EXECUTION COPY
PRUDENTIAL SECURITIES SECURED FINANCING CORPORATION
EMERGENT HOME EQUITY LOAN PASS-THROUGH CERTIFICATES
SERIES 1997-3
UNDERWRITING AGREEMENT
August 28, 1997
UNDERWRITING AGREEMENT
PRUDENTIAL SECURITIES INCORPORATED
One ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
August 28, 1997
Dear Sirs:
Prudential Securities Secured Financing Corporation (the
"Depositor") proposes, subject to the terms and conditions stated herein and in
the attached Underwriting Agreement Standard Provisions, dated August 28, 1997
(the "Standard Provisions"), between the Depositor and Prudential Securities
Incorporated, to issue and sell to you (the "Underwriter") the Securities
specified in Schedule I hereto (the "Offered Securities"). The Depositor agrees
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 you. 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 Offered 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
issue and sell to the Underwriter, and the Underwriter agrees to purchase from
the Depositor, at the time and place and at the purchase price to the
Underwriter and in the manner set forth in Schedule I hereto, the entire
original principal balance of the Offered Securities.
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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 between the Underwriter and the Depositor.
Very truly yours,
PRUDENTIAL SECURITIES SECURED
FINANCING CORPORATION
By:
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Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
Accepted as of the date hereof:
PRUDENTIAL SECURITIES INCORPORATED
By:
--------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇
Title: Vice President
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SCHEDULE I
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Title of Offered Securities: Emergent Home Equity Loan Pass-Through
Certificates, Series 1997-3, Class A-1,
Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class A-4, Class A-5
and Class A-6 (together, the "Class A
Certificates.")
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Terms of Offered Securities: The Offered Securities shall have the
terms set forth in 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 among the
Depositor, Emergent Mortgage Corp., as
servicer, and First Union National Bank,
as trustee.
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Purchase Price: The purchase price for the Class A-1
Certificates shall be $44,842,500.00 plus
accrued interest at the rate of 6.545% per
annum from September 1, 1997 to the date
of payment thereof. The purchase price for
the Class A-2 Certificates shall be
$19,930,000.00 plus accrued interest at
the rate of 6.540% per annum from
September 1, 1997 to the date of payment
thereof. The purchase price for the Class
A-3 Certificates shall be $24,912,500.00
plus accrued interest at the rate of
6.670% per annum from September 1, 1997 to
the date of payment thereof. The purchase
price for the Class A-4 Certificates shall
be $32,879,343.75 plus accrued interest at
the rate of 6.925% per annum from
September 1, 1997 to the date of payment
thereof. The purchase price for the Class
A-5 Certificates shall be $29,890,312.50
plus accrued interest at the rate of
7.290% per annum from September 1, 1997 to
the date of payment thereof. The purchase
price for the Class A-6 Certificates shall
be $16,936,515.71 plus accrued interest at
the rate of 6.930% per annum from
September 1, 1997 to the date of payment
thereof. Total accrued interest on the
Class ▇-▇, ▇▇▇▇▇ ▇-▇, Class A-3, Class
A-4, Class A-5
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and Class A-6 Certificates is $739,264.72.
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Specified funds for payment of Federal Funds (immediately available
Purchase Price: funds).
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Required Rating: Aaa by ▇▇▇▇▇'▇ Investors Service, Inc.
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AAA by Standard & Poor's Ratings Services,
a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc.
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Closing Date: On or about September 24, 1997 at 12:00
noon eastern standard time or at such
other time as the Depositor and the
Underwriter shall agree.
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Closing Location: Offices of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, 1301 Avenue
of the Americas, New York, New York.
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Name and address of Designated Representative: Prudential
Representative: Securities Incorporated.
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Address for Notices, ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
etc.: ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇.
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4
STANDARD PROVISIONS TO UNDERWRITING AGREEMENT
August 28, 1997
From time to time, Prudential Securities Secured Financing
Corporation, a Delaware 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
representative of the Underwriters and to Underwriters who act without any firm
being designated as their representative. The standard provisions set forth
herein (the "Standard Provisions") may be incorporated by reference in any
Underwriting Agreement. This Agreement 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. The obligations of the underwriters under this Agreement and each
Underwriting Agreement shall be several and not joint. Unless otherwise defined
herein, the terms defined in the Underwriting Agreement are used herein as
defined in the Prospectus referred to below.
