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SALOMON BROTHERS MORTGAGE SECURITIES VII, INC.
$710,134,000
COMMERCIAL MORTGAGE PASS-THROUGH CERTIFICATES,
SERIES 2000-C2
CLASS A-1, CLASS A-2, CLASS B, CLASS C,
CLASS D, CLASS E, CLASS F AND CLASS G
UNDERWRITING AGREEMENT
as of August 15, 2000
Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Chase Securities Inc.
000 Xxxx Xxxxxx 0xx Xxxxx
Xxx Xxxx, XX 00000
PaineWebber Incorporated
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Artesia Banking Corporation
WTC Tower 0
Xxxxxxxxx Xxx Xxxxxx XX, 00
0000 Xxxxxxxx
Xxxxxxx
Ladies and Gentlemen:
Salomon Brothers Mortgage Securities VII, Inc., a Delaware corporation
("SBMS"), proposes to sell to Xxxxxxx Xxxxx Xxxxxx Inc. ("Salomon"), PaineWebber
Incorporated ("PaineWebber"), Chase Securities Inc. ("Chase") and, solely
outside the United States, Artesia Banking Corp. ("Artesia"; Xxxxxxx,
PaineWebber, Chase and Artesia, each an "Underwriter" and together, the
"Underwriters"), pursuant to this Underwriting Agreement (this "Agreement"), the
classes of Commercial Mortgage Pass-Through Certificates, Series 2000-C2 that
are identified on Schedule I hereto (collectively, the "Registered
Certificates"), each having the initial aggregate stated principal amount (the
initial "Class Principal Balance") set forth on Schedule I. The Registered
Certificates, together with the Class H, Class J, Class K, Class L, Class M,
Class N, Class P, Class R, Class X and Class Y Certificates (collectively, the
"Certificates"), evidence the entire beneficial ownership interest in the assets
of a trust to be created by SBMS (such trust, the "Trust"; and such assets
collectively, the "Trust Fund"). The Trust Fund consists primarily of a pool
(the "Mortgage Pool") of multifamily and commercial mortgage loans (the
"Mortgage Loans") that will have, as of
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the close of business on their respective scheduled due dates in August 2000
(collectively the "Cut-off Date"), after taking into account all payments of
principal due on the Mortgage Loans on or before the Cut-off Date, whether or
not received, an aggregate principal balance of approximately $781,523,168
(subject to a variance of plus or minus 5.0%). Certain of the Mortgage Loans
will be acquired by SBMS from Salomon Brothers Realty Corp. ("SBRC" and such
Mortgage Loans, the "SBRC Mortgage Loans"), pursuant to a mortgage loan purchase
agreement, dated as of the date hereof (the "SBRC/SBMS Mortgage Loan Purchase
Agreement"), between SBRC, as mortgage loan seller, and SBMS, as purchaser.
Certain of the Mortgage Loans will be acquired by SBMS from Xxxxx Xxxxxx Real
Estate Securities Inc. ("PWRES" and such Mortgage Loans, the "PWRES Mortgage
Loans"), pursuant to a mortgage loan purchase agreement, dated as of the date
hereof (the "PWRES/SBMS Mortgage Loan Purchase Agreement"), between PWRES, as
mortgage loan seller, and SBMS, as purchaser. Certain of the Mortgage Loans will
be acquired by SBMS from Artesia Mortgage Capital Corporation ("AMCC" and such
Mortgage Loans, the "AMCC Mortgage Loans"), pursuant to a mortgage loan purchase
agreement, dated as of the date hereof (the "AMCC/SBMS Mortgage Loan Purchase
Agreement"), between AMCC, as mortgage loan seller, and SBMS, as purchaser. The
remaining Mortgage Loans will be acquired by SBMS from ORIX Real Estate Capital
Markets, LLC ("ORIX" and such Mortgage Loans, the "ORIX Mortgage Loans"; and
ORIX, PWRES, AMCC and SBRC, the "Mortgage Loan Sellers"), pursuant to a mortgage
loan purchase agreement dated as of the date hereof (the "ORIX/SBMS Mortgage
Loan Purchase Agreement;" and, together with the SBRC/SBMS Mortgage Loan
Purchase Agreement, the PWRES/SBMS Mortgage Loan Purchase Agreement and the
AMCC/SBMS Mortgage Loan Purchase Agreement, the "Mortgage Loan Purchase
Agreements") between ORIX, as mortgage loan seller, and SBMS, as purchaser. At
least three separate real estate mortgage investment conduit ("REMIC") elections
will be made with respect to the Trust Fund for federal income tax purposes. In
addition, certain Trust Fund assets will constitute two separate grantor trusts
for federal income tax purposes. The Trust is to be created and the Certificates
are to be issued under a pooling and servicing agreement, dated as of August 1,
2000 (the "Pooling and Servicing Agreement"), among SBMS as depositor, ORIX as
master servicer (in such capacity, the "Master Servicer") and as special
servicer (in such capacity, the "Special Servicer") and Xxxxx Fargo Bank
Minnesota, N.A., as trustee (in such capacity, the "Trustee"). Capitalized terms
used but not defined herein have the meanings assigned thereto in the Pooling
and Servicing Agreement.
1. REPRESENTATIONS, WARRANTIES AND COVENANTS. SBMS represents and
warrants to, and covenants with, each of the Underwriters that:
(a) A registration statement (File No. 333-84249) on Form S-3 has been
filed with the Securities and Exchange Commission (the "Commission"), and has
become effective under the Securities Act of 1933, as amended (the "Securities
Act"); such registration statement includes a prospectus which, as supplemented,
shall be, and may include a preliminary prospectus supplement which, as
completed, is proposed to be, used in connection with the sale of the Registered
Certificates. Such registration statement, as amended to the date of this
Agreement, is hereinafter referred to as the "Registration Statement"; such
prospectus (which shall be in the form in which it has most recently been filed,
as the same is proposed to be added to or changed), as first supplemented by a
prospectus supplement relating to the Registered Certificates, filed, or
transmitted for filing, with the Commission pursuant to Rule 424(b) under the
Securities Act and used in connection with the sale of the Registered
Certificates, is hereinafter referred to as the "Base
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Prospectus"; such prospectus supplement is hereinafter referred to as the
"Prospectus Supplement"; and the Base Prospectus and the Prospectus Supplement
are collectively referred to as the "Prospectus". Any preliminary form of
Prospectus that has heretofore been filed pursuant to Rule 424 hereinafter is
called the "Preliminary Prospectus". Any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement or the
Prospectus shall be deemed to refer to and include the filing of any document
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
deemed to be incorporated by reference therein after the date hereof. SBMS will
file with the Commission (i) within fifteen (15) days of the issuance of the
Certificates a current report on Form 8-K (a "Current Report") for purposes of
filing the Pooling and Servicing Agreement and other material contracts and (ii)
in the time period specified in Section 5(e) hereof, a Current Report for
purposes of filing certain Computational Materials and ABS Term Sheets as
described in Section 5(e) hereof.
(b) The Registration Statement, as of the date it became effective, and
the Prospectus, as of the date of the Prospectus Supplement, and any revisions
or amendments thereof or supplements thereto filed prior to the termination of
the offering of the Registered Certificates, as of their respective effective or
issue dates, conformed or will conform, as applicable, in all material respects
to the requirements of the Securities Act and the rules and regulations of the
Commission thereunder applicable to the use of such documents as of such
respective dates, and the Registration Statement and the Prospectus, as revised,
amended or supplemented as of the Closing Date (as defined in Section 3), will
conform in all material respects to the requirements of the Securities Act and
the rules and regulations of the Commission thereunder applicable to the use of
such documents as of the Closing Date; and no such document, as of such
respective dates and, in the case of the Prospectus and any revisions or
amendments thereof or supplements thereto filed prior to the Closing Date, as of
the Closing Date, included or will include any untrue statement of a material
fact or omitted or will omit to state 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; provided, however,
that SBMS does not make any representations, warranties or agreements as to (A)
the information contained in or omitted from the Prospectus or any revision or
amendment thereof or supplement thereto in reliance upon and in conformity with
information furnished in writing by or on behalf of the Underwriters
specifically for use in connection with the preparation of the Prospectus or any
revision or amendment thereof or supplement thereto, (B) any information in any
Computational Materials and ABS Term Sheets (each as defined in Section 9)
provided by the Underwriters to prospective investors in connection with the
sale of the Registered Certificates, or (C) the statements in the Registration
Statement, the Prospectus or any revisions or amendments thereof or supplement
thereto that are excluded from the indemnification provisions hereof pursuant to
Section 7(a)(ii). There are no contracts or other documents relating to SBMS of
a character required to be described in or to be filed as exhibits to the
Registration Statement, as of the date of the Prospectus Supplement, which were
not described or filed as required.
(c) As of the Closing Date, the Registered Certificates will be duly
authorized by SBMS, and, when the Registered Certificates have been duly
executed and authenticated in the manner contemplated in the Pooling and
Servicing Agreement and have been delivered to and paid for by the Underwriters
pursuant to this Agreement, the Registered Certificates will be validly issued
and outstanding and entitled to the benefits provided by the Pooling and
Servicing Agreement.
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(d) Xxxxxx Xxxxxxxx LLP ("Xxxxxx Xxxxxxxx") is an independent public
accountant with respect to SBMS as required by the Securities Act and the rules
and regulations thereunder.
