of the
applicable Closing Date.
4. Agreements of the Company. The Company agrees with each of the
Underwriters as follows:
(a) The Company will prepare a supplement to the Prospectus setting
forth the amount of the Notes covered thereby and the terms thereof not
otherwise specified in the Prospectus, the price at which the Notes are to be
purchased by the Underwriters, either the initial public offering price or the
method by which the price at which the Notes are to be sold will be determined,
the selling concessions and reallowances, if any, and such other information as
the Underwriters and the Company deem appropriate in connection with the
offering of the Notes, and the Company will timely file such supplement to the
prospectus with the SEC pursuant to Rule 424(b) under the Act, but the Company
will not file any amendments to the Registration Statement as in effect with
respect to the Notes or any amendments or supplements to the Prospectus, unless
it shall first have delivered copies of such amendments or supplements to the
Underwriters, or if the Underwriters shall have reasonably objected thereto
promptly after receipt thereof; the Company will immediately advise the
Underwriters or the Underwriters' counsel (i) when notice is received from the
SEC that any post-effective amendment to the Registration Statement has become
or will become effective and (ii) of any order or communication suspending or
preventing, or threatening to suspend or prevent, the offer and sale of the
Notes or of any proceedings or examinations that may lead to such an order or
communication, whether by or of the SEC or any authority administering any state
securities or Blue Sky law, as soon as the Company is advised thereof, and will
use its best efforts to prevent the issuance of any such order or communication
and to obtain as soon as possible its lifting, if issued.
(b) If, at any time when the Prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue statement
of a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend or supplement
the Prospectus to comply with the Act or the Rules and Regulations, the Company
promptly will prepare and file with the SEC, an amendment or supplement to such
Prospectus that will correct such statement or omission or an amendment that
will effect such compliance.
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(c) The Company will immediately inform the Underwriters (i) of the
receipt by the Company of any communication from the SEC or any state securities
authority concerning the offering or sale of the Notes and (ii) of the
commencement of any lawsuit or proceeding to which the Company is a party
relating to the offering or sale of the Notes.
(d) The Company will furnish to the Underwriters, without charge, copies
of the Registration Statement (including all documents and exhibits thereto or
incorporated by reference therein), the Prospectus, and all amendments and
supplements to such documents relating to the Notes, in each case in such
quantities as the Underwriters may reasonably request.
(e) No amendment or supplement will be made to the Registration
Statement or Prospectus which the Underwriters shall not previously have been
advised or to which it shall reasonably object after being so advised.
(f) The Company will cooperate with the Underwriters and with its
counsel in connection with the qualification of, or procurement of exemptions
with respect to, the Notes for offering and sale by the Underwriters and by
dealers under the securities or Blue Sky laws of such jurisdictions as the
Underwriters may designate and will file such consents to service of process or
other documents necessary or appropriate in order to effect such qualification
or exemptions; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so qualified or
to take any action which would subject it to service of process in suits, other
than those arising out of the offering or sale of the Notes, in any jurisdiction
where it is not now so subject.
(g) The Company consents to the use, in accordance with the securities
or Blue Sky laws of such jurisdictions in which the Notes are offered by the
Underwriters and by dealers, of the Prospectus furnished by the Company.
(h) To the extent, if any, that the rating or ratings provided with
respect to the Notes by the rating agency or agencies that initially rate the
Notes is conditional upon the furnishing of documents or the taking of any other
actions by the Company, the Company shall cause to be furnished such documents
and such other actions to be taken.
(i) So long as any of the Notes are outstanding, the Company will
furnish to the Underwriters (i) as soon as available, a copy of each document
relating to the Notes required to be filed with the SEC pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or any order
of the SEC thereunder, and (ii) such other information concerning the Company as
the Underwriters may request from time to time.
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(j) If this Agreement shall terminate or shall be terminated after
execution and delivery pursuant to any provisions hereof (otherwise than by
notice given by the Representative terminating this Agreement pursuant to
Section 8 or Section 9 hereof) or if this Agreement shall be terminated by the
Representative because of any failure or refusal on the part of the Company to
comply with the terms or fulfill any of the conditions of this Agreement, the
Company agrees to reimburse the Underwriters for all out-of-pocket expenses
(including fees and expenses of their counsel) reasonably incurred by it in
connection herewith, but without any further obligation on the part of the
Company for loss of profits or otherwise.
(k) The net proceeds from the sale of the Notes hereunder will be
applied substantially in accordance with the description set forth in the
Prospectus.
(l) Except as stated in this Agreement and in the Prospectus, the
Company has not taken, nor will it take, directly or indirectly, any action
designed to or that might reasonably be expected to cause or result in
stabilization or manipulation of the price of the Notes to facilitate the sale
or resale of the Notes.
(m) For a period from the date of this Agreement until the retirement of
the Notes, the Company will deliver to you the annual statements of compliance
and the annual independent certified public accountants' reports furnished to
the Trustee or the Company pursuant to the Servicing Agreement as soon as such
statements and reports are furnished to the Trustee or the Company.