1. The Offered Securities. The Depositor proposes to sell pursuant
to the applicable Underwriting Agreement to the several Underwriters named
therein home equity loan pass-through certificates (the "Securities")
representing beneficial ownership interests in a trust, the trust property of
which consists of a pool of Mortgage Loans and certain related property. The
Securities will be issued pursuant to a pooling and servicing agreement dated as
of August 10, 1997 (the "Pooling and Servicing Agreement") by and among the
Depositor, Emergent Mortgage Corp. (the "Servicer") and First Union National
Bank, as trustee (the "Trustee").
The terms and rights of any particular issuance of Securities shall
be as specified in the Underwriting Agreement relating thereto and in or
pursuant to the Pooling and Servicing Agreement identified in such Underwriting
Agreement. The Securities which are the subject of any particular Underwriting
Agreement into which this Agreement is incorporated are herein referred to as
the "Offered Securities."
The Depositor has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No. 333-27355),
including
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a prospectus relating to the Securities under the Securities Act of 1933, as
amended (the "1933 Act"). The term "Registration Statement" means such
registration statement as amended to the date of the Underwriting Agreement. The
term "Basic Prospectus" means the prospectus included in the Registration
Statement. The term "Prospectus" means the Basic Prospectus together with the
prospectus supplement specifically relating to the Offered Securities, as first
filed with the Commission pursuant to Rule 424. The term "Preliminary
Prospectus" means a preliminary prospectus supplement specifically relating to
the Offered Securities together with the Basic Prospectus.
2. Offering by the Underwriters. Upon the execution of the
Underwriting Agreement applicable to any Offered Securities and the
authorization by the Representative of the release of such Offered Securities,
the several Underwriters propose to offer for sale to the public the Offered
Securities at the prices and upon the terms set forth in the Prospectus.
3. Purchase, Sale and Delivery of the Offered Securities. Unless
otherwise specified in the Underwriting Agreement, payment for the Offered
Securities shall be made by certified or official bank check or checks payable
to the order of the Depositor in immediately available or next day funds, at the
time and place set forth in the Underwriting Agreement, upon delivery to the
Representative for the respective accounts of the several Underwriters of the
Offered 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 Offered Securities are herein referred
to as the "Closing Date".
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 and the
Servicer made in any certificates 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
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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 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, or a banking
moratorium shall have been declared by New York or United States
authorities; (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 have received, on the Closing Date, a
certificate dated the Closing Date and signed by an executive officer of
the Depositor to the effect that attached thereto is a true and correct
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 ▇▇▇▇ ▇▇▇) that rated the Offered Securities and
confirming that, unless otherwise specified in the Underwriting Agreement,
the Offered Securities have been rated in the highest rating categories by
each such organization and that each such rating has not been rescinded
since the date of the applicable letter.
(e) The Representative shall have received, on the Closing Date, an
opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, special counsel for the Depositor, dated the
Closing Date, in form and substance satisfactory to the Representative and
containing opinions substantially to the effect set forth in Exhibit A
hereto.
(f) The Representative shall have received, on the Closing Date, an
opinion of counsel for the Servicer, dated the Closing Date, in form and
substance
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satisfactory to the Representative and counsel for the Underwriters and
containing opinions substantially to the effect set forth in Exhibit B
hereto.
(g) 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 and containing opinions substantially to the effect set forth
in Exhibit C hereto.
(h) The Representative shall have received, on the Closing Date, an
opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, 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.
(i) 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.
(j) 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;
(k) The Servicer shall have furnished or caused to be furnished to
the Representative on the Closing Date a certificate of officers of such
Servicer in form and substance reasonably satisfactory to the
Representative;
(l) The Policy shall have been duly executed and issued at or prior
to the Closing Date and shall conform in all material respects to the
description thereof in the Prospectus Supplement.
(m) The Representative shall have received, on the Closing Date, an
opinion of counsel to Financial Security Assurance Inc. ("the Certificate
Insurer"), dated the Closing Date, in form and substance satisfactory to
the Representative and counsel for the Underwriters and containing
opinions substantially to the effect set forth in Exhibit D hereto.
(n) On or prior to the Closing Date there shall not have occurred
any downgrading, nor shall any notice have been given of (i) any intended
or potential downgrading or (ii) any review or possible change in rating
the direction of which has not been indicated, in the rating accorded the
Certificate Insurer's claims
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paying ability by any "nationally recognized statistical rating
organization," as such term is defined for purposes of the ▇▇▇▇ ▇▇▇.
