EXHIBIT 10.1
Execution Copy
FINANCIAL ASSET SECURITIES CORP.
REVOLVING HOME EQUITY LOAN ASSET-BACKED CERTIFICATES
Series 1996-1
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Class A and Class S
UNDERWRITING AGREEMENT
New York, New York
December 26, 1996
Greenwich Capital Markets Inc.
000 Xxxxxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Dear Sirs:
Financial Asset Securities Corp., a Delaware corporation (the "Company"),
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proposes to sell to you its Home Equity Loan Asset-Backed Certificates in the
series and classes, in the respective original principal amounts and with the
designations set forth in Schedule I hereto (the "Designated Certificates").
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Only the Designated Certificates are being purchased by you hereunder. The
Designated Certificates, together with the other classes of certificates set
forth on Schedule I hereto (collectively, the "Certificates"), will be issued by
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the Company pursuant to a Pooling and Servicing Agreement (the "Pooling and
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Servicing Agreement"), dated as of December 1, 1996, among the Company, as
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depositor, Headlands Mortgage Company, as seller and servicer ("Seller"),
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Headlands Mortgage L.L.C. (the "Transferor") and The First National Bank of
Chicago, as trustee (the "Trustee"). Each Certificate will evidence the
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holder's beneficial ownership in a trust fund (the "Trust Fund"), created
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pursuant to the Pooling and Servicing Agreement, and consisting primarily of a
pool (the "Pool") of adjustable rate home equity revolving credit line loans and
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certain fixed-rate closed-end loans made or to be made in the future (the
"Mortgage Loans") secured by either first or second deeds of trust or mortgages
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on residential properties (or, in certain limited cases, mixed-use properties)
that are primarily one- to four-family properties (each, a "Mortgaged
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Property"), the collections in respect of such Mortgage Loans and certain other
property relating to such Mortgage Loans. The Designated Certificates are
described more fully in Schedule I hereto and in a prospectus supplement
furnished to you by the Company.
Capitalized terms used but not otherwise defined herein shall have the
respective meanings assigned to them in the Pooling and Servicing Agreement.
1. Representations and Warranties. The Company represents and warrants to,
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and agrees with, you that:
(a) The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (the file number of
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which is set forth in Schedule I hereto) for the registration of Asset-
Backed Securities, issuable in series under the Securities Act of 1933, as
amended (the "1933 Act"), which registration statement was declared
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effective on the date set forth in Schedule I hereto and copies of which
have heretofore been delivered to you. The Company meets the requirements
for use of Form S-3 under the 1933 Act, and such registration statement, as
amended at the date hereof, meets the requirements set forth in Rule
415(a)(1)(x) under the 1933 Act and complies in all other material respects
with the 1933 Act and the rules and regulations thereunder. The Company
proposes to file with the Commission, with your consent, pursuant to Rule
424 under the 1933 Act, a supplement to the form of prospectus included in
such registration statement relating to the Designated Certificates and the
plan of distribution thereof, and has previously advised you of all further
information (financial and other) with respect to the Certificates and the
Mortgage Pool to be set forth therein. Such registration statement,
including all exhibits thereto, as amended at the date hereof, is referred
to herein as the "Registration Statement"; such prospectus in the form in
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which it appears in the Registration Statement is referred to herein as the
"Basic Prospectus" (except that if the prospectus filed by the Company
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pursuant to Rule 424(b) under the 1933 Act differs from the prospectus on
file at the time the Registration Statement became effective, the term
"Basic Prospectus" shall refer to such Rule 424(b) prospectus from and
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after the time it is mailed to the Commission for filing); such form of
prospectus supplemented by the prospectus supplement (the "Prospectus
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Supplement") relating to the Designated Certificates, in the form in which
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it shall be first filed with the Commission pursuant to Rule 424(b) under
the 1933 Act (including the Basic Prospectus as so supplemented), is
referred to herein as the "Final Prospectus".
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(b) As of the date hereof, as of the date on which the Final Prospectus
is first filed pursuant to Rule 424 under the 1933 Act, as of the date on
which, prior to the Closing Date (as hereinafter defined), any amendment to
the Registration Statement becomes effective, as of the date on which any
supplement to the Final Prospectus is filed with the Commission, and at the
Closing Date, (i) the Registration
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Statement, as amended as of any such time, and the Final Prospectus, as
amended or supplemented as of any such time, complies and will comply as to
form in all material respects with the applicable requirements of the 1933
Act and the rules and regulations thereunder, (ii) the Registration
Statement, as amended as of any such time, does not contain and will not
contain any untrue statement of a material fact and does not omit and will
not omit to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading, and (iii)
the Final Prospectus, as amended or supplemented as of any such time, does
not contain and will not contain any untrue statement of a material fact
and does not omit and will not omit to state any 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;
provided, however, that the Company makes no representations or warranties
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as to statements contained in or omitted from the Registration Statement or
the Final Prospectus or any amendment or supplement thereto made in
reliance upon and in conformity with information furnished in writing to
the Company by you specifically for use in the Registration Statement and
the Final Prospectus.