(n) On or before the Closing Date, the Company shall xxxx its accounting
and other records, if any, relating to the Initial Financed Eligible Loans and
shall cause the Servicer, UNIPAC and InTuition to xxxx their respective computer
records relating to the Initial Financed Eligible Loans to show the absolute
ownership by the Trustee, as eligible lender of, and the interest of the Company
in, the Initial Financed Eligible Loans, and from and after each Closing Date
the Company will take, or cause the Servicer, UNIPAC and InTuition to take, as
the case may be, such actions with respect to the respective records of each
with regard to any Additional Acquired Eligible Loans at the time of the
acquisition thereof by the Trustee on behalf of the Company and the Company
shall not take, or shall permit any other person to take, any action
inconsistent with the ownership of, and the interest of the Company in, the
Financed Eligible Loans, other than as permitted by the Basic Documents.
(o) For the period beginning on the date of this Agreement and ending 90
days hereafter, after none of the Company and any entity affiliated, directly or
indirectly, with the Company will, without the prior written notice to the
Underwriters, offer to sell or sell notes (other than the Notes) collateralized
by FFELP Loans; provided, however, that this shall not be construed to prevent
the sale of FFELP Loans by the Company.
(p) If, at the time the Registration Statement became effective, any
information shall have been omitted therefrom in reliance upon Rule 430A under
the 1933 Act, then, immediately following the execution of this Agreement, the
Company will prepare, and file or transmit for filing with the Commission in
accordance with such Rule 430A and Rule 424(b) under the 1933 Act, copies of an
amended Prospectus containing all information so omitted.
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5. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless each of the Underwriters and each person, if any, who controls
an Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages, liabilities
and expenses (including reasonable costs of investigation) arising out of or
based upon any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement, the Prospectus, or in any amendment or
supplement thereto, or any preliminary prospectus, or arising out of or based
upon any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses arise
out of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to an Underwriter
furnished in writing to the Company by or on behalf of such Underwriter
expressly for use in connection therewith; provided, however, that the
indemnification contained in this paragraph (a) with respect to any preliminary
prospectus shall not inure to the benefit of an Underwriter (or to the benefit
of any person controlling an Underwriter) on account of any such loss, claim,
damage, liability or expense arising from the sale of the of Notes by an
Underwriter to any person if the untrue statement or alleged untrue statement or
omission or alleged omission of a material fact contained in such preliminary
prospectus was corrected in the final Prospectus and such Underwriter sold Notes
to that person without sending or giving at or prior to the written confirmation
of such sale, a copy of the final Prospectus (as then amended or supplemented)
if the Company has previously furnished sufficient copies thereof to such
Underwriter. The foregoing indemnity agreement shall be in addition to any
liability which the Company may otherwise have.
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(b) If any action, suit or proceeding shall be brought against an
Underwriter or any person controlling an Underwriter in respect of which
indemnity may be sought against the Company, such Underwriter or such
controlling person shall promptly notify the parties against whom
indemnification is being sought (the "indemnifying parties"), but the omission
so to notify the indemnifying party will not relieve it from any liability which
it may have to any indemnified party except to the extent that the indemnifying
party is materially prejudiced by such omission. In case any such action is
brought against any indemnified party and it notifies the indemnifying party of
the commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party, be counsel to the indemnifying party). The applicable
Underwriter or any such controlling person shall have the right to employ
separate counsel in any such action, suit or proceeding and to participate in
the defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Underwriter or such controlling person unless (i) the
indemnifying parties have agreed in writing to pay such fees and expenses, (ii)
the indemnifying parties have failed to assume the defense and employ counsel,
or (iii) the named parties to any such action, suit or proceeding (including any
impleaded parties) include both the Underwriter or such controlling person and
the indemnifying parties and the Underwriter or such controlling person shall
have been advised by its counsel that there may be one or more legal defenses
available to it which are different from or additional to or in conflict with
those available to the indemnifying parties and in the reasonable judgment of
such counsel it is advisable for the Underwriter or such controlling person to
employ separate counsel (in which case the indemnifying party shall not have the
right to assume the defense of such action, suit or proceeding on behalf of the
Underwriter or such controlling person). It is understood, however, that the
indemnifying parties shall, in connection with any one such action, suit or
proceeding or separate but substantially similar or related actions, suits or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
each Underwriter and controlling persons not having actual or potential
differing interests with such Underwriter or among themselves, which firm shall
be designated in writing by such Underwriter, and that all such fees and
expenses shall be reimbursed on a monthly basis as provided in paragraph (a)
hereof. An indemnifying party will not, without the prior written consent of the
indemnified party, settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding.