(o) There shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or otherwise,
or in the earnings, business or operations, since December 31, 1994, of
the Certificate Insurer, that is in the Representative's judgment material
and adverse and that makes it in the Representative's judgment
impracticable to market the Offered Securities on the terms and in the
manner contemplated in the Prospectus.
(p) The Representative shall have been furnished such further
information, certificates, documents and opinions as the Representative
may reasonably request.
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 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
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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 any Preliminary Prospectus or 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 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 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 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 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 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
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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 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 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
applicable Pooling and Servicing Agreement, (ii) the annual independent
public accountants' servicing report furnished to the Trustee pursuant to
the applicable Pooling and Servicing Agreement, (iii) each report
regarding the Offered Securities mailed to the holders of such Securities,
and (iv) from time to time, such other information concerning such
Securities as the Representative may reasonably request.
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 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 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 Basic Prospectus only with respect to the Offered
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.
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(b) On the effective date of the Registration Statement, the
Registration Statement and the Basic 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 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.
(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 Delaware.
(e) The Depositor has all requisite power and authority (corporate
and other) and all requisite authorizations, approvals, order, 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 this Agreement, the Underwriting Agreement, the
Pooling and Servicing Agreement and, if applicable, the Custodial
Agreement, except such as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution by the
Underwriter of the Offered Securities; all such authorizations, approvals,
orders, licenses, certificates are in full force and effect and contain no
unduly burdensome provisions; 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 have been duly authorized, and when the
Offered Securities are issued and delivered pursuant to the Underwriting
Agreement, the Offered Securities will have been duly executed, issued and
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delivered and will be entitled to the benefits provided by the applicable
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 Pooling and Servicing
Agreement.
(g) The execution and delivery by the Depositor of this Agreement,
the Underwriting Agreement and the Pooling and Servicing Agreement are
within the corporate power of the Depositor and neither the execution and
delivery by the Depositor of this Agreement, the Underwriting Agreement
and the Pooling and Servicing Agreement 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 by the Underwriters.
(h) The Underwriting Agreement has been, and at the Closing Date the
Pooling and Servicing Agreement will have been, duly authorized, executed
and delivered by the Depositor.
(i) At the Closing Date, each of the Underwriting Agreement and the
Pooling and Servicing Agreement 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 Underwriting Agreement
or the Pooling and Servicing Agreement, except such as have been obtained
and except such as may
13
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 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 will, when issued, be a "mortgage
related security" as such term is defined in Section 3(a)(41) of the 1934
Act.
(n) At the Closing Date or any Pre-Funded Loan Transfer Date, as the
case may be, each of the Mortgage Loans which is a subject of the Pooling
and Servicing Agreement and all such Mortgage Loans in the aggregate will
meet the criteria for selection described in the Prospectus, and at the
Closing Date or any Pre-Funded Loan Transfer Date, as the case may be, the
representations and warranties made by the Depositor in such Pooling and
Servicing Agreement will be true and correct as of such date.
(o) At the time of execution and delivery of the Pooling and
Servicing Agreement and on any Pre-Funded Loan Transfer Date, as the case
may be, the Depositor will have good and marketable title to the Mortgage
Loans being transferred to the Trustee pursuant to the Pooling and
Servicing Agreement, free and clear of any lien, mortgage, pledge, charge,
encumbrance, adverse claim or other security interest (collectively
"Liens"), and will not have assigned to any person any of its right, title
or interest in such Mortgage Loans or in such Pooling and Servicing
Agreement or the Offered Securities being issued pursuant thereto, the
Depositor will have the power and authority to transfer such Mortgage
Loans to the Trustee and to transfer the Offered Securities to each of the
Underwriters, and, upon execution and delivery to the Trustee of the
Pooling and Servicing Agreement and delivery to each of the Underwriters
of the Offered Securities, and on any Pre-Funded Loan Transfer Date, as
the case may be, the Trustee will have
14
good and marketable title to the Mortgage Loans and each of the
Underwriters will have good and marketable title to the Offered
Securities, in each case free and clear of any Liens.
(p) The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended, and the Trust
Fund (as defined in the Pooling and Servicing Agreement) is not required
to be registered under the Investment Company Act of 1940, as amended.
