1
EXHIBIT 1.1
NATIONSCREDIT SECURITIZATION CORPORATION
DEPOSITOR
NATIONSCREDIT GRANTOR TRUST 0000-0
XXXXXXXXXXXX XXXXXXXXX
Xxx Xxxx, Xxx Xxxx
May __, 1997
NationsBanc Capital Markets, Inc.,
as Representative of the several underwriters
NationsBank Corporate Center
000 Xxxxx Xxxxx Xxxxxx, XX0-000-00-00
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Ladies and Gentlemen:
NationsCredit Securitization Corporation, a Delaware corporation (the
"Company"), proposes to form a trust entitled the NationsCredit Grantor Trust
1997-1 (the "Trust") pursuant to the terms of a proposed Pooling and Servicing
Agreement, including the Standard Terms and Conditions of Agreement, to be
dated as of April 30, 1997, among the Company, as Depositor, NationsCredit
Commercial Corporation of America, as Servicer (the "Servicer" or
"NationsCredit Commercial"), and Bankers Trust Company, as Trustee and
Collateral Agent (the "Pooling and Servicing Agreement"), pursuant to which
certain ____% Marine Receivable-Backed Certificates (the "Certificates") will
be issued. Each Certificate will evidence a fractional, undivided percentage
interest in the Trust. The property of the Trust includes a pool of marine
retail installment sale contracts secured by new and used boats, boat motors
and boat trailers (the "Receivables"), certain monies received under the Simple
Interest Receivables and certain monies due under the Precomputed Receivables,
in each case, on or after April 30, 1997, security interests in the boats and
marine equipment financed thereby, an irrevocable surety bond, guaranteeing
payments of interest and principal on the Certificates (the "Surety Bond"),
issued by Capital Markets Assurance Corporation (the "Surety Bond Issuer"),
such amounts as from time to time may be held in one or more trust accounts
which will be established and maintained by the Servicer pursuant to the
Pooling and Servicing Agreement, the rights of the
2
Company under that certain Purchase Agreement, dated as of April 30, 1997,
between the Company and the Servicer, the proceeds from any recourse rights of
the Servicer against any seller of new and used boats, boat motors and boat
trailers financed by the Receivables (a "Dealer") pursuant to any agreement
with a Dealer, the right to proceeds from claims on physical damage, credit
life and disability insurance policies relating to the Receivables, and any
property that shall have secured a Receivable and that shall have been acquired
by the Trustee. To the extent not defined herein, capitalized terms used
herein shall have the meanings specified in the Pooling and Servicing
Agreement.
The Company proposes to sell to the underwriters identified on Schedule I
hereto (the "Underwriters") for whom you are acting as representative (the
"Representative") the principal amount of the Certificates identified in
Schedule I hereto.
1. Representations and Warranties. The Company represents and warrants
to, and agrees with, each Underwriter that:
(a) The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act"), and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement on such form, registration number 333-______, under the Act,
which has become effective, for the registration under the Act of the
Certificates. The Company proposes to file with the Commission pursuant
to Rule 424 under the Act a final prospectus relating to the Certificates
and the plan of distribution thereof and has previously advised the
Representative of all further information (financial and other) with
respect to the Company to be set forth therein. Such registration
statement, including the exhibits thereto, as amended to the date of this
agreement, is hereinafter called the "Registration Statement"; such
prospectus in the form in which it appears in the Registration Statement
is hereinafter called the "Preliminary Prospectus"; and such final form
of prospectus, in the form in which it shall be filed with the Commission
pursuant to Rule 424 under the Act, is hereinafter called the "Final
Prospectus."
(b) As of the date hereof, when the Final Prospectus is first filed
pursuant to Rule 424 under the Act, when, prior to the Closing Date (as
hereinafter defined in Section 3), any amendment to the Registration
Statement becomes effective (including the filing of any document
incorporated by reference in the Registration Statement), when any
supplement to the Final Prospectus is filed with the Commission and at
the Closing Date, (i) the Registration Statement, as amended as of any
such time, and the Final Prospectus, as amended or supplemented as of any
such time, will comply in all material respects with the applicable
requirements of the Act and the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and the respective rules thereunder, (ii)
the Registration Statement, as amended as of any such time, will not
contain any untrue statement of a material fact or 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, will not contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary in
-2-
3
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 as to the information
contained in or omitted from the Registration Statement or the Final
Prospectus or any amendment thereof or supplement thereto in reliance
upon and in conformity with information furnished in writing to the
Company by or on behalf of any information furnished in writing to the
Company by or on behalf of any Underwriter through the Representative
specifically for use in connection with the preparation of the
Registration Statement and the Final Prospectus.
(c) The Company has been duly incorporated and is validly existing
as a corporation under the laws of the State of Delaware and has
corporate and other power and authority to own its properties and conduct
is business, as now conducted by it, and to enter into and perform its
obligations under this Agreement and each of the Purchase Agreement, the
Reimbursement Agreement and the Pooling and Servicing Agreement.
(d) The Company is not aware of (i) any request by the Commission
for any further amendment of the Registration Statement or for any
additional information or (ii) the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement.
(e) (i) This Agreement and each of the Purchase Agreement, the
Reimbursement Agreement and the Pooling and Servicing Agreement
have been duly authorized by the Company, and this Agreement and
each of the Purchase Agreement, the Reimbursement Agreement and the
Pooling and Servicing Agreement have been duly executed and
delivered by the Company, and each of this Agreement, the Purchase
Agreement, the Reimbursement Agreement and the Pooling and
Servicing Agreement, when executed and delivered by the Company,
does or will, as the case may be, constitute a legal, valid and
binding agreement of the Company, enforceable against the Company
in accordance with its terms, subject, as to the enforcement
of remedies, to applicable bankruptcy, insolvency, reorganization,
moratorium, receivership and similar laws affecting creditors' rights
generally and to general principles of equity (regardless of
whether the enforcement of such remedies is considered in a
proceeding in equity or at law); and (ii) the Certificates have
been duly authorized by the Company, and when duly executed by the
Trustee on behalf of the Trust, authorized by the Trustee and
delivered in accordance with the Pooling and Servicing Agreement
and delivered and paid for as provided herein, will be validly
issued and outstanding and entitled to the benefits and security
afforded by the Pooling and Servicing Agreement.