(c) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, has
full power and authority (corporate and other) necessary to own or hold its
properties and to conduct its business as now conducted by it and to enter
into and perform its obligations under this Agreement, the Pooling and
Servicing Agreement and the Indemnification Agreement dated as of December
26, 1996 (the "Indemnification Agreement") between the Company, Capital
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Markets Assurance Corporation, the Transferor, the Seller and you.
(d) As of the Date hereof, as of the date on which the Final Prospectus
is first filed pursuant to Rule 424 under the 1933 Act, as of the date on
which, prior to the Closing Date, any amendment to the Registration
Statement becomes effective, as of the date on which any supplement to the
Final Prospectus is filed with the Commission, and as of the Closing Date,
there has not and will not have been (i) any request by the Commission for
any further amendment to the Registration Statement or the Final Prospectus
or for any additional information, (ii) any issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement
or the institution or threat of any proceeding for that purpose or (iii)
any notification with respect to the suspension of the qualification of the
Certificates for sale in any jurisdiction or any initiation or threat of
any proceeding for such purpose.
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(e) This Agreement has been duly authorized, executed and delivered by
the Company.
(f) The Pooling and Servicing Agreement, when executed and delivered as
contemplated hereby and thereby, will have been duly authorized, executed
and delivered by the Company, and when so executed and delivered, will
constitute a legal, valid, binding and enforceable agreement of the
Company, subject, as to enforceability, to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights generally and (ii) general principles of equity regardless of
whether enforcement is sought in a proceeding in equity or at law.
(g) The Indemnification and Contribution Agreement, when executed and
delivered as contemplated hereby and thereby, will have been duly
authorized, executed and delivered by the Company, and when so executed and
delivered, will constitute a legal, valid, binding and enforceable
agreement of the Company, except insofar as the indemnification provisions
therein may be limited by applicable law.
(h) As of the Closing Date, the Designated Certificates and the Pooling
and Servicing Agreement will conform in all material respects to the
respective descriptions thereof contained in the Final Prospectus. As of
the Closing Date, the Designated Certificates will be duly and validly
authorized and, when duly and validly executed, authenticated and delivered
in accordance with the Pooling and Servicing Agreement and delivered to you
against payment therefor as provided herein, will be duly and validly
issued and outstanding and entitled to the benefits of the Pooling and
Servicing Agreement. The Designated Certificates will not be "mortgage
related securities," as such term is defined in the singular in the
Securities Exchange Act of 1934, as amended (the "1934 Act").
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(i) As of the Closing Date, each of the Mortgage Loans will meet the
criteria for selection described in the Final Prospectus, and on the
Closing Date the representations and warranties of the Company with respect
to the Mortgage Loans contained in the Pooling and Servicing Agreement will
be true and correct.
(j) The Company is not in violation of its certificate of incorporation
or by-laws or in default under any agreement, indenture or instrument the
effect of which violation or default would be material to the Company.
Neither the issuance and sale of the Designated Certificates, nor the
execution and delivery by the Company of this Agreement, the Pooling and
Servicing Agreement or the Indemnification and Contribution Agreement, nor
the consummation by the Company of any of the transactions herein or
therein contemplated, nor
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compliance by the Company with the provisions hereof or thereof, does or
will conflict with or result in a breach of any term or provision of the
certificate of incorporation or by-laws of the Company or conflict with,
result in a breach, violation or acceleration of, or constitute a default
under, the terms of any indenture or other agreement or instrument to which
the Company is a party or by which it is bound, or any statute, order or
regulation applicable to the Company of any court, regulatory body,
administrative agency or governmental body having jurisdiction over the
Company. The Company is not a party to, bound by or in breach or violation
of any indenture or other agreement or instrument, or subject to or in
violation of any statute, order or regulation of any court, regulatory
body, administrative agency or governmental body having jurisdiction over
it that materially and adversely affects, or may in the future materially
and adversely affect, (i) the ability of the Company to perform its
obligations under this Agreement, the Pooling and Servicing Agreement or
the Indemnification and Contribution Agreement or (ii) the business,
operations, financial conditions, properties or assets of the Company.