(c) Each Underwriter, severally and not jointly, agrees to indemnify and
hold harmless the Company and its directors and officers, and any person who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act, to the same extent as the indemnity from the Company to the
Underwriters set forth in paragraph (a) hereof, but only with respect to
information relating to an Underwriter furnished in writing by or on behalf of
such Underwriter expressly for use in the Registration Statement, the
Prospectus, or any amendment or supplement thereto, or any related preliminary
prospectus. If any action, suit or proceeding shall be brought against the
Company, any of its directors or officers, or any such controlling person based
on the Registration Statement, the Prospectus, or any amendment or supplement
thereto, or any related preliminary prospectus and in respect of which indemnity
may be sought against an Underwriter pursuant to this paragraph (c), such
Underwriter shall have the rights and duties given to the Company by paragraph
(b) above (except that if the Company shall have assumed the defense thereof the
Underwriter shall not be required to do so, but may employ separate counsel
therein and participate in the defense thereof, but the fees and expenses of
such counsel shall be at such Underwriter's expense), and the Company, its
directors and officers, and any such controlling person shall have the rights
and duties given to the Underwriters by paragraph (b) above. The foregoing
indemnity agreement shall be in addition to any liability which the Underwriters
may otherwise have.
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(d) If the indemnification provided for in this Section 5 is unavailable
to an indemnified party under paragraphs (a) or (c) hereof in respect of any
losses, claims, damages, liabilities or expenses referred to therein, then an
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or expenses (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company on
the one hand and the applicable Underwriter on the other hand from the offering
of the Notes, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of the Company on the one hand and the applicable Underwriter on the other
in connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and an Underwriter on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Notes (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by such Underwriter. The relative fault of
the Company on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or by an Underwriter on the other hand and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 5 were determined by a pro
rata allocation or by any other method of allocation that does not take account
of the equitable considerations referred to in paragraph (d) above. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages, liabilities and expenses referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating any claim or defending any such action, suit or proceeding.
Notwithstanding the provisions of this Section 5, no Underwriter shall not be
required to contribute any amount in excess of the amount by which the total
underwriting discounts and commissions received by such Underwriter exceed the
amount of any damages which such Underwriter has otherwise been required to pay
by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(f) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 5 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 5 and the
representations and warranties of the Company and the Underwriters set forth in
this Agreement shall remain operative and in full force and effect, regardless
of (i) any investigation made by or on behalf of the Underwriters, the Company
or any person controlling any of them or their respective directors or officers,
(ii) acceptance of any Notes and payment therefor hereunder, and (iii) any
termination of this Agreement. A successor to the Underwriters, the Company or
any person controlling any of them or their respective directors or officers,
shall be entitled to the benefits of the indemnity, contribution and
reimbursement agreements contained in this Section 5.
6. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters to purchase the Notes hereunder are subject to the following
conditions:
11
(a) All actions required to be taken and all filings required to be made
by the Company under the Act prior to the sale of the Notes shall have been duly
taken or made. At and prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been instituted or, to the knowledge of
the Company or the Underwriters, shall be contemplated by the Commission.
(b) Subsequent to the effective date of this Agreement, there shall not
have occurred (i) any change, or any development involving a prospective change,
in or affecting the condition (financial or other), business, properties, net
worth, or results of operations of the Company, a Seller, the Servicer, UNIPAC
or InTuition not contemplated by the Registration Statement, which in the
opinion of the Representative, would materially adversely affect the market for
the Notes, (ii) any downgrading in the rating of any debt securities of the
Company, a Seller, the Servicer, UNIPAC or InTuition by any nationally
recognized statistical rating organization or any public announcement that any
such organization has under surveillance or review its rating of any debt
securities of the Company, a Seller, the Servicer, UNIPAC or InTuition (other
than an announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating), or (iii) any event or
development which makes any statement made in the Registration Statement or
Prospectus untrue or which, in the opinion of the Company and its counsel or the
Underwriters and their counsel, requires the filing of any amendment to or
change in the Registration Statement or Prospectus in order to state a material
fact required by any law to be stated therein or necessary in order to make the
statements therein not misleading, if amending or supplementing the Registration
Statement or Prospectus to reflect such event or development would, in the
opinion of the Representative, materially adversely affect the market for the
Notes.
(c) You shall have received an opinion addressed to you of Xxxxx Xxxx,
in its capacity as counsel to the Company, dated the Closing Date, in form and
substance satisfactory to you and your counsel with respect to the status of the
Company, to each of the Sale Agreements, Servicing Agreement, Indenture,
Custodian Agreements, Auction Agency Agreement, Broker-Dealer Agreement and this
Agreement and to the validity of the Notes and such related matters as you shall
reasonably request. In addition, you shall have received an opinion addressed to
you of Xxxxx Xxxx, in its capacity as counsel for the Company, in form and
substance satisfactory to you and your counsel, concerning "true sale," "non-
consolidation" and "first perfected security interest" and certain other issues
with respect to the transfer of the Financed Eligible Loans from the Sellers to
the Company and from the Company to the Trustee.
(d) You shall have received an opinion addressed to you of Xxxxx Xxxx,
in its capacity as counsel for the Company, dated the Closing Date, in form and
substance satisfactory to you and your counsel to the effect that the statements
in the Prospectus under the headings "CERTAIN FEDERAL INCOME TAX CONSEQUENCES"
and "ERISA CONSIDERATIONS", to the extent that they constitute statements of
matters of law or legal conclusions with respect thereto, have been prepared or
reviewed by such counsel and are correct in all material respects.
12
(e) You shall have received an opinion addressed to you of Xxxxx Xxxx,
in its capacity as counsel for the Company, dated the Closing Date, in form and
substance satisfactory to you and your counsel with respect to the character of
the Notes for federal tax purposes.