2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties set forth herein, the Company
agrees to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company, the principal amount of the
Certificates set forth opposite such Underwriter's name in Schedule I hereto
at the purchase price of ______% of the principal amount of such Certificates,
plus, in each case, interest calculated from and including May 15, 1997
through and including the date prior to the Closing Date.
-3-
4
3. Delivery and Payment. Delivery of and payment for the
Certificates shall be made at the offices of Stroock & Stroock & Xxxxx LLP, 000
Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 a.m. New York time on
__________, 1997 or such other place as shall be agreed by the Company and the
Underwriters, and which date and time may be postponed by agreement between the
Representative and the Company or as provided in Section 9 hereof (such date
and time of delivery and payment for the Certificates being herein called the
"Closing Date"). Delivery of the Certificates shall be made to the
Representative for the respective accounts of the several Underwriters against
payment by the several Underwriters through the Representative of the purchase
price thereof by one or more wires of immediately available funds to an account
designated by the Company. Delivery of the Certificates shall be made through
the facilities of The Depository Trust Company.
4. Representations, Warranties and Covenants of the Underwriters.
The Underwriters agree with the Company that:
(a) Each Underwriter represents and warrants to the Company that it
will not, in connection with the offering and sale of the Certificates,
use (i) any "Computational Materials" within the meaning of the no-action
letter, dated May 20, 1994, issued by the Division of Corporation Finance
of the Commission to Xxxxxx, Xxxxxxx Acceptance Corporation I, Xxxxxx,
Peabody & Co. Incorporated, and Xxxxxx Structured Asset Corporation and
the no-action letter, dated May 27, 1994, issued by the Division of
Corporation Finance of the Commission to the Public Securities
Association or (ii) any "ABS Term Sheets" within the meaning of the
no-action letter, dated February 17, 1995, issued by the Division of
Corporation Finance of the Commission to the Public Securities
Association; and
(b) None of the Underwriters will institute against, or join any
other Person in instituting against, the Company any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceeding, or
other proceeding under any federal or state bankruptcy or similar law,
until [ ].
5. Agreements. The Company agrees with the several Underwriters that:
(a) Prior to the termination of the offering of the Certificates,
the Company will not file any amendment to the Registration Statement or
supplement to the Final Prospectus unless the Company has furnished the
Representative a copy of such amendment or supplement for their review
prior to filing and will not file any such proposed amendment or
supplement to which the Representative reasonably objects. Subject to
the foregoing sentence, the Company will cause the Final Prospectus to be
filed with the Commission pursuant to Rule 424. The Company will advise
the Representative promptly (i) when the Final Prospectus shall have been
filed with the Commission pursuant to Rule 424, (ii) when any amendment
to the Registration Statement relating to the Certificates shall have
become effective, (iii) of any request by the Commission for any
amendment of the Registration Statement or amendment of or supplement to
the Final Prospectus or for any additional information, (iv) of the
issuance
-4-
5
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any
proceeding for that purpose, and (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Certificates for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Company will use its
best efforts to prevent the issuance of any such stop order and, if
issued, to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Certificates
is required to be delivered under the Act, any event occurs as a result
of which the Final Prospectus as then amended or supplemented would
include any untrue statement of a material fact or 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, or if it
shall be necessary to amend or supplement the Final Prospectus to comply
with the Act or the Exchange Act or the respective rules thereunder. The
Company promptly will prepare and file with the Commission, subject to
the first sentence of paragraph (a) of this Section 5, an amendment or
supplement which will correct such statement or omission or an amendment
which will effect such compliance and will use its best efforts to cause
any required post-effective amendment to the Registration Statement
containing such amendment to be made effective as soon as possible.
(c) The Company will make generally available to its security
holders and to the Representative as soon as practicable, but not later
than 60 days after the close of the period covered thereby, an earnings
statement with respect to the Trust (in form complying with the
provisions of Rule 158 of the regulations under the Act) covering a
twelve-month period beginning not later than the first day of the
Company's fiscal quarter next following the "effective date" (as defined
in said Rule 158) of the Registration Statement.
(d) The Company will furnish to the Representative and counsel for
the Underwriters, without charge, executed 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 an Underwriter or dealer may be required by
the Act, as many copies of any Preliminary Prospectus and the Final
Prospectus and any amendments thereof and supplements thereto as the
Representative may reasonably request. The Company will pay the expenses
of printing all documents relating to the initial offering, provided that
any additional expenses incurred in connection with the requirement of
delivery of a market-making prospectus will be borne by the
Representative.
(e) The Company will make available to the Representative the
Certificate Factor for each month as soon as possible after the Company
has received such Certificate Factor from the Servicer pursuant to
Section 13.9 of the Pooling and Servicing Agreement.
-5-
6
(f) The Company will arrange for the qualification of the
Certificates for sale under the laws of such jurisdictions as the
Representative may reasonably designate, will maintain such
qualifications in effect so long as required for the distribution of the
Certificates and will arrange for the determination of the legality of
the Certificates for purchase by institutional investors; provided,
however, that the Company shall not be required 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 general or unlimited service of process
in any jurisdiction where it is not now so subject.
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the 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 (including the filing of any document incorporated by reference
therein) 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) No stop order suspending the effectiveness of the Registration
Statement, as amended from time to time, shall have been issued, and no
proceedings for that purpose shall have been instituted or threatened;
and the Final Prospectus shall have been filed or mailed for filing with
the Commission within the time period prescribed by the Commission.