(k) There are no actions or proceedings against, or investigations of,
the Company pending, or, to the knowledge of the Company, threatened,
before any court, arbitrator, administrative agency or other tribunal (i)
asserting the invalidity of this Agreement, the Pooling and Servicing
Agreement, the Indemnification and Contribution Agreement or the
Certificates, (ii) seeking to prevent the issuance of the Certificates or
the consummation of any of the transactions contemplated by this Agreement,
the Pooling and Servicing Agreement or the Indemnification and Contribution
Agreement, (iii) that are reasonably likely to be adversely determined and
that might materially and adversely affect the performance by the Company
of its obligations under, or the validity or enforceability of, this
Agreement, the Pooling and Servicing Agreement, the Indemnification and
Contribution Agreement or the Certificates or (iv) seeking to affect
adversely the federal income tax attributes of the Certificates as
described in the Final Prospectus.
(l) Any taxes, fees and other governmental charges in connection with
the execution and delivery of this Agreement, the Pooling and Servicing
Agreement and the Indemnification and Contribution Agreement or the
execution, delivery and sale of the Certificates have been or will be paid
on or prior to the Closing Date.
(m) Immediately prior to the assignment of the Mortgage Loans to the
Trustee as contemplated by the Pooling and Servicing Agreement, the Company
(i) had good title to, and was the sole owner of, each Mortgage Loan free
and clear of any pledge, mortgage, lien, security interest or other
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encumbrance (collectively, "Liens"), (ii) had not assigned to any person
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any of its right, title or interest in such Mortgage Loans or in the
Pooling and Servicing Agreement and (iii) will have the power and authority
to sell such Mortgage Loans to the Trustee, and upon the execution and
delivery of the Pooling and Servicing Agreement by the Trustee, the Trustee
will have acquired all of the Company's right, title and interest in and to
the Mortgage Loans.
(n) Neither the Company nor the Trust Fund is, and neither the issuance
and sale of the Certificates nor the activities of the Trust Fund pursuant
to the Pooling and Servicing Agreement will cause the Company or the Trust
Fund to be, an "investment company" or under the control of an "investment
company" as such terms are defined in the Investment Company Act of 1940,
as amended (the "Investment Company Act").
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2. Purchase and Sale. Subject to the terms and conditions and in reliance
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upon the representations and warranties set forth herein, the Company agrees to
sell the Designated Certificates to you, and you agree to purchase the
Designated Certificates from the Company, for the purchase price previously
agreed between us, before deducting expenses payable by the Company estimated at
$400,000.
3. Delivery and Payment. Delivery of and payment for the Designated
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Certificates shall be made at the office of Xxxxx Xxxxxxxxxx prior to 12:00
p.m., Eastern Standard Time, on the date specified in Schedule I hereto (or such
later date not later than seven business days after such specified date as you
shall designate), which date and time may be changed by agreement between you
and the Company or as provided herein (such date and time of delivery and
payment for the Designated Certificates being herein called the "Closing Date").
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Delivery of the Designated Certificates shall be made to you against payment by
you of the purchase price therefor in immediately available funds wired to such
bank as may be designated by the Company, or such other manner of payment as may
be agreed upon by the Company and you. The Designated Certificates to be so
delivered shall be in definitive fully registered form, unless otherwise agreed,
in such denominations and registered in such names as you may have requested in
writing not less than two full business days in advance of the Closing Date.
The Company agrees to have the Designated Certificates available for
inspection, checking and packaging by you at the offices of Xxxxx Xxxxxxxxxx,
not later than 4:00 p.m. on the business day prior to the Closing Date.
4. Offering of the Designated Certificates. It is understood that you
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propose to offer the Designated Certificates for sale to the public as set forth
in the Final Prospectus.
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5. Covenants of the Company. The Company covenants and agrees with you
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that:
(a) The Company will prepare a supplement to the Basic Prospectus
setting forth the amount of Designated Certificates covered thereby and the
terms thereof not otherwise specified in the Basic Prospectus, the expected
proceeds to the Company from the sale of such Designated Certificates, and
such other information as you and the Company may deem appropriate in
connection with the offering of such Designated Certificates. The Company
promptly will advise you or your counsel (i) when the Final Prospectus
shall have been filed or transmitted to the Commission for filing pursuant
to Rule 424, (ii) when any amendment to the Registration Statement shall
have become effective or any further supplement to the Prospectus shall
have been filed with the Commission, (iii) of any proposal or request to
amend or supplement the Registration Statement, the Basic Prospectus or the
Final Prospectus or any request by the Commission for any additional
information, (iv) when notice is received from the Commission that any
post-effective amendment to the Registration Statement has become or will
become effective, (v) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or post-
effective amendment thereto or the institution or threatening of any
proceeding for that purpose, (vi) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Designated Certificates for sale in any jurisdiction or the institution or
threatening of any proceeding for that purpose, and (vii) of the occurrence
of any event that would cause the Registration Statement, as then in
effect, to contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary in order to make
the statements therein not misleading, or that would cause the Final
Prospectus, as then in effect, to contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Company will
use its best efforts to prevent the issuance of any such stop order or
suspension and, if issued, to obtain as soon as possible the withdrawal
thereof. The Company will cause the Final Prospectus to be transmitted to
the Commission for filing pursuant to Rule 424 under the 1933 Act or will
cause the Final Prospectus to be filed with the Commission pursuant to said
Rule 424.
