Exhibit 1.1
EXECUTION COPY
$600,000,000
IMC HOME EQUITY LOAN OWNER TRUST 1998-4
Adjustable Rate Home Equity Loan Asset Backed Notes,
Series 1998-4
UNDERWRITING AGREEMENT
June 19, 1998
PAINEWEBBER INCORPORATED
As representative of the several underwriters
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
IMC Securities, Inc. (the "Depositor"), a Delaware corporation, has
authorized (i) the creation of IMC Home Equity Loan Owner Trust 1998-4, a
Delaware business trust (the "Issuer"), pursuant to the Trust Agreement, dated
as of June 1, 1998 (the "Trust Agreement"), between the Depositor and Wilmington
Trust Company ("Wilmington Trust"), as owner trustee (the "Owner Trustee") and
(ii) the issuance and sale of $600,000,000 aggregate original principal amount
of the Issuer's Adjustable Rate Home Equity Loan Asset Backed Notes Series
1998-4 (the "Notes"). The Notes will evidence non-recourse obligations of, and
will be issued by, the Issuer pursuant to the terms of the Indenture, dated as
of June 1, 1998 (the "Indenture"), between the Issuer and The Chase Manhattan
Bank, as indenture trustee (the "Indenture Trustee"). Pursuant to the Trust
Agreement, the Issuer also will issue certificates evidencing the residual
interest in the Issuer (the "Residual Interest"). The Residual Interest and the
Notes are sometimes collectively referred to as the "Securities."
The Notes will be secured by a trust estate (the "Trust Estate")
consisting primarily of a pool of adjustable-rate home equity loans secured by
mortgages or deeds of trust creating first or second liens on primarily one- to
four-family residential properties (the "Home Equity Loans") and such amounts as
may be held by the Indenture Trustee in any accounts for the Owners. The Notes
will initially be secured by (i) Home Equity Loans in an amount of approximately
$450,000,000 (the "Initial Home Equity Loans") as of the close of business on
June 1, 1998 (the "Cut-Off Date") and (ii) funds deposited in the Pre-Funding
Account (the "Pre-Funding Account") and the Capitalized Interest Account (the
"Capitalized Interest Account"). The Initial Home Equity Loans will be sold by
IMC Mortgage Company ("IMC") to the Depositor, and by the Depositor to the
Issuer pursuant to the Sale and Servicing Agreement, dated as of June 1, 1998
(the "Sale and Servicing Agreement"), among IMC, as seller (the "Seller") and as
servicer (the
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"Servicer"), the Depositor, the Indenture Trustee and the Issuer. Pursuant to
the Sale and Servicing Agreement, the Servicer will service the Home Equity
Loans on behalf of the Issuer. On the Closing Date, approximately $150,000,000
will be deposited in the name of the Indenture Trustee in the Pre-Funding
Account. It is intended that additional Home Equity Loans satisfying the
criteria specified in the Sale and Servicing Agreement (the "Subsequent Home
Equity Loans") will be purchased by the Issuer for inclusion in the Trust Estate
from the Depositor from time to time on or before August 15, 1998 from funds on
deposit in the Pre-Funding Account pursuant to the terms of the applicable
Subsequent Transfer Agreement (each, a "Subsequent Transfer Agreement"). Funds
in the Capitalized Interest Account will be applied by the Indenture Trustee to
cover shortfalls in interest during the Funding Period (as described in the
Prospectus Supplement) on the Notes attributable to the provisions allowing for
purchase of Subsequent Home Equity Loans after the Cut-Off Date.
The Notes will have the benefit of a financial guaranty insurance
policy (the "Insurance Policy") issued by MBIA Insurance Corporation (the "Note
Insurer"), issued pursuant to the Insurance Agreement, dated as of June 1, 1998
(the "Insurance Agreement") among the Seller, the Servicer, the Depositor, the
Indenture Trustee and the Note Insurer. The Note Insurer, the Seller, the
Depositor, PaineWebber Incorporated, Bear, Xxxxxxx & Co. Inc., Deutsche Bank
Securities Inc. and Nomura Securities International, Inc. as Underwriters, also
will enter into an Indemnification Agreement, dated as of June 26, 1998 (the
"Indemnification Agreement"). This Agreement, the Trust Agreement, the Sale and
Servicing Agreement, the Indenture, the Indemnification Agreement, the Insurance
Agreement and any Subsequent Transfer Agreement are sometimes referred to herein
collectively as the "Agreements". A form of each of the Trust Agreement, the
Indenture and the Sale and Servicing Agreement has been filed as an exhibit to
the Registration Statement (hereinafter defined).
The Notes are more fully described in a Registration Statement which
the Depositor has furnished to the Underwriters. Capitalized terms used but not
defined herein shall have the meanings given to them in the Agreements.
The Notes are being purchased by the Underwriters named in Schedule A
hereto (the "Underwriters"), and the Underwriters are purchasing, severally,
only the Notes set forth opposite their names in Schedule A, except that the
amounts purchased by the Underwriters may change in accordance with Section 10
of this Agreement. PaineWebber Incorporated (the "Representative") is acting for
itself and as representative of the other Underwriters.
SECTION 1. Representations and Warranties of the Depositor. The
Depositor represents and warrants to, and agrees with the Underwriters that:
A. A Registration Statement on Form S-3 (No. 333-48429) has
(i) been prepared by the Depositor in conformity with the requirements
of the Securities Act of 1933 (the "Securities Act"), the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act") and the
rules and regulations (the "Rules and Regulations") of the United
States Securities and Exchange Commission (the "Commission") under the
Securities Act and the Trust
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Indenture Act, (ii) been filed with the Commission under the Securities
Act and (iii) become effective under the Securities Act. Copies of such
Registration Statement have been delivered by the Depositor to the
Underwriters. As used in this Agreement, "Effective Time" means the
date and the time as of which such Registration Statement, or the most
recent post-effective amendment thereto, if any, was declared effective
by the Commission; "Effective Date" means the date of the Effective
Time; "Registration Statement" means such registration statement, at
the Effective Time, including any documents incorporated by reference
therein at such time; and "Basic Prospectus" means such final
prospectus dated May 29, 1998; and "Prospectus Supplement" means the
final prospectus supplement relating to the Notes, to be filed with the
Commission pursuant to paragraph (2), (3) or (5) of Rule 424(b) of the
Rules and Regulations. "Prospectus" means the Basic Prospectus together
with the Prospectus Supplement. Reference made herein to the Prospectus
shall be deemed to refer to and include any documents incorporated by
reference therein pursuant to Item 12 of Form S-3 under the Securities
Act, as of the date of the Prospectus and any reference to any
amendment or supplement to the Prospectus shall be deemed to refer to
and include any document filed under the Securities Exchange Act of
1934 (the "Exchange Act") after the date of the Prospectus, and
incorporated by reference in the Prospectus and any reference to any
amendment to the Registration Statement shall be deemed to include any
report of the Depositor filed with the Commission pursuant to Section
13(a) or 15(d) of the Exchange Act after the Effective Time that is
incorporated by reference in the Registration Statement. The Commission
has not issued any order preventing or suspending the use of the
Prospectus. There are no contracts or documents of the Depositor which
are required to be filed as exhibits to the Registration Statement
pursuant to the Securities Act, the Rules and Regulations or the Trust
Indenture Act which have not been so filed or incorporated by reference
therein on or prior to the Effective Date of the Registration Statement
other than such documents or materials, if any, as any Underwriter
delivers to the Depositor pursuant to Section 4(B) hereof for filing on
Form 8-K. The conditions for use of Form S-3, as set forth in the
General Instructions thereto, have been satisfied.
B. The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement or
the Prospectus will, when they become effective or are filed with the
Commission, as the case may be, conform in all respects to the
requirements of the Securities Act, the Trust Indenture Act and the
Rules and Regulations. The Registration Statement, as of the Effective
Date thereof and of any amendment thereto, did not contain an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading. The Prospectus as of its date, and as amended or
supplemented as of the Closing Date, does not and will not contain any
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that
no representation or warranty is made as to information contained in or
omitted from the Registration Statement or the Prospectus in reliance
upon and in conformity with written information furnished to the
Depositor in writing by the Underwriters expressly for use
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therein. The only information furnished by the Underwriters or on
behalf of the Underwriters for use in connection with the preparation
of the Registration Statement or the Prospectus is described in Section
8(I) hereof.
C. The documents incorporated by reference to the Prospectus,
when they became effective or were filed with the Commission, as the
case may be, conformed in all material respects to the requirements of
the Securities Act or the Exchange Act, as applicable, and the rules
and regulations of the Commission thereunder, and none of such
documents contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; and any further documents
so filed and incorporated by reference in the Prospectus, when such
documents become effective or are filed with the Commission, as the
case may be, will conform in all material respects to the requirements
of the Securities Act or the Exchange Act, as applicable, and the rules
and regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided that no representation is made as to
documents deemed to be incorporated by reference in the Prospectus as
the result of filing a Form 8-K at the request of the Underwriters
except to the extent such documents reflect information furnished by
the Depositor to the Underwriters for the purpose of preparing such
documents.
D. Since the respective dates as of which information is given
in the Prospectus, there has not been any material adverse change in
the general affairs, management, financial condition, or results of
operations of the Depositor, otherwise than as set forth or
contemplated in the Prospectus as supplemented or amended as of the
Closing Date.
E. The Depositor has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware and is in good standing as a foreign corporation in each
jurisdiction in which its ownership or lease of property or the conduct
of its business requires such qualification, and has all power and
authority necessary to own or hold its properties, to conduct the
business in which it is engaged and to enter into and perform its
obligations under each Agreement to which it is a party and to cause
the Securities to be issued.
F. There are no actions, proceedings or investigations pending
with respect to which the Depositor has received service of process
before or threatened by any court, administrative agency or other
tribunal to which the Depositor is a party or of which any of its
properties is the subject (a) which if determined adversely to the
Depositor would have a material adverse effect on the business or
financial condition of the Depositor, (b) asserting the invalidity of
any of the Agreements or the Securities, (c) seeking to prevent the
issuance of the Securities or the consummation by the Depositor of any
of the transactions contemplated by the Agreements, or (d) which might
materially and adversely affect the performance by the Depositor of its
obligations under, or the validity or enforceability of, the Agreements
or the Securities.
