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EXHIBIT 1.1
HOUSEHOLD HOME EQUITY LOAN TRUST ____
HFC REVOLVING CORPORATION
(Depositor)
HOUSEHOLD FINANCE CORPORATION
(Master Servicer)
Closed-End Home Equity Loan Asset Backed Certificates,
Series _____,
$____________ Class A Certificates
$____________ Class M Certificates
UNDERWRITING AGREEMENT
----------------------
_________, 1999
[NAME OF UNDERWRITER]
[UNDERWRITER'S ADDRESS]
Ladies and Gentlemen:
HFC Revolving Corporation, a Delaware corporation (the "Depositor"),
has authorized the issuance by Household Home Equity Loan Trust ______ (the
"Trust") of the aggregate principal amounts set forth above of Closed-End Home
Equity Loan Asset Backed Certificates, Series 1999-1, Class A (the "Class A
Certificates") and Class M (the "Class M Certificates"), and has authorized the
sale of the Class A and Class M Certificates (collectively, the "Underwritten
Certificates") to the several underwriters named in Schedule I hereto
(collectively, the "Underwriters"), for whom you are acting as representative
(the "Representative"). Each Class A and Class M Certificate will represent a
fractional undivided interest in the Trust. The assets of the Trust will
include, among other things, a pool of closed-end, fixed-rate home equity loans
conveyed to the Trust at the Closing Time (as defined herein) and any eligible
home equity loan substituted for a defective loan pursuant to the Pooling and
Servicing Agreement (as defined below) (each, an "Eligible Substitute Home
Equity Loan" and, together with the home equity loans conveyed to the Trust at
the Closing Time, the "Home Equity Loans"), secured primarily by first and
second mortgages on residential properties that are primarily one- to
four-family properties and certain monies due thereunder. The Depositor will
acquire the Home Equity Loans pursuant to the Home Equity Loan Purchase
Agreement, as described below. Simultaneously with the issuance of the
Underwritten Certificates and the sale of such certificates to the Underwriters
as contemplated herein, the Trust will also issue the Closed-End Home Equity
Loan Asset Backed Certificates, Series ______, Class R (the "Residual
Certificates" and, together with the Class A and Class M Certificates, the
"Certificates"), evidencing the remaining interest in the Trust not evidenced
by the
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Class A and Class M Certificates. The Certificates will be issued pursuant
to a Pooling and Servicing Agreement to be dated as of _________, 1999 (the
"Pooling and Servicing Agreement"), among the Depositor, Household Finance
Corporation, as master servicer (the "Master Servicer" or "HFC") and ________,
(the "Trustee"). The Depositor is a subsidiary of HFC.
The Depositor will enter into a Home Equity Loan Purchase Agreement
dated as of __________, 1999 (the "Home Equity Loan Purchase Agreement"),
between the Depositor, as purchaser, and certain originators, each of which is a
subsidiary of HFC (collectively, the "Sellers" and each individually, a
"Seller"). Pursuant to the Home Equity Loan Purchase Agreement, the Sellers will
sell to the Depositor all of their right, title and interest in and to the
unpaid principal balance of the Home Equity Loans, including all interest and
principal payments in respect thereof received on or after the Cut-Off Date, and
certain other rights with respect to the collateral supporting the Home Equity
Loans. Pursuant to the Pooling and Servicing Agreement, the Depositor will
assign and grant to the Trust all of its right, title and interest in and to the
Home Equity Loan Purchase Agreement. In addition, the Sellers have entered into
an agreement dated as of __________, 1999 ( the "Transfer Agreement"), between
the Trustee and each Seller, pursuant to which the Sellers will assign to the
Trust all of their right, title and interest in and to the collateral supporting
the Home Equity Loans, including the loan agreement and mortgage notes relating
thereto (collectively, the "Transferred Assets") not otherwise transferred
pursuant to the Home Equity Loan Purchase Agreement.
The Depositor has filed with the Securities and Exchange Commission
(the "Commission") a registration statement on Form S-3 (File No. 333-_____)
relating to the Underwritten Certificates, and the offering thereof from time to
time in accordance with Rule 415 under the Securities Act of 1933, as amended
(the "1933 Act"), and has filed, and proposes to file, such amendments thereto
as may have been required to the date hereof pursuant to the 1933 Act and the
rules of the Commission thereunder (the "1933 Act Regulations"). Such
registration statement, as amended at the time when it became effective under
the 1933 Act and at the Closing Time defined below, is referred to herein as the
"Registration Statement". The Depositor proposes to file with the Commission
pursuant to Rule 424(b)(5) under the 1933 Act Regulations a supplement (the
"Prospectus Supplement") to the prospectus (as it may be amended in connection
with such Prospectus Supplement, the "Basic Prospectus"; the Basic Prospectus,
together with the Prospectus Supplement, the "Prospectus"). Any preliminary form
of the Prospectus that has heretofore been filed pursuant to Rule 424(b) is
hereinafter called the "preliminary prospectus".
For purposes of this Agreement, all references to the Registration
Statement, any preliminary prospectus, the Prospectus or any amendment or
supplement to any of the foregoing shall be deemed to include the copy filed
with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system ("XXXXX").
All references in this Agreement to financial statements and schedules
and other information which is "contained," "included" or "stated" in the
Registration Statement, any preliminary
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prospectus or the Prospectus (or other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other
information which are incorporated by reference in the Registration Statement,
any preliminary prospectus or the Prospectus, as the case may be; and all
references in this Agreement to amendments or supplements to the Registration
Statement, any preliminary prospectus or the Prospectus shall be deemed to mean
and include the filing of any document under the Securities Exchange Act of
1934, as amended (the "1934 Act"), which is incorporated by reference in the
Registration Statement, such preliminary prospectus or the Prospectus, as the
case may be.
Capitalized terms used but not otherwise defined herein shall have the
meanings assigned thereto in the Pooling and Servicing Agreement or the
Prospectus, as applicable.
SECTION 1. Representations and Warranties.
(a) The Depositor represents and warrants to, and agrees with, each
Underwriter as set forth in this Section 1(a):
(i) The Depositor meets the requirements for use of Form S-3
under the 1933 Act. The Registration Statement has become effective
under the 1933 Act and no stop order suspending the effectiveness of
the Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the Depositor, are contemplated by the Commission, and
any request on the part of the Commission for additional information
has been complied with. At the time the Registration Statement became
effective and at the Closing Time, the Registration Statement and any
amendments and supplements thereto, including documents incorporated or
deemed to be incorporated by reference in the Registration Statement,
complied and will comply in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations and the , 1934 Act and the
rules and regulations of the Commission thereunder (the "1934 Act
Regulations"), and did not and will not contain any untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
Neither the Prospectus nor any amendments or supplements thereto, at
the time the Prospectus or any such amendment or supplement was filed
with the Commission and at the Closing Time, included or will include
an untrue statement of a material fact or omitted or will omit to state
a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided, however, that the Depositor makes no
representations or warranties as to (i) any statements in, or omissions
from, the Registration Statement or the Prospectus made in reliance
upon and in conformity with information furnished to the Depositor in
writing by the Underwriters expressly for use in the Registration
Statement or the Prospectus or (ii) information in any "Computational
Materials", "Collateral Term Sheets"or "Structural Term Sheets" (each
as hereinafter defined) provided by the Underwriters except to the
extent that the information set forth therein is "Pool Information". As
used herein, Pool Information means information with respect to the
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financial characteristics of the Home Equity Loans set forth in the
Prospectus Supplement.
(ii) Each preliminary prospectus and the prospectus filed as part
of the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424(b) under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with this offering
was, in all material respects, identical to the electronically
transmitted copies thereof filed with the Commission pursuant to XXXXX,
except to the extent permitted by Regulation S-T.
(iii) Since the respective dates as of which information is given
in the Prospectus, or the Prospectus as amended and supplemented at the
Closing Time, there has not been any material adverse change in the
general affairs, management, financial condition, or results of
operations of any of the Sellers or the Depositor or of their
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus or the Prospectus as amended and supplemented at the Closing
Time.