(b) If, at any time when a prospectus relating to the Designated
Certificates is required to be delivered under the 1933 Act, any event
occurs as a result of which the Final Prospectus, as then amended or
supplemented, would contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to
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make the statements therein, in light of the circumstances under which they
were made, not misleading, or if it shall be necessary to amend or
supplement the Final Prospectus to comply with the 1933 Act or the rules
and regulations thereunder, the Company promptly will prepare and file with
the Commission, at the expense of the Company, subject to paragraph (a) of
this Section 5, an amendment or supplement that will correct such statement
or omission or an amendment that will effect such compliance and, if such
amendment or supplement is required to be contained in a post-effective
amendment to the Registration Statement, the Company will use its best
efforts to cause such amendment to the Registration Statement to be made
effective as soon as possible.
(c) The Company will furnish to you and your counsel, without charge,
signed copies of the Registration Statement (including exhibits thereto)
and each amendment thereto which shall become effective on or prior to the
Closing Date, and so long as delivery of a prospectus by you may be
required by the 1933 Act, as many copies of any Final Prospectus and any
amendments and supplements thereto as you may reasonably request.
(d) The Company agrees that, so long as the Certificates shall be
outstanding, it will deliver to you the annual statement as to compliance
delivered to the Trustee pursuant to Section 3.09 of the Pooling and
Servicing Agreement and the annual statement of a firm of independent
public accountants delivered to the Trustee pursuant to Section 3.10 of the
Pooling and Servicing Agreement, as soon as such statements are furnished
to the Company.
(e) The Company will furnish such information, execute such instruments
and take such action, if any, as may be required to qualify the Designated
Certificates for sale under the laws of such jurisdictions as you may
designate and will maintain such qualifications in effect so long as
required for the distribution of the Designated Certificates; provided,
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however, that the Company shall not be required to qualify to do business
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in any jurisdiction where it is not now qualified or to take any action
that would subject it to general or unlimited service of process in any
jurisdiction where it is not now subject to such service of process.
(f) The Company will pay all costs and expenses in connection with the
transactions herein contemplated, including, but not limited to, the fees
and disbursements of its counsel; the costs and expenses of printing (or
otherwise reproducing) and delivering the Pooling and Servicing Agreement
and the Certificates; the fees, costs and expenses of the Trustee (to the
extent permitted under the Pooling and Servicing Agreement, and except to
the extent that another party is obligated to pay such amounts thereunder);
the fees
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and disbursements of accountants for the Company; the costs and expenses in
connection with the qualification or exemption of the Designated
Certificates under state securities or "blue sky" laws, including filing
fees and reasonable fees and disbursements of counsel in connection
therewith, in connection with the preparation of any blue sky survey and in
connection with any determination of the eligibility of the Designated
Certificates for investment by institutional investors and the preparation
of any legal investment survey; the expenses of printing any such blue sky
survey and legal investment survey; the cost and expenses in connection
with the preparation, printing and filing of the Registration Statement
(including exhibits thereto), the Basic Prospectus, the Final Prospectus,
the preparation and production of this Agreement and the delivery to you of
such copies of each Final Prospectus as you may reasonably request; and the
fees of rating agencies.
(g) The Company will enter into the Pooling and Servicing Agreement and
the Indemnification and Contribution Agreement on or prior to the Closing
Date.
6. Conditions to the Purchase of the Designated Certificates. Your
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obligation hereunder to purchase the Designated Certificates shall be subject to
the accuracy of the representations and warranties on the part of the Company
contained herein as of the date hereof, as of the date of the effectiveness of
any amendment to the Registration Statement filed prior to the Closing Date and
as of the Closing Date, to the accuracy of the statements of the Company made in
any certificates delivered pursuant to the provisions hereof, to the performance
by the Company of its obligations hereunder and to the following additional
conditions:
(a) The Registration Statement shall have become effective and no stop
order suspending the effectiveness of the Registration Statement, as
amended from time to time, shall have been issued and not withdrawn and no
proceedings for that purpose shall have been instituted or threatened; and
the Final Prospectus shall have been filed or transmitted for filing with
the Commission in accordance with Rule 424 under the 1933 Act.