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G. This Agreement has been, and each other Agreement to which
the Depositor is a party when executed and delivered as contemplated
hereby and thereby will have been, duly authorized, executed and
delivered by the Depositor, and this Agreement constitutes, and each
such other Agreement when executed and delivered as contemplated
herein, will constitute, legal, valid and binding instruments
enforceable against the Depositor in accordance with their respective
terms, subject as to enforceability to (x) applicable bankruptcy,
reorganization, insolvency moratorium or other similar laws affecting
creditors' rights generally, (y) general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity
or at law), and (z) with respect to rights of indemnity under this
Agreement and the Indemnification Agreement, limitations of public
policy under applicable securities laws.
H. The execution, delivery and performance of each Agreement
to which the Depositor is a party and the consummation of the
transactions contemplated hereby and thereby, and the issuance and
delivery of the Notes do not and will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Depositor is a party, by
which the Depositor is bound or to which any of the properties or
assets of the Depositor or any of its subsidiaries is subject, which
breach or violation would have a material adverse effect on the
business, operations or financial condition of the Depositor, nor will
such actions result in any violation of the provisions of the articles
of incorporation or by-laws of the Depositor or any statute or any
order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Depositor or any of its properties or
assets, which breach or violation would have a material adverse effect
on the business, operations or financial condition of the Depositor.
I. The Depositor has no reason to believe that either Coopers
& Xxxxxxx L.L.P. or Deloitte & Touche LLP are not independent public
accountants with respect to the Depositor as required by the Securities
Act and the Rules and Regulations.
J. The direction by the Depositor to the Owner Trustee to
execute, issue and deliver and the direction by the Depositor to the
Indenture Trustee to authenticate the Notes has been duly authorized by
the Depositor, and assuming the Owner Trustee and the Indenture Trustee
have been duly authorized to do so, when executed, authenticated,
issued and delivered in accordance with the Indenture, the Notes will
be validly issued and outstanding and will be entitled to the benefits
provided by the Indenture.
K. No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of
the United States is required for the issuance of the Securities and
the sale of the Notes to the Underwriters, or the consummation by the
Depositor of the other transactions contemplated by the Agreements
except such consents, approvals, authorizations, registrations or
qualifications as may be required under state
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securities or blue sky laws in connection with the purchase and
distribution of the Notes by the Underwriters or as have been obtained.
L. The Depositor possesses all material licenses, certificates,
authorities or permits issued by the appropriate State, Federal or
foreign regulatory agencies or bodies necessary to conduct the business
now conducted by it and as described in the Prospectus, and the
Depositor has not received notice of any proceedings relating to the
revocation or modification of any such license, certificate, authority
or permit which if decided adversely to the Depositor would, singly or
in the aggregate, materially and adversely affect the conduct of its
business, operations or financial condition.
M. At the time of execution and delivery of the Sale and
Servicing Agreement, the Depositor will: (i) have beneficial title to
the Initial Home Equity Loans conveyed by the Seller, free and clear of
any lien, mortgage, pledge, charge, encumbrance, adverse claim or other
security interest (collectively, "Liens"); (ii) not have assigned to
any person any of its right or title in the Initial Home Equity Loans
or in the Sale and Servicing Agreement or in the Notes being issued
pursuant to the Indenture and (iii) have the power and authority to
sell its interest in the Initial Home Equity Loans to the Issuer and to
sell the Notes to the Underwriters. Upon execution and delivery of the
Sale and Servicing Agreement by the Issuer, the Issuer will have
acquired beneficial ownership of all of the Depositor's right, title
and interest in and to the Initial Home Equity Loans. Upon execution
and delivery of the Indenture by the Issuer and the Indenture Trustee,
the Indenture Trustee will have a valid and perfected security interest
in the Trust Estate free of any other Liens. Upon delivery to the
Underwriters of the Notes, the Underwriters will have good title to the
Notes, free of any Liens.
N. At the time of execution and delivery of any Subsequent
Transfer Agreement, the Depositor will: (i) have beneficial title in
the Subsequent Home Equity Loans conveyed by the Seller, free and clear
of any Liens; (ii) not have assigned to any person any of its right or
title in the Subsequent Home Equity Loans or in the Sale and Serving
Agreement or in the Notes being issued pursuant to the Indenture; and
(iii) have the power and authority to sell the Subsequent Home Equity
Loans to the Issuer. Upon execution and delivery of the Subsequent
Transfer Agreement by the Issuer, the Issuer will acquire beneficial
ownership of all of the Depositor's right, title and interest in and to
the Subsequent Home Equity Loans.
O. As of the Cut-Off Date, each of the Initial Home Equity
Loans will meet the eligibility criteria described in the Prospectus
and will conform to the descriptions thereof contained in the
Prospectus.
P. As of any Subsequent Transfer Date, each of the Subsequent
Home Equity Loans will meet the eligibility criteria described in the
Prospectus and will conform to the descriptions thereof contained in
the Prospectus.
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Q. Neither the Depositor nor the Issuer is an "investment
company" within the meaning of such term under the Investment Company
Act of 1940 (the "1940 Act") and the rules and regulations of the
Commission thereunder.
R. At the Closing Date, the Notes and each Agreement will
conform in all material respects to the descriptions thereof contained
in the Prospectus.
S. At the Closing Date, the Notes shall have been rated in the
respective rating categories by the nationally recognized rating
agencies, as described in the Prospectus Supplement under "Ratings".
T. Any taxes, fees and other governmental charges in connection
with the execution, delivery and issuance of each Agreement and the
Securities have been paid or will be paid at or prior to the Closing
Date.
U. At the Closing Date, each of the representations and warranties
of the Depositor set forth in each Agreement to which it is a party
will be true and correct in all material respects.
Any certificate signed by an officer of the Depositor and delivered to
an Underwriter or counsel for the Underwriters in connection with an offering of
the Notes shall be deemed, and shall state that it is, a representation and
warranty as to the matters covered thereby to each person to whom the
representations and warranties in this Section 1 are made.
SECTION 2. Purchase and Sale. The commitment of the Underwriters to
purchase the Notes pursuant to this Agreement shall be deemed to have been made
on the basis of the representations and warranties herein contained and shall be
subject to the terms and conditions herein set forth. The Depositor agrees to
instruct the Issuer to issue the Notes and agrees to sell to each Underwriter,
and each Underwriter agrees (except as provided in Sections 10 and 11 hereof)
severally and not jointly to purchase from the Depositor the aggregate initial
principal amounts of the Notes set forth opposite their names on Schedule A, at
the purchase price or prices set forth in Schedule A. The Underwriters may offer
the Notes to certain dealers at such price less a concession not in excess of
the amount set forth in Schedule A. The Underwriters may allow and such dealers
may reallow a discount to certain dealers not in excess of the amount set forth
in Schedule A.
SECTION 3. Delivery and Payment. Delivery of and payment for the Notes
to be purchased by the Underwriters shall be made at the offices of Stroock &
Stroock & Xxxxx LLP, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, or at such other
place as shall be agreed upon by the Representative and the Depositor at 10:00
A.M. New York City time on June 26, 1998, or at such other time or date as shall
be agreed upon in writing by the Representative and the Depositor (such date
being referred to as the "Closing Date"). Payment shall be made to the Depositor
by wire transfer of same day funds payable to the account of the Depositor.
Delivery of the Notes
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shall be made to the Representative for the accounts of the applicable
Underwriters against payment of the purchase price thereof. The Notes shall be
in such authorized denominations and registered in such names as the
Representative may request in writing at least two business days prior to the
Closing Date. The Notes will be made available for examination by the
Representative no later than 2:00 P.M. New York City time on the first business
day prior to the Closing Date.
SECTION 4. Offering by the Underwriters.
A. It is understood that, subject to the terms and conditions
hereof, the Underwriters propose to offer the Notes for sale to the
public as set forth in the Prospectus.
B. It is understood that each Underwriter may prepare and
provide to prospective investors certain Computational Materials and
ABS Term Sheets in connection with the offering of the Notes, subject
to the following conditions:
1. In connection with its use of Computational
Materials, the applicable Underwriter shall comply with all applicable
requirements of the No-Action Letter, dated May 20, 1994, issued by the
Division of Corporation Finance of the Commission to Xxxxxx, Xxxxxxx
Acceptance Corporation I, Xxxxxx, Peabody & Co. Incorporated and Xxxxxx
Structured Asset Corporation, as made applicable to other issuers and
underwriters by the Division of Corporation Finance of the Commission
in response to the request of the Public Securities Association
("PSA"), dated May 23, 1994 (collectively, the "Xxxxxx/PSA Letters"),
as well as the PSA Letter referred to below. In connection with its use
of ABS Term Sheets, the applicable Underwriter shall comply with all
applicable requirements of the No-Action Letter dated February 17,
1995, issued by the Division of Corporation Finance of the Commission
to PSA (the "PSA Letter" and, together with the Xxxxxx/PSA Letters, the
"No-Action Letters").
2. The term "Computational Materials" as used herein
shall have the meaning given to such term in the No-Action Letters, but
shall include only those Computational Materials that have been
prepared or delivered to prospective investors by or at the direction
of the applicable Underwriter. The terms "ABS Term Sheets," "Collateral
Term Sheets" and "Structural Term Sheets" as used herein shall have the
meanings given to such terms in the PSA Letter, but shall include only
those ABS Term Sheets, Collateral Term Sheets or Structural Term Sheets
that have been prepared or delivered to prospective investors by or at
the direction of the applicable Underwriter.
3. All Computational Materials and ABS Term Sheets
provided to prospective investors that are required to be filed
pursuant to the No-Action Letter shall bear a legend in a form
previously agreed upon by the Depositor and the applicable Underwriter.
4. Any Computational Materials and ABS Term Sheets
are subject to review by and approval of the Depositor prior to their
distribution to any prospective investors
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and a copy of such Computational Materials and ABS Term Sheets as are
delivered to prospective investors shall, in addition to the following
delivery requirements, be delivered to the Depositor simultaneously
with delivery to prospective investors.