(f) You shall have received an opinion addressed to you of Stroock &
Stroock & Xxxxx, in its capacity as Underwriters' Counsel, dated the Closing
Date, in form and substance satisfactory to you.
(g) You shall have received an opinion addressed to you of Xxxxxxx Xxxxx
Xxxxxxx & Ingersoll LLP, in its capacity as counsel for the Company, dated the
Closing Date in form and substance satisfactory to you and your counsel with
respect to the Prospectus and the Registration Statement and certain matters
arising under the Trust Indenture Act of 1939, as amended, and the Investment
Company Act of 1940, as amended.
(h) You shall have received opinions addressed to you of Perry, Guthery,
Xxxxx & Xxxxxxxx, P.C. in their capacity as counsel to Union Bank and Trust
Company, NEBHELP, INC. and NHELP-1, Inc., each dated the Closing Date and
satisfactory in form and substance to you and your counsel, to the effect that:
(i) Union Bank and Trust Company has been duly organized and is
validly existing as a Nebraska bank and trust company in good standing
under the laws of the State of Nebraska; NHELP-1, Inc. is a corporation
in good standing under the laws of the State of Nevada; NEBHELP, INC. is
a corporation in good standing under the laws of the State of Nebraska;
and IHI is a corporation in good standing under the laws of the State of
Florida, each having the full power and authority (corporate and other)
to own its properties and conduct its business, as presently conducted
by it, and to enter into and perform its obligations under each of the
Servicing Agreement, the Sale Agreements and the Subservicing Agreements
to which it is a party.
(ii) The Sale Agreements have been duly authorized, executed and
delivered by the respective Sellers which are parties thereto and the
Servicing Agreement, the UNIPAC Subservicing Agreement and the InTuition
Subservicing Agreement have been duly authorized, executed and delivered
by Union Bank and Trust Company, and each such agreement is the legal,
valid and binding obligations of the Sellers and Union Bank and Trust
Company, as the case may be, enforceable against the Sellers and Union
Bank and Trust Company, as the case may be, in accordance with their
respective terms, except (x) the enforceability thereof may be subject
to bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights and (y)
remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought.
13
(iii) Neither the execution and delivery by Union Bank and Trust
Company of the Servicing Agreement, the Sale Agreement to which it is a
party, the UNIPAC Subservicing Agreement or the InTuition Subservicing
Agreement, nor the consummation by Union Bank and Trust Company or the
Sellers of the transactions contemplated therein nor the fulfillment of
the terms thereof by Union Bank and Trust Company or the Sellers will
conflict with, result in a breach, violation or acceleration of, or
constitute a default under, any term or provision of the by-laws of
Union Bank and Trust Company or the Sellers or of any indenture or other
agreement or instrument to which Union Bank and Trust Company or the
Sellers is a party or by which Union Bank and Trust Company or the
Sellers is bound, or result in a violation of or contravene the terms of
any statute, order or regulation applicable to Union Bank and Trust
Company or the Sellers of any court, regulatory body, administrative
agency or governmental body having jurisdiction over Union Bank and
Trust Company or the Sellers.
(iv) There are no actions, proceedings or investigations pending
or, to the best of such counsel's knowledge after due inquiry and
reasonable investigation, threatened against Union Bank and Trust
Company or the Sellers before or by any governmental authority that
might materially and adversely affect the performance by Union Bank and
Trust Company or the Sellers of its obligations under, or the validity
or enforceability of, the Servicing Agreement, the UNIPAC Subservicing
Agreement, the InTuition Subservicing Agreement or the Sale Agreement to
which it is a party.
(v) Nothing has come to such counsel's attention that would lead
such counsel to believe that the representations and warranties of Union
Bank and Trust Company contained in the Servicing Agreement, the Sale
Agreement to which it is a party, the UNIPAC Subservicing Agreement or
the InTuition Subservicing Agreement or the representations and
warranties of the Sellers contained in the Sale Agreement to which each
is a party are other than as stated therein.
(vi) No authorization, approval, or other action by, and no
notice to or filing with, any governmental authority or regulatory body
is required (a) for the due execution, delivery and performance by Union
Bank and Trust Company of the Servicing Agreement, the UNIPAC
Subservicing Agreement the InTuition Subservicing Agreement, the Sale
Agreement to which it is a party, (b) for the due execution, delivery
and performance by the Sellers of the Sale Agreement to which each is a
party or (c) for the perfection of the Company's and the Trustee's
interest in the Student Loans sold pursuant to the Sale Agreements or
the exercise by the Company (or it permitted assigns) and the Trustee of
their rights and remedies under the Sale Agreements, including
specifically the filings of any Uniform Commercial Code financing
statements, except for the execution and delivery of the Guarantee
Agreements.
(vii) The Sale Agreements together with the related xxxx of sale
and blanket endorsement effects a valid sale to the Trustee of the
Student Loans to be sold under the Sale Agreements enforceable against
creditors of, and purchasers from, the Sellers.