(q) Any taxes, fees and other governmental charges in connection
with the execution, delivery and issuance of the Underwriting Agreement,
this Agreement, the Pooling and Servicing Agreement and the Offered
Securities have been or will be paid at or prior to the Closing Date.
7. Indemnification and Contribution. The Depositor agrees to
indemnify and hold harmless each Underwriter (including Prudential Securities
Incorporated 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, any Preliminary Prospectus, the
Prospectus, 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, any Preliminary Prospectus, 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
Mortgage Loans except to the extent that the Depositor has been indemnified by
the Servicer. This indemnity agreement will be in addition to any liability
which the Depositor may otherwise have.
(a) 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
15
fact contained in the Registration Statement, any Preliminary Prospectus,
the Prospectus, 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 statement 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, any Preliminary Prospectus or the Prospectus,
and each of the several Underwriters represents and warrants that such
statements are correct as to it.
(b) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 7, notify the indemnifying party of
the commencement thereof, but the omission to so notify the indemnifying
party will not relieve the indemnifying party from any liability which the
indemnifying party may have to any indemnified party hereunder except to
the extent such indemnifying party has been prejudiced thereby. In case
any such action is brought against any indemnified party, and it notifies
the indemnifying party of the commencement thereof, the indemnifying party
will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof with counsel satisfactory to such indemnified
party. After notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party
will not be liable to such indemnified party under this Section 7 for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than reasonable costs of
investigation; provided, however, that the Representative shall have the
right to employ separate counsel to represent the Representative, those
other Underwriters and their respective controlling persons who may be
subject to liability arising out of any claim in respect of which
indemnity may be sought by the Underwriters against the Depositor under
this Section 7 if, in the reasonable judgment of the Representative, it is
advisable for the Representative and those Underwriters and controlling
persons to be represented by separate counsel, and in that event the fees
and expenses of such separate counsel shall be paid by the Depositor (it
being understood, however, that the Depositor shall not, in connection
with any one such claim or separate but substantially similar or related
claim in the same
16
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 at any time for the Representative and those
Underwriters and controlling persons).
(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
▇▇▇▇ ▇▇▇) 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 Underwriter or person
controlling such Underwriter shall be obligated to make contribution
hereunder which in the aggregate exceeds the total public offering price
of the Offered Securities purchased by such Underwriter under the
Underwriting Agreement, less the aggregate amount of any damages which
such Underwriter and its 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.
(d) The parties hereto agree that the first sentence of Section 5 of
the Indemnification Agreement (the "Indemnification Agreement") dated as
of the Closing Date among the Certificate Insurer, the Servicer, the
Depositor and the Underwriter shall not be construed as limiting the
Depositor's right to enforce its rights under Section 7 of this Agreement.
The parties further agree that, as between the parties hereto, to the
extent that the provisions of Section 4, 5 and 6
17
of the Indemnification Agreement conflict with Section 7 hereof, the
provisions of Section 7 hereof shall govern.
(e) Each Underwriter agrees to provide the Depositor no later the
date on which the Prospectus Supplement is required to be filed pursuant
to Rule 424 with a copy of its Derived Information (defined below) for
filing with the Commission on Form 8-K.
(f) Each Underwriter severally agrees, assuming all
Depositor-Provided Information (defined below) is accurate and complete in
all material respects, to indemnify and hold harmless the Depositor, its
respective officers and directors and each person who controls the
Depositor within the meaning of the Securities Act or the Exchange Act
against any and all losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Securities Act or the
Exchange 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 Derived
Information provided by such Underwriter, 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,
in the light of the circumstances under which they were made, not
misleading, 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).
For purposes of this Section 8, the term "Derived Information" means
such portion, if any, of the information delivered to the Depositor pursuant to
Section 8(D) 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; and (ii) does not constitute Depositor-Provided Information.
"Depositor-Provided Information" means any computer tape furnished to the
Underwriter by the Depositor concerning the assets comprising the Trust.
8. Survival of Certain Representations and Obligations. The
respective representations, warranties, agreements, covenants, indemnities and
other statements of the Depositor, its officers 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, 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.
18
9. Termination.
(a) The Underwriting Agreement may be terminated by the Depositor by
notice to the Representative 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.
(b) The Underwriting Agreement may be terminated by the
Representative by notice to the Depositor 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.
(c) 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.
10. Default of Underwriters. 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, the 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 Underwriters 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 an Underwriter under this Section 10. Nothing herein shall
relieve a defaulting Underwriter from liability for its default.