5. Each applicable Underwriter shall provide to the
Depositor, for filing on Form 8-K as provided in Section 5(E), two
printed copies and one electronic copy on diskette (in such format as
required by the Depositor) of all Computational Materials and ABS Term
Sheets distributed by such Underwriter and that are required to be
filed with the Commission pursuant to the No-Action Letters. Each
delivery of Computational Materials or ABS Term Sheets to the Depositor
pursuant to this paragraph shall be effected by delivering one printed
copy and one electronic copy on diskette of such materials to counsel
for the Depositor on behalf of the Depositor and one printed copy of
such materials to the Depositor. An Underwriter may provide copies of
the foregoing in a consolidated or aggregate form that includes all
information required to be filed by such Underwriter. All Computational
Materials and ABS Term Sheets described in this Section must be
provided to the Depositor no later than 10:00 a.m., New York time, on
the Business Day before the date on which filing thereof is required
pursuant to the terms of this Agreement. Each Underwriter agrees that
it will not provide to any investor or prospective investor of the
Notes any Computational Materials or ABS Terms Sheets on or after the
day on which Computational Materials and ABS Term Sheets are required
to be provided to the Depositor pursuant to this Section (other than
copies of Computational Materials or ABS Term Sheets previously
submitted to the Depositor in accordance with this Section for filing
pursuant to Section 5(E), unless such Computational Materials or ABS
Term Sheets are preceded or accompanied by the delivery of a Prospectus
to such investor or prospective investor.
6. All information included in the Computational
Materials and ABS Term Sheets shall be generated based on substantially
the same methodolgy and assumptions that are used to generate the
information in the Prospectus Supplement as set forth therein;
provided, however, that the Computational Materials and ABS Term Sheets
may include information based on alternative methodologies or
assumptions specified therein. If any Computational Materials or ABS
Term Sheets that are required to be filed contain any material error,
to the extent the Prospectus Supplement does not specifically correct
such error, the Underwriters shall prepare revised corrected
Computational Materials or ABS Term Sheets, as the case maybe,
circulate such revised Computational Materials or ABS Term Sheets, as
the case may be, to all recipients of the preliminary versions thereof
that indicated orally to the Underwriter that they would purchase all
or any portion of the Notes and include such revised Computational
Materials or ABS Term Sheets (marked "as revised") in the materials
delivered to the Depositor pursuant to Section 4(B)(5) hereof.
7. The Depositor shall not be obligated to file any
Computational Materials or ABS Term sheets that (i) in the reasonable
determination of the Depositor and the Underwriters and their
respective counsel are not required to be filed pursuant to the No-
Action Letters or (ii) have been determined to contain any material
error; provided that, at
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the request of an Underwriter, the Depositor will file Computational
Materials or ABS Term Sheets that contain a material error if clearly
marked "superseded by materials dated __________" and accompanied by
corrected Computational Materials or ABS Term sheets that are marked
"material previously dated _________, as corrected.".
C. Each Underwriter represents and warrants and agrees with
the Depositor that, as of the date hereof and the Closing Date, (i) the
Computational Materials and ABS Term Sheets furnished to the Depositor
pursuant to Section 4(B)(5) constitute (either in original, aggregated
or consolidated form) all of the materials furnished to prospective
investors by the Underwriter prior to the time of delivery thereof to
the Depositor that are required to be filed with the Commission with
respect to the Notes in accordance with the No-Action Letters, and such
Computational Materials and ABS Term Sheets comply with the
requirements of the No-Action Letters, (ii) the Underwriter has not and
will not represent to potential investors that any Computational
Materials or ABS Term Sheets were prepared or disseminated on behalf of
the Depositor, and (iii) all Computational Materials and ABS Term
Sheets (or underlying materials distributed to prospective investors on
which the Computational Materials and ABS Term Sheets were based)
contained and will contain the legend in the form previously agreed
upon by the Depositor and the Underwriters as required by Section
4(B)(3) hereof.
Notwithstanding the foregoing, the Underwriters make no representation
or warranty as to whether any Computational Materials or ABS Term Sheets (or any
written or electronic materials furnished to prospective investors on which the
Computational Materials or ABS Term Sheets are based) included or will include
any inaccurate statement resulting directly from any error contained in the
Seller-Provided Information provided to the Underwriters by the Depositor.
D. If an Underwriter does not provide any Computational
Materials or ABS Term Sheets to the Depositor pursuant to Section
4(B)(4), the Underwriter shall be deemed to have represented, as of the
Closing Date, that it did not provide any prospective investors with
any information in written or electronic form in connection with the
offering of the Notes that is required to be filed with the Commission
in accordance with the No-Action Letters.
SECTION 5. Covenants of the Depositor and IMC. The Depositor and, to
the extent the provisions of Section 5(I) below relate to IMC, IMC each agrees
as follows:
A. To prepare the Prospectus in a form approved by the
Underwriters and to file such Prospectus pursuant to Rule 424(b) under
the Securities Act not later than the Commission's close of business on
the second business day following the availability of the Prospectus to
the Underwriters to make no further amendment or any supplement to the
Registration Statement or to the Prospectus prior to the Closing Date
except as permitted herein; to advise the Underwriters, promptly after
it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective prior to the
Closing Date or any supplement to the Prospectus or any amended
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Prospectus has been filed prior to the Closing Date and to furnish the
Underwriters with copies thereof; to file promptly all reports and any
definitive proxy or information statements required to be filed by the
Depositor with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of the Prospectus and,
for so long as the delivery of a prospectus is required in connection
with the offering or sale of the Notes; to promptly advise the
Underwriters of its receipt of notice of the issuance by the Commission
of any stop order or of: (i) any order preventing or suspending the use
of the Prospectus; (ii) the suspension of the qualification of the
Notes for offering or sale in any jurisdiction; (iii) the initiation of
or threat of any proceeding for any such purpose; (iv) any request by
the Commission for the amending or supplementing of the Registration
Statement or the Prospectus or for additional information. In the event
of the issuance of any stop order or of any order preventing or
suspending the use of the Prospectus or suspending any such
qualification, the Depositor promptly shall use its best efforts to
obtain the withdrawal of such order by the Commission.
B. To furnish promptly to the Underwriters and to counsel for
the Underwriters a signed copy of the Registration Statement as
originally filed with the Commission, and of each amendment thereto
filed with the Commission, including all consents and exhibits filed
therewith.
C. To deliver promptly to the Underwriters such number of the
following documents as the Underwriters shall reasonably request: (i)
conformed copies of the Registration Statement as originally filed with
the Commission and each amendment thereto (in each case including
exhibits); (ii) the Prospectus and any amended or supplemented
Prospectus; and (iii) any document incorporated by reference in the
Prospectus (including exhibits thereto). If the delivery of a
prospectus is required at any time prior to the expiration of nine
months after the Effective Time in connection with the offering or sale
of the Notes, and if at such time any events shall have occurred as a
result of which the Prospectus as then amended or supplemented would
include any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when such
Prospectus is delivered, not misleading, or, if for any other reason it
shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated
by reference in the Prospectus in order to comply with the Securities
Act or the Exchange Act, the Depositor shall notify the Underwriters
and, upon the Underwriters' request, shall file such document and
prepare and furnish without charge to the Underwriters and to any
dealer in securities as many copies as the Underwriters may from time
to time reasonably request of an amended Prospectus or a supplement to
the Prospectus which corrects such statement or omission or effects
such compliance, and in case the Underwriters are required to deliver a
Prospectus in connection with sales of any of the Notes at any time
nine months or more after the Effective Time, upon the request of the
Underwriters but at their expense, the Depositor shall prepare and
deliver to the Underwriters as many copies as the Underwriters may
reasonably request of an amended or supplemented Prospectus complying
with Section 10(a)(3) of the Securities Act.
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D. To file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus that may, in the judgment of the Depositor or the
Underwriters, be required by the Securities Act, the Trust Indenture
Act or requested by the Commission.
E. The Depositor will cause any Computational Materials and
ABS Term Sheets with respect to the Notes which are delivered by any
Underwriter to the Depositor as provided in Section 4(B)(5) to be filed
with the Commission on a Current Report on Form 8-K (the "Form 8-K --
Computational Materials") at or before the time of filing of the
Prospectus pursuant to Rule 424(b) under the Securities Act; to cause
any ABS Term Sheets with respect to the Notes that are delivered to the
Depositor as provided in Section 4(B)(5) to be filed with the
Commission on one or more Current Reports on Form 8-K (i) at or before
the time of filing of the Prospectus pursuant to Rule 424(b) of the
Rules and Regulations in the case of Structural Term Sheets, and (ii)
within two Business Days of first use in the case of Collateral Term
Sheets. Prior to any such filing of Computational Materials or ABS Term
Sheets (other than any Collateral Term Sheets that are not based on
Home Equity Loan information provided to the Underwriters by the
Depositor) by the Depositor, however, the applicable Underwriter must
comply with its obligations pursuant to Section 4(B) and the Depositor
must receive a letter from independent, certified public accountants,
satisfactory in form and substance to the Depositor, the Depositor's
counsel and the applicable Underwriter, to the effect that such
accountants have performed certain specified procedures, all of which
have been agreed to by the Depositor and the applicable Underwriter, as
a result of which they determined that all information that is included
in the Computational Materials and ABS Term Sheets (if any) provided by
such Underwriter to the Depositor for filing on Form 8-K, as provided
in Section 4(B) and this Section 5(E), is accurate except as to such
matters that are not deemed by the Depositor to be material. The
Depositor shall file any corrected Computational Materials or ABS Term
Sheets described in Section 4(B)(7) as soon as practicable following
receipt thereof.
F. To furnish the Underwriters and counsel for the Underwriters,
prior to filing with the Commission, and to obtain the consent of the
Underwriters for the filing of the following documents relating to the
Notes: (i) amendment to the Registration Statement or supplement to the
Prospectus, or document incorporated by reference in the Prospectus, or
(ii) Prospectus pursuant to Rule 424 of the Rules and Regulations.
G. To make generally available to holders of the Notes as soon
as practicable, but in any event not later than 90 days after the close
of the period covered thereby, a statement of earnings of the Issuer
(which need not be audited) complying with Section 11(a) of the
Securities Act and the Rules and Regulations (including, at the option
of the Depositor, Rule 158) and covering a period of at least twelve
consecutive months beginning not later than the first day of the first
fiscal quarter following the Closing Date.