14
(viii) As of the date specified in a schedule to such opinion,
there were no (a) UCC financing statements naming the Sellers as debtor
or seller and covering any Student Loans to be sold under the Sale
Agreements or interest therein or (b) notices of the filing of any
federal tax lien (filed pursuant to Section 6323 of the Internal Revenue
Code) or lien of the Pension Benefit Guaranty Corporation (filed
pursuant to Section 4068 of ERISA) covering any Student Loan to be sold
under the Sale Agreements or interest therein, listed in the available
records in the respective offices set forth in such schedule opposite
each such date (which are all of the offices that are prescribed under
either the internal law of the conflict of law rules of the Nebraska UCC
as the offices in which filings should be made to perfect security
interests in Student Loans), except as set forth in such schedule.
(ix) Union Bank and Trust Company is an "eligible lender" as that
term is defined in the Higher Education Act of 1965, as amended (the
"Act"), at 20 U.S.C. ss.1085(d)(1).
(x) As of the date of such opinion, by executing the Guarantee
Agreements and upon execution and delivery of the instruments of
transfer described in the Sale Agreements and notification of the
Guarantors and borrowers of the transfer contemplated thereby, and
assuming that the Trustee is an eligible lender as that term is defined
in 20 U.S.C. ss.1085(d)(1) of the Higher Education Act of 1965, as
amended, the Trustee on behalf of the Company will be entitled to the
benefit of the applicable Guarantor and/or Department of Education
payments under the Act related to the Student Loans sold from time to
time under the Sale Agreements, subject to the terms and conditions of
the Guarantee Agreements and the Act.
(i) You shall have received an opinion addressed to you of counsel to
the Trustee, dated the Closing Date and in form and substance satisfactory to
you and your counsel, to the effect that:
(i) The Trustee is a national banking association duly organized
and validly existing under the laws of the United States of America.
(ii) The Trustee has the full corporate trust power to accept the
office of indenture trustee under the Indenture and to enter into and
perform its obligations under the Indenture, the Custodian Agreements,
the Auction Agency Agreement, the Market Agent Agreement and each
Guarantee Agreement.
(iii) The execution and delivery of each of the Indenture, the
Custodian Agreements, the Auction Agency Agreement, the Market Agent
Agreement and each Guarantee Agreement, and the performance by the
Trustee of its obligations under the Indenture, the Custodian
Agreements, the Auction Agency Agreement, the Market Agent Agreement and
each Guarantee Agreement, have been duly authorized by all necessary
action of the Trustee and each has been duly executed and delivered by
the Trustee.
15
(iv) The Indenture, the Custodian Agreements, the Auction Agency
Agreement, the Market Agent Agreement and each Guarantee Agreement
constitute valid and binding obligations of the Trustee enforceable
against the Trustee.
(v) The execution and delivery by the Trustee of the Indenture,
the Custodian Agreements, the Auction Agency Agreement, the Market Agent
Agreement and each Guarantee Agreement do not require any consent,
approval or authorization of, or any registration or filing with, any
state or United States Federal governmental authority.
(vi) Each of the Notes has been duly authenticated by the
Trustee.
(vii) Neither the consummation by the Trustee of the transactions
contemplated in the Indenture, the Custodian Agreements, the Auction
Agency Agreement and each Guarantee Agreement nor the fulfillment of the
terms thereof by the Trustee will conflict with, result in a breach or
violation of, or constitute a default under any law or the charter,
by-laws or other organizational documents of the Trustee or the terms of
any indenture or other agreement or instrument known to such counsel and
to which the Trustee or any of its subsidiaries is a party or is bound
or any judgment, order or decree known to such counsel to be applicable
to the Trustee or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body or arbitrator having
jurisdiction over the Trustee or any of its subsidiaries.
(viii) There are no actions, suits or proceedings pending or, to
the best of such counsel's knowledge after due inquiry, threatened
against the Trustee (as indenture trustee under the Indenture or in its
individual capacity) before or by any governmental authority that might
materially and adversely affect the performance by the Trustee of its
obligations under, or the validity or enforceability of, the Indenture,
the Custodian Agreements, the Auction Agency Agreement, the Market Agent
Agreement or any Guarantee Agreement.
(ix) The execution, delivery and performance by the Trustee of
the Indenture the Custodian Agreements, the Auction Agency Agreement,
the Market Agent Agreement or any Guarantee Agreement will not subject
any of the property or assets of the Company or any portion thereof, to
any lien created by or arising under the Indenture that is unrelated to
the transactions contemplated in such agreements.
(x) The Trustee is an "eligible lender" for purposes of the FFELP
Program in its capacity as trustee with respect to Financed Eligible
Loans held under the Indenture.
