EXHIBIT 1.1
EXECUTION COPY
RAFC ASSET-BACKED SECURITIES,
SERIES 2001-1
UNDERWRITING AGREEMENT
UNDERWRITING AGREEMENT
December 19, 2001
First Union Securities, Inc.
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Dear Sirs:
Residential Asset Funding Corporation (the "Depositor") proposes,
subject to the terms and conditions stated herein and in the attached
Underwriting Agreement Standard Provisions, dated December 19, 2001 (the
"Standard Provisions"), between the Depositor, First Union Securities, Inc.
("First Union"), Loop Capital Markets LLP ("Loop Capital") and Xxxxxxxx Capital
Partners L.P. ("Xxxxxxxx Capital") to issue and sell to you (the "Underwriters")
the securities specified in Schedule I hereto (the "Underwritten Securities") in
the amounts set forth in Schedule I hereto. First Union National Bank ("FUNB")
proposes, subject to the terms and conditions stated herein and in the attached
Standard Provisions, to sell to you from time to time in the future the
securities in Schedule I hereto (the "FUNB Securities"). The Depositor and FUNB
agree that each of the provisions of the Standard Provisions is incorporated
herein by reference in its entirety, and shall be deemed to be a part of this
Agreement to the same extent as if such provisions had been set forth in full
herein; and each of the representations and warranties set forth therein shall
be deemed to have been made at and as of the date of this Underwriting
Agreement. Each reference to the "Representative" herein and in the provisions
of the Standard Provisions so incorporated by reference shall be deemed to refer
to First Union, as representative for the Underwriters. Unless otherwise defined
herein, terms defined in the Standard Provisions are used herein as therein
defined. The Prospectus Supplement and the accompanying Prospectus relating to
the Underwritten Securities (together, the "Prospectus") are incorporated by
reference herein.
Subject to the terms and conditions set forth herein and in the
Standard Provisions incorporated herein by reference, the Depositor agrees to
cause the Trustee to issue and sell to the Representative, and the
Representative agrees to purchase from the Depositor, at the time and place and
at the purchase price to the Representative and in the manner set forth in
Schedule I hereto, the original principal balance of the Underwritten
Securities.
Subject to the terms and conditions set forth herein and in the
Standard Provisions incorporated herein by reference, FUNB agrees to sell to the
Depositor, and the Depositor agrees to sell to the Representative, at the time
and place and at the purchase price to the Representative and in the manner set
forth in Schedule I hereto, the original principal balance of the FUNB
Securities.
If the foregoing is in accordance with your understanding, please sign
and return to us two counterparts hereof, and upon acceptance hereof by you,
this letter and such acceptance hereof, including the provisions of the Standard
Provisions incorporated herein by reference, shall constitute a binding
agreement among the Underwriters, FUNB and the Depositor.
Yours truly,
RESIDENTIAL ASSET FUNDING
CORPORATION, as Depositor
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Director
FIRST UNION NATIONAL BANK
By: /s/ Xxxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Managing Director
Accepted as of the date hereof:
FIRST UNION SECURITIES, INC.,
as Representative of the Underwriters
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Director
[Signature Page to Underwriting Agreement]
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SCHEDULE I
Trust: Residential Asset Funding Corporation Trust 2001-1.
Title of Underwritten Securities: Residential Asset Funding Corporation Asset-Backed
Securities, Series 2001-1, Class A-1, Class A-2 and Class
B-1.
Title of Non-Underwritten Residential Asset Funding Corporation Asset-Backed
Securities: Securities, Series 2001-1, Class A-3, Class M-1, Class M-2
and Class B-2.
Terms of Underwritten The Underwritten Securities shall have the terms set forth in
Securities: the Prospectus and shall conform in all material respects to the
descriptions thereof contained therein, and shall be issued pursuant to
a Pooling and Servicing Agreement to be dated as of November 30, 2001
among the Depositor, Citibank, N.A., as Trustee, First Union National
Bank, as Certificate Administrator and Custodian, RAFC Transferor
Trust, as transferor (the "Transferor"), and HomEq Servicing
Corporation, as Servicer.
Purchase Commitment: Class First Union Loop Capital Xxxxxxxx Capital
----- ----------- ------------ ----------------
A-1 $53,351,000 $ ---- $ ----
A-2 $77,000,000 $4,000,000 $4,000,000
B-1 $35,567,000 $ ---- $ ----
Best Efforts Offering: The Underwriter agrees with First Union National Bank that it will
solicit offers for the Class A-3, Class M-1, Class M-2 and Class
B-2 (the "FUNB Securities") in the future on a best efforts basis;
the purchase price for such securities to be determined at the time
of offer:
Purchase Price: The purchase price for the Offered Securities shall be 100% of the
aggregate principal balance of the Class A-1 Certificates, 100% of the
aggregate principal balance of the Class A-2 Certificates, 100% of the
aggregate principal balance of the Class B-1 Certificates, as of the
Closing Date. The purchase price for the FUNB Securities shall be
determined at the time of the offer thereof.
Specified funds for payment of
Purchase Price: Federal Funds (immediately available funds).