H. To use its best efforts, in cooperation with the Underwriters, to
qualify the Notes for offering and sale under the applicable securities
laws of such states and other
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jurisdictions of the United States or elsewhere as the Underwriters may
designate, and maintain or cause to be maintained such qualifications
in effect for as long as may be required for the distribution of the
Notes. The Depositor will file or cause the filing of such statements
and reports as may be required by the laws of each jurisdiction in
which the Notes have been so qualified.
I. Unless the Underwriters shall otherwise have given their
written consent, no pass-through certificates or debt instruments
backed by home equity loans or other similar securities representing
interest in or secured by other mortgage-related assets originated or
owned by the Depositor or IMC shall be publicly offered, sold nor shall
the Depositor or IMC enter into any contractual arrangements that
contemplate the public offering or sale of such securities for a period
of seven (7) business days following the commencement of the offering
of the Notes to the public.
J. So long as the Notes shall be outstanding the Depositor
shall cause the Indenture Trustee, pursuant to the Sale and Servicing
Agreement, to deliver to the Underwriters as soon as such statements
are furnished to the Owners: (i) the annual statement as to compliance
delivered to the Indenture Trustee pursuant to Section 4.16 of the Sale
and Servicing Agreement; (ii) the annual statement of a firm of
independent public accountants furnished to the Indenture Trustee
pursuant to Section 4.17 of the Sale and Servicing Agreement; (iii) the
monthly servicing report furnished to the Trustee pursuant to Section
3.08 of the Sale and Servicing Agreement; and (iv) the monthly reports
furnished to the Noteholders pursuant to Section 3.09 of the Indenture.
K. To apply the net proceeds from the sale of the Notes in the
manner set forth in the Prospectus.
SECTION 6. Conditions to the Underwriters' Obligations. The obligations
of the Underwriters to purchase the Notes pursuant to this Agreement are subject
to: (i) the accuracy on and as of the Closing Date of the representations and
warranties on the part of the Depositor and IMC herein contained; (ii) the
performance by the Depositor of all of its obligations hereunder; and (iii) the
following conditions as of the Closing Date:
A. The Underwriters shall have received confirmation of the
effectiveness of the Registration Statement. No stop order suspending
the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission. Any request of the
Commission for inclusion of additional information in the Registration
Statement or the Prospectus shall have been complied with.
-13-
B. The Underwriters shall not have discovered and disclosed to
the Depositor on or prior to the Closing Date that the Registration
Statement or the Prospectus or any amendment or supplement thereto
contains an untrue statement of a fact or omits to state a fact which,
in the opinion of Stroock & Stroock & Xxxxx LLP, counsel for the
Underwriters, is material and is required to be stated therein or is
necessary to make the statements therein not misleading.
C. All corporate proceedings and other legal matters relating
to the authorization, form and validity of the Agreements, the Issuer,
the Notes, the Registration Statement and the Prospectus, and all other
legal matters relating to this Agreement and the transactions
contemplated hereby shall be satisfactory in all respects to the
Underwriters and their counsel, and the Depositor shall have furnished
to such counsel all documents and information that they may reasonably
request to enable them to pass upon such matters.
X. Xxxxx & Xxxxxx LLP shall have furnished to the Underwriters
their written opinion, as counsel to the Depositor, addressed to the
Underwriters and dated the Closing Date, in form and substance
satisfactory to the Underwriters, to the effect that:
1. The conditions to the use by the
Depositor of a registration statement on Form S-3 under the
Securities Act, as set forth in the General Instructions to
Form S-3, have been satisfied with respect to the Registration
Statement and the Prospectus.
2. The Registration Statement and any
amendments thereto have become effective under the Securities
Act; to the best of such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has
been issued and not withdrawn and no proceedings for that
purpose have been instituted or threatened and not terminated;
and the Registration Statement, the Prospectus and each
amendment or supplement thereto, as of their respective
effective or issue dates (other than the financial and
statistical information contained therein, as to which such
counsel need express no opinion), complied as to form in all
material respects with the applicable requirements of the
Securities Act and the rules and regulations thereunder.
3. To the best of such counsel's knowledge,
there are no material contracts, indentures or other documents
of a character required to be described or referred to in the
Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement other than those
described or referred to therein or filed or incorporated by
reference as exhibits thereto.
4. The statements set forth in the Basic
Prospectus under the captions "Description of The Securities",
"Servicing of Mortgage Loans" and "The Indenture" and in the
Prospectus Supplement under the captions "Description of the
Notes" and "Administration," to the extent such statements
purport to
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summarize certain provisions of the Notes or of the
Agreements, are fair and accurate in all material respects.
5. The statements set forth in the Basic
Prospectus and the Prospectus Supplement under the captions
"ERISA Considerations" and "Federal Income Tax Consequences"
to the extent that they constitute matters of federal law,
provide a fair and accurate summary of such law or
conclusions.
6. The Agreements conform in all material
respects to the descriptions thereof contained in the
Prospectus. The Indenture has been duly qualified under the
Trust Indenture Act of 1939, as amended and complies with the
requirements of the Trust Indenture Act and the applicable
Rules and Regulations.
7. Neither the Depositor nor the Issuer is
an "investment company" or under the "control" of an
"investment company" as such terms are defined in the 1940
Act.
8. For federal income tax purposes, the
Notes will be treated as debt obligations of the Issuer, and
the Issuer will not be characterized as an association (or
publicly traded partnership) taxable as a corporation.
9. The Notes will, when issued, conform to
the descriptions thereof contained in the Prospectus.
10. The Notes, when duly and validly
executed, authenticated and delivered in accordance with the
Indenture and delivered to the Underwriters and paid for in
accordance with the Underwriting Agreement, will be entitled
to the benefits of the Indenture.
Such counsel shall also have furnished to the Underwriters a written
statement, addressed to the Underwriters and dated the Closing Date, in
form and substance satisfactory to the Underwriters to the effect that
no facts have come to the attention of such counsel which lead them to
believe that: (a) the Registration Statement, at the time such
Registration Statement became effective, contained an untrue statement
of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading (except as to financial or statistical data contained in the
Registration Statement); (b) the Prospectus, as of its date and as of
the Closing Date, contained or contains an untrue statement of a
material fact or omitted or omits to state a material fact required to
be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading; or (c) any document incorporated by reference in the
Prospectus or any further amendment or supplement to any such
incorporated document made by the Depositor prior to the Closing Date
contained, as of the time it became effective or was filed with the
Commission, as the case may be, an untrue statement of a material fact
or omitted to state
-15-
a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading.
E. The Underwriters shall have received the favorable opinion,
dated the Closing Date, of Xxxxx & Xxxxxx LLP, special counsel to the
Depositor, addressed to the Depositor and satisfactory to Standard &
Poor's, a division of the XxXxxx-Xxxx Companies Inc., Xxxxx'x Investors
Service, Inc. and the Underwriters, with respect to certain matters
relating to the transfer of the Initial Home Equity Loans to the
Depositor and from the Depositor to the Issuer, and such counsel shall
have consented to the reliance on such opinion by Standard & Poor's, a
division of the XxXxxx-Xxxx Companies, Xxxxx'x Investors Service, Inc.
and the Underwriters as though such opinion had been addressed to each
such party.
X. Xxxxxxxx X. Xxxxxx, P.A., special counsel for IMC, in IMC's
capacity as both Seller and Servicer under the Sale and Servicing
Agreement, and/or Xxxxx & Xxxxxx LLP shall have furnished to the
Underwriters their written opinion or opinions, addressed to the
Underwriters and the Depositor and dated the Closing Date, in form and
substance satisfactory to the Underwriters, to the effect that:
1. IMC has been duly organized and is
validly existing as a corporation in good standing under the
laws of the State of Florida and has duly authorized all
actions contemplated hereby.
2. IMC has full power and authority to serve
in the capacity of seller and servicer of the Home Equity
Loans as contemplated in the Sale and Servicing Agreement and
to transfer the Home Equity Loans to the Depositor as
contemplated in the Sale and Servicing Agreement and has the
requisite power and authority and legal right to own the
Residual Interest.
3. This Agreement and the Sale and Servicing
Agreement have been duly authorized, executed and delivered by
IMC and, assuming the due authorization, execution and
delivery of such agreements by the other parties thereto,
constitute the legal, valid and binding agreements of IMC,
enforceable against IMC in accordance with their terms,
subject as to enforceability to (x) bankruptcy, insolvency,
reorganization, moratorium, receivership or other similar laws
now or hereafter in effect relating to creditors' rights
generally and (y) the qualification that the remedy of
specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to
the discretion, with respect to such remedies, of the court
before which any proceedings with respect thereto may be
brought.
4. No consent, approval, authorization,
order, registration or qualification of or with any court or
governmental agency or body having jurisdiction over IMC is
required for the consummation the Servicer of the transactions
contemplated by
-16-
the Sale and Servicing Agreement, except such consents,
approvals, authorizations, registrations and qualifications as
have been obtained.
5. Neither the transfer of the Initial Home
Equity Loans by IMC to the Depositor, nor the execution,
delivery or performance by IMC of the Sale and Servicing
Agreement and the transactions contemplated thereby (A)
conflict with or result in a breach of, or constitute a
default under, (i) any term or provision of the formation
documents of IMC, as applicable; (ii) any term or provision of
any material agreement, deed of trust, mortgage loan
agreement, contract, instrument or indenture, or other
agreement to which IMC is a party or is bound or to which any
of the property or assets of IMC or any of its subsidiaries is
subject; (iii) to the best of such counsel's knowledge without
independent investigation any order, judgment, writ,
injunction or decree of any court or governmental authority
having jurisdiction over IMC; or (iv) any law, rule or
regulations applicable to IMC; or (B) to the best of such
firm's knowledge without independent investigation, results in
the creation or imposition of any lien, charge or encumbrance
upon the Trust Estate or upon the Notes.
6. The execution of the Sale and Servicing
Agreement is sufficient to convey all of IMC's right, title
and interest in the Initial Home Equity Loans to the Depositor
and following the consummation of the transaction contemplated
by Section 2.05 of the Pooling and Servicing Agreement, the
transfer of the Initial Home Equity Loans by IMC to the
Depositor is a sale thereof.