(iv) Each of the Sellers and the Depositor has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its respective jurisdiction of incorporation, with
the full right, power and authority (corporate and other) to own, lease
and operate its properties and conduct its business as described in the
Prospectus and to enter into and perform its obligations under this
Agreement, the Pooling and Servicing Agreement, the Transfer Agreement
and the Home Equity Loan Purchase Agreement, as applicable, and to
cause the Certificates to be issued; each of the Sellers and the
Depositor is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction which requires
such qualification, except where failure to be so qualified would not
have a material adverse effect on the business or financial condition
of any such Seller or the Depositor; and each Seller is duly authorized
under the statutes that regulate the business of making loans or of
financing the sale of goods (commonly called "small loan laws,"
"consumer finance laws," or "sales finance laws"), or is permitted
under the general interest statutes and related laws and court
decisions, to conduct in the various jurisdictions in which any of them
do business the businesses as currently conducted therein by any of
them.
(v) There are no legal or governmental proceedings pending to
which any Seller or the Depositor is a party or of which any property
of any Seller or the Depositor is the subject, other than proceedings
which are not reasonably expected, individually or in the aggregate, to
have a material adverse effect on the financial position, shareholders'
equity or results of operations of such Seller or the Depositor; and to
the best knowledge of the Depositor, no such proceedings are threatened
or contemplated by governmental authorities or threatened by others.
(vi) This Agreement has been duly authorized, executed and
delivered
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by the Depositor, and the Pooling and Servicing Agreement and the Home
Equity Loan Purchase Agreement, when executed and delivered as
contemplated hereby and thereby, will have been duly authorized,
executed and delivered by the Depositor, and the Home Equity Loan
Purchase Agreement, and the Transfer Agreement when executed and
delivered as contemplated hereby and thereby, will have been duly
authorized, executed and delivered by each Seller. This Agreement
constitutes, and the Pooling and Servicing Agreement, the Transfer
Agreement and the Home Equity Loan Purchase Agreement when executed and
delivered as contemplated herein and therein will constitute, legal,
valid and binding instruments enforceable against the Depositor or the
Sellers, as applicable, in accordance with their respective terms,
subject as to enforceability (A) to applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting
creditors' rights generally, (B) to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity
or at law) and (C) with respect to rights of indemnity under this
Agreement, to limitations of public policy under applicable securities
laws.
(vii) The issuance and delivery of the Certificates, the
consummation of any other of the transactions contemplated herein or in
the Pooling and Servicing Agreement, the Transfer Agreement and the
Home Equity Loan Purchase Agreement, the Transfer Agreement and the
fulfillment of the terms of this Agreement, the Home Equity Loan
Purchase Agreement and the Pooling and Servicing Agreement, do not and
will not conflict with or violate any term or provision of the
Certificate or Articles of Incorporation or Bylaws of any of the
Sellers or the Depositor, any statute, order or regulation applicable
to any of the Sellers or the Depositor of any court, regulatory body,
administrative agency or governmental body having jurisdiction over any
of the Sellers or the Depositor and do not and will not conflict with,
result in a breach or violation or the acceleration of, or constitute a
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the property or assets of any of the
Sellers or the Depositor pursuant to the terms of, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument to which any of the Sellers or the Depositor is a party or
by which any of the Sellers or the Depositor may be bound or to which
any of the property or assets of any of the Sellers or the Depositor
may be subject, except for conflicts, violations, breaches,
accelerations and defaults which would not, individually or in the
aggregate, be materially adverse to any of the Sellers or the Depositor
or materially adverse to the transactions contemplated by this
Agreement.
(viii) Xxxxxx Xxxxxxxx LLP is an independent public accountant
with respect to the Sellers and the Depositor as required by the 1933
Act and 1933 Act Regulations.
(ix) The direction by the Depositor to the Trustee to execute,
countersign, issue and deliver the Certificates has been duly
authorized by the Depositor, and assuming the Trustee has been duly
authorized to do so, when executed, countersigned, issued and delivered
by the Trustee in accordance with the Pooling and Servicing
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Agreement, the Certificates will be validly issued and outstanding and
will be entitled to the benefits provided by the Pooling and Servicing
Agreement.
(x) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body of
the United States is required for the issuance or sale of the
Underwritten Certificates, or the consummation by any of the Sellers or
the Depositor of the other transactions contemplated by this Agreement,
the Pooling and Servicing Agreement, the Transfer Agreement or the Home
Equity Loan Purchase Agreement, except for (A) the registration under
the 1933 Act of the Underwritten Certificates, or (B) such consents,
approvals, authorizations, orders, registrations, filings,
qualifications, licenses or permits as have been obtained or as may be
required under State securities or Blue Sky laws in connection with the
issuance of the Underwritten Certificates and the subsequent purchase
and distribution of the Underwritten Certificates by the Underwriters
(C) where the failure to obtain such consents, approvals,
authorizations, orders, registrations, filings, qualifications,
licenses or permits would not have a material adverse effect on the
business or consolidated financial condition of HFC and its
subsidiaries taken as a whole or the transactions contemplated by such
agreements.
(xi) Each of the Sellers and the Depositor possesses all material
licenses, certificates, authorities or permits issued by the
appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct the business now conducted by it and as described
in the Prospectus, and none of the Sellers or the Depositor has
received notice of proceedings relating to the revocation or
modification of any such license, certificate, authority or permit
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would materially and adversely affect the
conduct of its business, operations or financial condition.
(xii) At the time of execution and delivery of the Home Equity
Loan Purchase Agreement, and the Transfer Agreement each Seller (A)
will have good and marketable title to the unpaid principal balance of
the Home Equity Loans and the Transferred Assets being transferred by
it to the Depositor, or Trustee, as the case may be, free and clear of
any lien, mortgage pledge, charge, encumbrance, adverse claim or other
security interest (collectively "Liens"), (B) will not have assigned to
any person any of its right, title or interest in or to the unpaid
principal balance of the Home Equity Loans under the Home Equity Loan
Purchase Agreement or the Transferred Assets under the Transfer
Agreement, and (C) will have the power and authority to sell the unpaid
principal balance of the Home Equity Loans to the Depositor and
transfer and assign the Transferred Assets to the Trustee; and upon the
consummation of the sale, transfer and assignment provided for pursuant
to the terms of the Home Equity Loan Purchase Agreement, the Depositor
will have acquired beneficial ownership of all the related Seller's
right, title and interest in and to the unpaid principal balance of the
Home Equity Loans.
(xiii) At the time of execution and delivery of the Pooling and
Servicing
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Agreement, the Depositor (A) will have good and marketable title to the
unpaid principal balance of the Home Equity Loans being transferred by
it to the Trustee pursuant to the Pooling and Servicing Agreement, free
and clear of Liens, (B) will not have assigned to any person any of its
right, title or interest in or to the unpaid principal balance of the
Home Equity Loans under the Home Equity Loan Purchase Agreement, the
Pooling and Servicing Agreement or the Certificates being issued
pursuant thereto and (C) will have the power and authority to sell the
unpaid principal balance of the Home Equity Loans to the Trustee and to
sell the Underwritten Certificates to the Underwriters; and upon
execution and delivery of the Pooling and Servicing Agreement by the
Trustee, the Trustee will have acquired beneficial ownership of all of
the Depositor's right, title and interest in and to the unpaid
principal balance of the Home Equity Loans; and upon delivery to the
Underwriters of the Underwritten Certificates in return for the agreed
upon consideration the Underwriters will have good and marketable title
to the Underwritten Certificates, in each case free of Liens, except to
the extent disclosed in the Prospectus.
(xiv) As of the Cut-Off Date, each of the Home Equity Loans will
meet the eligibility criteria described in the Prospectus and as of the
related Cut-Off Date for any Eligible Substitute Home Equity Loan, the
Eligible Substitute Home Equity Loan will meet the eligibility criteria
applicable thereto described in the Pooling and Servicing Agreement.