(b) The Company shall have delivered to you a certificate of the
Company, signed by the President or a vice president of the Company and
dated the Closing Date, to the effect that the signer of such certificate
has carefully examined the Registration Statement, the Final Prospectus and
this Agreement and that: (i) the representations and warranties of the
Company in this Agreement are true and correct in all material respects at
and as of the Closing Date with the same effect as if made on the Closing
Date, (ii) the Company has complied with all the agreements and satisfied
all
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the conditions on its part to be performed or satisfied at or prior to the
Closing Date, (iii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose
have been instituted or, to the Company's knowledge, threatened, and (iv)
nothing has come to the attention of the signer that would lead the signer
to believe that the Final Prospectus contains any untrue statement of a
material fact or omits to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading.
(c) You shall have received from Xxxxx Xxxxxxxxxx, your counsel and
counsel for the Company, a favorable opinion, dated the Closing Date, to
the effect that:
(i) The Registration Statement has become effective under
the 1933 Act; to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement has been
issued and not withdrawn, no proceedings for that purpose have been
instituted or threatened and not terminated; and the Registration
Statement and the Final Prospectus, as of their respective effective
or issue dates (other than the financial and statistical information
contained therein, as to which such counsel need express no opinion),
complied as to form in all material respects with the applicable
requirements of the 1933 Act and the rules and regulations thereunder;
(ii) To the best knowledge of such counsel, there are no
material contracts, indentures or other documents of a character
required to be described or referred to in the Registration Statement
or the Final 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;
(iii) This Agreement has been duly authorized, executed and
delivered by the Company;
(iv) The Pooling and Servicing Agreement has been duly
authorized, executed and delivered by the Company and constitutes a
legal, valid and binding agreement of the Company, enforceable against
the Company in accordance with its terms, subject, as to
enforceability, to bankruptcy, insolvency, reorganization, moratorium
and other similar laws affecting creditors' rights generally and to
general principles of equity, regardless of whether enforcement is
sought in a proceeding in equity or at law;
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(v) The Indemnification and Contribution Agreement has been
duly authorized, executed and delivered by the Company and constitutes
a legal, valid and binding agreement of the Company, except insofar as
the indemnification provisions therein may be limited by applicable
law;
(vi) The direction by the Company to the Trustee to execute,
authenticate and deliver the Designated Certificates has been duly
authorized by the Company, and the Designated Certificates, when
executed and authenticated in the manner contemplated in the Pooling
and Servicing Agreement, will be validly issued and outstanding and
entitled to the benefits of the Pooling and Servicing Agreement;
(vii) The Designated Certificates and the Pooling and
Servicing Agreement conform in all material respects to the
descriptions thereof contained in the Final Prospectus;
(viii) The statements in the Basic Prospectus and the Final
Prospectus, as the case may be, under the headings "Certain Federal
Income Tax Consequences", "ERISA Considerations" and "Legal
Investment", to the extent that they constitute matters of New York or
federal law or legal conclusions with respect thereto, have been
reviewed by such counsel and constitute a fair and accurate summary
with respect to those consequences or aspects that are discussed;
(ix) The Pooling and Servicing Agreement is not required to
be qualified under the Trust Indenture Act of 1939, as amended, and
neither the Company nor the Trust Fund is required to be registered
under the Investment Company Act; and
(x) Except as described in the two following sentences, the
Trust Fund will not be subject to California income or franchise tax
in effect on the date hereof, so long as the Trust Fund complies with
any changes in the statutory and regulatory requirements of California
law. The Trust Fund may be subject to California income or franchise
tax in certain circumstances where federal income tax is also imposed,
such as in the case of net income from foreclosure property. In
addition, the Trust Fund may be subject to the minimum tax imposed
under California Revenue and Taxation Code Sections 23153 and 24872.