7. There are, to the best of such counsel's
knowledge without independent investigation, no actions,
proceedings or investigations pending with respect to which
IMC has received service of process or threatened against IMC
before any court, administrative agency or other tribunal (a)
asserting the invalidity of any of the Agreements or the
Notes, (b) seeking to prevent the consummation of any of the
transactions contemplated by the Agreements or (c) which would
materially and adversely affect the performance by IMC of its
obligations under, or the validity or enforceability of, the
Sale and Servicing Agreement or this Agreement.
X. Xxxxx & Xxxxxx LLP, special counsel for the Depositor, shall
have furnished to the Underwriters their written opinion, addressed to
the Underwriters and dated the Closing Date, in form an substance
satisfactory to the Underwriters, to the effect that:
1. The Depositor has been duly organized and
is validly existing as a corporation in good standing under
the laws of the State of Delaware and is in good standing as a
foreign corporation in each jurisdiction in which its
ownership or lease of property or the conduct of its business
so requires. The Depositor has all power and authority
necessary to own or hold its properties and to conduct the
business in which it is engaged and to enter into and perform
its obligations under the Agreements and to cause the
Securities to be issued.
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2. The Depositor is not in violation of its
certificate of incorporation or by-laws or in default in the
performance or observance of any material obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other
instrument to which the Depositor is a party or by which it or
its properties may be bound, which default might result in any
material adverse changes in the financial condition, earnings,
affairs or business of the Depositor or which might materially
and adversely affect the properties or assets, taken as a
whole, of the Depositor.
3. The Agreements to which the Depositor is
a party have been duly authorized, and when duly executed and
delivered by the Depositor and, assuming the due
authorization, execution and delivery of such agreements by
the other parties thereto, such agreements constitute valid
and binding obligations, enforceable against the Depositor in
accordance with their respective terms, subject as to
enforceability to (x) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, (y) general
principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (z) with
respect to rights of indemnity under this Agreement and the
Indemnification Agreement, limitations of public policy under
applicable securities laws.
4. The execution, delivery and performance
of the Agreements to which the Depositor is a party by the
Depositor, the consummation of the transactions contemplated
hereby and thereby, and the issuance and delivery of the Notes
do not and will not conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute
a default under, any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the
Depositor is a party or by which the Depositor is bound or to
which any of the property or assets of the Depositor or any of
its subsidiaries is subject, which breach or violation would
have a material adverse effect on the business, operations or
financial condition of the Depositor, nor will such actions
result in a violation of the provisions of the certificate of
incorporation or by-laws of the Depositor or any statute or
any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Depositor or any
of its properties or assets, which breach or violation would
have a material adverse effect on the business, operations or
financial condition of the Depositor.
5. The directions by the Depositor to the
Trustees to execute, issue, authenticate and deliver the Notes
have been duly authorized by the Depositor and, assuming that
the Trustees have been duly authorized to do so, when
executed, authenticated and delivered by the Indenture Trustee
in accordance with the Indenture, the Notes will be validly
issued and outstanding and will be entitled to the benefits of
the Indenture.
-18-
6. No consent, approval, authorization,
order, registration or qualification of or with any court or
governmental agency or body of the United States is required
for the issuance of the Securities, and the sale of the Notes
to the Underwriters, or the consummation by the Depositor of
the other transactions contemplated by the Agreements, except
such consents, approvals, authorizations, registrations or
qualifications as may be required State securities or Blue Sky
laws in connection with the purchase and distribution of the
Notes by the Underwriters or as have been previously obtained.
7. There are not, to the best of such
counsel's knowledge, after reasonable independent
investigation, any actions, proceedings or investigations
pending with respect to which the Depositor has received
service of process before or, threatened by any court,
administrative agency or other tribunal to which the Depositor
is a party or of which any of its properties is the subject:
(a) which if determined adversely to the Depositor would have
a material adverse effect on the business, results of
operations or financial condition of the Depositor; (b)
asserting the invalidity of the Agreements or the Notes; (c)
seeking to prevent the issuance of the Notes or the
consummation by the Depositor of any of the transactions
contemplated by the Agreements; or (d) which might materially
and adversely affect the performance by the Depositor of its
obligations under, or the validity or enforceability of, the
Agreements or the Notes.
8. The execution of the Sale and Servicing
Agreement is sufficient to convey all of the Depositor's
right, title and interest in the Initial Home Equity Loans to
the Issuer and following the consummation of the transaction
contemplated by Section 2 of the Sale and Servicing Agreement,
the transfer of the Initial Home Equity Loans by the Depositor
to the Issuer is a sale thereof.
H. The documents listed in Schedule B hereto shall have been
executed and delivered and the Underwriters shall be entitled to rely
on any such opinions as though the same were addressed to the
Underwriters.
I. The Underwriters shall have received an opinion of Xxxxxxxx,
Xxxxxx & Finger, counsel to the Owner Trustee, dated the Closing Date,
in form and substance satisfactory to the Underwriters and counsel for
the Underwriters, to the effect that:
1. The Owner Trustee is a Delaware banking
corporation duly incorporated and validly existing under the
laws of the State of Delaware.
2. The Owner Trustee has the full power and
authority to accept the office of owner trustee under the
Trust Agreement and to enter into and perform its obligations
under the Trust Agreement and the transactions contemplated
thereby.
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3. The execution and delivery of the Trust
Agreement by the Owner Trustee and the performance by the
Owner Trustee of its obligations under the Trust Agreement
have been duly authorized by all necessary action of the Owner
Trustee and the Trust Agreement has been duly executed and
delivered by the Owner Trustee.
4. The Trust Agreement constitutes valid and
binding obligations of the Owner Trustee enforceable against
the Owner Trustee in accordance with its terms, except as the
enforceability thereof may be (a) limited by bankruptcy,
insolvency, reorganization, moratorium, liquidation or other
similar laws affecting the rights of creditors generally, and
(b) subject to general principals of equity (regardless of
whether such enforceability is considered in a proceeding in
equity or at law).
5. The execution and delivery by the Owner
Trustee of the Trust Agreement and the consummation of the
transactions contemplated thereby do not require any consent,
approval or authorization of, or any registration or filing
with, any applicable governmental authority of the State of
Delaware which has not been obtained or done.
6. Neither the consummation by the Owner
Trustee of the transactions contemplated in the Trust
Agreement, nor the fulfillment of the terms thereof by the
Owner Trustee will conflict with, result in a breach or
violation of, or constitute a default under the Articles of
Association, ByLaws or other organizational documents of the
Owner Trustee
J. The Underwriters shall have received an opinion of Xxxxxxxx,
Xxxxxx & Finger, special Delaware counsel for the Issuer dated the
Closing Date, in form and substance satisfactory to the Underwriters
and counsel for the Underwriters, to the effect that:
1. The Trust Agreement is the legal, valid
and binding agreement of the Owner Trustee, and the Depositor,
enforceable against the Owner Trustee, and the Depositor in
accordance with its terms subject to (i) applicable
bankruptcy, insolvency, moratorium, receivership,
reorganization, fraudulent conveyance and similar laws
relating to and affecting the rights and remedies of creditors
generally, (ii) principles of equity (regardless of whether
considered and applied in a proceeding in equity or at law),
and (iii) the effect of applicable public policy on the
enforceability of provisions relating to indemnification or
contribution.
2. The Certificate of Trust has been duly
filed with the Secretary of State of the State of Delaware.
The Issuer as been duly formed and is validly existing as a
business trust under the Delaware Business Trust Act.
-20-
3. The Issuer has the power and authority
under the Trust Agreement and the Delaware Business Trust Act
to execute, deliver and perform its obligations under the
Trust Agreement, the Indenture, the Sale and Servicing
Agreement, the Notes and the Residual Interests and to issue
the Securities.
4. The Issuer has duly authorized and
executed the Trust Agreement, the Indenture, the Sale and
Servicing Agreement, the Notes and the Residual Interests.
5. The Trust has the power under the Trust
Agreement and the Delaware Business Trust Act to pledge the
Trust Estate to the Indenture Trustee as security for the
Notes.
6. The Notes have been executed, authorized
and delivered by the Owner Trustee upon the order of the
Depositor in accordance with the Trust Agreement and the
Indenture.
7. To the extent that Article 9 of the
Uniform Commercial Code as in effect in the State of Delaware
(the "Delaware UCC") is applicable (without regard to
conflicts of laws principles), and assuming that the security
interest created by the Indenture in the Collateral has been
duly created and has attached, upon the filing of a UCC-1
financing statement with the Secretary of State of the State
of Delaware, the Indenture Trustee will have a perfected
security interest in such Collateral and the proceeds thereof;
and such security interest will be prior to any other security
interest granted by the Trust that is perfected solely by the
filing of financing statements under the Delaware UCC,
excluding purchase money security interests under ss.9-312 of
the Delaware UCC and temporarily perfected security interests
in proceeds under ss.9-306 of the Delaware UCC.
8. No re-filing or other action is necessary
under the Delaware UCC in the State of Delaware in order to
maintain the perfection of the security interest referenced
above except for the filing of continuation statements at
five-year intervals.
9. Under ss.3805(b) of the Delaware Business
Trust Act, no creditor of any holder of the Residual Interest
shall have any right to obtain possession of, or otherwise
exercise legal or equitable remedies with respect to, the
property of the Trust except in accordance with the terms of
the Trust Agreement subject to (i) applicable bankruptcy,
insolvency, moratorium, receivership, reorganization,
fraudulent conveyance and similar laws
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relating to and affecting the rights and remedies of creditors
generally, (ii) principles of equity (regardless of whether
considered and applied in a proceeding in equity or at law),
and (iii) the effect of applicable public policy on the
enforceability of provisions relating to indemnification or
contribution.
10. Under ss.3805(c) of the Delaware
Business Trust Act, and assuming that the Sale and Servicing
Agreement conveys good title to the Home Equity Loans to the
Issuer as a true sale and not as a security arrangement, the
Issuer, rather than the holders of the Residual Interest, is
the owner of the Home Equity Loans subject to (i) applicable
bankruptcy, insolvency, moratorium, receivership,
reorganization, fraudulent conveyance and similar laws
relating to and affecting the rights and remedies of creditors
generally, (ii) principles of equity (regardless of whether
considered and applied in a proceeding in equity or at law),
and (iii) the effect of applicable public policy on the
enforceability of provisions relating to indemnification or
contribution.