I-1
Required Ratings: Ratings
-------
Class Xxxxx'x S&P
----- ------- ---
X-0 X-0 X-0x
X-0 Xxx XXX
X-0 Baa2 BBB
A-3 Aaa AAA
M-1 Aa2 AA
M-2 A2 A
B-2 Ba2 BB
Closing Date: On or about December 21, 2001, at 10:00 A.M. eastern standard time or
at such other time as the Depositor and the Underwriter shall agree.
Closing Location: Offices of Xxxxx Xxxxxxxxxx LLP,
1301 Avenue of the Americas Xxx Xxxx,
Xxx Xxxx 00000
Representative: First Union Securities, Inc.
Address for Notices, etc.: First Union Securities, Inc.
One First Union Center
000 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000
Attn: General Counsel
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STANDARD PROVISIONS TO UNDERWRITING AGREEMENT
December 19, 2001
From time to time, Residential Asset Funding Corporation, a North
Carolina corporation (the "Depositor") may enter into one or more underwriting
agreements (each, an "Underwriting Agreement") that provide for the sale of
designated securities to the several Underwriters named therein (such
underwriters constituting the "Underwriters" with respect to such Underwriting
Agreement and the securities specified therein). The several underwriters named
in an Underwriting Agreement will be represented by one or more representatives
as named in such Underwriting Agreement (collectively, the "Representative").
The term "Representative" also refers to a single firm acting as sole
Underwriter. The standard provisions set forth herein (the "Standard
Provisions") may be incorporated by reference in any Underwriting Agreement.
These Standard Provisions shall not be construed as an obligation of the
Depositor to sell any securities or as an obligation of any of the Underwriters
to purchase such securities. The obligation of the Depositor to sell any
securities and the obligation of any of the Underwriters to purchase any of the
securities shall be evidenced by the Underwriting Agreement with respect to the
securities specified therein. An Underwriting Agreement shall be in the form of
an executed writing (which may be in counterparts), and may be evidenced by an
exchange of telegraphic communications or any other rapid transmission device
designed to produce a written record of the communications transmitted. Unless
otherwise defined herein, the terms defined in the Underwriting Agreement are
used herein as defined in the Prospectus referred to below.
SECTION 1. THE UNDERWRITTEN SECURITIES. The Depositor proposes to cause
the Trustee to sell, pursuant to the Underwriting Agreement to the Underwriter
or Underwriters named therein, asset backed certificates (the "Underwritten
Securities") representing undivided ownership interests in a pool of mortgage
loans (the "Mortgage Loans") and certain related property. The Underwritten
Securities will be issued pursuant to a pooling and servicing agreement (the
"Pooling and Servicing Agreement") dated as of November 30, 2001 among the
Depositor, RAFC Transferor Trust, as transferor (the "Transferor"), Citibank,
N.A., as trustee (the "Trustee"), First Union National Bank, as certificate
administrator (the "Certificate Administrator") and custodian (the "Custodian"),
and HomEq Servicing Corporation, as servicer (the "Servicer"). First Union
National Bank in its capacity as Mortgage Loan Seller (the "Seller") will convey
the Mortgage Loans to the Transferor pursuant to a loan purchase agreement,
dated as of November 30, 2001 (the "Purchase Agreement"). The Transferor will
then convey the Mortgage Loans to the Depositor pursuant to the Pooling and
Servicing Agreement. The Mortgage Loans are to be serviced pursuant to the
Pooling and Servicing Agreement. The Underwriter, the Depositor, First Union
National Bank and the Servicer have entered into an Indemnification and
Contribution Agreement, dated December 19, 2001 (the "Indemnification
Agreement," and collectively with the Underwriting Agreement, the Pooling and
Servicing Agreement, and the Purchase Agreement, the "Agreements").
The Depositor has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No. 333-53168),
including a prospectus relating to the Offered Securities under the Securities
Act of 1933, as amended (the "1933 Act"). The term "Registration Statement"
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means such registration statement as amended to the date of the Underwriting
Agreement. The term "Base Prospectus" means the prospectus included in the
Registration Statement. The term "Prospectus" means the Base Prospectus together
with the prospectus supplement specifically relating to the Offered Securities,
as first filed with the Commission pursuant to Rule 424.
SECTION 2. OFFERING BY THE UNDERWRITERS. Upon the execution of the
Underwriting Agreement with respect to any Underwritten Securities and the
authorization by the Representative of the release of such Underwritten
Securities, the several Underwriters propose to offer for sale to the public the
Underwritten Securities at the prices and upon the terms set forth in the
Prospectus.
SECTION 3. PURCHASE, SALE AND DELIVERY OF THE UNDERWRITTEN SECURITIES.
Unless otherwise specified in the Underwriting Agreement, payment for the
Underwritten Securities shall be made by wire transfer of immediately available
funds to or at the direction of the Depositor at the time and place set forth in
the Underwriting Agreement, upon delivery to the Representative of the
Underwritten Securities registered in definitive form and in such names and in
such denominations as the Representative shall request in writing not less than
five full business days prior to the date of delivery. The time and date of such
payment and delivery with respect to the Underwritten Securities are herein
referred to as the "Closing Date."