(b) The Company shall have furnished to the Representative the
opinion of Stroock & Stroock & Xxxxx LLP, special counsel for the
Company, dated the Closing Date, to the effect of paragraphs (i), (ii),
(iii), (iv), (vi), (vii), (viii), (ix), (x) and (xi) below, and the
opinion of a member of the office of the General Counsel of NationsBank
Corporation, special counsel for the Company, dated the Closing Date, to
the effect of paragraph (v) below:
(i) the Company is a duly organized and validly existing
corporation in good standing under the laws of the State of
Delaware and has the corporate power and authority to perform its
obligations under this Agreement, the Purchase Agreement, the
Reimbursement Agreement and the Pooling and Servicing Agreement,
and the issuance and sale of the Certificates have been duly
authorized by the Company;
(ii) each of this Agreement, the Purchase Agreement, the
Reimbursement Agreement and the Pooling and Servicing Agreement has
been duly authorized, executed and delivered by the Company;
-6-
7
(iii) the Certificates, the Purchase Agreement and the Pooling
and Service Agreement conform in all material respects to the
description thereof contained in the Final Prospectus;
(iv) assuming due authorization, execution and delivery by
the other parties thereto, each of this Agreement, the Purchase
Agreement, the Reimbursement Agreement and the Pooling and
Servicing Agreement constitutes a legal, valid and binding
agreement of the Company, enforceable in accordance with their
respective terms against the Company, as the case may be, subject
(a) to the effect of bankruptcy, insolvency, reorganization,
moratorium and similar laws relating to or affecting creditors'
rights generally and court decisions with respect thereto, (b) to
the understanding that no opinion is expressed as to the
application of equitable principles in any proceeding, whether at
law or in equity, and (c) to limitations of public policy under
applicable securities laws as to rights of indemnity and
contribution thereunder;
(v) to the best knowledge of such counsel, there is
no pending or threatened action, suit or proceeding before any
court or governmental agency, authority or body or any arbitrator
involving the Company of a character required to be disclosed in
the Registration Statement which is not adequately disclosed
therein and in the Final Prospectus;
(vi) to the best knowledge of such counsel, there is no
franchise, contract or other document of a character required to be
described in the Registration Statement or Final Prospectus, or to
be filed as an exhibit, which is not described or filed as
required;
(vii) the Registration Statement has become effective under
the Act; to the best knowledge of such counsel no stop order
suspending the effectiveness of the Registration Statement has been
issued, and no proceedings for that purpose have been instituted or
threatened; the Registration Statement, the Final Prospectus and
each amendment thereof or supplement thereto (other than (i)
financial, numerical, statistical and quantitative information
contained therein and (ii) the information under the heading "The
Surety Bond Issuer," as to which such counsel need express no view)
comply as to form in all material respects with the applicable
requirements of the Act and the Exchange Act and the respective
rules thereunder;
(viii) no consent, approval, authorization or order of any
court or governmental agency or body is required, with respect to
the Company, for the consummation of the transactions contemplated
herein, or in the Purchase Agreement, the Reimbursement Agreement
or the Pooling and Servicing Agreement, except such as have been
obtained under the Act and such as may be required under the blue
sky laws of any jurisdiction in connection with the
-7-
8
purchase and distribution of the Certificates by the Underwriters
and such other a approvals (specified in such opinion) as have been
obtained;
(ix) neither the issue and sale of the Certificates, nor the
consummation of any other of the transactions herein contemplated
or in the Purchase Agreement, the Reimbursement Agreement or the
Pooling and Servicing Agreement, nor the fulfillment of the terms
hereof or thereof will conflict with, result in a breach of, or
constitute a default under the certificate of incorporation or
by-laws of the Company or, to the best knowledge of such counsel,
the terms of any indenture or other agreement or instrument known
to such counsel and to which the Company is a party or bound, or
any order or regulation known to such counsel to be applicable to
the Company of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the
Company;
(x) the Pooling and Servicing Agreement will not be required
to be qualified under the Trust Indenture Act of 1939, as amended,
and the Trust is not, and immediately following the sale of the
Certificates pursuant hereto, will not, be required to be
registered under the Investment Company Act of 1940, as amended;
and
(xi) the issuance, offer and sale of the Certificates have
been duly authorized by the Company, and when issued, authenticated
in accordance with the Pooling and Servicing Agreement and paid for
pursuant to this Agreement, the Certificates will be validly issued
and entitled to the benefits of the Pooling and Servicing
Agreement.
Stroock & Stroock & Xxxxx LLP, special counsel for the Company, shall also
state that it has no reason to believe that the Registration Statement or any
amendment thereof at the time it became effective contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary to make the statements therein not misleading or
that the Final Prospectus, as amended or supplemented, as of its date and as of
the Closing Date, contains any untrue statement of a material fact 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 (other
than (i) financial, numerical, statistical and quantitative information
contained therein and (ii) the information under the heading "The Surety Bond
Issuer," as to which such counsel need express no view).
In rendering such opinions, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than (i) the United
States or the general corporation laws of the State of Delaware, (ii) with
respect to the office of the General Counsel of NationsBank Corporation, the
State of Pennsylvania, and (iii) with respect to Stroock & Stroock & Xxxxx LLP,
the State of New York, to the extent deemed proper and specified in such
opinion, upon the opinion of other counsel of good standing believed to be
reliable and who are
-8-
9
satisfactory to counsel for the Underwriters; and (B) as to matters of fact,
to the extent deemed proper, on certificates of responsible officers of the
Company or its affiliates and public officials.