11. Expenses. The Depositor agrees with the several Underwriters
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
19
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, any Preliminary Prospectus, 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;
(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.
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
Prudential Securities Secured Financing Corporation, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇
▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Director-Mortgage Finance Group;
provided, however, that any notice to any Underwriter pursuant to the
Underwriting Agreement shall be mailed, delivered or telegraphed and confirmed
to such Underwriter at the address furnished by it.
13. Representative of 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 of such Underwriters.
14. Successors. The Underwriting Agreement shall inure to the
benefit of and shall be binding upon the several Underwriters and the Depositor
and their
20
respective successors and legal representatives, 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.
15. Time of the Essence. Time shall be of the essence of each
Underwriting Agreement.
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.
21
Exhibit A
Opinions of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇,
Special Counsel for the Depositor
(i) Each of the Documents constitutes the valid, legal and binding
agreement of the Depositor, and is enforceable against the Depositor in
accordance with its terms.
(ii) The Certificates, assuming the due execution by the Trustee and
due authentication by the Trustee and payment therefor pursuant to the
Underwriting Agreement, are validly issued and outstanding and are entitled to
the benefits of the Pooling and Servicing Agreement.
(iii) No consent, approval, authorization or order of, registration
or filing with, or notice to, any governmental authority or court is required
under federal laws or the laws of the State of New York for the execution,
delivery and performance of the Documents or the offer, issuance, sale or
delivery of the Certificates or the consummation of any other transaction
contemplated thereby by the Depositor, except such which have been obtained.
(iv) The Registration Statement and the Prospectus (other than the
financial and statistical data included therein, as to which we are not called
upon to express any opinion), at the time the Registration Statement became
effective, as of the date of execution of the Underwriting Agreement and as of
the date hereof comply as to form in all material respects with the requirements
of the Securities Act of 1933, as amended, and the rules and regulations
thereunder, and the Exchange Act and the rules and regulations thereunder, and
we do not know of any amendment to the Registration Statement required to be
filed, or of any contracts, indentures or other documents of a character
required to be filed as an exhibit to the Registration Statement or required to
be described in the Registration Statement or the Prospectus, which has not been
filed or described as required.
(v) Neither the qualification of the Pooling and Servicing Agreement
under the Trust Indenture Act of 1939, as amended, nor the registration of the
Trust Fund created by the Pooling and Servicing Agreement under the Investment
Company Act of 1940 is required.
(vi) The statements in the Prospectus Supplement set forth under the
caption "DESCRIPTION OF THE CERTIFICATES," to the extent such statements purport
to summarize certain provisions of the Certificates or of the Pooling and
Servicing Agreement or of the Unaffiliated Seller's Agreement, are fair and
accurate in all material respects.
Exhibit B
Opinions of Counsel
to the Servicer
(i) The Servicer has been duly organized and is validly existing as
a corporation in good standing under the laws of the State of South Carolina and
is qualified to transact business in the State of South Carolina.
(ii) The Servicer has the requisite power and authority to execute
and deliver, engage in the transactions contemplated by, and perform and observe
the conditions of, the Pooling and Servicing Agreement.
(iii) The Pooling and Servicing Agreement has been duly and validly
authorized, executed and delivered by the Servicer, all requisite corporate
action having been taken with respect thereto, and constitutes the valid, legal
and binding agreement of the Servicer, and is enforceable against the Servicer
in accordance with its respective terms.
(iv) The execution, delivery or performance by the Servicer of the
Pooling and Servicing Agreement does not (A) conflict or will not conflict with
or result or will result in a breach of, or constitute or will constitute a
default under or violate or will violate, (i) any term or provision of the
Articles of Incorporation or By-laws of the Servicer; (ii) any term or provision
of any material agreement, contract, instrument or indenture, to which the
Servicer or any of its subsidiaries is a party or is bound; or (iii) any order,
judgment, writ, injunction or decree of any court or governmental agency or body
or other tribunal having jurisdiction over the Servicer or any of its
properties; or (B) result in, or will result in the creation or imposition of
any lien, charge or encumbrance upon the Trust Fund or upon the Certificates,
except as otherwise contemplated by the Pooling and Servicing Agreement.
(v) No consent, approval, authorization or order of, registration or
qualification of or with or notice to, any courts, governmental agency or body
or other tribunal is required under the laws of New York or South Carolina, for
the execution, delivery and performance of the Pooling and Servicing Agreement
or the consummation of any other transaction contemplated thereby by the
Servicer, except such which have been obtained.