(xv) None of the Sellers, the Depositor or the Trust created by
the Pooling and Servicing Agreement will conduct their operations while
any of the Underwritten Certificates are outstanding in a manner that
would require any Seller, the Depositor or the Trust to be registered
as an "investment company" under the Investment Company Act of 1940, as
amended (the "1940 Act"), as in effect on the date hereof.
(xvi) At the Closing Time, the Certificates and the Pooling and
Servicing Agreement will conform in all material respects to the
descriptions thereof contained in the Prospectus.
(xvii) At the Closing Time, each class of the Underwritten
Certificates shall have been rated in the applicable rating category
described in the Prospectus.
(xviii) Any taxes, fees and other governmental charges in
connection with the execution, delivery and issuance of this Agreement,
the Pooling and Servicing Agreement, the Transfer Agreement, the Home
Equity Loan Purchase Agreement and the Certificates have been paid or
will be paid at or prior to the Closing Time.
(xix) At the Closing Time, each of the representations and
warranties of the Depositor with respect to the Home Equity Loans set
forth in the Pooling and Servicing Agreement will be true and correct
in all material respects.
(b) HFC represents and warrants to, and agrees with, each Underwriter
as set forth in this Section 1(b):
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(i) HFC is a corporation duly organized and validly existing and
in good standing under the laws of its jurisdiction of incorporation.
HFC has all requisite power and authority to own its properties and
conduct its business as presently conducted and is duly qualified as a
foreign corporation to transact business and is in good standing in
each jurisdiction which requires such qualification, except where the
failure to have such power and authority or to be so qualified would
not have a material adverse effect on the business or consolidated
financial condition of HFC and its subsidiaries taken as a whole.
(ii) HFC is not in violation of its restated articles of
incorporation or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument
material to the business HFC and its subsidiaries, taken as a whole, to
which HFC is a party or by which it may be bound, or to which any of
the property or assets of HFC is subject.
(iii) The execution, delivery and performance by HFC of this
Agreement and the Pooling and Servicing Agreement, and the consummation
of the transactions contemplated hereby and thereby have been duly and
validly authorized by all necessary action or proceedings and will not
conflict with or constitute a breach of, or default under, or result in
the creation or imposition of any lien, charge or encumbrance upon any
property or assets of HFC pursuant to, any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which HFC
is a party or by which it may be bound, or to which any of the property
or assets of HFC is subject, nor will such action result in any
violation of the provisions of the charter or by-laws of HFC or any
applicable law, administrative regulation or administrative or court
decree, except where any such conflict, breach, default, encumbrance or
violation would not have a material adverse effect on the transactions
contemplated by this Agreement.
(iv) This Agreement and the Pooling and Servicing Agreement have
been duly executed and delivered by HFC; and this Agreement and the
Pooling and Servicing Agreement constitute legal, valid and binding
instruments enforceable against HFC in accordance with their respective
terms, subject as to enforceability (A) to applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting
creditors' rights generally, (B) to general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity
or at law) and (C) with respect to rights of indemnity under this
Agreement, to limitations of public policy under applicable securities
laws.
(v) Except as set forth in or contemplated in reports filed by
HFC with the Commission pursuant to the 1934 Act and the 1934 Act
Regulations, there has been no material adverse change in the
consolidated financial condition of HFC and its subsidiaries taken as a
whole since the respective dates as of which any information is
relating to HFC given in the Prospectus.
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(vi) There are no legal or governmental proceedings pending, or
to the knowledge of HFC threatened, to which HFC is a party or of which
any of its property is the subject, other than proceedings which are
not reasonably expected, individually or in the aggregate, to have a
material adverse effect on the shareholder's equity or consolidated
financial position of HFC and its subsidiaries taken as a whole or
which would have a material adverse effect upon the consummation of
this Agreement.
(vii) No consent, approval, authorization, order, registration,
filing, qualification, license or permit of or with any court or
governmental agency or body of the United States is required for the
consummation by HFC of the transactions contemplated by this Agreement
and the Pooling and Servicing Agreement, except for (A) the
registration under the 1933 Act of the Underwritten Certificates, (B)
such consents, approvals, authorizations, orders, registrations,
filings, qualifications, licenses or permits as have been obtained or
as may be required under state securities or Blue Sky laws in
connection with the issuance of the Underwritten Certificates and the
subsequent purchase and distribution of the Underwritten Certificates
by the Underwriters or (C) where the failure to obtain such consents,
approvals, authorizations, orders, registrations, filings,
qualifications, licenses or permits would not have a material adverse
effect on the business or consolidated financial condition of HFC and
its subsidiaries taken as a whole or the transactions contemplated by
such agreements.
(viii) Xxxxxx Xxxxxxxx LLP is an independent public accountant
with respect to HFC.
(c) Any certificate signed by an officer of the Depositor or HFC and
delivered to you or your counsel in connection with the offering of the
Underwritten Certificates shall be deemed, and shall state that it is, a
representation and warranty as to the matters covered thereby to each person to
whom the representations and warranties in this Section 1 are made.
(d) The Underwriters represent and warrant to, and agree with, the
Depositor and HFC as of the date hereof and as of the Closing Time that the
Underwriters have complied and will comply with all of their obligations arising
hereunder and in accordance with the 1933 Act, 1934 Act, the 1933 Act
Regulations and the 1934 Act Regulations and, with respect to the Computational
Materials, Collateral Term Sheets and Structural Term Sheets provided by the
Representative, such Computational Materials, Collateral Term Sheets and
Structural Term Sheets are accurate in all material respects (taking into
account the assumptions explicitly set forth in the Computational Materials,
Collateral Term Sheets and Structural Term Sheets, except for any errors therein
attributable to errors or mistakes in the Pool Information). The Computational
Materials, Collateral Term Sheets and Structural Term Sheets provided by the
Representative to the Depositor constitute a complete set of all Computational
Materials, Collateral Term Sheets and Structural Term Sheets required to be
filed with the Commission pursuant to the No-Action Letters.
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SECTION 2. Purchase and Sale.
(a) Subject to the terms and conditions and in reliance upon the
covenants, representations and warranties herein set forth, the Depositor agrees
to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Depositor the principal amount
of Class A Certificates set forth opposite such Underwriter's name in Schedule I
pursuant to the terms of this Agreement at a purchase price equal to ______% of
the aggregate principal amount represented by the Class A Certificates.
(b) Subject to the terms and conditions and in reliance upon the
covenants, representations and warranties herein set forth, the Depositor agrees
to sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Depositor the principal amount
of Class M Certificates set forth opposite such Underwriter's name in Schedule I
pursuant to the terms of this Agreement at a purchase price equal to _____% of
the aggregate principal amount represented by the Class M Certificates.
SECTION 3. Delivery and Payment. Payment of the purchase price for,
and delivery of, the Underwritten Certificates to be purchased by the
Underwriters shall be made at the offices of Xxxxxx Xxxxxx & Xxxxx, 000 Xxxx
Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or at such other place as shall be
agreed upon by you, the Depositor and HFC, at 10:00 A.M. New York City time on
___________, 1999, which date, time or place may be postponed or changed by
agreement between you, the Depositor and HFC (such date and time of delivery and
payment for the Certificates being herein referred to as the "Closing Time").
Delivery of one or more global certificates representing the Underwritten
Certificates shall be made to the accounts of the several Underwriters against
payment by them of the purchase price therefor, to or upon the order of the
Depositor by one or more wire transfers in immediately available funds. The
global certificates to be so delivered shall be registered in the name of Cede &
Co., as nominee for The Depository Trust Company ("DTC"). The interests of
beneficial owners of the Underwritten Certificates will be represented by book
entries on the records of DTC and participating members thereof. Definitive
Certificates representing the Underwritten Certificates will be available only
under limited circumstances as described in the Pooling and Servicing Agreement.