(c) The Servicer shall have furnished to the Representative the
opinion of a member of the office of the General Counsel of NationsBank
Corporation, special counsel for NationsCredit Commercial, dated the
Closing Date, to the effect of paragraphs (i), (ii), (iv), (v) and (vi)
below, and the opinion of Stroock & Stroock & Xxxxx LLP, special counsel
for the Servicer, dated the Closing Date, to the effect of paragraph
(iii) below:
(i) NationsCredit Commercial is a duly organized and validly
existing corporation in good standing under the laws of the State
of North Carolina and has the corporate power and authority to
perform its obligations under the Pooling and Servicing Agreement,
the Purchase Agreement and the Indemnification Agreement;
(ii) each of the Pooling and Servicing Agreement, the Purchase
Agreement and the Indemnification Agreement has been duly
authorized, executed and delivered by NationsCredit Commercial;
(iii) assuming due authorization, execution and delivery by
the other parties thereto, each of the Pooling and Servicing
Agreement, the Purchase Agreement and the Indemnification Agreement
constitutes a legal, valid and binding agreement of NationsCredit
Commercial, enforceable in accordance with their respective terms
against NationsCredit Commercial, as the case may be, subject (a)
to the effect of bankruptcy, insolvency, reorganization, moratorium
and similar laws relating to or affecting creditors' rights
generally and court decisions with respect thereto, (b) to the
understanding that no opinion is expressed as to the application of
equitable principles in any proceeding, whether at law or in
equity, and (c) to limitations of public policy under applicable
securities laws as to rights of indemnity and contribution
thereunder;
(iv) to the best knowledge of such counsel, there is no
pending or threatened action, suit or proceeding before any court
or governmental agency, authority or body or any arbitrator
involving NationsCredit Commercial of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed therein and in the Final Prospectus;
(v) neither the consummation of any of the transactions
contemplated in the Pooling and Servicing Agreement, the Purchase
Agreement or the Indemnification Agreement, nor the fulfillment of
the terms thereof will conflict with, result in a breach of, or
constitute a default under the articles of incorporation or by-laws
of NationsCredit Commercial; and
-9-
10
(vi) neither the consummation of any of the transactions
contemplated in the Pooling and Servicing Agreement, the Purchase
Agreement or the Indemnification Agreement, nor the fulfillment of
the terms thereof will conflict with, result in a breach of, or
constitute a default under the terms of any indenture or other
agreement or instrument known to such counsel and to which
NationsCredit Commercial is a party or bound, or any order or
regulation known to such counsel to be applicable to NationsCredit
Commercial of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over
NationsCredit Commercial.
In rendering such opinions, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than (i) the United
States or the general corporation laws of the State of Delaware. (ii) with
respect to the office of the General Counsel of NationsBank Corporation, the
State of Pennsylvania, and (iii) with respect to Stroock & Stroock & Xxxxx LLP,
the State of New York, to the extent deemed proper and specified in such
opinion, upon the opinion of other counsel of good standing believed to be
reliable and who are satisfactory to counsel for the Underwriters; and (B) as
to matters of fact, to the extent deemed proper, on certificates of responsible
officers of NationsCredit Commercial or its affiliates and public officials.
(d) The Company shall have furnished to the Representative an
opinion of Stroock & Stroock & Xxxxx LLP, special counsel for the Company, dated
the Closing Date, to the effect that:
(i) the statements in the Final Prospectus under the heading
"Certain Federal Income Tax Consequences" and the summary thereof
under the heading "Prospectus Summary--Tax Status," to the extent
they constitute matters of Federal law or legal conclusions with
respect thereto, have been reviewed by such counsel and are correct
in all material respects; and
(ii) the statements in the Final Prospectus under the headings
"Certain Legal Aspects of the Receivables" and "ERISA
Considerations," to the extent they constitute matters of Federal
law or legal conclusions with respect thereto, have been reviewed
by such counsel and are correct in all material respects.
(e) The Company shall have furnished to the Representative (i) an
opinion or opinions of Stroock & Stroock & Xxxxx LLP, special counsel for the
Company, dated the Closing Date, to the effect that (A) the separate corporate
existence of the Company would not be disregarded so as to include the assets
and liabilities of the Company in the bankruptcy estate of NationsCredit
Commercial in the event of a bankruptcy proceeding with respect thereto; and (B)
the Receivables were sold and transferred from the NationsCredit Commercial to
the Company in a manner such that the Receivables would not be considered to be
property of the bankruptcy estate of NationsCredit Commercial in the event of a
bankruptcy proceeding with respect thereto; and (ii) opinions of local counsel
to the Company, dated the Closing Date, with respect to the
-10-
11
perfection of the Trust's interest in the Receivables, in each case in a form
previously approved by the Representative and its counsel. In addition, the
Representative shall have received a reliance letter with respect to any
opinion that the Company is required to deliver to each Rating Agency.
(f) The Representative shall have received from Xxxxx, Xxxxx & Xxxxx,
special counsel for Receivables Capital Corporation ("RCC"), an opinion dated
the Closing Date, to the effect that:
(i) RCC is a duly organized and validly existing
corporation in good standing under the laws of the State of Delaware
and has the corporate power and authority to perform its obligations
under the Assignment;
(ii) the Assignment has been duly authorized, executed
and delivered by RCC;
(iii) the Assignment constitutes a legal, valid and
binding agreement of RCC, enforceable in accordance with their
respective terms against RCC, as the case may be, subject (a) to the
effect of bankruptcy, insolvency, reorganization, moratorium and
similar laws relating to or affecting creditors' rights generally
and court decisions with respect thereto, (b) to the understanding
that no opinion is expressed as to the application of equitable
principles in any proceeding, whether at law or in equity, and (c)
to limitations of public policy under applicable securities laws as
to rights of indemnity and contribution thereunder;
(iv) neither the consummation of any of the transactions
contemplated in the Assignment, nor the fulfillment of the terms
thereof will conflict with, result in a breach of, or constitute a
default under the articles of incorporation or by-laws of RCC; and
(v) neither the consummation of any of the transactions
contemplated in the Assignment, nor the fulfillment of the terms
thereof will conflict with, result in a breach of, or constitute a
default under the terms of any indenture or other agreement or
instrument known to such counsel and to which RCC is a party or
bound, or any order or regulation known to such counsel to be
applicable to RCC of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction over
RCC.