(e) As of the Closing Date, the Pooling and Servicing Agreement and
each Mortgage Loan Purchase Agreement will have been duly authorized, executed
and delivered by SBMS and, assuming the valid authorization, execution and
delivery thereof by the other parties thereto, will constitute a valid and
binding agreement of SBMS enforceable in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency, reorganization or
other laws relating to or affecting the enforcement of creditors' rights and by
general principles of equity.
(f) This Agreement has been duly authorized, executed and delivered by
SBMS.
(g) SBMS has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Delaware, with
corporate power and authority to own its properties and conduct its business as
described in the Prospectus.
(h) The issuance and sale of the Registered Certificates to the
Underwriters pursuant to this Agreement, the compliance by SBMS with the other
provisions of this Agreement, the Mortgage Loan Purchase Agreements, the Pooling
and Servicing Agreement and the Registered Certificates and the consummation by
SBMS of the other transactions herein or therein contemplated do not, under any
statute, regulation or rule of general applicability in the United States or any
decision, order, decree or judgment of any judicial or other governmental body
specifically applicable to SBMS, require any consent, approval, authorization,
order, registration or qualification of or with any court or governmental
authority, except (A) such as have been obtained or effected with respect to the
Registered Certificates under the Securities Act, (B) the recordation of the
assignments of the Mortgage Loans to the Trustee, which recordation is to be
completed pursuant to the Pooling and Servicing Agreement on or following the
Closing Date and (C) such other approvals as have been obtained; provided that
SBMS makes no representations or warranties as to any consent, approval,
authorization, registration or qualification that may be required under state
securities or "blue sky" laws.
(i) Neither the execution and delivery of this Agreement, the Mortgage
Loan Purchase Agreements and the Pooling and Servicing Agreement, nor the
issuance and delivery of the Registered Certificates, nor the consummation by
SBMS of any other of the transactions contemplated herein or therein, nor the
fulfillment by SBMS of the terms of this Agreement, the Mortgage Loan Purchase
Agreements and the Pooling and Servicing Agreement, will conflict with, violate,
result in a breach of or constitute a default under the certificate of
incorporation or by-laws of SBMS, any statute or regulation currently applicable
to SBMS, or any order currently applicable to SBMS of any court, regulatory
body, administrative agency or governmental body having jurisdiction over SBMS,
or the terms of any indenture or other agreement or instrument to which SBMS is
a party or by which it or any of its properties are bound.
(j) There are no actions or proceedings against, or investigations of,
SBMS pending, or, to the knowledge of SBMS, threatened, before any court,
administrative agency or other tribunal (A) asserting the invalidity of this
Agreement, the Mortgage Loan Purchase Agreements, the Pooling and Servicing
Agreement or the Registered Certificates, (B) seeking to prevent the issuance of
the
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Registered Certificates or the consummation by SBMS of any of the transactions
contemplated by this Agreement, the Mortgage Loan Purchase Agreements or the
Pooling and Servicing Agreement, (C) that might materially and adversely affect
the performance by SBMS of its obligations under, or the validity or
enforceability against SBMS of, this Agreement, the Mortgage Loan Purchase
Agreements, the Pooling and Servicing Agreement or the Registered Certificates
or (D) seeking to affect adversely the federal income tax attributes of the
Registered Certificates described in the Prospectus.
(k) SBMS is not aware of (i) any request by the Commission for any
further amendment of the Registration Statement or the Prospectus or for any
additional information, (ii) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose or (iii) any notification with
respect to the suspension of the qualification of the Registered Certificates
for sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose.
(l) Any taxes, fees and other governmental charges (other than income
taxes, franchise taxes and recording and filing fees) that are due and payable
by SBMS as of the Closing Date in connection with the execution, delivery and
performance of this Agreement, the Mortgage Loan Purchase Agreements, the
Pooling and Servicing Agreement and the Registered Certificates, will have been
paid at or prior to the Closing Date.
(m) SBMS is not, and the issuance and sale of the Registered
Certificates in the manner contemplated by the Prospectus will not cause SBMS to
be, subject to registration or regulation as an investment company or affiliate
of an investment company under the Investment Company Act of 1940, as amended
(the "Investment Company Act").
(n) The transfer of the Mortgage Loans to the Trust and the sale of the
Certificates to each of the Underwriters, at the Closing Date, will be treated
by SBMS for financial accounting and reporting purposes as a sale of assets and
not as a pledge of assets to secure debt.
2. PURCHASE AND SALE. Subject to the terms and conditions and in
reliance on the representations and warranties herein set forth, SBMS agrees to
sell to each of the Underwriters, and each of the Underwriters, severally and
not jointly, agrees to purchase from SBMS, their respective portions of the
Class Principal Balance of each class of Registered Certificates specified on
Schedule I hereto, at the purchase price for each such class as set forth on
such Schedule I (the "Purchase Price").
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3. DELIVERY AND PAYMENT. Delivery of and payment for the Registered
Certificates shall be made in the manner, on the date and at the time specified
in Schedule I hereto, which date and time may be changed by agreement among the
Underwriters and SBMS (such date and time of delivery of and payment for the
Registered Certificates being hereinafter referred to as the "Closing Date").
Delivery of each Underwriter's allotment of the Registered Certificates shall be
made to the related Underwriter against payment by such Underwriter of the
purchase price therefor to or upon the order of SBMS in same-day funds by
federal funds wire (or by such other method as such Underwriter and SBMS may
agree). Unless delivery is made through the facilities of The Depository Trust
Company, the Registered Certificates of each class thereof shall be registered
in such names and in such authorized denominations as the related Underwriter
may have requested not less than three (3) full business days prior to the
Closing Date.
SBMS agrees to have the Registered Certificates available for
inspection, checking and packaging in New York, New York, at any time before
3:00 p.m. New York City time on the business day prior to the Closing Date.
4. OFFERING BY THE UNDERWRITERS. It is understood that the Underwriters
propose to offer the Registered Certificates for sale as set forth in the
Prospectus. It is further understood that SBMS, in reliance upon Policy
Statement 105, has not filed and will not file an offering statement pursuant to
Section 352-e of the General Business Law of the State of New York with respect
to the Registered Certificates. As required by Policy Statement 105, each
Underwriter therefore covenants and agrees with SBMS that sales of the
Registered Certificates made by such Underwriter in and from the State of New
York will be made only to institutional investors within the meaning of Policy
Statement 105. It is further understood that, as set forth in the Prospectus,
Artesia is not registered as a broker/dealer in the United States. Accordingly,
Artesia can offer the Registered Certificates for sale only outside the United
States to non-U.S. persons within the meaning of the Securities Act and the
rules and regulations thereunder, and assuming compliance herewith, Artesia
shall not be subject to the provisions hereof regarding Computational Materials
and ABS Term Sheets.
5. AGREEMENTS. SBMS and the Underwriters mutually agree that:
(a) SBMS will not file any supplement to the Prospectus relating to or
affecting the Registered Certificates at any time, except as contemplated by
Section 5(e) or unless SBMS has furnished a copy to the Underwriters for their
review prior to filing, and will not file any such proposed supplement to which
the Underwriters reasonably objects. SBMS will not file any amendment to the
Registration Statement relating to or affecting the Registered Certificates at
any time subsequent to the date hereof and prior to the Closing Date, except as
contemplated by Section 5(e) or unless SBMS has furnished a copy to Salomon for
its review prior to filing, and will not file any such proposed amendment to
which Xxxxxxx reasonably objects. Subject to the foregoing sentences, SBMS will
cause the Prospectus to be filed, or transmitted for filing, with the Commission
pursuant to Rule 424(b) under the Securities Act and will promptly advise each
Underwriter when the Prospectus has been so filed, or transmitted for filing,
and, prior to the termination of the offering of the Registered Certificates,
will also promptly advise each Underwriter (i) when any amendment to the
Registration Statement relating to the Registered Certificates has become
effective or any revision of or supplement to the Prospectus has been so filed
or transmitted for filing, (ii) of any request by the Commission for any
amendment of the Registration Statement or the Prospectus or
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for any additional information, (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose and (iv) of the
receipt by SBMS of any notification with respect to the suspension of the
qualification of the Registered Certificates for sale in any jurisdiction or the
institution or threatening of any proceeding for such purpose. SBMS will use its
best efforts to prevent the issuance of any such stop order and, if issued, to
obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Registered
Certificates is required to be delivered under the Securities Act, (i) 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 a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or (ii) it shall be
necessary to revise, amend or supplement the Prospectus to comply with the
Securities Act or the rules and regulations of the Commission thereunder, SBMS
promptly will prepare and file with the Commission, subject to paragraph (a) of
this Section 5, a revision, amendment or supplement that will correct such
statement or omission or effect such compliance.
(c) Upon request, so long as delivery of a prospectus relating to the
Registered Certificates is required under the Securities Act, SBMS will furnish
to any Underwriter and counsel for such Underwriter, without charge, as many
copies of the Prospectus and any revisions or amendments thereof or supplements
thereto as may be reasonably requested.