SECTION 4. Offering by the Underwriters. It is understood that the
Underwriters propose to offer the Underwritten Certificates for sale to the
public as set forth in the Prospectus.
SECTION 5. Covenants of the Depositor. The Depositor covenants with
each of the Underwriters as follows:
(a) The Depositor will notify the Underwriters immediately, and confirm
the notice in writing, (i) when any post-effective amendment to the Registration
Statement shall become effective, or any supplement to the Prospectus or any
amended Prospectus shall have been filed, (ii) of the receipt of any comments
from the Commission with respect to the Prospectus, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or of any order preventing or
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suspending the use of the preliminary prospectus, or of the suspension of the
qualification of the Underwritten Certificates for offering or sale in any
jurisdiction, or of the initiation or threatening of any proceedings for any of
such purposes. The Depositor will promptly effect the filings necessary pursuant
to Rule 424(b) and will take such steps as it deems necessary to ascertain
promptly whether the form of prospectus transmitted for filing under Rule 424(b)
was received for filing by the Commission and, in the event that it was not, it
will promptly file such prospectus. The Depositor will make every reasonable
effort to prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) The Depositor will give the Underwriters notice of its intention to
file or prepare any amendment to the Registration Statement or any amendment,
supplement or revision to either the Basic Prospectus or to the Prospectus,
whether pursuant to the 1933 Act, the 1934 Act or otherwise (other than reports
to be filed pursuant to the 1934 Act), will furnish the Representative with
copies of any such documents other than Computational Materials, Collateral Term
Sheets and Structural Term Sheets a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file or use any such
document to which the Representative or counsel for the Underwriters shall
object.
(c) The Depositor has furnished or will deliver to the Representative
and counsel for the Underwriters, without charge, signed copies of the
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference therein) and
signed copies of all consents and certificates of experts, and will also deliver
to the Underwriters without charge, a conformed copy of the Registration
Statement as originally filed and of each amendment thereto (without exhibits).
The copies of the Registration Statement and each amendment thereto furnished to
the Underwriters will be identical, in all material respects, to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(d) The Depositor has delivered to the Underwriters, without charge, as
many copies of the preliminary prospectus as the Underwriters reasonably
requested, and the Depositor hereby consents to the use of such copies for
purposes permitted by the 1933 Act. The Depositor will furnish to the
Underwriters, without charge, during the period when the Prospectus is required
to be delivered under the 1933 Act or the 1934 Act, such number of copies of the
Prospectus (as amended or supplemented) as the Underwriters may reasonably
request. The Prospectus and any amendments or supplements thereto furnished to
the Underwriters will be identical, in all material respects, to the
electronically transmitted copies thereof filed with the Commission pursuant to
XXXXX, except to the extent permitted by Regulation S-T.
(e) The Depositor will comply with the 1933 Act and the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations so as to permit the
completion of the distribution of the Underwritten Certificates as contemplated
in this Agreement and in the Prospectus. If at any time when a prospectus is
required by the 1933 Act to be delivered in connection with sales of the
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Underwritten Certificates, any event shall occur or condition shall exist as a
result of which it is necessary, in the opinion of counsel for the Underwriters
or for the Depositor, to amend the Registration Statement or amend or supplement
the Prospectus in order that the Prospectus will not include any untrue
statements of a material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it
shall be necessary, in the opinion of such counsel, at any such time to amend
the Registration Statement or amend or supplement the Prospectus in order to
comply with the requirements of the 1933 Act or the 1933 Act Regulations, the
Depositor will promptly prepare and file with the Commission, subject to Section
5(b), such amendment or supplement as may be necessary to correct such statement
or omission or to make the Registration Statement or the Prospectus comply with
such requirements, and the Depositor will furnish to the Underwriters such
number of copies of such amendment or supplement as the Underwriters may
reasonably request.
(f) Upon the request of and in cooperation with the Underwriters, the
Depositor will use its best efforts to qualify the Underwritten Certificates for
offering and sale under the applicable securities laws of such states and other
jurisdictions as the Representative may designate and to maintain such
qualifications in effect for a period of not less than one year from the later
of the effective date of the Registration Statement; provided, however, that the
Depositor or the Trust shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or to subject
itself to taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject. Upon the request of and in cooperation with the
Underwriters, the Depositor will also supply the Representative with such
information as is reasonably necessary for the determination of the legality of
the Underwritten Certificates for investment under the laws of such
jurisdictions as the Underwriters may request.
(g) The Depositor, during the period when the Prospectus is required to
be delivered under the 1933 Act or the 1934 Act, will file all documents
required to be filed with the Commission pursuant to the 1934 Act within the
time periods required by the 1934 Act and the 1934 Act Regulations.
(h) The Depositor will, at the expense of the Underwriters, file the
Computational Materials and Structural Term Sheets provided to it by the
Representative under Section 6 with the Commission pursuant to a Current Report
on Form 8-K not later than 5:00 p.m. on the day the Prospectus is delivered to
the Underwriters or, in the case of any Collateral Term Sheet required to be
filed pursuant to the No-Action Letters, not later than the second business day
following the first day on which the Collateral Term Sheet has been sent to a
prospective investor; provided, however, that as a condition to the filing of
the Computational Materials, Collateral Term Sheets and Structural Term Sheets
by the Depositor, the Depositor must receive a letter from a firm of independent
certified public accountants reasonably acceptable to the Depositor, which
letter shall be satisfactory in form and substance to the Depositor, HFC and
their counsel, to the effect that such accountants have performed certain
specified procedures, all of which have been agreed to by
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the Depositor, as a result of which they have determined the accuracy in all
material respects of the numerical and financial information included in the
Computational Materials and Structural Term Sheets provided by the
Representative to the Depositors for filing with the Commission.
(i) The Depositor shall take all reasonable action necessary to enable
____________________ and ______________________________ (the "Rating
Agencies") to provide their respective credit ratings of the Underwritten
Certificates as described in the Prospectus.
(j) The Depositor will not, without your prior written consent,
publicly offer or sell in the United States any mortgage pass-through
certificates, mortgage pass-through notes or collateralized mortgage obligations
or other similar securities representing interests in or secured by other
mortgage-related assets originated or owned by the Depositor or HFC for a period
of five days following the commencement of the offering of the Underwritten
Certificates to the public.
(k) The Depositor will cooperate with the Underwriters and use its best
efforts to permit the Underwritten Certificates to be eligible for clearance and
settlement through the facilities of DTC.
(l) If, between the date hereof and the Closing Time, to the knowledge
of the Depositor there are any legal or governmental proceedings instituted or
threatened against HFC or the Depositor, other than proceedings which are not
reasonably expected, individually or in the aggregate, to have a material
adverse effect on the financial condition, shareholders' equity or results of
operations of HFC or the Depositor, the Depositor will give prompt written
notice thereof to the Underwriters.
SECTION 6. Computational Materials, Collateral Term Sheets and
Structural Terms Sheets. It is understood that the Underwriters may prepare and
provide to prospective investors certain Computational Materials, Collateral
Term Sheets and Structural Term Sheets in connection with their offering of the
Underwritten Certificates, subject to the following conditions:
(a) The Underwriters shall comply with all applicable laws and
regulations in connection with the use of Computational Materials, including the
No-Action letter of May 20, 1994 issued by the Commission to Xxxxxx, Xxxxxxx
Acceptance Corporation I, Xxxxxx, Peabody & Co. Incorporated and Xxxxxx
Structured Asset Corporation as made applicable to other issuers and
underwriters by the Commission in response to the request of the Public
Securities Association dated May 24, 1994 (collectively, the "Xxxxxx/PSA
Letter"), as well as the PSA Letter referred to below. The Underwriters shall
comply with all applicable laws and regulations in connection with the use of
Collateral Terms Sheets and Structural Term Sheets, including the No-Action
Letter of February 17, 1995 issued by the Commission to the Public Securities
Association (the "PSA Letter" and, together with the Xxxxxx/PSA Letter, the
"No-Action Letters").