SECTION 4. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS. The respective
obligations of the several Underwriters pursuant to the Underwriting Agreement
shall be subject, in the discretion of the Representative, to the accuracy in
all material respects of the representations and warranties of the Depositor
contained herein as of the date of the Underwriting Agreement and as of the
Closing Date as if made on and as of the Closing Date, to the accuracy in all
material respects of the statements of the officers of the Depositor, the Seller
and the Servicer made in the Loan Participation Agreement, the Purchase
Agreement, the Pooling and Servicing Agreement and any certificates delivered
pursuant to the provisions hereof and of the Underwriting Agreement, to the
performance by the Depositor of its covenants and agreements contained herein
and to the following additional conditions precedent:
(a) All actions required to be taken and all filings required to be
made by or on behalf of the Depositor under the 1933 Act and the Securities
Exchange Act of 1934, as amended (the "1934 Act") prior to the sale of the
Offered Securities shall have been duly taken or made;
(b) (i) No stop order suspending the effectiveness of the Registration
Statement shall be in effect; (ii) no proceedings for such purpose shall be
pending before or threatened by the Commission, or by any authority
administering any state securities or "Blue Sky" laws; (iii) any requests for
additional information on the part of the Commission shall have been complied
with to the Representative's reasonable satisfaction; (iv) since the respective
dates as of which information is given in the Registration Statement and the
Prospectus except as otherwise stated therein, there shall have been no material
adverse change in the condition, financial or otherwise, earnings, affairs,
regulatory situation or business prospects of the Depositor; (v) there are no
material actions, suits or proceedings pending before any court or governmental
agency, authority or body or threatened, affecting the Depositor or the
transactions contemplated by the Underwriting Agreement; (vi) the Depositor is
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not in violation of its charter or its by-laws or in default in the performance
or observance of any obligation, agreement, covenant or condition contained in
any contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which it is a party or by which it or its properties may be bound,
which violations or defaults separately or in the aggregate would have a
material adverse effect on the Depositor; and (vii) the Representative shall
have received, on the Closing Date a certificate, dated the Closing Date and
signed by an executive officer of the Depositor, to the foregoing effect;
(c) Subsequent to the execution of the Underwriting Agreement, there
shall not have occurred any of the following: (i) if at or prior to the Closing
Date, trading in securities on the New York Stock Exchange shall have been
suspended or any material limitation in trading in securities generally shall
have been established on such exchange; (ii) if at or prior to the Closing Date,
there shall have been an outbreak or escalation of hostilities between the
United States and any foreign power, or of any other insurrection or armed
conflict involving the United States which results in the declaration of a
national emergency or war, and, in the reasonable opinion of the Representative,
makes it impracticable or inadvisable to offer or sell the Offered Securities;
or (iii) if at or prior to the Closing Date, a general moratorium on commercial
banking activities in New York shall have been declared by either federal or New
York State authorities;
(d) The Representative 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 Xxxxx Xxxxxxxxxx
LLP, counsel for the Representative, is material and is required to be stated
therein or is necessary to make the statements therein not misleading.
(e) All corporate proceedings and other legal matters relating to the
authorization, form and validity of the Agreements, the Certificates, 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 Representative and its 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.
(f) Each of the Agreements, and the certificates shall have been
executed and delivered by the parties thereto.
(g) The Representative shall have received, on the Closing Date, a copy
of the letter from each nationally recognized statistical rating organization
(as that term is defined by the Commission for purposes of Rule 436(g)(2) under
the 0000 Xxx) that rated the Offered Securities confirming that, unless
otherwise specified in the Underwriting Agreement, the Offered Securities have
been rated in the rating categories disclosed in the Prospectus Supplement by
each such organization and that each such rating has not been rescinded since
the date of the applicable letter;
(h) The Representative shall have received, on the Closing Date, an
opinion of Xxxxx Xxxxxxxxxx LLP, special counsel for the Depositor, dated the
Closing Date, in form and substance satisfactory to the Representative;
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(i) The Representative shall have received, on the Closing Date, an
opinion of in-house counsel for the Seller and the Servicer, dated the Closing
Date, in form and substance reasonably satisfactory to the Representative and
counsel for the Underwriters;
(j) The Representative shall have received, on the Closing Date, an
opinion of counsel for the Trustee, dated the Closing Date, in form and
substance satisfactory to the Representative and counsel for the Underwriters;
(k) The Representative shall have received, on the Closing Date, an
opinion of Xxxxx Xxxxxxxxxx LLP, counsel for the Underwriters, dated the Closing
Date, with respect to the incorporation of the Depositor, the validity of the
Offered Securities, the Registration Statement, the Prospectus and other related
matters as the Underwriters may reasonably require, and the Depositor shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters;
(l) The Representative shall have received, on the Closing Date, such
other opinions of counsel in form and substance satisfactory to the
Representative and counsel to the Underwriters as the Representative shall
request;
(m) The Representative shall have received, on or prior to the date of
first use of the Prospectus Supplement relating to the Offered Securities, and
on the Closing Date if requested by the Representative, letters of independent
accountants of the Depositor in the form and reflecting the performance of the
procedures previously requested by the Representative;
(n) The Representative shall have received, on the Closing Date, a copy
of the Indemnification Agreement duly executed by the Depositor and the Seller
at or prior to the Closing Date;
(o) The Depositor shall have furnished or caused to be furnished to the
Representative on the Closing Date a certificate of an executive officer of the
Depositor satisfactory to the Representative as to the accuracy of the
representations and warranties of the Depositor herein at and as of such Closing
Date as if made as of such date, as to the performance by the Depositor of all
of its obligations hereunder to be performed at or prior to such Closing Date,
and as to such other matters as the Representative may reasonably request;
(p) The Seller shall have furnished or caused to be furnished to the
Representative on the Closing Date a certificate of officers of the Seller in
form and substance reasonably satisfactory to the Representative;
(q) The Servicer shall have furnished or caused to be furnished to the
Representative on the Closing Date a certificate of officers of the Servicer in
form and substance reasonably satisfactory to the Representative;
(r) The Representative shall have been furnished such further
information, certificates, documents and opinions as the Representative may
reasonably request.