(d) SBMS will use its best efforts to arrange for the qualification of
the Registered Certificates for sale under the laws of such jurisdictions as
Xxxxxxx may designate, to maintain such qualifications in effect so long as
required for the distribution of the Registered Certificates and to arrange for
the determination of the legality of the Registered Certificates for purchase by
institutional investors; provided, however, that SBMS shall not be required to
qualify to do business in any jurisdiction where it is not now so qualified or
to take any action that would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(e) SBMS will cause or, if appropriate, has caused any Computational
Materials and ABS Term Sheets (each as defined in Section 9) with respect to the
Registered Certificates, which are or have been delivered by the Underwriters to
SBMS pursuant to or as contemplated by Section 9, to be filed with the
Commission on a Current Report pursuant to Rule 13a-11 under the Exchange Act
not later than, in each such case, the business day immediately following the
later of (i) the day on which such Computational Materials or ABS Term Sheets
are delivered to counsel for SBMS by the Underwriters (it being understood that
any such material that is delivered after 10:30 a.m., New York City time, on a
business day shall be deemed to have been delivered on the next business day)
and (ii) the date hereof; and, if such filing is subsequent to the date hereof,
SBMS will promptly advise the Underwriters when each such Current Report has
been so filed. If any Collateral Term Sheet (as defined in Section 9) is
provided by any Underwriter to potential investors in the Registered
Certificates, SBMS will cause each such Collateral Term Sheet that is delivered
by such Underwriter to SBMS to be filed with the Commission on a Current Report
pursuant to Rule 13a-11 under the Exchange Act on the business day immediately
following the day on which such Collateral Term Sheet is delivered to counsel
for SBMS by such Underwriter (it being understood that any such material that is
delivered after 10:30 a.m., New York City time, on a business day shall be
deemed
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to have been delivered on the next business day). Each such Current Report shall
be incorporated by reference in the Prospectus and the Registration Statement.
Notwithstanding the foregoing, SBMS shall have no obligation to file materials
provided by the Underwriters pursuant to or as contemplated by Section 9 which,
in the reasonable determination of SBMS after making reasonable efforts to
consult with the Underwriters, are not required to be filed pursuant to the
No-Action Letters (as defined in Section 9), or which contain erroneous
information or contain any untrue statement of a material fact, or which, when
read in conjunction with the Prospectus, omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading;
it being understood, however, that SBMS shall have no obligation to review or
pass upon the accuracy or adequacy of, or to correct, any Computational
Materials or ABS Term Sheets provided by the Underwriters to SBMS pursuant to or
as contemplated by Section 9 hereof.
(f) The purchase of the Certificates by each of the Underwriters, at
the Closing Date, will be treated by each Underwriter for financial accounting
and reporting purposes as a sale of the Certificates by SMBS and not as a pledge
of the Certificates to secure a debt. The Underwriters agree to sell the
Registered Certificates only to purchasers other than SBMS, the Mortgage Loan
Sellers and their respective affiliates, except that Artesia may sell its
allocation of Registered Certificates to an affiliate of AMCC.
(g) SBMS will make generally available to holders of the Registered
Certificates as soon as practicable, but in any event not later than eighteen
months after the filing of the Prospectus pursuant to Rule 424(b) under the
Securities Act, an earnings statement (which need not be audited) with respect
to the Mortgage Pool as contemplated by Section 11(a) of the Securities Act),
which pursuant to Rule 158 under the Securities Act may be the annual report
filed with the Commission with respect to the Trust.
6. CONDITIONS TO THE OBLIGATIONS OF EACH UNDERWRITER AND SBMS. The
obligation of each Underwriter to purchase from SBMS, and the obligation of SBMS
to sell to such Underwriter, its allotment of the Registered Certificates shall
be subject to the accuracy of the representations and warranties on the part of
SBMS and such Underwriter contained herein as of the date hereof and as of the
Closing Date, to the accuracy of the statements of SBMS and such Underwriter
made in any officer's certificate delivered pursuant to the provisions hereof,
to the performance by SBMS and such Underwriter of their respective obligations
hereunder and to the following additional conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been instituted and be pending or shall have been threatened.
(b) SBMS shall have furnished to the Underwriters:
(i) An executed copy of the Pooling and Servicing Agreement;
(ii) An opinion of Xxxxxx & Xxxxxx, counsel for SBMS, dated
the Closing Date, substantially to the effect that:
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(A) SBMS is validly existing as a corporation in good
standing under the laws of the State of Delaware, with
corporate power and authority under such laws to enter into
and perform its obligations under this Agreement, the Mortgage
Loan Purchase Agreements and the Pooling and Servicing
Agreement;
(B) The Registered Certificates have been duly
authorized by SBMS and, when the Registered Certificates have
been duly executed and authenticated in the manner
contemplated in the Pooling and Servicing Agreement and have
been delivered to and paid for by the Underwriters pursuant to
this Agreement, the Registered Certificates will be validly
issued and outstanding and entitled to the benefits provided
by the Pooling and Servicing Agreement;
(C) The Pooling and Servicing Agreement and each of
the Mortgage Loan Purchase Agreements has been duly
authorized, executed and delivered by SBMS and, upon the due
authorization, execution and delivery by the other parties
thereto, will constitute a valid, legal and binding agreement
of SBMS, enforceable against SBMS in accordance with its
terms, except as enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws
relating to or affecting the enforcement of creditors' rights
generally, by general principles of equity, whether
enforcement is sought in a proceeding in equity or at law, by
public policy considerations underlying the securities laws,
to the extent that such public policy considerations limit the
enforceability of the provisions of the Pooling and Servicing
Agreement that purport or are construed to provide
indemnification for securities laws liabilities, and by such
other exceptions as the Underwriters shall agree;
(D) The Pooling and Servicing Agreement is not
required to be qualified under the Trust Indenture Act of
1939, as amended, and the Trust is not required to be
registered under the Investment Company Act;
(E) The Registration Statement has become effective
under the Securities Act, and, to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for
that purpose have been instituted and are pending or have been
threatened under the Securities Act;
(F) The Registration Statement, at the time it became
effective, and the Prospectus, as of the date of the
Prospectus Supplement, and each revision or amendment thereof
or supplement thereto relating to the Registered Certificates,
as of its effective or issue date (except in each case for
accounting, financial and statistical statements included
therein or omitted therefrom and for Computational Materials
and ABS Term Sheets, as to which such counsel has not been
requested to comment), appeared on their respective faces to
be appropriately responsive in all material respects to the
requirements of the Securities Act and the rules and
regulations of the Commission thereunder applicable to such
documents as of such respective dates; and the Prospectus, as
revised, amended or supplemented as of the date hereof (except
for accounting, financial and statistical statements included
therein
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or omitted therefrom, as to which such counsel has not been
requested to comment), conforms in all material respects to
the requirements of the Securities Act and the rules and
regulations of the Commission thereunder applicable to use of
the Prospectus (as so revised, amended or supplemented) as of
the date hereof;
(G) No consent, approval, authorization or order of
any federal or State of New York court or agency or other
governmental body is required for the consummation by SBMS of
the transactions contemplated by the terms of this Agreement,
the Mortgage Loan Purchase Agreements or the Pooling and
Servicing Agreement, except such as may be required under the
securities or "blue sky" laws of any state in connection with
the purchase and the offer and sale of the Registered
Certificates by the Underwriters as to which such counsel need
not express any opinion, and except such as have been
obtained;
(H) The execution, delivery and performance by SBMS
of the terms of this Agreement, the Mortgage Loan Purchase
Agreements or the Pooling and Servicing Agreement will not
violate or result in a breach of any term or provision of the
certificate of incorporation or by-laws of SBMS or any federal
or State of New York statute or regulation, except such
counsel need express no opinion as to compliance with the
securities laws of New York and other particular States in
connection with the purchase and sale of the Registered
Certificates by the Underwriters;
(I) Such counsel does not know, having made no
independent investigation, of any contracts or other documents
relating to SBMS of a character required to be described in or
to be filed as exhibits to the Registration Statement, as of
the date of the Prospectus Supplement, that were not described
or filed as required;
(J) This Agreement has been duly authorized, executed
and delivered by SBMS;
(K) The statements in each of the Base Prospectus and
the Prospectus Supplement under the headings "ERISA
Considerations", "Federal Income Tax Consequences" and "Legal
Investment", to the extent that they describe certain matters
of federal law or legal conclusions with respect thereto,
while not discussing all possible consequences of an
investment in the Registered Certificates to all investors,
provide in all material respects an accurate summary of such
matters and conclusions set forth under such headings;
(L) As described in the Prospectus Supplement and
assuming compliance with the provisions of the Pooling and
Servicing Agreement, (1) REMIC I will qualify as a REMIC
within the meaning of Sections 860A through 860G (the "REMIC
Provisions") of the Internal Revenue Code of 1986, and the
REMIC I Regular Interests will be "regular interests" and the
REMIC I Residual Interest will be the sole class of "residual
interests" in REMIC I (as both terms are defined in the REMIC
Provisions in effect on the Closing Date), (2) REMIC II will
qualify as a REMIC within the meaning of the REMIC Provisions,
and the REMIC II Regular Interests
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will be "regular interests" and the REMIC II Residual Interest
will be the sole class of "residual interests" in REMIC II and
(3) REMIC III will qualify as a REMIC within the meaning of
the REMIC Provisions, and the Class A-1, Class A-2, Class X,
Class B, Class C, Class D, Class E, Class F, Class G, Class H,
Class J, Class K, Class L, Class M, Class N and Class P
Certificates will be "regular interests" and the REMIC III
Residual Interest will be the sole class of "residual
interests" in REMIC III;
(M) Assuming compliance with the provisions of the
Pooling and Servicing Agreement, for City and State of New
York income and corporation franchise tax purposes, REMIC I,
REMIC II and REMIC III will each be classified as a REMIC and
not as a corporation, partnership or trust, in conformity with
the federal income tax treatment of REMIC I, REMIC II and
REMIC III. Accordingly, the Trust Fund will be exempt from all
City and State of New York taxation imposed on its income,
franchise or capital stock, and its assets will not be
included in the calculation of any franchise tax liability;
(N) The portions of the Trust Fund consisting of
Grantor Trust Y and Grantor Trust R, respectively, will each
be classified as a grantor trust under Subpart E, Part I of
Subchapter J of the Code; and
(O) The statements set forth in the Prospectus
Supplement under the headings "Description of the Offered
Certificates" and "Servicing of the Underlying Mortgage Loans"
and in the Prospectus under the headings "Description of the
Certificates" and "Description of the Agreements", insofar as
such statements purport to summarize certain material
provisions of the Registered Certificates and the Pooling and
Servicing Agreement, provide in all material respects an
accurate summary of such provisions.