16
(j) You shall have received certificates addressed to you dated the
Closing Date of any two of the Chairman of the Board, the President, any
Executive Vice President, Senior Vice President or Vice President, the
Treasurer, any Assistant Treasurer, the principal financial officer or the
principal accounting officer of each of the Sellers and the Servicer in which
such officers shall state that, to the best of their knowledge after reasonable
investigation, (i) the representations and warranties of the Sellers or the
Servicer, as the case may be, contained in the Sale Agreement, the Servicing
Agreement, the UNIPAC Subservicing Agreement and the InTuition Subservicing
Agreement, as applicable, are true and correct in all material respects, that
each of the Sellers and the Servicer has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied under such
agreements at or prior to the Closing Date, (ii) that they have reviewed the
Prospectus and that the information therein regarding the Sellers or the
Servicer, as applicable, is fair and accurate in all material respects, and
(iii) since the date set forth in such certificate, except as may be disclosed
in the Prospectus, no material adverse change or any development involving a
prospective material adverse change, in or affecting particularly the business
or properties of the Sellers or the Servicer, as applicable, has occurred.
(k) You shall have received certificates addressed to you dated the
Closing Date of any two of the Chairman of the Board, the President, any
Executive Vice President, Senior Vice President or Vice President, the
Treasurer, any Assistant Treasurer, the principal financial officer or the
principal accounting officer of UNIPAC and InTuition in which such officers
shall state that, to the best of their knowledge after reasonable investigation,
(i) the representations and warranties of UNIPAC and InTuition contained in the
UNIPAC Subservicing Agreement and the InTuition Subservicing Agreement,
respectively, are true and correct in all material respects, that each of UNIPAC
and InTuition has complied with all agreements and satisfied all conditions on
its part to be performed or satisfied under such agreements at or prior to the
Closing Date, (ii) that they have reviewed the Prospectus and that the
information therein regarding UNIPAC and InTuition is fair and accurate in all
material respects, and (iii) since the date set forth in such certificate,
except as may be disclosed in the Prospectus, no material adverse change or any
development involving a prospective material adverse change in, or affecting
particularly the business or properties of UNIPAC and InTuition has occurred.
(l) You shall have received evidence satisfactory to you that, on or
before the Closing Date, UCC-1 financing statements have been or are being filed
in the office of the Secretary of State of the States of Nevada and Arizona
reflecting the grant of the security interest by the Company in the Financed
Eligible Loans and the proceeds thereof to the Trustee.
(m) You shall have received a certificate addressed to you dated the
Closing Date from a responsible officer acceptable to you of the Trustee in form
and substance satisfactory to you and your counsel and to which shall be
attached each Guarantee Agreement.
(n) The Underwriters shall have received on the Closing Date from KPMG
Peat Marwick a letter dated the Closing Date, and in form and substance
satisfactory to the Representative, to the effect that they have carried out
certain specified procedures, not constituting an audit, with respect to certain
information regarding the Financed Eligible Loans and setting forth the results
of such specified procedures.
17
(o) All the representations and warranties of the Company contained in
this Agreement and the Basic Documents shall be true and correct in all material
respects on and as of the date hereof and on and as of the Closing Date as if
made on and as of the Closing Date and the Underwriters shall have received a
certificate, dated the Closing Date and signed by an executive officer of the
Company to the effect set forth in this Section 6(p) and in Section 6(q) hereof.
(p) The Company shall not have failed at or prior to the Closing Date to
have performed or complied with any of its agreements herein contained and
required to be performed or complied with by it hereunder at or prior to the
Closing Date.
(q) The Underwriters shall have received by instrument dated the Closing
Date (at the option of the Representative), in lieu of or in addition to the
legal opinions referred to in this Section 6, the right to rely on opinions
provided by such counsel and all other counsel under the terms of the Basic
Documents.
(r) Each of the Class A Notes shall be rated at least "AAA" and "AAA",
respectively, by Fitch IBCA, Inc. ("Fitch") and Standard & Poor's Ratings
Service, a division of The XxXxxx-Xxxx Companies ("S&P"), and that the Class B
Notes shall be rated at least "A" and "A" by Fitch and S&P, respectively, and
that neither Fitch nor S&P have placed either of the Class A Notes or the Class
B Notes under surveillance or review with possible negative implications.
(s) The issuance of the Notes shall not have resulted in a reduction or
withdrawal by Fitch or S&P of the current rating of any outstanding securities
issued or originated by the Company or any of its affiliates.
(t) You shall have received evidence satisfactory to you of the
completion of all actions necessary to effect the transfer of the Financed
Eligible Loans as described in the Prospectus and the recordation thereof on the
Sellers', UNIPAC's and InTuition's computer systems.
(u) You shall have received certificates addressed to you dated the
Closing Date from officers of the Company addressing such additional matters as
you may reasonably request in form and substance satisfactory to you and your
counsel.
(v) You shall have received a signed Indemnity Agreement from Union Bank
and Trust Company and Union Financial Services, Inc. in form and substance
satisfactory to you and your counsel.
(w) You shall have received such other opinions, certificates and
documents as are required under the Indenture as a condition to the issuance of
the Notes.
The Company will provide or cause to be provided to you such conformed
copies of such of the foregoing opinions, notes, letters and documents as you
reasonably request.