Such counsel shall also state that nothing has come to its attention
that would lead it to believe that the Registration Statement (other than the
financial and statistical information
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contained therein, as to which such counsel need not express an opinion), at the
time it became effective, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or that the Final Prospectus (other
than (i) the financial and statistical information contained therein or (ii) the
information contained in the Prospectus Supplement under the headings
"DESCRIPTION OF THE MORTGAGE LOANS" and "SERVICING OF THE MORTGAGE LOANS", as of
its date, and on the date hereof, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
(d) You shall have received from the Vice President and Counsel of the
Company or an affiliate of the Company, a favorable opinion, dated the Closing
Date, to the effect that:
(i) The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Delaware and has all corporate power and authority necessary to own
or hold its properties and to conduct its business as now conducted by
it and to enter into and perform its obligations under this Agreement,
the Pooling and Servicing Agreement and the Indemnification and
Contribution Agreement;
(ii) To the best knowledge of such counsel, there are no
actions, proceedings or investigations pending or threatened against
or affecting the Company before or by any court, arbitrator,
administrative agency or other governmental authority reasonably
likely to be adversely determined that would materially and adversely
affect the ability of the Company to carry out the transactions
contemplated in this Agreement, the Pooling and Servicing Agreement or
the Indemnification and Contribution Agreement;
(iii) No consent, approval, authorization or order of, or
filing or registration with, any state or federal court or
governmental agency or body is required for the consummation by the
Company of the transactions contemplated herein, except such as may be
required under the blue sky laws of any jurisdiction in connection
with the purchase and distribution of the Designated Certificates and
except any recordation of the assignments of the Mortgage Loans to the
Trustee pursuant to the Pooling and Servicing Agreement that have not
yet been completed; and
(iv) The Company is not in violation of its certificate of
incorporation or by-laws or in default under any agreement, indenture
or instrument the effect
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of which violation or default would be material to the Company, and
neither the issuance and sale of the Designated Certificates, nor the
execution or delivery of or performance under this Agreement, the
Pooling and Servicing Agreement or the Indemnification and
Contribution Agreement, nor the consummation of any other of the
transactions contemplated herein or therein will conflict with or
result in a breach or violation of any term or provision of, or
constitute a default (or an event which with the passing of time or
notification, or both, would constitute a default) under, the
certificate of incorporation or by-laws of the Company, or, to the
knowledge of such counsel, any indenture or other agreement or
instrument to which the Company or any of its affiliates is a party or
by which it or any of them is bound, or any New York or federal
statute or regulation applicable to the Company or any of its
affiliates or, to the knowledge of such counsel, any order of any New
York or federal court, regulatory body, administrative agency or
governmental body having jurisdiction over the Company or any of its
affiliates.
With respect to the opinions in (c) and (d) above, such counsel may:
(1) express its reliance as to factual matters on the representations and
warranties made by, and on certificates or other documents furnished by officers
of, the parties to this Agreement, the Pooling and Servicing Agreement and the
Indemnification and Contribution Agreement; (2) assume the due authorization,
execution and delivery of the instruments and documents referred to therein by
the parties thereto other than the Company; (3) qualify such opinion only as to
the federal laws of the United States of America, the laws of the State of New
York and the general corporation law of the State of Delaware; and (4) to the
extent necessary, rely as to the laws of states, other than those specified in
clause (3), on the opinion of local counsel. Such counsel shall also confirm
that you may rely, on and as of the Closing Date, on any opinion or opinions of
such counsel submitted to the rating agency or agencies rating the Designated
Certificates as if addressed to you and dated the Closing Date.
(e) You shall have received from KPMG Peat Marwick, certified public
accountants, one or more letters, dated the date hereof and satisfactory in form
and substance to you and your counsel, to the effect that such accountants have
performed certain specified procedures regarding certain information of an
accounting, financial or statistical nature set forth in the Prospectus
Supplement.
(f) You shall have received a rating letter assigning a rating on the
Class A and S Certificates of "AAA" and "AAAr", respectively, from Standard &
Poor's Rating Group and "Aaa" and "Aaar", respectively, from Xxxxx'x Investors
Service, Inc., which ratings shall not have been withdrawn.
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(g) You shall have received from counsel for the Trustee a favorable
opinion, dated the Closing Date, in form and substance satisfactory to you and
your counsel, to the effect that the Pooling and Servicing Agreement has been
duly authorized, executed and delivered by the Trustee and constitutes a legal,
valid, binding and enforceable agreement of the Trustee, subject, as to
enforceability, to bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights in general and by general principles of
equity regardless of whether enforcement is considered in a proceeding in equity
or at law, and as to such other matters as may be agreed upon by you and the
Trustee.
(h) You shall have received from counsel for the Seller a favorable
opinion, dated the Closing Date, in form and substance satisfactory to you and
your counsel.
(i) You shall have received from Xxxxx & Xxxxx, special counsel for
the Seller, a favorable opinion, dated the Closing Date, in form and substance
satisfactory to you and your counsel to the effect that each of the Pooling and
Servicing Agreement and the Indemnification and Contribution Agreement has been
duly authorized, executed and delivered by the Seller and the Transferor and
constitutes the legal, valid, binding and enforceable agreement of each of the
Seller and the Transferor, subject, as to enforceability, to: (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights in general; (ii) general principles of equity regardless of
whether enforcement is considered in a proceeding in equity or at law; and (iii)
public policy considerations underlying the securities laws, to the extent that
such public policy considerations limit the enforceability of the provisions of
the Pooling and Servicing Agreement and the Indemnification and Contribution
Agreement which purport to provide indemnification from securities law
liabilities.