In giving its opinions, Xxxxxx & Xxxxxx, counsel to SBMS, shall
additionally state that, based on conferences and telephone conversations with
representatives of the Mortgage Loan Sellers, the Underwriters, SBMS, the
Trustee, the Master Servicer, the Special Servicer and their respective counsel
(but without having reviewed any of the mortgage notes, mortgages or other
documents relating to the Mortgage Loans or made any inquiry of any originator
of any Mortgage Loan not referenced above), nothing has come to such counsel's
attention that would lead it to believe that the Registration Statement or the
Prospectus (other than any accounting, financial or statistical information
contained in or omitted from the Registration Statement or the Prospectus and
information incorporated by reference into the Registration Statement or the
Prospectus and any information relating to the characteristics of the Mortgage
Loans and the related borrowers and mortgaged properties, all as to which such
counsel has not been requested to comment), at the date of effectiveness of the
Registration Statement (in the case of the Registration Statement) or at the
date of the Prospectus Supplement or at the Closing Date (in the case of the
Prospectus Supplement), included or includes an untrue statement of a material
fact or omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
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Such opinion may express its reliance as to factual matters on the
representations and warranties made by, and on certificates or other documents
furnished by officers and/or authorized representatives of, the parties to this
Agreement, the Mortgage Loan Purchase Agreements and the Pooling and Servicing
Agreement and on certificates furnished by public officials. Such opinion may
assume the due authorization, execution and delivery of the instruments and
documents referred to therein by the parties thereto other than SBMS. Such
opinion need cover only the laws of the State of New York, the General
Corporation Law of the State of Delaware and the federal law of the United
States;
(iii) The Underwriters shall have received copies of all legal
opinion letters delivered to the Rating Agencies by Xxxxxx & Xxxxxx, as
counsel to SBMS, in connection with the issuance of the Registered
Certificates, accompanied in each case by a letter signed by Xxxxxx &
Xxxxxx stating that such Underwriter may rely on such opinion letter as
if it were addressed to the Underwriters as of the date thereof;
(iv) Good standing certificates regarding SBMS, each of the
Mortgage Loan Sellers, the Master Servicer, the Special Servicer and
the Trustee from the Secretary of State (or other appropriate
authority) of the jurisdiction under which each such entity has been
formed, dated not earlier than 30 days prior to the Closing Date;
(v) Certificates of SBMS, each of the Mortgage Loan Sellers,
the Master Servicer, the Special Servicer and the Trustee, each dated
the Closing Date and signed by an executive officer or authorized
signatory of such party, to the effect that the representations and
warranties of such party herein, in the Mortgage Loan Purchase
Agreements and/or in the Pooling and Servicing Agreement, as
applicable, are true and correct in all material respects on and as of
the Closing Date with the same effect as if made on the Closing Date,
and, in the case of SBMS, to the effect that SBMS has complied in all
material respects with all agreements and satisfied all the conditions
on its part to be performed or satisfied at or prior to the Closing
Date; and
(vi) Officer's certificates, dated the Closing Date and signed
by the secretary or an assistant secretary of SBMS, each of the
Mortgage Loan Sellers, the Master Servicer, the Special Servicer and
the Trustee, to the effect that each individual who, as an officer or
representative of such party, signed this Agreement, any of the
Mortgage Loan Purchase Agreements, the Pooling and Servicing Agreement
or any other document or certificate delivered on or before the Closing
Date in connection with the transactions contemplated herein, in the
Mortgage Loan Purchase Agreements or in the Pooling and Servicing
Agreement, was at the respective times of such signing and delivery,
and is as of the Closing Date, duly elected or appointed, qualified and
acting as such officer or representative, and the signatures of such
persons appearing on such documents and certificates are their genuine
signatures. Such certificate shall be accompanied by true and complete
copies (certified as such by the secretary or an assistant secretary of
such party) of the organizational documents of such party, as in effect
on the Closing Date, and of the resolutions of such party and any
required shareholder, member or partner consent relating to the
transactions contemplated in this Agreement, the Mortgage Loan Purchase
Agreements and/or the Pooling and Servicing Agreement, as applicable.
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(c) The Underwriters shall have received, with respect to each of the
Mortgage Loan Sellers, the Master Servicer, the Special Servicer and the
Trustee, a favorable opinion of counsel, dated the Closing Date, addressing the
valid existence and good standing of such party under the laws of the
jurisdiction of its organization, the due authorization, execution and delivery
of, as applicable, the Pooling and Servicing Agreement, the related Mortgage
Loan Purchase Agreement and/or the related Indemnification Agreement (as defined
in Section 7(a)) by such party and, subject to the same limitations as set forth
in Section 6(b)(ii)(C), the enforceability of, as applicable, the Pooling and
Servicing Agreement and the related Mortgage Loan Purchase Agreement against
such party. Such opinion may express its reliance as to factual matters on
representations and warranties made by, and on certificates or other documents
furnished by officers and/or authorized representatives of parties to the
Pooling and Servicing Agreement, the related Mortgage Loan Purchase Agreement
and the related Indemnification Agreement and on certificates furnished by
public officials. Such opinion may assume the due authorization, execution and
delivery of the instruments and documents referred to therein by the parties
thereto other than the party on behalf of which such opinion is being rendered.
Such opinion need cover only the laws of the jurisdiction in which the party on
whose behalf such opinion is being rendered is organized, the laws of the State
of New York and the federal law of the United States.
(d) SBMS and the Underwriters shall have received from Xxxxxx Xxxxxxxx,
certified public accountants, various comfort letters, dated, as applicable, the
date of the Preliminary Prospectus, the date of the Prospectus Supplement or
such other date acceptable to SBMS and the Underwriters, in form and substance
reasonably satisfactory to SBMS and the Underwriters, stating in effect that:
(i) They have performed certain specified procedures as a
result of which they have determined that the information of an
accounting, financial or statistical nature set forth in the Prospectus
Supplement under the caption "Description of the Mortgage Pool" and on
Annex A-1 and A-2 thereto agrees with the data sheet or computer tape
prepared by the Mortgage Loan Sellers, unless otherwise noted in such
letter(s); and
(ii) They have compared the data contained in the data sheet
or computer tape referred to in the immediately preceding clause (i) to
information contained in an agreed upon sampling of the Mortgage Loan
files and in such other sources as shall be specified by them, and
found such data and information to be in agreement, unless otherwise
noted in such letter.
(e) SBMS and the Underwriters shall have received from Xxxxxx Xxxxxxxx,
certified public accountants, a letter dated on or about the Closing Date, in
form and substance reasonably satisfactory to SBMS and the Underwriters, to the
effect that they have performed certain specified procedures, all of which have
been agreed to by SBMS and the Underwriters, as a result of which they confirmed
the information of an accounting, financial or statistical nature included in
the Prospectus Supplement under the caption "Yield and Maturity Considerations".
(f) Each Underwriter shall have delivered to SBMS and to the other
Underwriters an officer's certificate (i) stating that attached thereto are all
of the information, tables, charts and other items that constitute Computational
Materials or ABS Term Sheets prepared by such Underwriter that are required to
be filed with the Commission pursuant to the terms of the No-Action Letters (as
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defined in Section 9) and stating that such Underwriter has otherwise complied
with the terms of the No-Action Letters and (ii) representing that, other than
the items described in clause (i), no term sheets, collateral information or
other data in written form that would be required to be filed with the
Commission pursuant to the No-Action Letters were furnished by such Underwriter
to actual or potential investors for the Registered Certificates prior to the
Closing Date.
(g) Xxxxxx Xxxxxxxx shall have furnished to SBMS and each Underwriter a
letter or letters, each in form and substance satisfactory to SBMS, relating to
the Computational Materials and ABS Terms Sheets of such Underwriter filed in
accordance with Section 5(e), dated the date of the related Current Report and
stating in effect that:
(i) Using the assumptions and methodology used by such
Underwriter, all of which shall be described by reference in the
letter, they have recalculated the numerical data and dates set forth
in such Computational Materials and ABS Term Sheets of such Underwriter
(or portions thereof) attached to such letter, compared the results of
their calculations to the corresponding items in such Computational
Materials and ABS Term Sheets (or portions thereof) and found such
items to be in agreement with the respective results of such
calculation;
(ii) If such Computational Materials and ABS Term Sheets
include data reflecting the distribution of interest at other than a
fixed rate, or reflecting other characteristics that give rise to the
use of tables in such Computational Materials and ABS Term Sheets, such
letter shall also set forth such other statements as are customarily
set forth by Xxxxxx Xxxxxxxx in such letter with respect to such data;
and
(iii) They have performed certain specified procedures as a
result of which they have determined that the information of an
accounting, financial or statistical nature set forth in such
Computational Materials and ABS Term Sheets agrees with the data sheet
or computer tape prepared by each Mortgage Loan Seller, unless
otherwise indicated in such letter.
(h) The Underwriters shall have received an opinion of counsel, dated
the Closing Date, from Xxxxxx & Xxxxxxx, counsel to the Underwriters, in form
and substance satisfactory to them.