(b) As used herein, "Computational Materials" shall have the meaning
given such
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term in the No-Action Letters, but shall include only those Computational
Materials that have been prepared and delivered to prospective investors by or
at the direction of the Underwriters. As used herein, "Structural Term Sheets"
and "Collateral Term Sheets" shall have the meanings given such terms in the PSA
Letter, but shall include (i) only those Structural Term Sheets that have been
prepared and delivered to prospective investors by or at the direction of the
Underwriters and (ii) only those Collateral Term Sheets that have been prepared
by the Depositor or the Underwriters and delivered to prospective investors by
or at the direction of the Underwriters.
(c) The Representative shall provide to the Depositor copies (in such
format as required by the Depositor) of all Computational Materials, Collateral
Term Sheets and Structural Term Sheets that are required to be filed with the
Commission pursuant to the No-Action Letters. The Representative may provide to
the Depositor copies of the foregoing in a consolidated or aggregated form,
including all information required to be filed. All Computational Materials,
Collateral Term Sheets and Structural Term Sheets must be provided to the
Depositor by the Representative not later than 10:00 a.m. on the first business
day prior to the day on which the filing of such materials is to be made with
the Commission. The Underwrites shall be responsible for all costs and expenses
incurred by the Depositor in filing the Computational Materials, Collateral Term
Sheets and Structural Term Sheets with the Commission, including the fees of the
independent auditor who provides the letter required by Section 5(h).
(d) (i) All Computational Materials and Structural Term Sheets provided
to prospective investors by the Underwriters that are required to be filed
pursuant to the No-Action Letters shall bear a legend on each page substantially
in the following form:
"Recipients must read the information contained in the attached
statement. Do not use or rely on this information if you have not
received and reviewed the statement. If you have not received the
statement, call your [Underwriter] account executive for another copy."
The statement referenced in the above paragraph shall be substantially
in the following form:
"The attached tables and other statistical analyses (the "Computational
Materials") are privileged and confidential and are intended for use by
the addressee only. These Computational Materials are furnished to you
solely by [Underwriter] ("[Underwriter]") and not by the issuer of the
securities or any of its affiliates. The issuer of these securities has
not prepared or taken part in the preparation of these materials.
Neither [Underwriter], the issuer of the securities nor any of its
affiliates makes any representation as to the accuracy or completeness
of the information herein. The information herein is preliminary, and
will be superseded by the applicable Prospectus Supplement and by any
other information subsequently filed
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with the Securities and Exchange Commission. They may not be provided
to any third party other than the addressee's legal, tax, financial
and/or accounting advisors for the purposes of evaluating said
material.
Numerous assumptions were used in preparing the Computational Materials
which may or may not be stated therein. As such, no assurance can be
given as to the accuracy, appropriateness or completeness of the
Computational Materials in any particular context; or as to whether the
Computational Materials and/or the assumptions upon which they are
based reflect present market conditions or future market performance.
These Computational Materials should not be construed as either
projections or predictions or as legal, tax, financial or accounting
advice.
Any yields or weighted average lives shown in the Computational
Materials are based on prepayment assumptions and actual prepayment
experience may dramatically affect such yields or weighted average
lives. In addition, it is probable that prepayments on the underlying
assets will occur at rates slower or faster than the rates assumed in
the attached Computational Materials. Furthermore, unless otherwise
provided, the Computational Materials assume no losses on the
underlying assets and no interest shortfall. The specific
characteristics of the securities may differ from those shown in the
Computational Materials due to differences between the actual
underlying assets and the hypothetical assets used in preparing the
Computational Materials. The principal amount and structure of any
security described in the Computational Materials are subject to change
prior to issuance.
Although a registration statement (including the prospectus) relating
to the securities discussed in this communication has been filed with
the Securities and Exchange Commission and is effective, the final
prospectus supplement relating to the securities discussed in this
communication has not been filed with the Securities and Exchange
Commission. This communication shall not constitute an offer to sell or
the solicitation of any offer to buy nor shall there be any sale of the
securities discussed in this communication in any state in which such
offer, solicitations or sale would be unlawful prior to registration or
qualification under the securities laws of any such state. Prospective
purchasers are referred to the final prospectus and prospectus
supplement relating to the securities discussed in this communication
for definitive Computational Materials on any matter discussed in this
communication. The information contained in these Computational
Materials will be superseded by the description of the mortgage loans
and the other information contained in the final prospectus supplement
and prospectus relating to the securities discussed in this
communication. A final prospectus and prospectus supplement may be
obtained by contacting the [Underwriter] Trading Desk at (212)
___-_____.
Please be advised that asset-backed securities may not be appropriate
for all investors. Potential investors must be willing to assume, among
other things, market
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price volatility, prepayments, yield curve and interest rate risk.
Investors should fully consider the risk of an investment in these
securities.
If you have received this communication in error, please notify the
sending party immediately by telephone and return the original to such
party by mail."
(ii) In the case of Collateral Term Sheets, such legend shall
also include a statement in substantially the following form:
"THE INFORMATION CONTAINED HEREIN WILL BE SUPERSEDED BY THE
DESCRIPTION OF THE COLLATERAL POOL CONTAINED IN THE PROSPECTUS
SUPPLEMENT RELATING TO THE SECURITIES AND SUPERSEDES ALL
INFORMATION CONTAINED IN ANY COLLATERAL TERM SHEETS RELATING TO
THE COLLATERAL POOL PREVIOUSLY PROVIDED BY [UNDERWRITER]."
Notwithstanding the foregoing legends, this subsection (d) shall be
satisfied if all Computational Materials, Structural Term Sheets and
Collateral Term Sheets bear a legend in a form or forms previously
approved in writing by the Depositor.
(e) The Depositor shall not be obligated to file any
Computational Materials, Collateral Term Sheets or Structural Term
Sheets that have been determined to contain any material errors or
omissions; provided, however, that, at the request of the
Representative, the Depositor shall file Computational Materials,
Collateral Term Sheets or Structural Term Sheets containing material
errors or omissions if clearly marked "superseded by materials dated
____________" and accompanied by corrected Computational Materials,
Collateral Term Sheets or Structural Term Sheets that are marked "these
materials supersede and correct the materials dated ____________."]
Section 7. Conditions to the Underwriters' Obligations. The
obligations of the Underwriters to purchase the Underwritten Certificates
pursuant to this Agreement are subject to the accuracy on and as of the Closing
Time of the representations and warranties on the part of the Depositor and HFC
herein contained, to the material accuracy of the statements of officers of the
Depositor and HFC, respectively, made pursuant hereto, to the performance by the
Depositor and HFC of all of their respective obligations hereunder and to the
following conditions at the Closing Time:
(a) At the Closing Time no stop order suspending the effectiveness of
the Registration Statement shall have been issued under the 1933 Act or
proceedings therefor initiated or threatened by the Commission, and any request
on the part of the Commission for additional information shall have been
complied with to the reasonable satisfaction of counsel to the Underwriters.
(b) All corporate proceedings and other legal matters relating to the
authorization,
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form and validity of this Agreement, the Pooling and Servicing Agreement, the
Transfer Agreement, the Home Equity Loan Purchase Agreement, the Certificates,
the Registration Statement and the Prospectus, and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
satisfactory in all respects to counsel for the Underwriters.
(c) The Underwriters shall have received the favorable opinion, dated
the date of the Closing Time, of Xxxxxx Xxxxxx & Zavis, as special counsel to
the Depositor and HFC, in form and substance satisfactory to the Underwriters,
to the effect that:
(i) The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939, as amended.
(ii) Neither the Depositor nor the Trust is an "investment
company" or under the control of an "investment company" as such terms
are defined in the 1940 Act.
(iii) The Underwritten Certificates and the Pooling and Servicing
Agreement each conforms in all material respects to the respective
description thereof contained in the Prospectus.