(j) You shall have received such further information, certificates,
documents and opinions as you may reasonably have requested not less than three
business days prior to the Closing Date.
(k) All proceedings in connection with the transactions contemplated
by this Agreement and all documents incident hereto shall be satisfactory in
form and substance to you and your counsel, and you and such counsel shall have
received such information, certificates and documents as you or they may have
reasonably requested.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
if the Company is in breach of any covenants or agreements contained herein or
if any of the opinions and certificates referred to above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and
14
substance to you and your counsel, this Agreement and all your obligations
hereunder may be canceled by you at, or at any time prior to, the Closing Date.
Notice of such cancellation shall be given to the Company in writing, or by
telephone or facsimile transmission confirmed in writing.
7. Indemnification and Contribution. The Company agrees with you
--------------------------------
that:
(a) The Company will indemnify and hold harmless you and each person
who controls you within the meaning of either the 1933 Act or the 1934 Act
against any and all losses, claims, damages or liabilities, joint or
several, to which you or any of them may become subject under the 1933 Act,
the 1934 Act, or other federal or state law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon (x) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or in any amendment thereof, or the omission or
alleged omission to state in the Registration Statement or any amendment
thereof a material fact required to be stated therein or necessary to make
the statements therein not misleading, or (y) any untrue statement or
alleged untrue statement of a material fact contained in the Basic
Prospectus, any Final Prospectus, or the omission or alleged omission to
state in the Basic Prospectus, any or the Final Prospectus or in any
amendment or supplement thereto a material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading, and agrees to
reimburse each such indemnified party for any legal or other expenses
reasonably incurred by it in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that (i)
-------- -------
the Company will not be liable in any such case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such
untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Company as herein stated by you specifically
for use in connection with the preparation thereof, and (ii) such indemnity
with respect to the Basic Prospectus or any Final Prospectus shall not
inure to you (or any person controlling you) from whom the person asserting
any such loss, claim, damage or liability purchased the Designated
Certificates that are the subject thereof if such person did not receive a
copy of the Final Prospectus at or prior to the confirmation of the sale of
such Designated Certificates to such person in any case where such delivery
is required by the 1933 Act and the untrue statement or omission of a
material fact contained in the Basic Prospectus was corrected in the Final
Prospectus. This indemnity will be in addition to any liability that the
Company may otherwise have.
15
(b) You agree to indemnify and hold harmless the Company, each of its
directors, each of its officers who signs the Registration Statement, and
each person, if any, who controls the Company within the meaning of either
the 1933 Act or the 1934 Act, to the same extent as the foregoing indemnity
from the Company to you, but only with reference to written information
furnished to the Company as herein stated by you specifically for use in
connection with the preparation of the documents referred to in the
foregoing indemnity. This indemnify will be in addition to any liability
that you may otherwise have. The Company and you each acknowledge that the
statements set forth in the third paragraph under the heading
"Underwriting" in the Final Prospectus constitute the only information
furnished in writing by you for inclusion in the documents referred to in
the foregoing indemnity, and you confirm that such statements are correct.
(c) Promptly after receipt by an indemnified party under this Section
7 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under this Section 7, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party
will not relieve it from any liability that it may have to any indemnified
party otherwise than under this Section 7. 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 elect by written
notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense
thereof, with counsel satisfactory to such indemnified party; provided,
--------
however, that if the defendants in any such action include both the
-------
indemnified party and the indemnifying party and the indemnified party or
parties shall have reasonably concluded that there may be legal defenses
available to it or them and/or other indemnified parties that are different
from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to elect separate counsel
to assert such legal defenses and to otherwise participate in the defense
of such action on behalf of such indemnified party or parties. Upon
receipt of notice from the indemnifying party to such indemnified party of
its election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable for
any legal or other expenses subsequently incurred by such indemnified party
in connection with the defense thereof, unless (i) the indemnified party
shall have employed separate counsel in connection with the assertion of
legal defenses in accordance with the proviso to the next preceding
sentence (it being understood, however, that the indemnifying party shall
not be liable for the
16
expenses of more than one separate counsel, approved by you in the case of
paragraph (a) of this Section 7, representing the indemnified parties under
such paragraph (a) who are parties to such action), (ii) the indemnifying
party shall not have employed counsel satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of
commencement of the action or (iii) the indemnifying party has authorized
the employment of counsel for the indemnified party at the expense of the
indemnifying party; and except that, if clause (i) or (iii) is applicable,
such liability shall only be in respect of the counsel referred to in such
clause (i) or (iii).