11. The execution and delivery by the Owner
Trustee of the Trust Agreement and, on behalf of the Issuer,
of the Indenture and the Sale and Servicing Agreement do not
require any consent, approval or authorization of, or any
registration or filing with, any governmental authority of the
State of Delaware, except for the filing of the Certificate of
Trust with the Secretary of State.
12. Neither the consummation by the Owner
Trustee of the transactions contemplated by the Trust
Agreement or, on behalf of the Trust, the transactions
contemplated by the Trust Agreement, Indenture and the Sale
and Servicing Agreement nor the fulfillment of the terms
thereof by the Owner Trustee will conflict with or result in a
breach or violation of any law of the State of Delaware.
Such opinion may contain such assumptions, qualifications and
limitations as are customary in opinions of this type and are reasonably
acceptable to counsel to the Underwriters. In rendering such opinion, such
counsel may state that they express no opinion as to the laws of any
jurisdiction other than the Federal law of the United States of America and the
laws of the State of Delaware.
K. The Underwriters shall have received the favorable opinion
dated the Closing Date, from Xxxxx Xxxx, counsel to the Note Insurer,
in form and scope satisfactory to counsel for the Underwriters,
substantially to the effect that:
1. The Note Insurer is a monoline insurance
company duly incorporated, validly existing, and in good
standing under the laws of the State of New York.
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The Note Insurer is validly licensed and authorized to issue
the Insurance Policy and perform its obligations under the
Insurance Agreement in accordance with the terms thereof,
under the laws of the State of New York.
2. The Note Insurer has the corporate power
to execute and deliver, and to take all action required of it
under the Insurance Agreement and the Insurance Policy.
3. The execution, delivery and performance
by the Note Insurer of the Insurance Policy, the
Indemnification Agreement and Insurance Agreement does not
require the consent or approval of, the giving of notice to,
the prior registration with, or the taking of any other action
in respect of any state or other governmental agency or
authority which has not previously been obtained or effected.
4. The Insurance Policy, the Indemnification
Agreement and Insurance Agreement have been duly authorized,
executed and delivered by the Note Insurer and constitute the
legal, valid and binding agreement of the Note Insurer,
enforceable against the Note Insurer in accordance with its
terms subject, as to enforcement, to (x) bankruptcy,
reorganization, insolvency, moratorium and other similar laws
relating to or affecting the enforcement of creditors' rights
generally, including, without limitation, laws relating to
fraudulent transfers or conveyances, preferential transfers
and equitable subordination, presently or from time to time in
effect and general principles of equity (regardless of whether
such enforcement is considered in a proceeding in equity or at
law), as such laws may be applied in any such proceeding with
respect to the Note Insurer and (y) the qualification that the
remedy of specific performance and other forms of equitable
relief may be subject to equitable defenses and to the
discretion of the court before which any proceedings with
respect thereto may be brought.
5. To the extent the Insurance Policy
constitutes a security within the meaning of Section 2(1) of
the Securities Act, it is a security that is exempt from the
registration requirements of the Act.
6. The information set forth under the
caption, "The Note Insurer" in the Prospectus Supplement,
insofar as such information constitutes a description of the
Insurance Policy, accurately summarizes such Insurance Policy.
L. The Underwriters shall have received the favorable opinion
of counsel to the Indenture Trustee, dated the Closing Date, addressed
to the Underwriters and in form and scope satisfactory to counsel to
the Underwriters, to the effect that:
1. The Indenture Trustee is a banking
corporation duly incorporated and validly existing under the
laws of the State of New York.
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2. The Indenture Trustee has the full
corporate trust power to execute, deliver and perform its
obligations under the Indenture
3. The execution and delivery by the
Indenture Trustee of the Indenture and the performance by the
Indenture Trustee of its obligations under the Indenture have
been duly authorized by all necessary corporate action of the
Indenture Trustee.
4. The Indenture is a valid and legally
binding obligation of the Indenture Trustee enforceable
against the Trustee.
5. The execution and delivery by the
Indenture Trustee of the Indenture does not (a) violate the
Organization Certificate of the Trustee or the Bylaws of the
Indenture Trustee, (b) to such counsel's knowledge, violate
any judgment, decree or order of any New York or United States
federal court or other New York or United States federal
governmental authority by which the Indenture Trustee is bound
or (c) assuming the non-existence of any judgment, decree or
order of any court or other governmental authority that would
be violated by such execution and delivery, violate any New
York or United States federal statute, rule or regulation or
require any consent, approval or authorization of any New York
or United States federal court or other New York or United
States federal governmental authority.
6. The Notes have been duly authenticated
and delivered by the Indenture Trustee.
7. If the Indenture Trustee were acting as
Servicer under Sale and Servicing Agreement as of the date of
such opinion, the Indenture Trustee would have the full
corporate trust power to perform the obligations of the
Servicer under the Sale and Servicing Agreement; and
8. To the best of such counsel's knowledge,
there are no actions, proceedings or investigations pending or
threatened against or affecting the Indenture Trustee before
or by any court, arbitrator, administrative agency or other
governmental authority which, if decided adversely to the
Indenture Trustee, would materially and adversely affect the
ability of the Indenture Trustee to carry out the transactions
contemplated in the Indenture.
M. The Underwriters shall have received the favorable opinion
or opinions, dated the date of the Closing Date, of counsel for the
Underwriters, with respect to the issue and sale of the Notes, the
Registration Statement, this Agreement, the Prospectus and such other
related matters as the Underwriters may reasonably require.
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N. The Depositor and IMC shall each have furnished to the
Underwriters a certificate, dated the Closing Date and signed by the
Chairman of the Board, the President or a Vice President of the
Depositor and IMC, respectively, stating as it relates to each such
entity:
1. The representations and warranties made by
such entity in the Agreements to which it is a party are true
and correct as of the Closing Date; and such entity has
complied with all agreements contained herein which are to
have been complied with on or prior to the Closing Date.
2. The information contained in the
Prospectus relating to such entity and the Home Equity Loans
is true and accurate in all material respects and nothing has
come to his or her attention that would lead such officer to
believe that the Registration Statement or the Prospectus
includes any untrue statement of a material fact or omits to
state a material fact necessary to make the statements therein
not misleading.
3. There has been no amendment or other
document filed affecting the Certificate of Incorporation or
bylaws of the Depositor since November 10, 1994 or the
formation documents of IMC since June 19, 1996 and no such
amendment has been authorized. No event has occurred since
March 31, 1998 which has affected the good standing of the
Depositor under the laws of the State of Delaware or since
March 31, 1998 which has affected the good standing of IMC
under the laws of the State of Florida.
4. There has not occurred any material
adverse change, or any development involving a prospective
material adverse change, in the condition, financial or
otherwise, or in the earnings, business or operations of such
entity from March 31, 1998.
In addition to the foregoing, the IMC certificate shall state that the
representations and warranties set forth in Sections 1 D, E, F, G, H,
K, L, M, N, O, P and R of this Agreement are made by IMC instead of the
Depositor and are true as to IMC as though such representations and
warranties were fully set forth in such certificate.
O. The Indenture Trustee shall have furnished to the Underwriters a
certificate of the Indenture Trustee, signed by one or more duly
authorized officers of the Indenture Trustee, dated the Closing Date,
as to the due authorization, execution and delivery of the Indenture by
the Indenture Trustee and the acceptance by the Indenture Trustee of
the trusts created thereby and the due authentication and delivery of
the Notes by the Indenture Trustee thereunder and such other matters as
the Representative shall reasonably request.
P. The Notes shall have been rated in the respective rating
categories and by the nationally recognized statistical rating
organizations described in the Prospectus Supplement under "Ratings."
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Q. The Depositor shall have furnished to the Underwriters such
further information, certificates and documents as the Underwriters may
reasonably have requested not less than three full business days prior
to the Closing Date.
R. Prior to the Closing Date, counsel for the Underwriters
shall have been furnished with such documents and opinions as they may
reasonably require for the purpose of enabling them to pass upon the
issuance and sale of the Notes as herein contemplated and related
proceedings or in order to evidence the accuracy and completeness of
any of the representations and warranties, or the fulfillment of any of
the conditions, herein contained, and all proceedings taken by the
Depositor in connection with the issuance and sale of the Notes as
herein contemplated shall be satisfactory in form and substance to the
Underwriters and counsel for the Underwriters.
S. Subsequent to the execution and delivery of this Agreement
none of the following shall have occurred: (i) trading in securities
generally on the New York Stock Exchange, the American Stock Exchange
or the over-the-counter market shall have been suspended or minimum
prices shall have been established on either of such exchanges or such
market by the Commission, by such exchange or by any other regulatory
body or governmental authority having jurisdiction; (ii) a banking
moratorium shall have been declared by federal or state authorities;
(iii) the United States shall have become engaged in hostilities, there
shall have been an escalation of hostilities involving the United
States or there shall have been a declaration of a national emergency
or war by the United States; (iv) any of the ratings assigned to the
claims paying ability of the Note Insurer shall have been placed on
credit watch, withdrawn or downgraded; or (v) there shall have occurred
such a material adverse change in general economic, political or
financial conditions (or the effect of international conditions on the
financial markets of the United States shall be such) as to make it in
each of the instances set forth in clauses (i), (ii), (iii), (iv) and
(v) herein, in the reasonable judgment of the Underwriters, impractical
or inadvisable to proceed with the public offering or delivery of the
Notes on the terms and in the manner contemplated in the Prospectus.
T. The Underwriters shall have received from each of Coopers &
Xxxxxxx L.L.P. and Deloitte & Touche LLP, certified public accountants,
a letter dated the date of the Prospectus Supplement and a letter dated
the date hereof and satisfactory in form and substance to the
Underwriters and their counsel, to the effect that they have performed
certain specified procedures, all of which have been agreed to by the
Underwriters, as a result of which they determined that certain
information of an accounting, financial or statistical nature set forth
in the Prospectus Supplement on the cover page thereof and under the
captions "Summary of Terms - The Home Equity Loans", "Risk Factors -
Risk of Home Equity Loan Coupon Rates Reducing the Note Rate," "The
Seller and Servicer General", "The Seller and Servicer - Delinquency,
Loan Loss and Foreclosure Information" and "The Home Equity Loan Pool -
General," agrees with the records of the Depositor excluding any
questions of legal interpretation.