(i) SBMS and the Underwriters shall have received an opinion of
counsel, dated the Closing Date, from counsel for each Mortgage Loan Seller,
stating that, based on conferences and telephone conversations with
representatives of such Mortgage Loan Seller, the Underwriters, SBMS, the
Trustee, the Master Servicer, the Special Servicer and their respective counsel,
and further based on a review of certain legal documents relating to a select
group of the Mortgage Loans being sold by that Mortgage Loan Seller and a
compilation of the information in the loan summaries prepared by such Mortgage
Loan Seller for all of such Mortgage Loans (but otherwise without having
reviewed any of the mortgage notes, mortgages or other documents relating to the
Mortgage Loans or made any inquiry of any originator of any Mortgage Loan),
nothing has come to such counsel's attention that would lead it to believe that
the statements in the Prospectus relating to the description of the Mortgage
Loans being sold by that Mortgage Loan Seller (except for any accounting,
financial or statistical information contained in or omitted from the Prospectus
and
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information incorporated by reference into the Prospectus, all as to which such
counsel has not been requested to comment), at the date of the Prospectus
Supplement or at the Closing Date, included or includes an untrue statement of a
material fact or omitted or omits to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading.
(j) Subsequent to the date hereof, there shall not have occurred any
change, or any development involving a prospective change, in or affecting the
business or properties of SBMS that Xxxxxxx concludes, in its opinion after
consultation with SBMS, materially impairs the investment quality of the
Registered Certificates so as to make it impractical or inadvisable to proceed
with the public offering or the delivery of the Registered Certificates as
contemplated by the Prospectus.
(k) The Registered Certificates shall have been assigned ratings no
less than those set forth on Schedule I and such ratings shall not have been
rescinded or qualified.
7. INDEMNIFICATION AND CONTRIBUTION. (a) SBMS agrees to indemnify and hold
harmless each Underwriter and each person who controls such Underwriter within
the meaning of either the Securities Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which it or any of
them may become subject under the Securities Act, the Exchange Act, or other
federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement, the
Prospectus or any revision or amendment thereof or supplement thereto, or in any
other filing incorporated by reference therein, 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 it or him in connection with investigating or defending any such
loss, claim, damage, liability or action; provided that SBMS 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: (i) any such untrue statement or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact in the Prospectus or any revision or amendment thereof or supplement
thereto that was made in reliance upon and in conformity with written
information furnished to SBMS by or on behalf of any Underwriter specifically
for use in connection with the preparation thereof; (ii) any such untrue
statement or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact in the Registration Statement, the Prospectus
or any revision or amendment thereof or supplement thereto that (A) arose out of
or was based upon an untrue statement, omission or other inaccuracy with respect
to the Mortgage Loan Seller Matters (as defined below) contained in the Master
Tape (also as defined below) (it being acknowledged that the Master Tape has
been used to prepare the Prospectus Supplement and any Computational Materials
and ABS Term Sheets (each as defined in Section 9) with respect to the
Registered Certificates), (B) was made in reliance upon and conformity with (1)
any of the representations and warranties made by a Mortgage Loan Seller
contained in the related Indemnification Agreement (as defined below) or the
related Mortgage Loan Purchase Agreement, or (2) any other information regarding
the Mortgage Loan Seller Matters furnished by a Mortgage Loan Seller,
electronically or in writing, to the Depositor or any Underwriter in connection
with the preparation of the Prospectus, any Computational Materials or ABS Term
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Sheets with respect to the Registered Certificates, or any revision or amendment
thereof or supplement thereto, or (C) is contained in the information regarding
the Mortgage Loan Seller Matters set forth (1) in the Prospectus Supplement
under the headings "Summary of Prospectus Supplement-The Underlying Mortgage
Loans and the Mortgaged Real Properties", "Risk Factors-Risks Related to the
Underlying Mortgage Loans" and/or "Description of the Mortgage Pool" (provided
that SBMS shall be liable to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon an error in the manipulation
of, or any calculations based upon, or any aggregation (other than an
aggregation made in the Master Tape by a Mortgage Loan Seller) of information
concerning the Mortgage Loan Seller Matters), (2) on Annex A-1 and/or Annex A-2
to the Prospectus Supplement or (3) on the diskette accompany the Prospectus
Supplement; (iii) any such untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact that was
made in any Computational Materials or ABS Term Sheets provided by any
Underwriter to prospective investors in connection with the sale of the
Registered Certificates and incorporated by reference into the Registration
Statement or Prospectus as a result of any filing pursuant to Section 5(e), or
(iv) any breach, inaccuracy or untruth of any of the statements,
representations, warranties and/or covenants made by any Underwriter pursuant to
Section 6(f) and/or Section 9(b). This indemnity agreement will be in addition
to any liability that SBMS may otherwise have.
The "Mortgage Loan Seller Matters" consist of the following matters:
the Mortgage Loans and the underlying real properties securing the Mortgage
Loans; the related loan documents and the obligors thereunder, the Loan REMICs
and the Mortgage Loan Sellers.
The "Master Tape" is the compilation of underlying information and data
regarding the Mortgage Loans covered by the independent accountants' report on
applying agreed upon procedures dated August 15, 2000, as supplemented to the
date of initial issuance of the Certificates, and rendered by Xxxxxx Xxxxxxxx.
The "Indemnification Agreements" consist, collectively, of (i) the
Indemnification Agreement dated the date hereof, between SBRC, SBMS and the
Underwriters, (ii) the Indemnification Agreement dated the date hereof, between
PWRES, SBMS and the Underwriters, (iii) the Indemnification Agreement dated the
date hereof, between AMCC, SBMS and the Underwriters, and (iv) the
Indemnification Agreement dated the date hereof, between ORIX, SBMS and the
Underwriters.
(b) Each Underwriter, severally and not jointly, agrees to indemnify
and hold harmless SBMS and each of its directors, each of its officers who
signed the Registration Statement or any amendments thereof, and each person who
controls SBMS within the meaning of either the Securities Act or the Exchange
Act, to the same extent as the foregoing indemnities from SBMS to the
Underwriters, but only with reference to (i) written information furnished to
SBMS by or on behalf of such Underwriter, specifically for use in connection
with the preparation of the Prospectus or any revision or amendment thereof or
supplement thereto, (ii) any untrue statement or alleged untrue statement of a
material fact made in Computational Materials or ABS Term Sheets provided by
such Underwriter to prospective investors in connection with the sale of the
Registered Certificates and incorporated by reference into the Registration
Statement or Prospectus as a result of any filing pursuant to Section 5(e)
(except that no such indemnity shall be available for any losses, claims,
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damages or liabilities, or actions in respect thereof, resulting from any
Collateral Error (as defined below), other than a Corrected Collateral Error (as
defined below)), (iii) any omission or alleged omission to state in any
Computational Materials or ABS Term Sheets provided by such Underwriter to
prospective investors in connection with the sale of the Registered Certificates
and incorporated by reference into the Registration Statement or Prospectus as a
result of any filing pursuant to Section 5(e), a material fact that, when read
in conjunction with the Prospectus, is required to be stated therein or
necessary to make the statements therein not misleading (except that no such
indemnity shall be available for any losses, claims, damages or liabilities, or
actions in respect thereof, resulting from any Collateral Error, other than a
Corrected Collateral Error) and (iv) any material breach, inaccuracy or untruth
of any of the statements, representations, warranties and/or covenants set forth
in Section 6(f) and/or Section 9(b). This indemnity agreement will be in
addition to any liability that the Underwriters may otherwise have. SBMS
acknowledges that the statements set forth in the fourth and fifth sentences of
the final paragraph on the cover page of the Prospectus Supplement, the
subsection entitled "Summary of Prospectus Supplement--Relevant
Parties--Underwriters" in the Prospectus Supplement, the second and third
sentences under the heading "Risk Factors - Risks Related to the Offered
Certificates-Secondary Market Limitations" in the Prospectus Supplement and the
second paragraph, the first sentence of the third paragraph, the first sentence
of the fourth paragraph, the first sentence of the fifth paragraph and the last
two paragraphs under the heading "Method of Distribution" in the Prospectus
Supplement, constitute the only information furnished in writing by or on behalf
of the Underwriters for inclusion in the Prospectus or any revision or amendment
thereof or supplement thereto, and each Underwriter confirms that such
statements attributable thereto are correct.
As used herein, "Collateral Error" shall mean any error in the
information concerning the Mortgage Loans furnished by a Mortgage Loan Seller to
SBMS or any Underwriter in writing or by electronic transmission that was used
in the preparation of any Computational Materials or ABS Term Sheets; provided
that Collateral Error shall not include an error in the manipulation of, or any
calculation based upon, or any aggregation of information concerning the
Mortgage Loans, provided by a Mortgage Loan Seller. "Corrected Collateral Error"
shall mean any Collateral Error as to which the Underwriters, prior to the
dissemination of the materials from which any loss, claim, damage or liability
or action in respect thereof arose, were notified in writing or provided in
written or electronic form information superseding or correcting such Collateral
Error, including, without limitation, as part of the Prospectus.