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SECTION 5. COVENANTS OF THE DEPOSITOR. In further consideration of the
agreements of the Underwriters contained in the Underwriting Agreement, the
Depositor covenants as follows:
(a) To furnish the Representative, without charge, copies of the
Registration Statement and any amendments thereto including exhibits and as many
copies of the Prospectus and any supplements and amendments thereto as the
Representative may from time to time reasonably request.
(b) Immediately following the execution of the Underwriting Agreement,
the Depositor will prepare a prospectus supplement setting forth the principal
amount, notional amount or stated amount, as applicable, of Offered Securities
and FUNB Securities covered thereby, the price at which the Offered Securities
are to be purchased by the Underwriters from the Depositor, either the initial
public offering price or prices or the method by which the price or prices at
which the Offered Securities are to be sold will be determined, the selling
concessions and reallowances, if any, any delayed delivery arrangements, and
such other information as the Representative and the Depositor deem appropriate
in connection with the offering of the Offered Securities, but the Depositor
will not file any amendment to the Registration Statement or any supplement to
the Prospectus of which the Representative shall not previously have been
advised and furnished with a copy a reasonable time prior to the proposed filing
or to which the Representative shall have reasonably objected. The Depositor
will use its best efforts to cause any amendment to the Registration Statement
to become effective as promptly as possible. During the time when a Prospectus
is required to be delivered under the 1933 Act, the Depositor will comply so far
as it is able with all requirements imposed upon it by the 1933 Act and the
rules and regulations thereunder to the extent necessary to permit the
continuance of sales or of dealings in the Offered Securities in accordance with
the provisions hereof and of the Prospectus, and the Depositor will prepare and
file with the Commission, promptly upon request by the Representative, any
amendments to the Registration Statement or supplements to the Prospectus which
may be necessary or advisable in connection with the distribution of the Offered
Securities by the Underwriters, and will use its best efforts to cause the same
to become effective as promptly as possible. The Depositor will advise the
Representative, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement or any amended Registration Statement
has become effective or any supplement to the Prospectus or any amended
Prospectus has been filed. The Depositor will advise the Representative,
promptly after it receives notice or obtains knowledge thereof, of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any order preventing or suspending the use of the
Prospectus, or the suspension of the qualification of the Offered Securities for
offering or sale in any jurisdiction, or of the initiation or threatening of any
proceeding for any such purpose, or of any request made by the Commission for
the amending or supplementing of the Registration Statement or the Prospectus or
for additional information, and the Depositor will use its best efforts to
prevent the issuance of any such stop order or any order suspending any such
qualification, and if any such order is issued, to obtain the lifting thereof as
promptly as possible.
(c) If, at any time when a prospectus relating to the Offered
Securities and FUNB Securities is required to be delivered under the 1933 Act,
any event occurs as a result of which the Prospectus as then amended or
supplemented would include any untrue statement of a material fact, or omit to
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state any 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, or if it is necessary for any other reason to amend or
supplement the Prospectus to comply with the 1933 Act, to promptly notify the
Representative thereof and upon their request to prepare and file with the
Commission, at the Depositor's own expense, an amendment or supplement which
will correct such statement or omission or any amendment which will effect such
compliance.
(d) During the period when a prospectus is required by law to be
delivered in connection with the sale of the Offered Securities and FUNB
Securities pursuant to the Underwriting Agreement, the Depositor will file, on a
timely and complete basis, all documents that are required to be filed by the
Depositor with the Commission pursuant to Sections 13, 14, or 15(d) of the 1934
Act.
(e) To qualify the Offered Securities and FUNB Securities for offer and
sale under the securities or "Blue Sky" laws of such jurisdictions as the
Representative shall reasonably request and to pay all expenses (including fees
and disbursements of counsel) in connection with such qualification of the
eligibility of the Offered Securities and FUNB Securities for investment under
the laws of such jurisdictions as the Representative may designate provided that
in connection therewith the Depositor shall not be required to qualify to do
business or to file a general consent to service of process in any jurisdiction.
(f) To make generally available to the Depositor's security holders, as
soon as practicable, but in any event not later than eighteen months after the
date on which the filing of the Prospectus, as amended or supplemented, pursuant
to Rule 424 under the 1933 Act first occurs, an earnings statement of the
Depositor covering a twelve-month period beginning after the date of the
Underwriting Agreement, which shall satisfy the provisions of Section 11(a) of
the 1933 Act and the applicable rules and regulations of the Commission
thereunder (including, at the option of the Depositor, Rule 158).