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U. The Insurance Policy and the Insurance Agreement shall have
been issued by the Note Insurer and shall have been duly authenticated
by an authorized agent of the Note Insurer, if so required under
applicable state law or regulations.
If any condition specified in this Section 6 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the Underwriters by notice to the Depositor at any time at or prior to the
Closing Date, and such termination shall be without liability of any party to
any other party except as provided in Section 7.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to the Underwriters and their counsel.
SECTION 7. Payment of Expenses. The Depositor agrees to pay: (a) the
costs incident to the authorization, issuance, sale and delivery of the Notes
and any taxes payable in connection therewith; (b) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto; (c) the costs of distributing
the Registration Statement as originally filed and each amendment thereto and
any post-effective amendments thereof (including, in each case, exhibits), the
Prospectus and any amendment or supplement to the Prospectus or any document
incorporated by reference therein, all as provided in this Agreement; (d) the
costs of reproducing and distributing this Agreement; (e) the fees and expenses
of qualifying the Notes under the securities laws of the several jurisdictions
designated by the Underwriters as provided in Section 5(H) hereof and of
preparing, printing and distributing a Blue Sky Memorandum and a Legal
Investment Survey (including related fees and expenses of counsel to the
Underwriters); (f) any fees charged by securities rating services for rating the
Notes; (g) the costs of the accountant's letters referred to in Section 6(T)
hereof; and (h) all other costs and expenses incident to the performance of the
obligations of the Depositor (including costs and expenses of your counsel);
provided that, except as provided in this Section 7, the Underwriters shall pay
their own costs and expenses, including the costs and expenses of their counsel,
any transfer taxes on the Notes which they may sell and the expenses of
advertising any offering of the Notes made by the Underwriters, and the
Underwriters shall pay the cost of any accountant's letters relating to any
Computational Materials and ABS Term Sheets.
If this Agreement is terminated by the Underwriters in accordance with
the provisions of Section 6 or Section 11, the Depositor shall cause the
Underwriters to be reimbursed for all reasonable out-of-pocket expenses,
including fees and disbursements of Stroock & Stroock & Xxxxx LLP, counsel for
the Underwriters.
SECTION 8. Indemnification and Contribution. A. The Depositor agrees to
indemnify and hold harmless each Underwriter and each person, if any, who
controls or such Underwriter within the meaning of Section 15 of the Securities
Act from and against any and all loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of the
Notes), to which such Underwriter or any such controlling person may become
subject, under the Securities Act or
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otherwise, insofar as such loss, claim, damage, liability or action arises out
of, or is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, or any amendment thereof
or supplement thereto, (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, (iii) any untrue statement or alleged untrue statement
of a material fact contained in the Prospectus, or any amendment thereof or
supplement thereto, or (iv) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading and shall reimburse such Underwriter and each such controlling person
promptly upon demand for any legal or other expenses reasonably incurred by such
Underwriter or such controlling person in connection with investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action as such expenses are incurred; provided, however, that the Depositor
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission made in
the Prospectus, or any amendment thereof or supplement thereto, or the
Registration Statement, or any amendment thereof or supplement thereto, in
reliance upon and in conformity with written information furnished to the
Depositor by or on behalf of such Underwriter specifically for inclusion
therein. The foregoing indemnity agreement is in addition to any liability which
the Depositor may otherwise have to any Underwriter or any controlling person of
any of such Underwriter. The only information furnished by the Underwriters or
on behalf of the Underwriters for use in connection with the preparation of the
Registration Statement or the Prospectus is described in Section 8(I) hereof.
B. Each Underwriter severally agrees to indemnify and hold harmless the
Depositor, each of its directors, each of its officers who signed the
Registration Statement, and each person, if any, who controls the Depositor
within the meaning of Section 15 of the Securities Act against any and all loss,
claim, damage or liability, or any action in respect thereof, to which the
Depositor or any such director, officer or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, or any amendment thereof or supplement thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, (iii)
any untrue statement or alleged untrue statement of a material fact contained in
the Prospectus, or any amendment thereof or supplement thereto, or (iv) the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Depositor by or on behalf of such Underwriter
specifically for inclusion therein, and shall reimburse the Depositor and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Depositor or any director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may
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otherwise have to the Depositor or any such director, officer or controlling
person. The only information furnished by the Underwriters or on behalf of the
Underwriters for use in connection with the preparation of the Registration
Statement or the Prospectus is described in Section 8(I) hereof.
C. Promptly after receipt by any indemnified party under this Section 8
of notice of any claim or the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against any indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify an indemnifying party shall not relieve it from any liability which it
may have under this Section 8 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify any
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under this Section 8.
If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except to the extent
provided in the next following paragraph, the indemnifying party shall not be
liable to the indemnified party under this Section 8 for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
Any indemnified party shall have the right to employ separate counsel
in any such action and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such indemnified party
unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel; or (iii) the
indemnifying party has failed to assume the defense of such action and employ
counsel reasonably satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to one local counsel per jurisdiction) at any time for all such
indemnified parties, which firm shall be designated in writing by the related
Underwriter, if the indemnified parties under this Section 8 consist of one or
more Underwriters or any of its or their controlling persons, or the Depositor,
if the indemnified parties under this Section 8 consist of the Depositor or any
of the Depositor's directors, officers or controlling persons.
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Each indemnified party, as a condition of the indemnity agreements
contained in Section 8(A) and 8(B) shall use its best efforts to cooperate with
the indemnifying party in the defense of any such action or claim. No
indemnifying party shall be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment for the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss or
liability by reason of such settlement or judgment.
Notwithstanding the foregoing paragraph, if at any time an indemnified
party shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel, the indemnifying party agrees that it
shall be liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 30 days after
receipt by such indemnifying party of the aforesaid request and (ii) such
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement.
D. [Reserved]
E. Each Underwriter severally agrees, assuming all Seller-Provided
Information is accurate and complete in all material respects, to indemnify and
hold harmless the Depositor, each of the Depositor's officers and directors and
each person who controls the Depositor within the meaning of Section 15 of the
Securities Act against any and all losses, claims, damages or liabilities, joint
or several, to which they may become subject under the Securities Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement of a
material fact contained in the Computational Materials and ABS Term Sheets
provided by such Underwriter and agrees to reimburse each such indemnified party
for any legal or other expenses reasonably incurred by him, her or it in
connection with investigating or defending or preparing to defend any such loss,
claim, damage, liability or action as such expenses are incurred. The
obligations of an Underwriter under this Section 8(E) shall be in addition to
any liability which such Underwriter may otherwise have.
The procedures set forth in Section 8(C) shall be equally applicable to
this Section 8(E).
F. If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(A), 8(B) or 8(E) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Depositor on the one hand and the related Underwriter on the
other, from the offering of the related Notes or (ii) if the allocation provided
by clause (i) above is not permitted by applicable law or if the indemnified
party failed to give the notice required under Section 8C., in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Depositor on the one hand
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and the related Underwriter on the other, with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations.
The relative benefits of the Depositor and an Underwriter shall be
deemed to be in such proportion as the total net proceeds from the offering
(before deducting expenses) received by the Depositor bear to the total
underwriting discounts and commissions as set forth on the cover page of the
Prospectus Supplement received by such Underwriter.
The relative fault of an Underwriter and the Depositor shall be
determined by reference to whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Depositor or by such Underwriter, the intent of
the parties and their relative knowledge, access to information and opportunity
to correct or prevent such statement or omission and other equitable
considerations.
The Depositor and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section 8(F) were to be determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purposes) or by any other method of allocation which does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Section 8(F)
shall be deemed to include, for purposes of this Section 8(F), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim.
For purposes of this Section 8, in no case shall any Underwriter be
responsible for any amount in excess of the amount of the underwriting discounts
and commissions received by such Underwriter in connection with its purchase of
the Notes. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
G. For purposes of this Section 8, as to each Underwriter the term
"Computational Materials" and "ABS Term Sheets" means such portion, if any, of
the information delivered to the Depositor by such Underwriter pursuant to
Section 4(B) for filing with the Commission on Form 8-K as:
(i) is not contained in the Prospectus without taking into
account information incorporated therein by reference through a Form
8-K; and
(ii) does not constitute Seller-Provided Information.
"Seller-Provided Information" means any computer tape (or other
information) furnished to any Underwriter by or on behalf of the Seller and
Servicer concerning the assets comprising the Trust Estate.
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H. The Seller and Servicer agrees to indemnify each indemnified party
referred to in Section 8(A) hereof with respect to Seller-Provided Information
to the same extent as the indemnity granted under such section. The procedures
set forth in Section 8(C) shall be equally applicable to this Section 8(H).
I. Each Underwriter confirms that the information regarding such
Underwriter set forth in the last paragraph on the cover page of the Prospectus
Supplement and the information regarding such Underwriter set forth under the
caption "Underwriting" in the Prospectus Supplement is correct, and the parties
hereto acknowledge that such information constitutes the only information
furnished in writing by or on behalf of any Underwriter for use in connection
with the preparation of the Registration Statement or the Prospectus.
SECTION 9. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in certificates of officers of the Depositor submitted
pursuant hereto shall remain operative and in full force and effect, regardless
of any investigation made by or on behalf of the Underwriters or controlling
persons thereof, or by or on behalf of the Depositor and shall survive delivery
of any Notes to the Underwriters.
SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters participating in the public offering of the Notes shall fail
at the Closing Date to purchase the Notes which it is (or they are) obligated to
purchase hereunder (the "Defaulted Notes"), then the non-defaulting Underwriters
shall have the right, within 24 hours thereafter, to make arrangements for one
or more of the non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Notes in such amounts as
may be agreed upon and upon the terms herein set forth. If, however, the
Underwriters have not completed such arrangements within such 24-hour period,
then:
(i) if the aggregate principal amount of Defaulted Notes does
not exceed 10% of the aggregate principal amount of the Notes to be
purchased pursuant to this Agreement, the non-defaulting Underwriters
named in this Agreement shall be obligated to purchase the full amount
thereof in the proportions that their respective underwriting
obligations hereunder bear to the underwriting obligations of all such
non-defaulting Underwriters, or
(ii) if the aggregate principal amount of Defaulted Notes
exceeds 10% of the aggregate principal amount of the Notes to be
purchased pursuant to this Agreement, this Agreement shall terminate,
without any liability on the part of any non-defaulting Underwriters.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from the liability with respect to any default of such
Underwriter under this Agreement.