(c) Promptly after receipt by an indemnified party under Sections 7(a)
or (b) above of notice of the commencement of any suit, action, proceeding
(including, without limitation, any governmental or regulatory investigation),
claim or demand, such indemnified party will, if a claim in respect thereof is
to be made against the indemnifying party under Sections 7(a) or (b) above,
notify the indemnifying party in writing of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve the indemnifying
party from any liability that it may have to any indemnified party otherwise
than under this Section 7; provided, however, that any increase in such
liability as a result of such failure to notify shall not be an expense of the
indemnifying party. 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 may elect by
written notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof,
with counsel reasonably satisfactory to
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such indemnified party; provided that, if the defendants in any such action
include both the indemnified party and the indemnifying party, and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties that are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to assert such
legal defenses and to otherwise participate in the defense of such action on
behalf of such indemnified party or parties. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to assume the
defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party for legal
expenses of other counsel or other expenses, in each case subsequently incurred
by such indemnified party, in connection with the defense thereof unless (i) the
indemnified party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel (in addition to any
local counsel), representing the indemnified party or parties who are parties to
such action), (ii) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time period after notice of commencement of the action
or (iii) the indemnifying party has authorized the employment of counsel for the
indemnified party at the expense of the indemnifying party; and except that, if
clause (i) or (iii) is applicable, such liability shall be only in respect of
the counsel referred to in such clause (i) or (iii). No indemnifying party
shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified party is an actual or potential party to such action or claim)
unless such settlement, compromise or judgment (A) includes an unconditional
release of the indemnified party from all liability arising out of such action
or claim and (B) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(d) If the indemnification provided for in Sections 7(a) or (b) above
is due in accordance with its terms but is for any reason held by a court to be
unavailable on grounds of public policy or otherwise, SBMS and the related
Underwriter shall each contribute to the aggregate losses, claims, damages and
liabilities (including legal and other expenses reasonably incurred in
connection with investigating or defending same) to which SBMS and such
Underwriter may be subject in such proportion so that such Underwriter is
responsible for 0.5% thereof and SBMS is responsible for the balance; provided,
however, that if such allocation is not permitted by applicable law, then the
indemnifying party shall contribute in such proportion as is appropriate to
reflect not only the relative benefits referred to above but also the relative
fault of SBMS on the one hand and the related Underwriter on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. Notwithstanding the foregoing provisions of this Section 7(d),
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total underwriting discounts and commissions received by
such Underwriter in connection with the offering of the Registered Certificates
exceeds the amount of any damages which such party has otherwise been required
to pay by reason of such untrue statement or omission of a material fact or
alleged untrue statement or omission of a material fact. The relative fault of
SBMS on the one hand and the related Underwriter on the other shall be
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determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by SBMS or by such Underwriter
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. Notwithstanding
the foregoing, however, no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 7, each person who controls an
Underwriter within the meaning of either the Securities Act or the Exchange Act
shall have the same rights to contribution as such Underwriter, and each person
who controls SBMS within the meaning of either the Securities Act or the
Exchange Act, each officer of SBMS who shall have signed the Registration
Statement or any amendments thereof and each director of SBMS shall have the
same rights to contribution as SBMS. Any party entitled to contribution will,
promptly after receipt of notice of commencement of any action, suit or
proceeding against such party in respect of which a claim for contribution may
be made against another party or parties under this paragraph (d), notify such
party or parties from whom contribution may be sought, but the omission to so
notify such party or parties shall not relieve the party or parties from whom
contribution may be sought from any other obligation it or they may have
hereunder or otherwise than under this paragraph (d).
(e) The Underwriters further agree as follows:
(i) Xxxxxxx will indemnify and hold harmless each of Chase,
PaineWebber and Artesia against any losses, claims, damages or
liabilities to which either of them may become subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon (1) any untrue statements or
misstatements of a material fact made in Computational Materials or ABS
Term Sheets prepared by Salomon (except when due solely to a Collateral
Error) or (2) Xxxxxxx's failure to comply with Section 9, and will
reimburse each of Chase, PaineWebber and Artesia for any legal or other
expenses reasonably incurred by any of them thereby in connection with
investigating or defending any such action or claim as such expenses
are incurred.
(ii) PaineWebber will indemnify and hold harmless each of
Salomon, Chase and Artesia against any losses, claims, damages or
liabilities to which either of them may become subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon (1) any untrue statements or
misstatements of a material fact made in Computational Materials or ABS
Term Sheets prepared by PaineWebber (except when due solely to a
Collateral Error) or (2) PaineWebber's failure to comply with Section
9, and will reimburse each of Xxxxxxx, Chase and Xxxxxxx for any legal
or other expenses reasonably incurred by any of them thereby in
connection with investigating or defending any such action or claim as
such expenses are incurred.
(iii) Chase will indemnify and hold harmless each of Salomon,
PaineWebber and Artesia against any losses, claims, damages or
liabilities to which either of them may become subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon (1) any untrue statements or
misstatements of a material fact made in Computational materials or ABS
Term Sheets prepared by Chase (except when due solely to a Collateral
Error) or (2) Xxxxx'x failure to comply with Section
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9, and will reimburse each of Xxxxxxx, PaineWebber and Artesia for any
legal or other expenses reasonably incurred by any of them thereby in
connection with investigating or defending any such action or claim as
such expenses are incurred.
(iv) Artesia will indemnify and hold harmless each of Salomon,
Chase and PaineWebber against any losses, claims, damages or
liabilities to which either of them may become subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon (1) any untrue statements or
misstatements of a material fact made in Computational Materials or ABS
Term Sheets prepared by Artesia (except when due solely to a Collateral
Error) or (2) Artesia's failure to comply with Section 9, and will
reimburse each of Xxxxxxx, Chase and XxxxxXxxxxx for any legal or other
expenses reasonably incurred by any of them thereby in connection with
investigating or defending any such action or claim as such expenses
are incurred.
(v) Promptly after receipt by an indemnified party under
clause (i), clause (ii), clause (iii), or clause (iv) above of notice
of the commencement of any action, such indemnified party shall, if a
claim in respect thereof is to be made against the indemnifying party
under such clause, notify the indemnifying party in writing of the
commencement thereof; but the omission to so notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party otherwise than under such clause; provided, however,
that any increase in such liability as a result of such failure to
notify shall not be an expense of the indemnifying party. In case any
such action shall be brought against any indemnified party, and it
shall notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, may
elect by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party to
assume the defense thereof with counsel reasonable satisfactory to such
indemnified party, and, after notice from the indemnifying party to
such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified
party under clause (i), clause (ii), clause (iii), or clause (iv) above
for any legal expenses of other counsel or any other expenses, in each
case subsequently incurred by such indemnified party, in connection
with the defense thereof unless (A) the indemnified party shall have
employed separate counsel in connection with the assertion of legal
defenses in accordance with the proviso to this sentence (it being
understood, however, that the indemnifying party shall not be liable
for the expenses of more than one separate counsel (in addition to any
local counsel), approved by the indemnified party or parties,
representing the indemnified party or parties who are parties to such
action), (B) the indemnifying party shall not have employed counsel
reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time period after notice of
commencement of the action or (C) the indemnifying party has authorized
the employment of counsel for the indemnified party at the expense of
the indemnifying party; and except that, if clause (A) or (C) is
applicable, such liability shall be only in respect of the counsel
referred to in such clause (A) or (C); provided that, if the defendants
in any such action include both the indemnified party and the
indemnifying party, and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assert such legal
defenses and to
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otherwise participate in the defense of such action on behalf of such
indemnified party or parties. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to,
any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified party is an actual or potential party to such action or
claim) unless such settlement, compromise or judgment (A) includes an
unconditional release of the indemnified party from all liability
arising out of such action or claim and (B) does not include a
statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.
(vi) If the indemnification provided in clause (i), clause
(ii), clause (iii), or clause (iv) above, as the case may be, is due in
accordance with its terms in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, but is
for any reason held by a court to be unavailable on grounds of public
policy or otherwise, then the indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of
such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect both the
relative benefits received by the indemnifying party on the one hand
and indemnified party on the other, from the offering of the Registered
Certificates, and the relative fault of the indemnifying party on the
one hand and indemnified party on the other in connection with the
statements which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative benefits received by
the indemnifying party on the one hand and indemnified party on the
other shall be deemed to be in the same proportion to the amount of
Registered Certificates underwritten by each such party. The relative
fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to
information supplied by the indemnifying party on the one hand or
indemnified party on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such statement or omission. The parties hereto agree that it would not
be just and equitable if contribution pursuant to this clause (vi) were
determined by pro rata allocation or by any other method of allocation
which does not take into account the equitable considerations referred
to above in this clause (vi). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to above in this
clause (vi) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding
the provisions of this clause (vi), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price
at which the Registered Certificates underwritten by it and distributed
to the public, were sold, exceeds the amount of any damages which such
party has otherwise been required to pay by reason of such untrue or
alleged untrue statement of a material fact or omission or alleged
omission to state a material fact. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.
(vii) The respective obligations of each of Xxxxxxx, Chase,
PaineWebber and Artesia under clauses (i) through (vi) above shall be
in addition to any liability which each
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may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls Xxxxxxx, Chase,
PaineWebber and Artesia, as applicable, within the meaning of the
Securities Act or the Exchange Act.
8. FEES AND EXPENSES. Except as provided in any other particular
Section hereof, costs and expenses incurred in connection with the transactions
herein contemplated shall be allocated pursuant to the terms of that certain
Term Sheet dated May 30, 2000 (the "Term Sheet").