18
7. Expenses. The Company agrees to pay or to otherwise cause the payment
of the following costs and expenses and all other costs and expenses incident to
the performance by it of its obligations hereunder: (i) the preparation,
printing or reproduction of the Registration Statement, the Prospectus and each
amendment or supplement to any of them, this Agreement, and each other Basic
Document; (ii) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies of
the Registration Statement, the Prospectus and all amendments or supplements to
any of them as may be reasonably requested for use in connection with the
offering and sale of the Notes; (iii) the preparation, printing, authentication,
issuance and delivery of definitive certificates for the Notes; (iv) the
printing (or reproduction) and delivery of this Agreement, the preliminary and
supplemental Blue Sky Memoranda and all other agreements or documents printed
(or reproduced) and delivered in connection with the offering of the Notes; (v)
qualification of the Indenture under the Trust Indenture Act; (vi) the
qualification of the Notes for offer and sale under the securities or Blue Sky
laws of the several states as provided in Section 3(h) hereof (including the
reasonable fees, expenses and disbursements of counsel relating to the
preparation, printing or reproduction, and delivery of the preliminary and
supplemental Blue Sky Memoranda and such qualification); (vii) the fees and
disbursements of (A) the Company's counsel, (B) the Underwriters' counsel, (C)
the Trustee and its counsel, (D) the Depository Trust Company in connection with
the book-entry registration of the Notes and (G) KPMG Peat Marwick, accountants
for the Company and issuer of the Comfort Letter; and (viii) the fees charged by
S&P and Fitch for rating the Notes.
8. Effective Date of Agreement. This Agreement shall be deemed effective
as of the date first above written upon the execution and delivery hereof by all
the parties hereto. Until such time as this Agreement shall have become
effective, it may be terminated by the Company, by notifying the Representative,
or by the Representative, by notifying the Company.
Any notice under this Section 8 may be given by telecopy or telephone
but shall be subsequently confirmed by letter.
9. Termination of Agreement. This Agreement shall be subject to
termination in the absolute discretion of the Representative, without liability
on the part of the Underwriters to the Company, by notice to the Company, if
prior to the Closing Date (i) trading in securities generally on the New York
Stock Exchange, American Stock Exchange or the Nasdaq National Market shall have
been suspended or materially limited, (ii) a general moratorium on commercial
banking activities in New York shall have been declared by either Federal or
state authorities, or (iii) there shall have occurred any outbreak or escalation
of hostilities or other international or domestic calamity, crisis or change in
political, financial or economic conditions, the effect of which on the
financial markets of the United States is such as to make it, in the judgment of
the Representative, impracticable or inadvisable to commence or continue the
offering of the Notes on the terms set forth in the Prospectus, as applicable,
or to enforce contracts for the resale of the Notes by the Underwriters. Notice
of such termination may be given to the Company by telecopy or telephone and
shall be subsequently confirmed by letter.
10. Information Furnished by the Underwriters. The statements set forth
under the heading "Plan of Distribution" in the Prospectus Supplement constitute
the only information furnished by or on behalf of the Underwriters as such
information is referred to in Sections 3(b) and 5 hereof.
19
11. Default by One of the Underwriters. If any of the Underwriters shall
fail on the Closing Date to purchase the Notes which it is obligated to purchase
hereunder (the "Defaulted Notes"), the remaining Underwriters (the
"Non-Defaulting Underwriters") shall have the right, but not the obligation,
within one (1) Business Day thereafter, to make arrangements to purchase all,
but not less than all, of the Defaulted Notes upon the terms herein set forth;
if, however, the Non-Defaulting Underwriters shall have not completed such
arrangements within such one (1) Business Day period, then this Agreement shall
terminate without liability on the part of the Non-Defaulting Underwriters.
No action taken pursuant to this Section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Non-Defaulting Underwriters or the Company shall
have the right to postpone the Closing Date for a period not exceeding seven
days in order to effect any required changes in the Registration Statement or
Prospectus or in any other documents or arrangements.
12. Computational Materials. (a) It is understood that the Underwriters
may prepare and provide to prospective investors certain Computational Materials
(as defined below) in connection with the Company's offering of the Notes,
subject to the following conditions:
(i) The Underwriters shall comply with all applicable laws and
regulations in connection with the use of Computational Materials including the
No-Action Letter of May 20, 1994 issued by the Commission to Xxxxxx, Xxxxxxx
Acceptance Corporation I, Xxxxxx, Peabody & Co. Incorporated and Xxxxxx
Structured Asset Corporation, as made applicable to other issuers and
underwriters by the Commission in response to the request of the Public
Securities Association dated May 24, 1994, and the No-Action Letter of February
17, 1995 issued by the Commission to the Public Securities Association
(collectively, the "Xxxxxx/PSA Letters").
(ii) As used herein, "Computational Materials" and the term "ABS
Term Sheets" shall have the meanings given such terms in the Xxxxxx/PSA Letters,
but shall include only those Computational Materials that have been prepared or
delivered to prospective investors by or at the direction of an Underwriter.
(iii) Each Underwriter shall provide the Company with
representative forms of all Computational Materials prior to their first use, to
the extent such forms have not previously been approved by the Company for use
by such Underwriter. Each Underwriter shall provide to the Company, for filing
on Form 8-K as provided in Section 11(b), copies of all Computational Materials
that are to be filed with the Commission pursuant to the Xxxxxx/PSA Letters.