(g) The Representative shall have received an opinion of counsel to
the Trustee, dated the Closing Date, to the effect that:
(i) the Trustee has been duly incorporated and is
validly existing as a banking corporation under the laws of the
State of New York and has the power and authority to enter into and
to perform all actions required of it under the Pooling and
Servicing Agreement;
-11-
12
(ii) the Pooling and Servicing Agreement has been duly
authorized, executed and delivered by the Trustee, and constitutes a
legal, valid and binding obligation of the Trustee, enforceable
against the Trustee in accordance with its terms except as such
enforceability may be limited by (A) bankruptcy, insolvency,
liquidation, reorganization, moratorium, conservatorship,
receivership or other similar laws now or hereafter in effect
relating to the enforcement of creditors' rights in general, as such
laws would apply in the event of a bankruptcy, insolvency,
liquidation, reorganization, moratorium, conservatorship,
receivership or similar occurrence affecting the Trustee, and (B)
general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law) as
well as concepts of reasonableness, good faith and fair dealing;
(iii) the Certificates have been duly executed on behalf
of the Trust, authenticated and delivered by the Trustee;
(iv) the execution and delivery of the Pooling and
Servicing Agreement and, on behalf of the Trust, the Certificates,
by the Trustee and the performance by the Trustee of the terms
thereof do not conflict with or result in a violation of (A) any law
or regulation of the United States or the State of New York
governing the banking or trust powers of the Trustee, or (B) the
certificate of incorporation or articles of association or by-laws
of the Trustee; and
(v) no approval, authorization or other action by, or
filing with, any governmental authority of the United States or the
State of New York having jurisdiction over the banking or trust
powers of the Trustee is required in connection with the execution
and delivery by the Trustee of the Pooling and Servicing Agreement
and, on behalf of the Trust, the Certificates, or the performance by
the Trustee thereunder.
(h) The Representative shall have received an opinion of Shaw, Pittman,
Xxxxx & Xxxxxxxxxx, special counsel for the Surety Bond Issuer, dated the
Closing Date, to the effect that:
(i) the Surety Bond Issuer is a New York domiciled
monoline stock insurance company which engages only in the business of
financial guaranty insurance and is duly incorporated and validly existing
under the laws of the State of New York and has the full power and
authority (corporate and otherwise) to issue, and to take all action
required of it under, the Surety Bond;
(ii) the execution, delivery and performance by the
Surety Bond Issuer of the Surety Bond have been duly authorized by all
necessary corporate action on the part of the Surety Bond Issuer;
-12-
13
(iii) the execution, delivery and performance by the
Surety Bond Issuer of the Surety Bond do not require the consent or
approval of, the giving of notice to, the prior registration with, or the
taking of any other action in respect of any state or other governmental
agency or authority which has not previously been obtained or effected;
provided, however, the New York State Insurance Law requires that policy
forms and any amendments thereto shall be filed with the Superintendent of
the New York State Insurance Department within thirty (30) days of their
use by the insurer if not previously so filed;
(iv) the Surety Bond has been duly authorized, executed
and delivered by the Surety Bond Issuer and constitutes the legally valid
and binding obligation of the Surety Bond Issuer, enforceable in
accordance with its terms subject, as to enforcement, to (a) bankruptcy,
reorganization, insolvency, moratorium and other laws relating to or
affecting the enforcement of creditors' rights generally, including,
without limitation, laws relating to fraudulent transfers or conveyances,
preferences and equitable subordination, presently or from time to time in
effect and general principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or at law) and (b) the
qualification that the remedy of specific performance may be subject to
equitable defenses and to the discretion of the court before which any
proceedings with respect thereto may be brought;
(v) the obligations of the Surety Bond Issuer under the
Security Bond will rank equally with general obligations and all other
unsecured indebtedness of the Surety Bond Issuer outstanding on the
Closing Date or thereafter which are not contractually subordinated to the
payment of such obligations under the Surety Bond; and
(vi) the Surety Bond is not required to be registered
under the Securities Act of 1933, as amended, in connection with the offer
and sale of the Certificates in the manner contemplated by the Final
Prospectus.
(i) The Surety Bond Issuer shall have furnished to the
Representative a certificate of the Surety Bond Issuer, signed by
any of a Managing Director or General Counsel, dated the Closing
Date, to the effect that the signer of such certificate has
carefully examined the Registration Statement (excluding any
documents incorporated by reference therein), the Final Prospectus
and this Agreement and that, to the best of his knowledge:
(i) any information with respect to the Surety Bond Issuer
in the Registration Statement or any amendment thereof at the time
it became effective did not contain any untrue statement of a
material fact or omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
-13-
14
(ii) any information with respect to the Surety Bond Issuer in
the Final Prospectus, as amended or supplemented, as of its date and
as of the Closing Date, did not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; and
(iii) there has been no change in the financial condition of the
Surety Bond Issuer since December 31, 1996 which would have a
material adverse effect on the Surety Bond Issuer's ability to meet
its obligations under the Surety Bond.
(j) The Company shall have furnished to the Representative a
certificate of the Company, signed by (i) any of the Chairman of the
Board, the President or any Vice President, and (ii) any of the principal
treasury officer, the principal financial officer or the principal
accounting officer of the Company, dated the Closing Date, to the effect
that the signers of such certificate have carefully examined the
Registration Statement (excluding any documents incorporated by reference
therein), the Final Prospectus and this Agreement and that, to the best of
their knowledge:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the Closing Date with the same effect as if made on the Closing Date
and the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied at or
prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement, as amended, has been issued, and no
proceedings for that purpose have been instituted or threatened; and
(iii) since the respective dates as of which information is given
in the Final Prospectus, there has been no material adverse change
in the condition (financial or other), earnings, business or
properties of the Company, whether or not arising from transactions
in the ordinary course of business, except as set forth in or
contemplated in the Final Prospectus.
(k) On the date hereof and on the Closing Date, Price Waterhouse LLP
and/or any other firm of certified independent public accountants acceptable to
the Representative shall have furnished to the Representative a letter, dated
the date hereof and the date of the Closing Date, respectively, in form and
substance satisfactory to the Representative, confirming that they are
independent accountants within the meaning of the Act and the Exchange Act and
the respective applicable published rules and regulations thereunder, and
stating in effect that using the assumptions and methodology used by the
Company, all of which shall be described in such letter, they have recalculated
such numbers and percentages set forth in the Final Prospectus as the
Representative may reasonably request and agreed to by Price Waterhouse LLP,
compared the results of their calculations to the corresponding items in the
Final Prospectus, and found
-14-
15
each such number and percentage set forth in the Final Prospectus to be in
agreement with the results of such calculations. To the extent historical
financial information with respect to the Company and/or historical financial,
delinquency or related information with respect to one or more Servicers is
included in the Final Prospectus, such letter or letters shall also relate to
such information.