9. COMPUTATIONAL MATERIALS AND ABS TERM SHEETS. (a) Not later than
10:30 a.m., New York City time, on the date hereof, each Underwriter shall
deliver to SBMS five (5) complete copies of all materials provided by such
Underwriter to prospective investors in the Registered Certificates that
constitute either (i) "Computational Materials" within the meaning of the
no-action letter dated May 20, 1994 issued by the Division of Corporation
Finance of the Commission to Xxxxxx, Xxxxxxx Acceptance Corporation I, Xxxxxx,
Xxxxxxx & Co. Incorporated, and Xxxxxx Structured Asset Corporation and the
no-action letter dated May 27, 1994 issued by the Division of Corporation
Finance of the Commission to the Public Securities Association (together, the
"Xxxxxx/PSA Letters") or (ii) "ABS Term Sheets" within the meaning of the
no-action letter dated February 17, 1995 issued by the Division of Corporation
Finance of the Commission to the Public Securities Association (such letter,
together with the Xxxxxx/PSA Letters, the "No-Action Letters"), if the filing of
such materials with the Commission is a condition of the relief granted in such
letters and, in the case of any such materials that constitute "Collateral Term
Sheets" within the meaning of the PSA Letter, such Collateral Term Sheets have
not previously been delivered to SBMS as contemplated by Section 9(b)(i) below.
Each delivery of Computational Materials pursuant to this paragraph (a) shall be
effected by delivering four (4) copies of such materials to counsel for SBMS and
one copy of such materials to SBMS. Each delivery of ABS Term Sheets pursuant to
this paragraph (a) shall be effected by delivering such materials to counsel for
SBMS on behalf of SBMS at the address specified in Section 16 hereof in a format
that will permit such materials to be promptly filed electronically with the
Commission.
(b) Each Underwriter (other than PaineWebber with respect to clause
9(b)(v) below) represents and warrants to and agrees with SBMS, as of the date
hereof and as of the Closing Date, as applicable, that:
(i) If such Underwriter has provided any Collateral Term
Sheets to potential investors in the Registered Certificates prior to
the date hereof and if the filing of such materials with the Commission
is a condition of the relief granted in the No-Action Letters, then in
each such case such Underwriter delivered such materials in the format
contemplated by Section 9(a) to counsel for SBMS on behalf of SBMS at
the address specified in Section 16 hereof no later than 10:30 a.m.,
New York City time, on the first business day following the date on
which such materials were initially provided to a potential investor;
(ii) The Computational Materials (either in original,
aggregated or consolidated form) and ABS Term Sheets furnished to SBMS
pursuant to Section 9(a) or as contemplated in Section 9(b)(i)
constitute all of the materials relating to the Registered Certificates
furnished by such Underwriter (whether in written, electronic or other
format) to prospective investors in the Registered Certificates prior
to the date hereof, except for any Preliminary
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Prospectus and any Computational Materials and ABS Term Sheets that are
not required to be filed with the Commission in accordance with the
No-Action Letters, and all Computational Materials and ABS Term Sheets
provided by such Underwriter to potential investors in the Registered
Certificates comply with the requirements of the No-Action Letters;
(iii) On the respective dates any such Computational Materials
and/or ABS Term Sheets with respect to the Registered Certificates
referred to in Section 9(b)(ii) were last furnished by such Underwriter
to each prospective investor, on the date of delivery thereof to SBMS
pursuant to or as contemplated by this Section 9 and on the Closing
Date, such Computational Materials and/or ABS Term Sheets did not and
will not include any untrue statement of a material fact, or, when read
in conjunction with the Prospectus, omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading;
(iv) At the time any Computational Materials or ABS Term
Sheets with respect to the Registered Certificates were furnished to a
prospective investor and on the date hereof, such Underwriter
possessed, and on the date of delivery of such materials to SBMS
pursuant to or as contemplated by this Section 9 and on the Closing
Date, such Underwriter will possess, the capability, knowledge,
expertise, resources and systems of internal control necessary to
ensure that such Computational Materials and/or ABS Term Sheets conform
to the representations and warranties of such Underwriter contained in
subparagraphs (ii) and (iii) above of this paragraph (b);
(v) All Computational Materials and ABS Term Sheets with
respect to the Registered Certificates furnished by such Underwriter to
potential investors contained and will contain a legend, prominently
displayed on the first page thereof, to the effect that SBMS has not
prepared, reviewed or participated in the preparation of such
Computational Materials or ABS Term Sheets, is not responsible for the
accuracy thereof and has not authorized the dissemination thereof;
(vi) All Collateral Term Sheets with respect to the Registered
Certificates furnished by such Underwriter to potential investors
contained and will contain a legend, prominently displayed on the first
page thereof, indicating that the information contained therein will be
superseded by the description of the Mortgage Loans contained in the
Prospectus and, except in the case of the initial Collateral Term
Sheet, that such information supersedes the information in all prior
Collateral Term Sheets; and
(vii) After the date hereof, such Underwriter shall not
deliver or authorize the delivery of any Computational Materials, ABS
Term Sheets or other materials relating to the Registered Certificates
(whether in written, electronic or other format) to any potential
investor unless such potential investor has received a Prospectus prior
to or at the same time as the delivery of such Computational Materials,
ABS Term Sheets or other materials.
Notwithstanding the foregoing, no Underwriter makes any representation
or warranty as to whether any Computational Materials or ABS Term Sheets with
respect to the Registered Certificates
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included or will include any untrue statement resulting directly from any
Collateral Error (except any Corrected Collateral Error, with respect to
materials prepared after the receipt by the Underwriters from SBMS or any
Mortgage Loan Seller of notice of such Collateral Error or materials superseding
or correcting such Collateral Error).
(c) The Underwriters acknowledge and agree that SBMS has not authorized
and will not authorize the distribution of any Computational Materials or ABS
Term Sheets with respect to the Registered Certificates to any prospective
investor, and agree that any such Computational Materials and/or ABS Term Sheets
furnished to prospective investors shall include a disclaimer in the form set
forth in paragraph (b)(v) above. The Underwriters agree that they will not
represent to potential investors that any Computational Materials and/or ABS
Term Sheets with respect to the Registered Certificates were prepared or
disseminated on behalf of SBMS.
(d) If, at any time when a prospectus relating to the Registered
Certificates is required to be delivered under the Securities Act prior to 90
days from the date hereof, it shall be necessary in the opinion of the
Underwriters or their counsel to amend or supplement the Prospectus as a result
of an untrue statement of a material fact contained in any Computational
Materials or ABS Term Sheets provided by the Underwriters pursuant to or as
contemplated by this Section 9 or the omission to state a material fact
required, when considered in conjunction with the Prospectus, to be stated
therein or necessary to make the statements therein, when read in conjunction
with the Prospectus, not misleading, or if it shall be necessary to amend or
supplement any Current Report to comply with the Securities Act or the rules
thereunder, the Underwriters, at their expense (or, if such amendment or
supplement is necessary due to a Collateral Error (except any Corrected
Collateral Error, with respect to materials prepared after the receipt by the
Underwriters from SBMS or any Mortgage Loan Seller of notice of such Collateral
Error or materials superseding or correcting such Collateral Error), at the
expense of SBMS), shall promptly prepare and furnish to SBMS for filing with the
Commission an amendment or supplement that will correct such statement or
omission or an amendment that will effect such compliance and shall distribute
such amendment or supplement to each prospective investor in the Registered
Certificates that received such information being amended or supplemented. The
Underwriters represent and warrant to SBMS, as of the date of delivery of such
amendment or supplement to SBMS, that such amendment or supplement will not
include any untrue statement of a material fact or, when read in conjunction
with the Prospectus, omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading. SBMS shall have no
obligation to file such amendment or supplement if SBMS determines that (i) such
amendment or supplement contains any untrue statement of a material fact or,
when read in conjunction with the Prospectus, omits to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading (it being understood, however, that SBMS shall have no obligation to
review or pass upon the accuracy or adequacy of, or to correct, any such
amendment or supplement provided by the Underwriters to SBMS pursuant to this
paragraph (d)) or (ii) such filing is not required under the Securities Act.
Notwithstanding the foregoing, the Underwriters make no representation or
warranty as to whether any such amendment or supplement of Computational
Materials or ABS Term Sheets with respect to the Registered Certificates
included or will include any untrue statement resulting directly from any
Collateral Error (except any Corrected Collateral Error, with respect to
materials prepared after the receipt by the Underwriters from SBMS or any
Mortgage Loan Seller of notice of such Collateral Error or materials superseding
or correcting such Collateral Error).
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(e) If, at any time when a prospectus relating to the Registered
Certificates is required to be delivered under the Securities Act prior to 90
days from the date hereof, it shall be necessary in the opinion of SBMS or its
counsel to amend or supplement the Prospectus as a result of an untrue statement
of a material fact contained in any Computational Materials or ABS Term Sheets
provided by the Underwriters pursuant to or as contemplated by this Section 9 or
the omission to state therein a material fact required, when considered in
conjunction with the Prospectus, to be stated therein or necessary to make the
statements therein, when read in conjunction with the Prospectus, not
misleading, or if it shall be necessary to amend or supplement any Current
Report to comply with the Securities Act or the rules thereunder, SBMS promptly
will notify the Underwriters of the necessity of such amendment or supplement,
and the Underwriters, at their expense (or, if such amendment or supplement is
necessary due to a Collateral Error (except any Corrected Collateral Error, with
respect to materials prepared after the receipt by the Underwriters from SBMS or
any of the Mortgage Loan Sellers of notice of such Collateral Error or materials
superseding or correcting such Collateral Error), at the expense of SBMS), shall
promptly prepare and furnish to SBMS for filing with the Commission an amendment
or supplement that will correct such statement or omission or an amendment that
will effect such compliance and shall distribute such amendment or supplement to
each prospective investor in the Registered Certificates that received such
information being amended or supplemented. The Underwriters represent and
warrant to SBMS, as of the date of delivery of such amendment or supplement to
SBMS, that such amendment or supplement will not include any untrue statement of
a material fact or, when read in conjunction with the Prospectus, omit to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading. SBMS shall have no obligation to file such
amendment or supplement if SBMS determines that such amendment or supplement
contains any untrue statement of a material fact or, when read in conjunction
with the Prospectus, omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading (it being
understood, however, that SBMS shall have no obligation to review or pass upon
the accuracy or adequacy of, or to correct, any such amendment or supplement
provided by the Underwriters to SBMS pursuant to this paragraph (e)).