(g) For so long as any of the Offered Securities and FUNB Securities
remain outstanding, to furnish to the Representative upon request in writing
copies of such financial statements and other periodic and special reports as
the Depositor may from time to time distribute generally to its creditors or the
holders of the Offered Securities and to furnish to the Representative copies of
each annual or other report the Depositor shall be required to file with the
Commission.
(h) For so long as any of the Offered Securities and FUNB Securities
remain outstanding, the Depositor will, or will cause the Servicer to, furnish
to the Representative, as soon as available, a copy of (i) the annual statement
of compliance delivered by the Servicer to the Trustee under the Pooling and
Servicing Agreement, (ii) the annual independent public accountants' servicing
report furnished to the Trustee pursuant to the Pooling and Servicing Agreement,
(iii) each report regarding the Offered Securities and FUNB Securities mailed to
the holders thereof, and (iv) from time to time, such other information
concerning such securities as the Representative may reasonably request.
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SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR. The
Depositor represents and warrants to, and agrees with, each Underwriter, as of
the date of the Underwriting Agreement, as follows:
(a) The Registration Statement including a prospectus relating to the
mortgage backed securities and the offering thereof from time to time in
accordance with Rule 415 under the 1933 Act has been filed with the Commission
and such Registration Statement, as amended to the date of the Underwriting
Agreement, has become effective. No stop order suspending the effectiveness of
such Registration Statement has been issued and no proceeding for that purpose
has been initiated or threatened by the Commission. A prospectus supplement
specifically relating to the Offered Securities and FUNB Securities will be
filed with the Commission pursuant to Rule 424 under the 1933 Act; provided,
however, that a supplement to the Prospectus prepared pursuant to Section 5(b)
hereof shall be deemed to have supplemented the Base Prospectus only with
respect to the Offered Securities and FUNB Securities to which it relates. The
conditions to the use of a registration statement on Form S-3 under the 1933
Act, as set forth in the General Instructions on Form S-3, and the conditions of
Rule 415 under the 1933 Act, have been satisfied with respect to the Depositor
and the Registration Statement. There are no contracts or documents of the
Depositor that are required to be filed as exhibits to the Registration
Statement pursuant to the 1933 Act or the rules and regulations thereunder that
have not been so filed.
(b) On the effective date of the Registration Statement, the
Registration Statement and the Base Prospectus conformed in all material
respects to the requirements of the 1933 Act and the rules and regulations
thereunder, and did not include any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading; on the date of the Underwriting Agreement
and as of the Closing Date, the Registration Statement and the Prospectus
conform, and as amended or supplemented, if applicable, will conform in all
material respects to the requirements of the 1933 Act and the rules and
regulations thereunder, and on the date of the Underwriting Agreement and as of
the Closing Date, neither of such documents, any Computational Materials nor any
ABS Term Sheets includes any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading, and neither of such documents as amended or
supplemented, if applicable, will include any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that
the foregoing does not apply to statements or omissions in any of such documents
based upon written information furnished to the Depositor by any Underwriter
specifically for use therein. "Computational Materials" shall mean those
materials delivered within the meaning of the no-action letter dated May 20,
1994 issued by the Division of Corporation Finance of the Commission to Xxxxxx,
Xxxxxxx Acceptance Corporation I, Xxxxxx, Peabody & Co., Incorporated, and
Xxxxxx Structured Asset Corporation and the no-action letter dated May 27, 1994
issued by the Division of Corporation Finance of the Commission to the Public
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Securities Association for which the filing of such material is a condition of
the relief granted in such letters. "ABS Term Sheet" shall mean those materials
delivered in the form of "Structural Term Sheets" or "Collateral Term Sheets,"
in each case within the meaning of the no-action letter dated February 13, 1995
issued by the Division of Corporation Finance of the Commission to the Public
Securities Association for which the filing of such material is a condition of
the relief granted in such letter.
(c) Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as otherwise stated therein,
there has been no material adverse change in the condition, financial or
otherwise, earnings, affairs, regulatory situation or business prospects of the
Depositor, whether or not arising in the ordinary course of the business of the
Depositor.
(d) The Depositor has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of North Carolina.
(e) The Depositor has all requisite power and authority (corporate and
other) and all requisite authorizations, approvals, orders, licenses,
certificates and permits of and from all government or regulatory officials and
bodies to own its properties, to conduct its business as described in the
Registration Statement and the Prospectus and to execute, deliver and perform
the Agreements, except such as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution by the Underwriters of
the Offered Securities and the FUNB Securities; all such authorizations,
approvals, orders, licenses, and certificates are in full force and effect; and,
except as set forth or contemplated in the Registration Statement or the
Prospectus, there are no legal or governmental proceedings pending or, to the
best knowledge of the Depositor, threatened that would result in a material
modification, suspension or revocation thereof.
(f) The Offered Securities and the FUNB Securities have been duly
authorized, and when the Offered Securities are issued and delivered pursuant to
the Pooling and Servicing Agreement, the Offered Securities will have been duly
executed, issued and delivered and will be entitled to the benefits provided by
the Pooling and Servicing Agreement, subject, as to the enforcement of remedies,
to applicable bankruptcy, reorganization, insolvency, moratorium and other laws
affecting the rights of creditors generally, and to general principles of equity
(regardless of whether the entitlement to such benefits is considered in a
proceeding in equity or at law), and will conform in substance to the
description thereof contained in the Registration Statement and the Prospectus,
and will in all material respects be in the form contemplated by the Indenture.