(iv) The statements in the base Prospectus under the headings
["Legal Aspects of Home Equity Loans and Related Matters"], "Employee
Benefit Plan Considerations", "State Tax Considerations" and "Material
Federal Income Tax Consequences", and the statements in the Prospectus
Supplement under the headings "Summary--Tax Status", and "--Employee
Benefit Considerations", "Material Federal Income Tax Consequences",
and "Employee Benefit Plan Considerations", to the extent that they
constitute matters of federal law or legal conclusions with respect
thereto, have been reviewed by such counsel and are correct in all
material respects with respect to those consequences or aspects that
are discussed.
(v) The Trust as described in the Prospectus Supplement and the
Pooling and Servicing Agreement will qualify to be treated as a "real
estate mortgage investment conduit" (the "REMIC") as defined in the
Internal Revenue Code of 1986, as amended (the "Code"), the Class A and
Class M Certificates will be treated as "regular interests" in the
REMIC and the Residual Certificates will be treated as the single class
of "residual interests" in the REMIC assuming: (i) an election is made
to treat the Trust as a REMIC, (ii) compliance with the Pooling and
Servicing Agreement and (iii) compliance with changes in the law,
including any amendments to the Code or applicable Treasury regulations
thereunder.
Such opinion may express its reliance as to factual matters on the
representations and warranties made by the parties hereto, and on certificates
or other documents furnished by officers of such parties to the instruments and
documents referred to therein. No opinion need be expressed as to the effect of
the compliance or noncompliance of the Depositor, HFC or the Trustee with any
state or federal laws or regulations applicable to them because of their legal
or regulatory status or
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the nature of their respective businesses, or to the due authorization,
execution and delivery of this Agreement and the Certificates. As to such
matters, such opinion may rely upon the opinion of Xxxx X. Xxxxxx, Esq., Vice
President, Corporate Law and Assistant Secretary of Household International,
Inc., delivered pursuant to Section 7(d) of this Agreement, and such counsel
need make no independent investigation of the matters referred to in such
opinion.
(d) The Underwriters shall have received the favorable opinion, dated
the date of the Closing Time, of Xxxx X. Xxxxxx, Esq., Vice President -
Corporate Law and Assistant Secretary of Household International, Inc., the
parent company of HFC, in form and substance satisfactory to the Underwriters,
to the effect that:
(i) HFC has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware,
with corporate power to own its properties, to conduct its business as
described in the Prospectus and to enter into and perform its
obligations under this Agreement and the Pooling and Servicing
Agreement.
(ii) The Depositor has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power to own its properties, to conduct its
business as described in the Prospectus and to enter into and perform
its obligations under this Agreement, the Pooling and Servicing
Agreement and the Home Equity Loan Purchase Agreement.
(iii) Each of the Sellers has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
its jurisdiction of incorporation, with corporate power to own its
properties, to conduct its business as described in the Prospectus and
to enter into and perform its obligations under the Home Equity Loan
Purchase Agreement and the Transfer Agreement.
(iv) HFC has full corporate power and authority to serve in the
capacity of master servicer of the Home Equity Loans as contemplated in
the Pooling and Servicing Agreement.
(v) Each of the Sellers, the Depositor and HFC is duly authorized
under relevant statutes, laws and court decisions, to conduct in the
various jurisdictions in which they do business the respective
businesses therein currently conducted by them, except where failure to
be so permitted or failure to be so authorized will not have a material
adverse effect on the business or financial condition of the Sellers,
the Depositor or HFC, and the Sellers are duly authorized under the
statutes which regulate the business of making loans or of financing
the sale of goods (commonly called "small loan laws," "consumer finance
laws" or "sales finance laws"), or are permitted under the general
interest statutes and related laws and court decisions, to conduct in
the various jurisdictions in which any of them do business the
businesses as currently conducted therein by any of them.
(vi) None of the Sellers, the Depositor or HFC is in violation
of its
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Certificate or Articles of Incorporation or Bylaws or, to the best of
such counsel's knowledge, in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument known to such counsel which is material to the business of
the Sellers, the Depositor or HFC and which any of the Sellers, the
Depositor or HFC is a party or by which it or its properties may be
bound.
(vii) This Agreement and the Pooling and Servicing Agreement have
been duly authorized, executed and delivered by the Depositor and HFC,
and, assuming the due authorization, execution and delivery of such
agreements by the other parties thereto, such agreements constitute the
valid and binding obligation of each of the Depositor and HFC,
enforceable against each of the Depositor and HFC, in accordance with
their respective terms, and the Home Equity Loan Purchase Agreement and
Transfer Agreement has been duly authorized, executed and delivered by
the Depositor and the Sellers, as the case may be, and such agreements
constitute the valid and binding obligation of each of the Depositor
and the Sellers, as applicable, enforceable against the Depositor or
the Sellers in accordance with its terms, except that in each case as
to enforceability (A) such enforcement may be subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally, (B) the
remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the
discretion of the court before which any proceeding therefor may be
brought and (C) the enforceability as to rights to indemnification
under this Agreement may be subject to limitations of public policy
under applicable securities laws.
(viii) The issuance and delivery of the Certificates, the
consummation of any other of the transactions contemplated herein or in
the Pooling and Servicing Agreement or the Home Equity Loan Purchase
Agreement, or the fulfillment of the terms of this Agreement or the
Pooling and Servicing Agreement do not and will not conflict with or
violate any term or provision of the Certificate or Articles of
Incorporation or Bylaws of the Depositor or, to the best of such
counsel's knowledge, any statute, order or regulation applicable to the
Depositor of any court, regulatory body, administrative agency or
governmental body having jurisdiction over the Depositor and do not and
will not conflict with, result in a breach or violation or the
acceleration of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any of
the property or assets of the Depositor pursuant to the terms of, any
indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument known to such counsel to which the Depositor is a party
or by which the Depositor may be bound or to which any of the property
or assets of the Depositor may be subject except for conflicts,
violations, breaches, accelerations and defaults which would not,
individually or in the aggregate, be materially adverse to the
Depositor or materially adverse to the transactions contemplated by
this Agreement.
(ix) The consummation of any of the transactions contemplated
in the
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Home Equity Loan Purchase Agreement and the Transfer Agreement, and the
fulfillment of the terms of the Home Equity Loan Purchase Agreement and
the Transfer Agreement, do not and will not conflict with or violate
any terms or provision of the Certificate or Articles of Incorporation
or Bylaws of any of the Sellers or, to the best of such counsel's
knowledge, any statute, order or regulation applicable to any of the
Sellers and do not and will not conflict with, result in a breach or
violation or the acceleration of, or constitute a default under or
result in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of any of the Sellers pursuant to
the terms of, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument known to such counsel to which any of the
Sellers may be bound or to which any of the property or assets of any
of the Sellers may be subject except for conflicts, violations,
breaches, accelerations and defaults which would not, individually or
in the aggregate, be materially adverse to the applicable Sellers or
materially adverse to the transactions contemplated by this Agreement.
(x) The consummation of any of the transactions contemplated
herein or in the Pooling and Servicing Agreement, or the fulfillment of
the terms of this Agreement or the Pooling and Servicing Agreement, do
not and will not conflict with or violate any term or provision of the
Certificate or Articles of Incorporation or Bylaws of HFC or, to the
best of such counsel's knowledge, any statute, order or regulation
applicable to HFC, and do not and will not conflict with, result in a
breach or violation or the acceleration of, or constitute a default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any of the property or assets of HFC pursuant to the
terms of, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument known to such counsel to which HFC is a
party or by which HFC may be bound or to which any of the property or
assets of HFC may be subject except for conflicts, violations,
breaches, accelerations and defaults which would not, individually or
in the aggregate, be materially adverse to HFC or materially adverse to
the transactions contemplated by this Agreement.