Each Underwriter may provide copies of the foregoing in a consolidated or
aggregated form. All Computational Materials described in this subsection
(a)(iii) must be provided to the Company not later than 10:00 A.M., Colorado
time, one business day before filing thereof is required pursuant to the terms
of this Agreement.
20
(iv) If an Underwriter does not provide the Computational
Materials to the Company pursuant to subsection (a)(iii) above, such Underwriter
shall be deemed to have represented, as of the applicable Closing Date, that it
did not provide any prospective investors with any information in written or
electronic form in connection with the offering of the Notes that is required to
be filed with the Commission in accordance with the Xxxxxx/PSA Letters.
(v) In the event of any delay in the delivery by an Underwriter
to the Company of all Computational Materials required to be delivered in
accordance with subsection (a)(iii) above, the Company shall have the right to
delay the release of the Prospectus to investors or to such Underwriter, to
delay the Closing Date and to take other appropriate actions in each case as
necessary in order to allow the Company to comply with its agreement set forth
in Section 11(b) to file the Computational Materials by the time specified
therein.
(b) The Company shall file the Computational Materials (if any) provided
to it by the Underwriter under Section 11(a)(iii) with the Commission pursuant
to a Current Report on Form 8-K no later than 5:30 P.M., New York time, on the
date required pursuant to the Xxxxxx/PSA Letters.
13. Survival of Representations and Warranties. The respective
indemnities, agreements, representations, warranties and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement or contained in notes of officers of the Company submitted
pursuant hereto shall remain operative and in full force and effect, regardless
of any investigation or statement as to the results thereof, made by or on
behalf of the Underwriters, the Company or any of their respective
representatives, officers or directors or any controlling person, and will
survive delivery of and payment for the Notes.
14. Miscellaneous. Except as otherwise provided in Sections 5, 8 and 9
hereof, notice given pursuant to any provision of this Agreement shall be in
writing and shall be delivered (i) if to the Company, at 0000 Xxxx Xxxxxxxxx
Xxxx, Xxxxx X000, Xxxxxxxxxx, Xxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxxxxxx,
and (ii) if to the Underwriters, to Xxxxxxx Xxxxx Barney Inc., 000 Xxxxxxxxx
Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxx X. Xxxxxx.
This Agreement has been and is made solely for the benefit of the
Underwriters, the Company, their respective directors, officers, trustees and
controlling persons referred to in Section 5 hereof and their respective
successors and assigns, to the extent provided herein, and no other person shall
acquire or have any right under or by virtue of this Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from an Underwriter of any of the Notes in his status
as such purchaser.
15. Applicable Law; Counterparts. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York without giving
effect to the choice of laws or conflict of laws principles thereof.
This Agreement may be signed in various counterparts which together
constitute one and the same instrument. If signed in counterparts, this
Agreement shall not become effective unless at least one counterpart hereof or
thereof shall have been executed and delivered on behalf of each party hereto.
21
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the Underwriters.
Very truly yours,
UNION FINANCIAL SERVICES-1, INC.
By:/s/ Xxxxxxx X. Xxxxxxxxxxx
------------------------------
Xxxxxxx X. Xxxxxxxxxxx
President
Confirmed as of the date first above mentioned.
XXXXXXX XXXXX BARNEY INC., as acting on
behalf of itself and as Representative of the Underwriters
By: /s/ Xxxx Xxxxxx
----------------------
Xxxx Xxxxxx, Director
22
SCHEDULE A
Principal Amount of Notes
Underwriter Class A-7 Class A-8 Class A-9 Class A-10 Class A-11 Class A-12 Class B-5
----------- --------- --------- --------- ---------- ---------- ---------- ---------
Xxxxxxx Xxxxx Xxxxxx Inc. $112,500,000 $112,500,000 $112,500,000 $100,000,000 $100,000,000 $100,000,000 $70,000,000
Xxxx Xxxxxxxx Incorporated 12,500,000 12,500,000 12,500,000 -- -- -- --
------------ ----------- ----------- ----------- ----------- ---------- ----------
Total $125,000,000 $125,000,000 $125,000,000 $100,000,000 $100,000,000 $100,000,000 $70,000,000
=========== =========== =========== =========== =========== =========== ==========
Terms of the Notes
Interest Rate Final Maturity Date Price to Public Underwriting Discount Proceeds to Issuer
------------- ------------------- --------------- --------------------- ------------------
Class
----
A-7 5.48% August 1, 2005 (1) (1) (1)
A-8 5.50% September 1, 2005 (1) (1) (1)
A-9 5.73% December 1, 2005 (1) (1) (1)
A-10 Auction Rate October 1, 2032 100% 0.325% $99,675,000
A-11 Auction Rate November 1, 2032 100% 0.325% $99,675,000
A-12 Auction Rate December 1, 2032 100% 0.325% $99,675,000
B-5 Auction Rate December 1, 2032 100% 0.375% $69,737,500
(1)These Classes of Series 1998 Notes will be purchased by the Underwriters for
an aggregate purchase price of $371,871,376, plus accrued interest from December
15, 1998. These Classes of Series 1998 Notes will be offered by the Underwriters
from time to time in negotiated transactions or otherwise at varying prices to
be determined at the time of sale.
1