(l) The Certificates shall have received the rating of "AAA"
from Standard & Poor's Rating Services and "Aaa" from Xxxxx'x Investors
Service, Inc.
(m) On the Closing Date, [ ] shall have
furnished to the Representative a letter, dated the Closing Date, in form
and substance satisfactory to the Representative, indicating that the
Company and the Underwriters are entitled to rely upon the audited
financial statements of the Surety Bond Issuer prepared by them.
(n) On or prior to the Closing Date, NationsCredit Commercial
shall have executed the Indemnification Agreement, substantially in the
form of Exhibit A hereto.
(o) Prior to the Closing Date, the Company shall have furnished
to the Representative such further information, certificates and documents
as the Representative may reasonably request.
If any of the conditions specified in this Section G shall not
have been fulfilled in all material respects when and as provided in this
Agreement or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Representative and its counsel, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representative. Notice of such
cancellation shall be given to the Company in writing or by telephone or
telegraph confirmed in writing.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Certificates provided for herein is not consummated because any condition to the
obligations of the Underwriters 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 a default by any of the Underwriters, the Company will reimburse,
subject to paragraph (e) of Section 8 below, the Underwriters severally upon
demand for all out-of-pocket expenses (including reasonable fees and
disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Certificates.
8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each
Underwriter and each person who controls any Underwriter within the meaning of
either the Act or the Exchange Act against any and all losses, claims, damages
or liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other Federal or state statutory law
or regulation, at common law or otherwise, insofar as such losses, claims,
damages
-15-
16
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement for the registration of the Certificates as
originally filed or in any amendment thereof, or in any Preliminary Prospectus
or the Final Prospectus, or in any amendment thereof or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein 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 by or on behalf of
any Underwriter through the Representative specifically for use in connection
with the preparation thereof and (ii) such indemnity with respect to any
Preliminary Prospectus shall not inure to the benefit of any Underwriter (or
any person controlling such Underwriter) from whom the person asserting any
such loss, claim, damage or liability purchased the Certificates which are the
subject thereof if such person did not receive a copy of the Final Prospectus
(or the Final Prospectus as amended or supplemented) at or prior to the
confirmation of the sale of such Certificates to such person in any case where
such delivery is required by the Act and the untrue statement or omission of a
material fact contained in any Preliminary Prospectus was corrected in the
Final Prospectus (or the Final Prospectus as amended or supplemented). This
indemnity agreement will be in addition to any liability which the Company may
otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless
the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representative
specifically for use in the preparation of the documents referred to in the
foregoing indemnity. This indemnity agreement will be in addition to any
liability which any Underwriter may otherwise have. The Company acknowledges
that the statements set forth under the heading "Underwriting" constitute the
only information furnished in writing by or on behalf of the several
Underwriters for inclusion in the documents referred to in the foregoing
indemnity, and you, as the Representative, confirm that such statements are
correct.
(c) Promptly after receipt by an indemnified party under this Section
8 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 8, 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 which it may have to any indemnified party otherwise than under
this Section 8. 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
-16-
17
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 shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to
select 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 to such indemnified party under this Section 8 for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof unless (i) the indemnified party shall have employed separate
counsel in connection with the assertion of legal defenses in accordance with
the proviso to the next preceding sentence (it being understood, however, that
the indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Representative in the case of subparagraph
(a), representing the indemnified parties under subparagraph (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 be only in respect of
the counsel referred to in such clause (i) or (iii). After such notice from
the indemnifying party to such indemnified party, the indemnifying party will
not be liable for the costs and expenses of any settlement of such action
effected by such indemnified party without the consent of the indemnifying
party, which will not be unreasonably withheld, unless such indemnifying party
waived its rights under this Section 8 in writing in which case the indemnified
party may effect such a settlement without such consent. No indemnifying party
may avoid its duty to indemnify under this Section 8 if such indemnifying party
shall, without the prior written consent of the indemnified party, effect any
settlement or compromise of or consent to the entry of any judgment in, any
pending or threatened action in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party unless such settlement includes an unconditional release of
such indemnified party from all liability on all claims that are the subject
matter of such action. An indemnifying party shall not be liable for any
settlement of any claim effected without its consent unless its right to
consent under this Section 8 has been waived in writing
(d) To provide for just and equitable contribution in circumstances in
which the indemnification provided for in paragraph (a) or (b) of this Section 8
is due in accordance with its terms but is for any reason held by a court to be
unavailable from the Company or the Underwriters on the grounds of policy or
otherwise, the Company and the Underwriters shall contribute to the aggregate
losses, claims, damages and liabilities (including legal or other expenses
reasonably incurred in connection with investigating or defending same) to which
the
-17-
18
Company and one or more of the Underwriters may be subject, in such proportion
so that the Underwriters are responsible for that portion represented by the
percentage that the underwriting discount bears to the sum of such discount and
the purchase price of the Certificates specified in Schedule I hereto and the
Company is responsible for the balance; provided, however, that in no case
shall any Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Certificates) be responsible for
any amount in excess of the underwriting discount applicable to the
Certificates purchased by such Underwriter hereunder.
Notwithstanding anything to the contrary in this paragraph (d), 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. For purposes of this Section 8, each
person who controls an Underwriter within the meaning of either the Act or the
Exchange Act shall have the same rights to contribution as such Underwriter,
and each person who controls the Company within the meaning of either the Act
or the Exchange 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, subject in each case to the preceding
sentence of this paragraph (d). 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).
9. Default by an Underwriter. If any one or more Underwriters
shall fail to purchase and pay for any of the Certificates agreed to be
purchased by such Underwriter or Underwriters hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the
amount of Certificates set forth opposite their names in Schedule I hereto bear
to the aggregate amount of Certificates set forth opposite the names of all the
remaining Underwriters) the Certificates which the defaulting Underwriter or
Underwriters agreed but failed to purchase; provided, however, that in the
event that the aggregate amount of Certificates which the defaulting
Underwriter or Underwriters agreed but failed to purchase shall exceed 10% of
the aggregate amount of Certificates set forth in Schedule I hereto, the
remaining Underwriters shall have the right to purchase all, but shall not be
under any obligation to purchase any, of the Certificates, and if such
nondefaulting Underwriters do not purchase all the Certificates, this Agreement
will terminate without liability to any nondefaulting Underwriter or the
Company. In the event of a default by any Underwriter as set forth in this
Section 9, the Closing Date shall be postponed for such period, not exceeding
seven days, as the Representative shall determine in order that the required
changes in the Registration Statement and the Final Prospectus or in any other
documents or arrangements may be effected. Nothing contained in this Agreement
shall relieve any defaulting Underwriter of its liability, if any, to the
Company and any nondefaulting Underwriter for damages occasioned by its default
hereunder.