(vi) There are no legal or governmental suits, proceedings or
investigations pending or, to such counsel's knowledge, threatened against the
Servicer before any court, governmental agency or body or other tribunal (A)
which, if determined adversely to the Servicer, would individually or in the
aggregate have a material adverse effect on (i) the consolidated financial
position, business prospects, stockholders's equity or results of operations of
the Servicer; or (ii) the Servicer's ability to perform its obligations under,
or the validity or enforceability of the Pooling and Servicing Agreement; or (B)
which have not otherwise been disclosed in the Registration Statement
and to the best of such counsel's knowledge, no such proceedings or
investigations are threatened or contemplated by governmental authorities or
threatened by others.
B-2
Exhibit C
Opinions of Counsel
to the Trustee
(i) The Trustee is a national banking association duly organized,
validly existing and in good standing under the laws of the United States and
has the power and authority to enter into and to take all actions required of it
under the Pooling and Servicing Agreement;
(ii) The Pooling and Servicing Agreement has been duly authorized,
executed and delivered by the Trustee and the Pooling and Servicing Agreement
constitutes the legal, valid and binding obligation of the Trustee, enforceable
against the Trustee in accordance with its terms, except as enforceability
thereof may be limited by (A) bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally, as such
laws would apply in the event of a bankruptcy, insolvency or reorganization or
similar occurrence affecting the Trustee, and (B) general principles of equity
regardless of whether such enforcement is sought in a proceeding at law or in
equity;
(iii) No consent, approval, authorization or other action by any
governmental agency or body or other tribunal is required on the part of the
Trustee in connection with its execution and delivery of the Pooling and
Servicing Agreement or the performance of its obligations thereunder;
(iv) The Certificates have been duly executed, authenticated and
delivered by the Trustee; and
(v) The execution and delivery of, and performance by the Trustee of
its obligations under, the Pooling and Servicing Agreement do not conflict with
or result in a violation of any statute or regulation applicable to the Trustee,
or the charter or bylaws of the Trustee, or to the best knowledge of such
counsel, any governmental authority having jurisdiction over the Trustee or the
terms of any indenture or other agreement or instrument to which the Trustee is
a party or by which it is bound.
Exhibit D
Opinions of Counsel
to the Certificate Insurer
(i) The Certificate Insurer is a stock insurance corporation, duly
incorporated and validly existing under the laws of the State of New York. The
Certificate Insurer is validly licensed and authorized to issue the Policy and
perform its obligations under the Policy in accordance with the terms thereof,
under the laws of the State of New York.
(ii) The execution and delivery by the Certificate Insurer of the
Policy, the Insurance and Indemnity Agreement and the Indemnification Agreement
are within the corporate power of the Certificate Insurer and has been
authorized by all necessary corporate action on the part of the Certificate
Insurer; the Policy has been duly executed and is the valid and binding
obligation of the Certificate Insurer enforceable in accordance with its terms
except that the enforcement of the Policy may be limited by laws relating to
bankruptcy, insolvency, reorganization, moratorium, receivership and other
similar laws affecting creditors' rights generally and by general principles of
equity.
(iii) The Certificate Insurer is authorized to deliver the
Indemnification Agreement and the Insurance and Indemnity Agreement, and each
Agreement has been duly executed and is the valid and binding obligation of the
Certificate Insurer enforceable in accordance with its terms except that the
enforcement thereof may be limited by laws relating to bankruptcy, insolvency,
reorganization, moratorium, receivership and other similar laws affecting
creditors' rights generally and by general principles of equity and by public
policy considerations relating to indemnification for securities law violations.
(iv) No consent, approval, authorization or order of any state or
federal court or governmental agency or body is required on the part of the
Certificate Insurer, the lack of which would adversely affect the validity or
enforceability of the Policy; to the extent required by applicable legal
requirements that would adversely affect validity or enforceability of the
Policy, the form of the Policy has been filed with, and approved by, all
governmental authorities having jurisdiction over the Certificate Insurer in
connection with such Policy.
(v) To the extent the Policy constitutes a security within the
meaning of Section 2(1) of the 1933 Act, it is a security that is exempt from
the registration requirements of the Act.
(vi) The information set forth under the captions "THE INSURER" in
the Prospectus insofar as such statements constitute a description of the
Policy, accurately summarizes the Policy.