(g) The execution and delivery by the Depositor of the Agreements are
within the corporate power of the Depositor and neither the execution and
delivery by the Depositor of the Agreements, nor the consummation by the
Depositor of the transactions therein contemplated, nor the compliance by the
Depositor with the provisions thereof, will conflict with or result in a breach
of, or constitute a default under, the charter or the by-laws of the Depositor
or any of the provisions of any law, governmental rule, regulation, judgment,
decree or order binding on the Depositor or its properties, or any of the
provisions of any indenture, mortgage, contract or other instrument to which the
Depositor is a party or by which it is bound, or will result in the creation or
imposition of a lien, charge or encumbrance upon any of its property pursuant to
the terms of any such indenture, mortgage, contract or other instrument, except
such as have been obtained under the 1933 Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase and distribution of
the Offered Securities and the FUNB Securities by the Underwriters.
8
(h) The Underwriting Agreement and the Indemnification Agreement have
been, and at the Closing Date the Pooling and Servicing Agreement and the
Purchase Agreement, will have been, duly authorized, executed and delivered by
the Depositor.
(i) At the Closing Date, each of the Agreements will constitute a
legal, valid and binding obligation of the Depositor, enforceable against the
Depositor, in accordance with its terms, subject, as to the enforcement of
remedies, to applicable bankruptcy, reorganization, insolvency, moratorium and
other laws affecting the rights of creditors generally, and to general
principles of equity and the discretion of the court (regardless of whether the
enforcement of such remedies is considered in a proceeding in equity or at law).
(j) No filing or registration with, notice to, or consent, approval,
non-disapproval, authorization or order or other action of, any court or
governmental authority or agency is required for the consummation by the
Depositor of the transactions contemplated by the Agreements, except such as
have been obtained and except such as may be required under the 1933 Act, the
rules and regulations thereunder, or state securities or "Blue Sky" laws, in
connection with the purchase and distribution of the Offered Securities and the
FUNB Securities by the Underwriters.
(k) The Depositor owns or possesses or has obtained all material
governmental licenses, permits, consents, orders, approvals and other
authorizations necessary to lease, own or license, as the case may be, and to
operate, its properties and to carry on its business as presently conducted and
has received no notice of proceedings relating to the revocation of any such
license, permit, consent, order or approval, which singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would materially
adversely affect the conduct of the business, results of operations, net worth
or condition (financial or otherwise) of the Depositor.
(l) Other than as set forth or contemplated in the Prospectus, there
are no legal or governmental proceedings pending to which the Depositor is a
party or of which any property of the Depositor is the subject which, if
determined adversely to the Depositor would individually or in the aggregate
have a material adverse effect on the condition (financial or otherwise),
earnings, affairs, or business or business prospects of the Depositor and, to
the best of the Depositor's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others.
(m) Each of the Offered Securities and the FUNB Securities will, when
issued, be a "mortgage related security" as such term is defined in Section
3(a)(41) of the 0000 Xxx.
(n) The Depositor is not required to be registered under the Investment
Company Act of 1940, as amended.
(o) Any taxes, fees and other governmental charges in connection with
the execution and delivery of the Depositor Agreements, and issuance of the
Offered Securities and the FUNB Securities have been or will be paid at or prior
to the Closing Date.
9
SECTION 7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Depositor agrees to indemnify and hold harmless each
Underwriter (including First Union Securities, Inc., acting in its capacity as
Representative and as one of the Underwriters), and each person, if any, who
controls any Underwriter within the meaning of the 1933 Act, against any losses,
claims, damages or liabilities, joint or several, to which such Underwriter or
such controlling person may become subject under the 1933 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 or alleged untrue
statement of any material fact contained in the Registration Statement, the
Prospectus, any Computational Materials, any ABS Term Sheets, or any amendment
or supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse each
Underwriter and each such controlling person for any legal or other expenses
reasonably incurred by such Underwriter or such controlling person in connection
with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Depositor will not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in the Registration Statement, the Prospectus or any
amendment or supplement thereto in reliance upon and in conformity with (1)
written information furnished to the Depositor by any Underwriter through the
Representative specifically for use therein or (2) information regarding the
Seller, the Servicer or the Mortgage Loans, except to the extent that the
Depositor has been indemnified by the Seller and the Servicer in the
Indemnification Agreement. This indemnity agreement will be in addition to any
liability which the Depositor may otherwise have.