(xi) The direction by the Depositor to the Trustee to execute,
issue, countersign and deliver the Certificates has been duly
authorized by the Depositor and, assuming that the Trustee has been
duly authorized to do so and when executed and countersigned and
delivered by the Trustee against payment of the agreed upon
consideration therefor in accordance with the Pooling and Servicing
Agreement, the Certificates will be validly issued and outstanding and
will be entitled to the benefits of the Pooling and Servicing
Agreement.
(xii) To the best of such counsel's knowledge, no consent,
approval, authorization, order, registration or qualification of or
with any court or governmental agency or body of the United States is
required for the issuance of the Underwritten Certificates and the sale
of the Underwritten Certificates to the Underwriters, or the
consummation by the Sellers, the Depositor and HFC of the other
transactions contemplated by this Agreement, the Pooling and Servicing
Agreement the Transfer Agreement and the Home Equity Loan Purchase
Agreement, except the registration under the 1933 Act of the
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Underwritten Certificates and such consents, approvals, authorizations,
registrations or qualifications as have been obtained or as may be
required under State securities or Blue Sky laws in connection with the
issuance of the Underwritten Certificates and the subsequent purchase
and distribution of the Underwritten Certificates by the Underwriters.
(xiii) The Registration Statement and any amendments thereto have
become effective under the 1933 Act; to the best of such counsel's
knowledge, no stop order suspending the effectiveness of the
Registration Statement has been issued and not withdrawn and no
proceedings for that purpose have been instituted or threatened and not
terminated.
(xiv) The conditions to the use by the Depositor and the Trust of
a registration statement on Form S-3 under the 1933 Act, as set forth
in the General Instructions to Form S-3, have been satisfied with
respect to the Registration Statement and the Prospectus. To the best
of such counsel's knowledge, there are no material contracts,
indentures or other documents of a character required to be described
or referred to in the Registration Statement or the Prospectus or to be
filed as exhibits to the Registration Statement other than those
described or referred to therein or filed or incorporated by reference
as exhibits thereto. The statements in the Prospectus under the caption
"Legal Aspects of the Home Equity Loans and Related Matters" and the
statements in the Prospectus Supplement under the caption "Legal
Investment", to the extent that statements in such sections constitute
matters of law or legal conclusions with respect thereto, have been
reviewed by attorneys under such counsel's supervision and are complete
and correct in all material respects.
(xv) There are no actions, proceedings or investigations pending
before or, to the best knowledge of such counsel, threatened by any
court, administrative agency or other tribunal to which any of the
Sellers, HFC or the Depositor is a party or of which any of their
respective properties is the subject (A) other than actions,
proceedings or investigations which are not reasonably expected to have
a material adverse effect on the business or financial condition of any
of the Sellers, HFC or the Depositor, (B) asserting the invalidity of
the Pooling and Servicing Agreement, the Transfer Agreement, the Home
Equity Loan Purchase Agreement or the Certificates, (C) seeking to
prevent the issuance of the Certificates or the consummation by any of
the Sellers, HFC or the Depositor of any of the transactions
contemplated by the Pooling and Servicing Agreement, the Transfer
Agreement and the Home Equity Loan Purchase Agreement and this
Agreement, as the case may be, or (D) which might materially and
adversely affect the performance by any of the Sellers, HFC or the
Depositor of their respective obligations under, or the validity or
enforceability of, the Pooling and Servicing Agreement, the Home Equity
Loan Purchase Agreement, this Agreement, or the Certificates.
(xvi) The Registration Statement, the Prospectus and each
amendment or supplement thereto, as of their respective effective or
issue dates complied as to form in
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all material respects with the applicable requirements of the 1933 Act
and the 1933 Act Regulations.
(xvii) Such counsel has no reason to believe that (A) the
Registration Statement and the Prospectus, as of the date the
Registration Statement became effective, or the Registration Statement
(excluding the exhibits thereto) as of the date that the most recent
post-effective amendment thereto became effective, contained or
contains any untrue statement of a material fact or omitted or omits to
state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading or (B) the
Prospectus, as of its date and the date of such opinion, contained or
contains any untrue statement of a material fact or omitted or omits to
state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading (it being understood that such counsel need express no
opinion as to information included in Computational Materials,
Collateral Term Sheets or Structural Term Sheets and the financial
statements or other financial and statistical data contained or
incorporated by reference in the Registration Statement).
Such opinion may express its reliance as to factual matters on the
representations and warranties made by the parties hereto, and on certificates
or other documents furnished by public officials or officers of such parties to
the instruments and documents referred to therein. Such opinion may be
qualified, insofar as it concerns the enforceability of the documents referred
to therein, to the extent that such enforceability may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting the enforcement of
creditors' rights in general, or by general principles of equity (regardless of
whether such enforcement is considered in a proceeding in equity or at law) and
no opinion need be given as to the enforceability of Section 9 or the legends
set forth in Section 6 of this Agreement.
(e) The Underwriters shall have received the favorable opinion of
counsel to the Trustee, dated the date of the Closing Time, addressed to the
Underwriters and in form and scope satisfactory to counsel to the Underwriters,
to the effect that:
(i) The Trustee has duly authorized, executed and delivered the
Pooling and Servicing Agreement which constitutes the valid and legally
binding agreement of the Trustee, is enforceable against the Trustee in
accordance with its terms, subject, as to enforcement of remedies, (A)
to applicable bankruptcy, insolvency, reorganization, and other similar
laws affecting the rights of creditors generally and (B) to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(ii) The Trustee has duly executed and countersigned the
Certificates issued on the date thereof on behalf of the Trust.
(iii) The execution and delivery by the Trustee of the Pooling
and Servicing Agreement and the Transfer Agreement and the performance
by the Trustee of its obligations thereunder do not conflict with or
result in a violation of the Organization
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Certificate or Bylaws of the Trustee.
(iv) The Trustee has full power and authority to execute and
deliver the Pooling and Servicing Agreement and the Transfer Agreement
and to perform its obligations thereunder.
(v) To the best of such counsel's knowledge, there are no
actions, proceedings or investigations pending or threatened against or
affecting the Trustee before or by any court, arbitrator,
administrative agency or other governmental authority which, if
adversely decided, would materially and adversely affect the ability of
the Trustee to carry out the transactions contemplated in the Pooling
and Servicing Agreement and the Transfer Agreement.
(vi) No consent, approval or authorization of, or registration,
declaration or filing with, any court or governmental agency or body of
the United States of America or any state thereof is required for the
execution, delivery or performance by the Trustee of the Pooling and
Servicing Agreement and the Transfer Agreement.
(f) The Underwriters shall have received the favorable opinion or
opinions, dated the date of the Closing Time, of Xxxxx & Xxxx LLP, as counsel
for the Underwriters, with respect to the issuance of the Underwritten
Certificates and the sale of the Underwritten Certificates to the Underwriters,
the Registration Statement, this Agreement, the Prospectus and such other
related matters as the Underwriters may require.
(g) The Underwriters shall have received an opinion, dated the date of
the Closing Time, of Xxxxxx Xxxxxx & Zavis, as special counsel to the Depositor
and HFC, addressed to the Depositor, and satisfactory to Fitch and Xxxxx'x
relating to the sale of the principal balance of the Home Equity Loans by the
Sellers to the Depositor and by the Depositor to the Trust, and such counsel
shall have consented to reliance by Fitch and Xxxxx'x and the Underwriters on
such opinion as though such opinion had been addressed to each such party.
(h) Each of the Depositor and HFC shall have furnished to the
Underwriters a certificate signed on behalf of the Depositor and HFC by an
accounting or financial officer thereof, dated the date of the Closing Time, as
to (A) the accuracy of the representations and warranties of the Depositor and
HFC herein at and as of the Closing Time, (B) there being no legal or
governmental proceedings pending, other than those, if any, referred to in the
Prospectus or the Prospectus as amended or supplemented or the 34 Act filings of
HFC, as the case may be, to which any of the Depositor or HFC is a party or of
which any property of any of the Depositor or HFC is the subject, which, in the
judgment of any of the Depositor or HFC, as applicable, have a reasonable
likelihood of resulting in a material adverse change in the financial condition,
shareholders' equity or results of operations of the Depositor or HFC; and to
the best knowledge of each of the Depositor or HFC, as applicable, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others, (C) the performance by the Depositor and HFC of all of
their respective obligations hereunder to be performed at or prior to the
Closing Time, and (D) such other
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matters as you may reasonably request.