Notwithstanding the foregoing, the Underwriters make no representation or
warranty as to whether any such amendment or supplement of Computational
Materials or ABS Term Sheets with respect to the Registered Certificates
included or will include any untrue statement resulting directly from any
Collateral Error (except any Corrected Collateral Error, with respect to
materials prepared after the receipt by the Underwriters from SBMS or any
Mortgage Loan Seller of notice of such Collateral Error or materials superseding
or correcting such Collateral Error).
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10. TERMINATION. This Agreement shall be subject to termination by
notice given to SBMS, if the sale of the Registered Certificates provided for
herein is not consummated because of any failure or refusal on the part of SBMS
to comply in all material respects with the terms or to fulfill in all material
respects any of the conditions of this Agreement, or if for any reason SBMS
shall be unable to perform in all material respects its obligations under this
Agreement. This Agreement shall also be subject to termination in the absolute
discretion of Salomon, by notice given to SBMS prior to delivery of and payment
for the Certificates, if prior to such time (i) trading in securities generally
on the New York Stock Exchange shall have been suspended or materially limited,
(ii) a general moratorium on commercial banking activities in New York shall
have been declared by either federal or New York State authorities, or (iii)
there shall have occurred any material outbreak or escalation of hostilities or
other calamity or crisis the effect of which on the financial markets of the
United States is such as to make it, in the reasonable judgment of Xxxxxxx after
consultation with SBMS, impracticable to market the Registered Certificates.
11. DEFAULT BY AN UNDERWRITER. If any Underwriter shall fail to
purchase and pay for any of the Registered Certificates agreed to be purchased
by such Underwriter hereunder and such failure to purchase shall constitute a
default in the performance of its obligations under this Agreement, the
remaining Underwriters shall be obligated (in proportion to their allocations
set forth in Schedule I) to take up and pay for the Registered Certificates that
the defaulting Underwriter or Underwriters agreed but failed to purchase;
provided, however, that in the event that the purchase price of the Registered
Certificates that the defaulting Underwriter or Underwriters agreed but failed
to purchase shall exceed 10% of the aggregate Purchase Price of the Registered
Certificates, the remaining Underwriters shall have the right to purchase all,
but shall not be under any obligation to purchase any, of the Registered
Certificates, and if such nondefaulting Underwriters do not purchase all of the
Registered Certificates, this Agreement will terminate without liability to the
nondefaulting Underwriters or SBMS. In the event of a default by an Underwriter
as set forth in this Section 11, the Closing Date for the Registered
Certificates shall be postponed for such period, not exceeding seven (7) days,
as the nondefaulting Underwriters shall determine in order that the required
changes in the Registration Statement, the Prospectus or any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Underwriter of its liability, if any, to SBMS and to any
nondefaulting Underwriter for damages occasioned by its default hereunder.
12. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, warranties, indemnities and other statements of
SBMS, the Underwriters and their respective officers, directors, employees and
agents set forth in or made pursuant to this Agreement will remain in full force
and effect, regardless of any investigation made by or on behalf of the
Underwriters, SBMS or any of the officers, directors or controlling persons
referred to in Section 7 hereof, and will survive delivery of and payment for
the Registered Certificates. The provisions of Sections 7 and 9 hereof shall
survive the termination or cancellation of this Agreement.
13. BENEFICIARIES. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, directors and controlling persons referred to in Section 7 hereof, and
no other person will have any right or obligation hereunder.
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14. APPLICABLE LAW. This Agreement will be governed by and construed in
accordance with the substantive laws of the State of New York, applicable to
agreements negotiated, made and to be performed entirely in said state.
15. MISCELLANEOUS. This Agreement supersedes all prior or
contemporaneous agreements and understandings relating to the subject matter
hereof (other than the Term Sheet). Neither this Agreement nor any term hereof
may be changed, waived, discharged or terminated except by a writing signed by
the party against whom enforcement of such change, waiver, discharge or
termination is sought. This Agreement may be signed in any number of
counterparts, each of which shall be deemed an original, and that taken together
shall constitute one and the same instrument.
16. NOTICES. All communications hereunder will be in writing and
effective only upon receipt and, if sent to the Underwriters, will be delivered
to Xxxxxxx Xxxxx Xxxxxx Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Xxxxxx Xxxxxx, Xxxxx Securities Inc., 000 Xxxx Xxxxxx 0xx Xxxxx, Xxx
Xxxx, XX 00000, Attention: Xxxxx Xxxxxxxx, PaineWebber Incorporated, 0000 Xxxxxx
xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxx Xxxxxx, and Artesia Banking
Corporation, WTC Tower 0, Xxxxxxxxx Xxx Xxxxxx, 00, 0000 Xxxxxxxx, Xxxxxxx,
Attention: Xxxxx Xxxxxx; and, if sent to SBMS, will be delivered to Salomon
Brothers Mortgage Securities VII, Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, XX
00000, Attention: Xxxxxx Xxxxxx, and, solely for purposes of Section 5(e),
Sidley & Austin, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxxxx X.
Xxxxxx; or, in each such case, to such other address as may be forwarded by any
such party to the other parties hereto in writing.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the undersigned a counterpart hereof,
whereupon this letter and your acceptance shall represent a binding agreement
between you and SBMS.
Very truly yours,
XXXXXXX XXXXXXXX MORTGAGE
SECURITIES VII, INC.
By:_________________________________
Name:
Title:
The foregoing Underwriting Agreement
is hereby confirmed and accepted as
of the date first above written.
XXXXXXX XXXXX XXXXXX INC.
By:_________________________________
Name:
Title:
CHASE SECURITIES INC.
By:_________________________________
Name:
Title:
PAINEWEBBER INCORPORATED
By:_________________________________
Name:
Title:
ARTESIA BANKING CORPORATION
By:_________________________________
Name:
Title:
29
SCHEDULE I
As used in this Agreement, the term "Registration Statement" refers to the
registration statement No. 333-84249 filed by SBMS on Form S-3 and declared
effective by the Commission.
TITLE AND DESCRIPTION OF THE REGISTERED CERTIFICATES:
Commercial Mortgage Pass-Through Certificates, Series 2000-C2, Class A-1, Class
A-2, Class X, Class B, Class C, Class D, Class E, Class F and Class G
Certificates.
Underwriting Agreement, dated as of August 15, 2000
Cut-off Date: August 1, 2000
Class Initial Class Principal Initial Rating
Designation Purchase Price Balance (1)(2) Pass-Through Rate by Moody's/Fitch (3)
----------- -------------- --------------- ----------------- --------------------
Class A-1 100.00% $ 114,601,000 7.298% Aaa/AAA
Class A-2 1.004883602% $ 483,255,000 7,455% Aaa/AAA
Class B 100.00% $ 33,214,000 7.526% Aa2/AA
Class C 1.003870992% $ 33,215,000 7.727% A2/A
Class D 100.50% $ 7,815,000 7,834% A3/A-
Class E 100.50% $ 11,723,000 8.193% Baa1/BBB+
Class F 99.890625% $ 13,677,000 8.200% Baa2/BBB
Class G 99.406250% $ 9,769,000 8.503% Baa3/BBB-
(1) Subject to a variance of plus or minus 5.0%.
(2) Subject to rounding to the nearest whole dollar, Xxxxxxx Xxxxx
Barney Inc. will acquire 55%, PaineWebber Incorporated will
acquire 45%, Chase Securities Inc. will acquire 0% and Artesia
Banking Corp. will acquire 0% of the Class Principal Balance
of the Class A-1 Certificates; Xxxxxxx Xxxxx Xxxxxx Inc. will
acquire 0%, PaineWebber Incorporated will acquire 40%; Chase
Securities Inc. will acquire 5% and Artesia Banking Corp. will
acquire 2% of the Class Principal Balance of the Class A-2
Certificates; and Xxxxxxx Xxxxx Xxxxxx Inc. will acquire
51.3333333333% and PaineWebber Incorporated will acquire
41.1666666666% of the remaining classes of Registered
Certificates.
(3) By each of Xxxxx'x Investors Service, Inc. ("Moody's") and
Fitch, Inc. ("[ ]").
Purchase Price: The purchase prices set forth in the above schedule for
each Class of Registered Certificates is expressed as a percentage of
the Class Principal Balance of such Class, and is to be accompanied by
interest on the Class Principal Balance of such Class of Registered
Certificates at the initial Pass-Through Rate for such Class, from the
August 1, 2000 to but not including the Closing Date.
Closing Time, Date and Location: 10:00 a.m. New York City time on
August 24, 2000 at the offices of Sidley & Austin, 000 Xxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
Issuance and delivery of Registered Certificates: Each class of
Registered Certificates will be issued as one or more Certificates
registered in the name of Cede & Co., as nominee of The Depository
Trust Company. Beneficial owners will hold interests in such
Certificates through the book-entry facilities of The Depository Trust
Company in minimum denominations of initial principal balance of
$10,000 and integral multiples of $1 in excess thereof.
S-1