(d) If the indemnification provided for in this Section 7 shall for
any reason be unavailable to an indemnified party under this Section 7,
then you and the Company shall contribute to the amount paid or payable by
such indemnified party as a result of the aggregate losses, claims, damages
and liabilities referred to in paragraph (a) or (b) above, in such
proportion to the relative benefit and the relative fault of the
indemnifying party; provided that no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 7, each
person, if any, who controls you within the meaning of either the 1933 Act
or the 1934 Act shall have the same rights to contribution as do you and
each person, if any, who controls the Company within the meaning of either
the 1933 Act or the 1934 Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall
have the same rights to contribution as the Company. Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim
for contribution may be made against another party or parties under this
paragraph (d), notify such party or parties from whom contribution may be
sought, but the omission to so notify such party or parties shall not
relieve the party or parties from whom contribution may be sought from any
other obligation it or they may have hereunder or otherwise than under this
paragraph (d).
8. Termination.
-----------
(a) This Agreement shall be subject to termination in your absolute
discretion, by notice given to the Company prior to delivery of and payment
for the Designated Certificates, if, prior to such time, (i) trading of
securities generally on the New York Stock Exchange or the American Stock
Exchange shall have been suspended or materially limited, (ii) a general
moratorium on commercial banking activities in New York shall have been
declared by either federal or New York
17
State authorities or (iii) there shall have occurred any material outbreak
or declaration of hostilities or other calamity or crisis the effect of
which on the financial markets of the United States is such as to make it,
in your reasonable judgment, impracticable to market the Designated
Certificates on the terms specified herein.
(b) If the sale of the Designated Certificates shall not be
consummated because any condition to your obligations set forth in Section
6 hereof is not satisfied or because of any refusal, inability or failure
on the part of the Company to perform any agreement herein or comply with
any provision hereof other than by reason of your default, the Company
shall reimburse you for the reasonable fees and expenses of your counsel
and for such other out-of-pocket expenses as shall have been incurred by
you in connection with this Agreement and the proposed purchase of the
Designated Certificates, and upon demand the Company shall pay the full
amount thereof to you.
(c) This Agreement will survive delivery of and payment for the
Designated Certificates. The provisions of Section 7 and this Section 8(c)
shall survive the termination or cancellation of this Agreement.
9. Notices. All communications hereunder will be in writing and
-------
effective only on receipt, and, if sent to you, will be mailed, delivered or
transmitted by facsimile and confirmed to you at 000 Xxxxxxxxx Xxxx, Xxxxxxxxx,
Xxxxxxxxxxx 00000, attention: Mortgage Finance Department; or, if sent to the
Company, will be mailed, delivered or transmitted by facsimile and confirmed to
it at 000 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxx 00000, xxxxxxxxx: Mortgage
Finance Department.
10. Successors. This Agreement will inure to the benefit of and be
----------
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 7, and their
successors and assigns, and no other person will have any right or obligation
hereunder.
11. Applicable Law; Counterparts. This Agreement will be governed by and
----------------------------
construed in accordance with the laws of the State of New York. This Agreement
may be executed in any number of counterparts, each of which shall for all
purposes be deemed to be an original and all of which shall together constitute
but one and the same instrument.
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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us a counterpart hereof, whereupon this letter and
your acceptance shall represent a binding agreement between the Company and you.
Very truly yours,
FINANCIAL ASSET SECURITIES CORP.
By:/s/Xxxxx Xxxxxxx
---------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
The foregoing Agreement is hereby
confirmed and accepted as of
the date first above written.
GREENWICH CAPITAL MARKETS INC.
By:/s/Xxxxx Xxxxxxx
---------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
[Underwriting Agreement]
SCHEDULE I
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Underwriting Agreement dated December 23, 1996.
As used in this Agreement, the term "Registration Statement" refers to the
Registration Statement on Form S-3 (File No. 33-99018) filed on November 6, 1995
and declared effective by the Commission on March 20, 1996.
Closing Date: December 30, 1996.
--------------------------------------------------------------------------------
Title, Purchase Price and Description of Designated Certificates:
Financial Asset Securities Corp., Revolving Home Equity Loan Asset-Backed
Certificates, Series 1996-1, $125,595,644.60 Class A Variable Pass-Through
Rate Certificates and Class S 1% Pass-Through Rate Certificates.
Cut-off Date Principal Balance: $128,158,821.02
Cut-off Date: November 30, 1996.
I-1