-18-
19
10. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Representative, by notice given to the Company
prior to delivery of and payment for the Certificates, if prior to such time (i)
trading in securities generally on the New York Stock Exchange shall have been
suspended or limited or minimum prices shall have been established on such
Exchange, or (ii) there shall have occurred any outbreak or material escalation
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 the judgment of the
Representative, impracticable to market the Certificates.
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Underwriters set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of any Underwriter or the Company or any of
the officers, directors or controlling persons referred to in Section 8 hereof,
and will survive delivery of and payment for the Certificates. The provisions
of Section 7 and 8 hereof and this Section 11 shall survive the termination or
cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representative, will be mailed,
delivered or telegraphed to NationsBanc Capital Markets, Inc., NationsBank
Corporate Center, NC1-007-07-01, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx
Xxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxx, Director, and to any other
Representative at such address, if any, as is specified in writing to the
Company for notices hereunder; or, if sent to the Company, will be mailed,
delivered or telegraphed and confirmed to it at NationsBank Corporate Center,
NC1-007-23-01, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx, 00000,
Attention: Xxxx X. Xxxx, Senior Vice President, with a copy to: NationsBank
Corporation, Legal Department, NC1-007-20-01, NationsBank Corporate Center, 000
Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx, 00000, Attention: Xxxx X.
Xxxxxxx, General Counsel.
13. 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 8 hereof, and no
other person will have any right or obligation hereunder.
14. APPLICABLE LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED
WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
PRINCIPLES OF CONFLICT OF LAWS.
-19-
20
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company and the several Underwriters.
Very truly yours,
NATIONSCREDIT SECURITIZATION
CORPORATION
By:_______________________________
Xxxx X. Xxxx
Senior Vice President
The foregoing Agreement is
hereby confirmed and accepted
as of the date first written
above.
NATIONSBANC CAPITAL MARKETS, INC.,
as Representative
By: NATIONSBANC CAPITAL MARKETS, INC.
By:________________________
Xxxxxxx X. Xxxxxx
Director
For themselves and as Representative
for the other several Underwriters,
if any named in Schedule I to the
foregoing Agreement
-20-
21
SCHEDULE I
Principal Amount
of Certificates to
Underwriters be Purchased
------------ ------------------
NationsBanc Capital Markets, Inc., ............... $____________
....................................... $____________
Total ......................................... $____________
-21-
22
EXHIBIT A
INDEMNIFICATION AGREEMENT
This Indemnification Agreement is entered into between NationsCredit
Commercial Corporation of America, a North Carolina corporation
("NationsCredit"), and NationsBanc Capital Markets, Inc., in its individual
capacity and as representative of the underwriters identified on Schedule I
hereto (collectively, the "Underwriters"), dated as of May __, 1997.
The Underwriters and NationsCredit Securitization Corporation, a
Delaware corporation (the "Company"), have entered into an Underwriting
Agreement (the "Underwriting Agreement"), dated as of May __, 1997, providing
for the sale by the Company to the Underwriters of the ___% Marine
Receivable-Backed Certificates (the "Certificates") of the NationsCredit
Grantor Trust 1997-1 (the "Trust"). The Certificates represent beneficial
interests in a pool of marine retail installment sale contracts secured by new
and used boats, boat motors and boat trailers (the "Receivables"), sold by
NationsCredit to the Company pursuant to the Purchase Agreement (the "Purchase
Agreement"), dated as of April 30, 1997, and certain monies received under the
Simple Interest Receivables and certain monies due under the Precomputed
Receivables, in each case, on or after May 1, 1997, security interests in the
boats and marine equipment financed thereby, an irrevocable surety bond,
limited in amount, covering certain payments under the Receivables (the "Surety
Bond"), issued by Capital Markets Assurance Corporation (the "Surety Bond
Issuer"), such amounts as from time to time may be held in one or more trust
accounts which will be established and maintained by the Servicer pursuant to
the Pooling and Servicing Agreement, the fights of the Company under that
certain Purchase Agreement dated as of April 30, 1997 between the Company and
the Servicer, the proceeds from any recourse rights of the Servicer against any
seller of new and used boats, boat motors and boat trailers financed by the
Receivables (a "Dealer") pursuant to any agreement with a Dealer, the right to
proceeds from claims on physical damage, credit life and disability insurance
policies relating to the Receivables, and any property that shall have secured a
Receivable and that shall have been acquired by the Trustee. The Certificates
will be issued pursuant to a Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement"), dated as of April 30, 1997, among the Company as
Depositor, NationsCredit as Servicer and Bankers Trust Company as Trustee.
This Indemnification Agreement is being entered into by the parties hereto as a
condition to the execution of Underwriting Agreement and to induce the
Underwriters to execute the same. Capitalized terms used but not defined herein
shall have the meanings ascribed thereto in the Underwriting Agreement.