(b) Each Underwriter will indemnify and hold harmless the Depositor,
each of the Depositor's directors, each of the Depositor's officers who signed
the Registration Statement and each person, if any, who controls the Depositor,
within the meaning of the 1933 Act, against any losses, claims, damages or
liabilities to which the Depositor, or any such director, officer or controlling
person may become subject, under the 1933 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 or alleged untrue statement of any
material fact contained in the Registration Statement, the Prospectus, any
Computational Materials, any ABS Term Sheets or any amendment or supplement
thereto, or any other prospectus relating to the Offered Securities, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statements or alleged untrue statements or omission or alleged
omission was made in reliance upon and in conformity with written information
furnished to the Depositor by any Underwriter through the Representative
specifically for use therein; and each Underwriter will reimburse any legal or
other expenses reasonably incurred by the Depositor or any such director,
officer or controlling person in connection with investigating or defending any
such loss, claim, damage, liability or action. This indemnity agreement will be
in addition to any liability which such Underwriter may otherwise have. The
Depositor acknowledges that the statements set forth under the caption "Plan of
Distribution" in the Prospectus Supplement constitute the only information
furnished to the Depositor by or on behalf of any Underwriter for use in the
Registration Statement, the Prospectus, and each of the several Underwriters
represents and warrants that such statements are correct as to it.
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(c) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in the preceding
parts of this Section 7 is for any reason held to be unavailable to or
insufficient to hold harmless an indemnified party under subsection (a) or (b)
above in respect of any losses, claims, damages or liabilities (or actions in
respect thereof) referred to therein, then the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a result of
such losses, claims, damages or liabilities (or actions in respect thereof);
provided, however, that no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the 0000 Xxx) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation. In
determining the amount of contribution to which the respective parties are
entitled, there shall be considered the relative benefits received by the
Depositor on the one hand, and the Underwriters on the other, from the offering
of the Offered Securities (taking into account the portion of the proceeds of
the offering realized by each), the Depositor's and the Underwriters' relative
knowledge and access to information concerning the matter with respect to which
the claim was asserted, the opportunity to correct and prevent any statement or
omission, and any other equitable considerations appropriate in the
circumstances. The Depositor and the Underwriters agree that it would not be
equitable if the amount of such contribution were determined by pro rata or per
capita allocation (even if the Underwriters were treated as one entity for such
purpose). No Underwriters or person controlling such Underwriter shalls be
obligated to make contribution hereunder which in the aggregate exceeds the
total underwriting fee of the Offered Securities purchased by such Underwriters
under the Underwriting Agreement, less the aggregate amount of any damages which
such Underwriters and their controlling persons have otherwise been required to
pay in respect of the same or any substantially similar claim. The Underwriters'
obligation to contribute hereunder are several in proportion to their respective
underwriting obligations and not joint. For purposes of this Section 7, each
person, if any, who controls an Underwriter within the meaning of Section 15 of
the 1933 Act shall have the same rights to contribution as such Underwriter, and
each director of the Depositor, each officer of the Depositor who signed the
Registration Statement, and each person, if any, who controls the Depositor
within the meaning of Section 15 of the 1933 Act, shall have the same rights to
contribution as the Depositor.
SECTION 8. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The
respective representations, warranties, agreements, covenants, indemnities and
other statements of the Depositor, its officers, FUNB and the several
Underwriters set forth in, or made pursuant to, the Underwriting Agreement shall
remain in full force and effect, regardless of any investigation, or statement
as to the result thereof, made by or on behalf of any Underwriter, the
Depositor, FUNB or any of the officers or directors or any controlling person of
any of the foregoing, and shall survive the delivery of and payment for the
Offered Securities.
SECTION 9. TERMINATION. The Underwriting Agreement may be terminated by
the Depositor by notice to the Representative and FUNB in the event that a stop
order suspending the effectiveness of the Registration Statement shall have been
issued or proceedings for that purpose shall have been instituted or threatened.
11
(a) The Underwriting Agreement may be terminated by the Representative
by notice to the Depositor and FUNB in the event that the Depositor shall have
failed, refused or been unable to perform all obligations and satisfy all
conditions to be performed or satisfied hereunder by the Depositor at or prior
to the Closing Date.
(b) Termination of the Underwriting Agreement pursuant to this Section
9 shall be without liability of any party to any other party other than as
provided in Sections 7 and 11 hereof.
SECTION 10. DEFAULT OF THE UNDERWRITER. If any Underwriter or
Underwriters defaults or default in their obligation to purchase Offered
Securities which it or they have agreed to purchase under the Underwriting
Agreement and the aggregate principal amount of the Offered Securities which
such defaulting Underwriter or Underwriters agreed but failed to purchase is ten
percent or less of the aggregate principal amount, notional amount or stated
amount, as applicable, of the Offered Securities to be sold under the
Underwriting Agreement, as the case may be, other Underwriters shall be
obligated severally in proportion to their respective commitments under the
Underwriting Agreement to purchase the Offered Securities which such defaulting
Underwriter or Underwriters agreed but failed to purchase. If any Underwriter or
Underwriters so defaults or default and the aggregate principal amount of the
Offered Securities with respect to which such default or defaults occurs or
occur is more than ten percent of the aggregate principal amount, notional
amount or stated amount, as applicable, of Offered Securities to be sold under
the Underwriting Agreement, as the case may be, and arrangements satisfactory to
the Representative and the Depositor for the purchase of such Offered Securities
by other persons (who may include one or more of the non-defaulting Underwriters
including the Representative) are not made within 36 hours after any such
default, the Underwriting Agreement will terminate without liability on the part
of any non-defaulting Underwriter or the Depositor except for the expenses to be
paid or reimbursed by the Depositor pursuant to Section 11 hereof. As used in
the Underwriting Agreement, the term "Underwriter" includes any person
substituted for the Underwriter under this Section 10. Nothing herein shall
relieve a defaulting Underwriter from liability for its default.