In the event of a default by any Underwriter as set forth in this
Section 10, each of the Underwriters and the Depositor shall have the right to
postpone the Closing Date for a period not exceeding five Business Days in order
that any required changes in the Registration Statement or Prospectus or in any
other documents or arrangements may be effected.
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SECTION 11. Termination of Agreement. The Underwriters may terminate
this Agreement immediately upon notice to the Depositor, at any time at or prior
to the Closing Date if any of the events or conditions described in Section 6(T)
of this Agreement shall occur and be continuing. In the event of any such
termination, the covenant set forth in Section 5(G), the provisions of Section
7, the indemnity agreement set forth in Section 8, and the provisions of
Sections 9 and 15 shall remain in effect.
SECTION 12. Obligations of IMC. IMC agrees with the Underwriters, for
the sole and exclusive benefit of each such Underwriter and each person
controlling such Underwriter within the meaning of the Securities Act and not
for the benefit of any assignee thereof or any other person or persons dealing
with such Underwriter, in consideration of and as an inducement to their
agreement to purchase the Notes from the Depositor, to indemnify and hold
harmless each Underwriter against any failure by the Depositor to perform its
obligations to the Underwriters hereunder, including, without limitation, any
failure by the Depositor to honor any obligation to any Underwriter pursuant to
Section 8 hereof.
SECTION 13. Notices. All statements, requests, notices and agreements
hereunder shall be in writing, and:
A. if to the Underwriters, shall be delivered or sent by mail,
telex or facsimile transmission to PaineWebber Incorporated, 0000
Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: Xxxxxxx
Xxxxxx, 11th Floor (Fax: 000-000-0000) with a copy to Xxxx Xxxxxx,
12th Floor, at the same address; and
B. if to the Depositor, shall be delivered or sent by mail, telex or
facsimile transmission to care of IMC Securities, Inc., 0000 Xxxx
Xxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000-0000 Attention: Xxxxxx Xxxxxxxxx
(Fax: (000) 000-0000).
SECTION 14. Persons Entitled to the Benefit of this Agreement. This
Agreement shall inure to the benefit of and be binding upon the Underwriters and
the Depositor, and their respective successors. This Agreement and the terms and
provisions hereof are for the sole benefit of only those persons, except that
the representations, warranties, indemnities and agreements contained in this
Agreement shall also be deemed to be for the benefit of the person or persons,
if any, who control any of the Underwriters within the meaning of Section 15 of
the Securities Act, and for the benefit of directors of the Depositor, officers
of the Depositor who have signed the Registration Statement and any person
controlling the Depositor within the meaning of Section 15 of the Securities
Act. Nothing in this Agreement is intended or shall be construed to give any
person, other than the persons referred to in this Section 14, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
SECTION 15. Survival. The respective indemnities, representations,
warranties and agreements of the Depositor and the Underwriters contained in
this Agreement, or made by or on behalf of them, respectively, pursuant to the
shall survive the delivery of and payment for the Notes and shall remain in full
force and effect, regardless of any investigation made by or on behalf of any of
them or any person controlling any of them.
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SECTION 16. Definition of the Term "Business Day". For purposes of this
Agreement, "Business Day" means any day on which the New York Stock Exchange,
Inc. is open for trading.
SECTION 17. Governing Law; Submission to Jurisdiction. This Agreement
shall be governed by and construed in accordance with the laws of the State of
New York without giving effect to the conflict of law rules thereof.
The parties hereto hereby submit to the jurisdiction of the United
States District Court for the Southern District of New York and any court in the
State of New York located in the city and County of New York, and appellate
court from any thereof, in any action, suit or proceeding brought against it or
in connection with this Agreement or any of the related documents or the
transactions contemplated hereunder or for recognition or enforcement of any
judgment, and the parties hereto hereby agree that all claims in respect of any
such action or proceeding may be heard or determined in New York State court or,
to the extent permitted by law, in such federal court.
SECTION 18. Counterparts. This Agreement may be executed in
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
SECTION 19. Headings. The headings herein are inserted for convenience
of reference only and are not intended to be part of, or to affect the meaning
or interpretation of, this Agreement.
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If the foregoing correctly sets forth the agreement between the
Depositor, IMC and the Underwriters, please indicate your acceptance in the
space provided for the purpose below.
Very truly yours,
IMC SECURITIES, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
IMC MORTGAGE COMPANY
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
CONFIRMED AND ACCEPTED,
as of the date first above written:
PAINEWEBBER INCORPORATED
Acting on its own behalf and as
Representative of the several Underwriters
By: /s/ Xxxxxxx Xxxxxx
----------------------
Name: Xxxxxxx Xxxxxx
Title: Managing Director
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SCHEDULE A
Underwriters Principal Amount
------------- ----------------
PaineWebber Incorporated $150,000,000
Bear, Xxxxxxx & Co. Inc. $150,000,000
Deutche Bank Securities Inc. $150,000,000
Nomura Securities International, Inc. $150,000,000
Total $600,000,000
Purchase Price Percentage
99.75%
Selling Concession Reallowance Discount
------------------ --------------------
0.15% 0.10%
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SCHEDULE B
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(a) An Issuer Order authorizing the authentication and delivery
of the Notes by the Indenture Trustee.
(b) All of the items of Collateral which shall be delivered to
the Indenture Trustee or its designee.
(c) An executed counterpart of the Trust Agreement.
(d) Opinions of Counsel addressed to the Indenture Trustee and
the Note Insurer to the effect that:
(i) all instruments furnished to the Indenture Trustee as
conditions precedent to the authentication of the
Notes by the Indenture Trustee pursuant to the
Indenture conform to the requirements of the Indenture
and constitute all the documents required to be
delivered thereunder for the Indenture Trustee to
authenticate the Notes;
(ii) all conditions precedent provided for in the Indenture
relating to the authentication of the Notes have been
complied with;
(iii) the Owner Trustee has power and authority to execute,
deliver and perform its obligations under the Trust
Agreement;
(iv) the Issuer has been duly formed, is validly existing
as a business trust under the laws of the State of
Delaware, 12 Del. C. Section 3801, et seq., and has
power, authority and legal right to execute and
deliver the Indenture, the Insurance Agreement and the
Sale and Servicing Agreement;
(v) assuming due authorization, execution and delivery
thereof by the Indenture Trustee, the Indenture is the
valid, legal and binding obligation of the Issuer,
enforceable in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, arrangement,
moratorium, fraudulent or preferential conveyance and
other similar laws of general application affecting
the rights of creditors generally and to general
principles of equity (regardless of whether such
enforcement is considered in a proceeding in equity or
at law);
(vi) the Notes, when executed and authenticated as provided
herein and delivered against payment therefor, will be
the valid, legal and binding obligations of the Issuer
pursuant to the terms of the Indenture, entitled to
the benefits of the Indenture, and will be enforceable
in accordance with
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their terms, subject to bankruptcy, insolvency,
reorganization, arrangement, moratorium, fraudulent or
preferential conveyance and other similar laws of
general application affecting the rights of creditors
generally and to general principles of equity
(regardless of whether such enforcement is considered
in a proceeding in equity or at law);
(vii) the Trust Agreement authorizes the Issuer to Grant the
Collateral to the Indenture Trustee as security for
the Notes and the Owner Trustee has taken all
necessary action under the Trust Agreement to Grant
the Collateral to the Indenture Trustee;
(viii) the Indenture has been duly qualified under the Trust
Indenture Act and the Notes have been registered under
the Securities Act;
(ix) the Indenture, together with the Grant of the
Collateral to the Indenture Trustee, creates a valid
security interest in the Collateral in favor of the
Indenture Trustee for the benefit of the Owners;
(x) such action has been taken with respect to delivery of
possession of the Collateral, and with respect to the
execution and filing of the Indenture and any
financing statements as are necessary to make
effective and to perfect a first priority security
interest created by the Indenture in the Collateral in
favor of the Indenture Trustee, except that with
respect to the Mortgage Notes, possession of such
Mortgage Notes must be maintained by the Indenture
Trustee or an agent of the Indenture Trustee (other
than the Issuer, an Affiliate of the Issuer, or a
"securities intermediary," as defined in Section 8.102
of the UCC); and
(xi) no authorization, approval or consent of any
governmental body having jurisdiction in the premises
which has not been obtained by the Issuer is required
to be obtained by the Issuer for the valid issuance
and delivery of the Notes, except that no opinion need
be expressed with respect to any such authorizations,
approvals or consents as may be required under any
state securities "blue sky" laws.
(e) An Officer's Certificate complying with the requirements of
Section 11.1 of the Indenture and stating that:
(i) the Issuer is not in Default under this Indenture and
the issuance of the Notes applied for will not result
in any breach of any of the terms, conditions or
provisions of, or constitute a default under, the
Trust Agreement, any indenture, mortgage, deed of
trust or other agreement or instrument to which the
Issuer is a party or by which it is bound, or any
order of any court or administrative agency entered in
any proceeding to
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which the Issuer is a party or by which it may be
bound or to which it may be subject, and that all
conditions precedent provided in the Indenture
relating to the authentication and delivery of the
Notes applied for have been complied with;
(ii) the Issuer is the owner of all of the Initial Home
Equity Loans, has not assigned any interest or
participation in the Initial Home Equity Loans (or, if
any such interest or participation has been assigned,
it has been released) and has the right to Grant all
of the Home Equity Loans to the Indenture Trustee;
(iii) the Issuer has Granted to the Indenture Trustee all of
its right, title, and interest in the Collateral, and
has delivered or caused the same to be delivered to
the Indenture Trustee;
(iv) attached thereto are true and correct copies of
letters signed by Moody's and Standard & Poor's
confirming that the Notes have been rated "Aaa" and
"AAA" by Moody's and Standard & Poor's, respectively;
and
(v) all conditions precedent provided for in the Indenture
relating to the authentication of the Notes have been
complied with.
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