1. Indemnification. (a) NationsCredit agrees to indemnify and hold
harmless each Underwriter and each person who controls any Underwriter within
the meaning of either the Act or the Exchange Act against any and all losses,
claims, damages or liabilities, joint or several, to which they or any of them
may become subject under the Act, the Exchange Act or other Federal
-22-
23
or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement for the registration
of the Certificates as originally filed or in any amendment thereof, or in any
Preliminary Prospectus or the Final Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein 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)
NationsCredit 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 or NationsCredit by or on behalf of any Underwriter through the
Representatives specifically for use in connection with the preparation thereof
and (ii) such indemnity with respect to any Preliminary Prospectus shall not
inure to the benefit of any Underwriter (or any person controlling such
Underwriter) from whom the person asserting any such loss, claim. damage or
liability purchased the Certificates which are the subject thereof if such
person did not receive a copy of the Final Prospectus (or the Final Prospectus
as amended or supplemented) at or prior to the confirmation of the sale of such
Certificates to such person in any case where such delivery is required by the
Act and the untrue statement or omission of a material fact contained in any
Preliminary Prospectus was corrected in the Final Prospectus (or the Final
Prospectus as amended or supplemented). This indemnity agreement will be in
addition to any liability which NationsCredit may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold harmless
NationsCredit, each of its directors, and each person who controls
NationsCredit within the meaning of either the Act or the Exchange Act, to the
same extent as the foregoing indemnity from NationsCredit to each Underwriter,
but only with reference to written information relating to such Underwriter
furnished to the Company or NationsCredit by or on behalf of such Underwriter
through the Representatives specifically for use in the preparation of the
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability which any Underwriter may otherwise have.
NationsCredit acknowledges that the statements set forth under the heading
"Underwriting" constitute the only information furnished in writing by or on
behalf of the several Underwriters for inclusion in the documents referred to
in the foregoing indemnity, and the Representatives confirm that such
statements are correct.
(c) Promptly after receipt by an indemnified party under this
Indemnification Agreement 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 Indemnification Agreement, 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 which
it may have to any indemnified party otherwise than under this Indemnification
Agreement. In case any such action is brought against any indemnified party,
and it notifies the indemnifying party of the
-23-
24
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 shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the light to select 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 to such indemnified party
under this Indemnification Agreement for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof unless (i) the indemnified party shall have employed separate counsel
in connection with the assertion of legal defenses in accordance with the
proviso to the next preceding sentence (it being understood, however, that the
indemnifying party shall not be liable for the expenses of more than one
separate counsel, approved by the Representatives in the case of subparagraph
(a) and approved by NationsCredit in the case of subparagraph (b), representing
the indemnified parties under Subparagraph (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 be only in respect of the counsel referred to
in such clause (i) or (iii). After such notice from the indemnifying party to
such indemnified party, the indemnifying party will not be liable for the costs
and expenses of any settlement of such action effected by such indemnified
party without the consent of the indemnifying party, which will not be
unreasonably withheld, unless such indemnifying party waived its rights under
this Indemnification Agreement in writing in which case the indemnified party
may effect such a settlement without such consent. No indemnifying party may
avoid its duty to indemnify under this Indemnification Agreement if such
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement or compromise of, or consent to the entry of any
judgment in, any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on all
claims that are the subject matter of such action. An indemnifying party shall
not be liable for any settlement of any claim effected without its consent
unless its right to consent under this Indemnification Agreement has been
waived in writing.
2. Contribution. To provide for just and equitable contribution in
circumstances in which the indemnification provided for in Section l (a) or l
(b) of this Indemnification Agreement is due in accordance with its terms but
is for any a reason held by a court to be unavailable from NationsCredit or the
Underwriters on the grounds of policy or otherwise, NationsCredit and the
-24-
25
Underwriters shall contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in
connection with investigating or defending same) to which NationsCredit and one
or more of the Underwriters may be subject, in such proportion so that the
Underwriters are responsible for that portion represented by the percentage
that the underwriting discount bears to the sum of such discount and the
purchase price of the Certificates specified in Schedule I hereto and
NationsCredit is responsible for the balance; provided, however, that in no
case shall any Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Certificates) be responsible for
any amount in excess of the underwriting discount applicable to the
Certificates purchased by such Underwriter hereunder.
Notwithstanding anything to the contrary in this Section 2, 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. For purposes of this Indemnification
Agreement, each person who controls an Underwriter within the meaning of either
the Act or the Exchange Act shall have the same rights to contribution as such
Underwriter, and each person who controls NationsCredit within the meaning of
either the Act or the Exchange Act and each director of NationsCredit shall
have the same rights to contribution as NationsCredit, subject in each case to
the preceding sentence of this Section 2. 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 Section 2, 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 Section 2.
3. No Termination. NationsCredit agrees that it shall not terminate,
amend or modify the Purchase Agreement or the Pooling and Servicing Agreement
or in each case any portion thereof without the prior written consent of each
Underwriter.
4. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to the Representatives, will be mailed, delivered
or telegraphed to NationsBanc Capital Markets, Inc., NationsBank Corporate
Center, NC1-007-07-01, 000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000,
Attention: Xxxxxxx X. Xxxxxx, Director, and to any other Representative at such
address, if any, as is specified in writing to NationsCredit for notices
hereunder; or, if sent to NationsCredit, will be mailed, delivered or
telegraphed and confirmed to it at NationsBank Corporate Center, NC1-007-23-01,
000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx, 00000, Attention: Xxxx X.
Xxxx, Senior Vice President, with a copy to: NationsBank Corporation, Legal
Department, NC1-007-20-01,. NationsBank Corporate Center, 000 Xxxxx Xxxxx
Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx, 00000, Attention: Xxxx X. Xxxxxxx, General
Counsel.
5. 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
-25-
26
persons referred to in Section 1 hereof, and no other person will have any
right or obligation hereunder.
6. APPLICABLE LAW. THIS AGREEMENT WILL BE GOVERNED BY AND CONSTRUED WITH
THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO PRINCIPLES
OF CONFLICT OF LAWS.
7. Counterparts. This Indemnification Agreement may be executed in any
number of counterparts, each of which when so executed shall be deemed to be an
original, but all of such counterparts shall together constitute one
instrument.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among NationsCredit and the several Underwriters.
NATIONSCREDIT COMMERCIAL
CORPORATION OF AMERICA
By:______________________________
Xxxx X. Xxxx
Senior Vice President
NATIONSBANC CAPITAL MARKETS, INC.,
as Representative
By: NATIONSBANC CAPITAL MARKETS,
INC.
By:______________________________
Xxxxxxx X. Xxxxxx
Director
-26-
27
SCHEDULE I
Underwriters
NationsBanc Capital Markets, Inc.
-27-