SECTION 11. EXPENSES. The Depositor agrees with the several
Underwriters and FUNB that:
(a) whether or not the transactions contemplated in the Underwriting
Agreement are consummated or the Underwriting Agreement is terminated, the
Depositor will pay all fees and expenses incident to the performance of its
obligations under the Underwriting Agreement, including, but not limited to, (i)
the Commission's registration fee, (ii) the expenses of printing and
distributing the Underwriting Agreement and any related underwriting documents,
the Registration Statement, the Prospectus, any amendments or supplements to the
Registration Statement or the Prospectus, and any Blue Sky memorandum or legal
investment survey and any supplements thereto, (iii) fees and expenses of rating
agencies, accountants and counsel for the Depositor, (iv) the expenses referred
to in Section 5(e) hereof, and (v) all miscellaneous expenses referred to in
Item 30 of the Registration Statement;
12
(b) all out-of-pocket expenses, including counsel fees, disbursements
and expenses, reasonably incurred by the Underwriters in connection with
investigating, preparing to market and marketing the Offered Securities and
proposing to purchase and purchasing the Offered Securities under the
Underwriting Agreement will be borne and paid by the Depositor if the
Underwriting Agreement is terminated by the Depositor pursuant to Section 9(a)
hereof or by the Representative on account of the failure, refusal or inability
on the part of the Depositor to perform all obligations and satisfy all
conditions on the part of the Depositor to be performed or satisfied hereunder;
and
(c) the Depositor will pay the cost of preparing the certificates for
the Offered Securities.
Except as otherwise provided in this Section 11, the Underwriters agree
to pay all of their expenses in connection with investigating, preparing to
market and marketing the Offered Securities and proposing to purchase and
purchasing the Offered Securities under the Underwriting Agreement, including
the fees and expenses of their counsel and any advertising expenses incurred by
them in making offers and sales of the Offered Securities.
SECTION 12. NOTICES. All communications under the Underwriting
Agreement shall be in writing and, if sent to the Underwriters, shall be mailed,
delivered or telegraphed and confirmed to the Representative at the address and
to the attention of the person specified in the Underwriting Agreement, and, if
sent to the Depositor, shall be mailed, delivered or telegraphed and confirmed
to Residential Asset Funding Corporation, One First Union Center, 000 Xxxxx
Xxxxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000, Attention: Managing
Director - Asset Finance Group, and, if sent to FUNB, shall be mailed, delivered
or telegraphed and confirmed to First Union National Bank, Xxx Xxxxx Xxxxx
Xxxxxx, XX-0, Xxxxxxxxx, XX 00000-0000, Attention: Structured Finance Trust
Services (RAFC Asset-Backed Trust, Series 2001-1); provided, however, that any
notice to any Underwriter pursuant to the Underwriting Agreement shall be
mailed, delivered or telegraphed and confirmed to the such Underwriter at the
address furnished by it.
SECTION 13. REPRESENTATIVE OF THE UNDERWRITERS. Any Representative
identified in the Underwriting Agreement will act for the Underwriters of the
Offered Securities and any action taken by the Representative under the
Underwriting Agreement will be binding upon all such Underwriters.
SECTION 14. SUCCESSORS. The Underwriting Agreement shall inure to the
benefit of and shall be binding upon the several Underwriters, FUNB and the
Depositor and their respective successors, and nothing expressed or mentioned
herein or in the Underwriting Agreement is intended or shall be construed to
give any other person any legal or equitable right, remedy or claim under or in
respect of the Underwriting Agreement, or any provisions herein contained, the
Underwriting Agreement and all conditions and provisions hereof being intended
to be and being for the sole and exclusive benefit of such persons and for the
benefit of no other person except that (i) the representations and warranties of
the Depositor contained herein or in the Underwriting Agreement shall also be
for the benefit of any person or persons who controls or control any Underwriter
within the meaning of Section 15 of the 1933 Act, and (ii) the indemnities by
the several Underwriters shall also be for the benefit of the directors of the
Depositor, the officers of the Depositor who have signed the Registration
Statement and any person or persons who control the Depositor within the meaning
of Section 15 of the 1933 Act. No purchaser of the Offered Securities from any
Underwriter shall be deemed a successor because of such purchase. This Agreement
and each Underwriting Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
13
SECTION 15. TIME OF THE ESSENCE. Time shall be of the essence in each
Underwriting Agreement.
SECTION 16. GOVERNING LAW. This Agreement and each Underwriting
Agreement shall be governed by and construed in accordance with the laws of the
State of New York.
[Signature Page Follows]
14
If the foregoing is in accordance with your understanding, please sign
and return two counterparts hereof.
Yours truly,
RESIDENTIAL ASSET FUNDING
CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Director
FIRST UNION NATIONAL BANK
By: /s/ Xxxxxxx Xxxxxxx
-------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Managing Director
Accepted as of the date hereof:
FIRST UNION SECURITIES, INC.,
as Representative for the Underwriters
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Director
[Signature Page to Underwriting Agreement Standard Provisions]