(i) The Trustee shall have furnished to the Underwriters a certificate
of the Trustee, signed by one or more duly authorized officers of the Trustee,
dated the date of the Closing Time, as to the due authorization, execution and
delivery of the Pooling and Servicing Agreement and the Transfer Agreement by
the Trustee and the acceptance by the Trustee of the trust created by the
Pooling and Servicing Agreement and the due execution and delivery of the
Certificates by the Trustee thereunder and such other matters as you shall
reasonably request.
(j) The Class A Certificates shall have been rated ___ by _____ and
___ by _______, the Class M-1 Certificates shall have been rated __ by _____
and ___ by _______ and the Class M-2 Certificates shall have been rated _ by
_____ and __ by _______.
(k) Counsel and special counsel to HFC and the Depositor shall have
furnished to the Underwriters any opinions supplied to the rating agencies
relating to certain matters with respect to the Underwritten Certificates.
(l) The Underwriters shall have received from Xxxxxx Xxxxxxxx LLP, or
other independent certified public accountants acceptable to the Underwriters, a
letter, dated as of the Closing Time in the form heretofore agreed to.
(m) Prior to the Closing Time, Xxxxx & Wood LLP, as counsel for the
Underwriters, shall have been furnished with such documents and opinions as they
may reasonably require for the purpose of enabling them to pass upon the
issuance of the Underwritten Certificates and the sale of the Underwritten
Certificates to the Underwriters as herein contemplated and related proceedings
or in order to evidence the accuracy and completeness of any of the
representations and warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Depositor and HFC in
connection with the issuance of the Underwritten Certificates and the sale of
the Underwritten Certificates to the Underwriters as herein contemplated shall
be satisfactory in form and substance to the Underwriters and Xxxxx & Xxxx LLP.
(n) Since the respective dates as of which information is given in the
Prospectus, there shall not have been any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
condition, stockholders' equity or results of operations of the Depositor, any
of the Sellers or HFC otherwise than as set forth or contemplated in the
Prospectus, the effect of which is in the reasonable judgment of the
Underwriters, after consultation with the Depositor and HFC, so material and
adverse as to make it impracticable or inadvisable to proceed with the public
offering or the delivery of the Underwritten Certificates on the terms and in
the manner contemplated in the Prospectus.
If any condition specified in this Section 7 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by you by notice to the Depositor at any time at or prior to the Closing Time,
and such termination shall be without liability of any party to any other party
except as provided in Section 8.
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SECTION 8. Payment of Expenses. The Depositor and HFC jointly and
severally agree to pay all expenses incident to the performance of their
obligations under this Agreement, including without limitation those related to
(i) the filing of the Registration Statement and all amendments thereto, (ii)
the preparation, issuance and delivery of the Certificates, (iii) the fees and
disbursements of Xxxxxx Xxxxxx & Zavis, as special counsel for the Depositor and
HFC, and Xxxxxx Xxxxxxxx LLP, accountants of the Depositor and HFC, (iv) any
qualification of the Underwritten Certificates under securities and Blue Sky
laws and the determination of the eligibility of the Underwritten Certificates
for investment in accordance with the provisions of subsection 5(f) including
filing fees (except for filing fees related to the filing of Computational
Materials which Underwriters agree to pay), and the fees and disbursements of
Xxxxx & Wood LLP, as counsel for the Underwriters (not to exceed $__,000, in
connection therewith and in connection with the preparation of any Blue Sky
Survey, (v) the printing and delivery to the Underwriters, in such quantities as
you may reasonably request, of copies of the Registration Statement and
Prospectus (except for expenses related to overnight delivery of copies of the
Prospectus which Underwriters agree to pay) and all amendments and supplements
thereto, and of any Blue Sky Survey, (vi) the delivery to the Underwriters, in
such quantities as you may reasonably request, of copies of the Pooling and
Servicing Agreement, (vii) the fees charged by nationally recognized statistical
rating agencies for rating the Underwritten Certificates and (viii) the fees and
expenses of the Trustee and its counsel.
If this Agreement is terminated by you in accordance with the
provisions of Section 7, the Depositor, the Sellers and HFC shall reimburse you
for all reasonable out-of-pocket expenses, including the fees and disbursements
of Xxxxx & Xxxx LLP, as counsel for the Underwriters.
SECTION 9. Indemnification. (a) HFC and the Depositor jointly and
severally agree to indemnify and hold harmless the Underwriters and each person,
if any, who controls the Underwriters within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto) or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading, unless (A) such untrue statement or omission or
alleged untrue statement or omission was made in reliance upon and in
conformity with written information furnished to the Depositor or HFC,
or information electronically transmitted to the Depositor or HFC or by
the Underwriters expressly for use in the Registration Statement (or
any amendment thereto), (B) such untrue statement or omission or
alleged untrue statement or omission relates to information in any
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Computational Materials, Collateral Term Sheets or Structural Term
Sheets (a) not provided by the Representative to the Depositor pursuant
to Section 6, or (b) provided by the Underwriters to a prospective
investor regardless of whether such Computational Materials, Collateral
Term Sheets or Structural Term Sheets are filed with the Commission
(except to the extent that such untrue statements contained therein are
Pool Information) or (C) such untrue statement or omission or alleged
untrue statement or omission was made in any preliminary prospectus and
corrected in the Prospectus and (1) any such loss, claim, damage or
liability suffered or incurred by an Underwriter resulted from an
action, claim or suit by any person who purchased the Underwritten
Certificates from such Underwriter in the offering and (2) such
Underwriter failed to deliver or provide a copy of the Prospectus (or
the Prospectus as supplemented) to such person at or prior to the
confirmation of the sale of such Underwritten Certificates in any case
where such delivery is required by the 1933 Act;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, if such settlement is
effected with the written consent of the Depositor; and
(iii) against any and all expense whatsoever (including the fees
and disbursements of counsel chosen by you and reasonably acceptable to
Depositor and HFC) as reasonably incurred in investigating, preparing
to defend or defending against or appearing as a third party witness
with respect to any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, as such
expense is incurred and to the extent that any such expense is not paid
under (i) or (ii) above. This indemnity agreement will be in addition
to any liability which the Depositor may otherwise have.
(b) Each of the Underwriters severally agrees to indemnify and hold
harmless the Depositor, each of its directors, each of its officers who signed
the Registration Statement, and each person, if any, who controls the Depositor
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
(each, an "Indemnified Party") against any and all loss, liability, claim,
damage and expense, as incurred, described in the indemnity contained in
subsection (a) of this Section 9, but only with respect to (i) untrue statements
or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Depositor or HFC by such Underwriter expressly for
use in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto) or (ii) information in any
Computational Materials, Collateral Term Sheets or Structural Term Sheets
provided by such Underwriter (except to the extent that such untrue statements
or errors contained therein are Pool Information). The parties hereto
acknowledge that the only information supplied to the Depositor by the
Underwriters expressly for use in the Registration Statement or the
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Prospectus is limited to the information set forth in the [last paragraph on the
cover page and the first sentence of the first paragraph and the second sentence
of the seventh paragraph under the caption "Method of Distribution"] in the
Prospectus Supplement. This indemnity agreement will be in addition to any
liability that the Underwriters may otherwise have.
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it with respect to which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve it from any liability which it may have hereunder unless
it has been materially prejudiced by such failure to notify or from any
liability which it may have otherwise than on account of this indemnity
agreement. An indemnifying party may participate at its own expense in the
defense of such action. In no event shall the indemnifying parties be liable for
the fees and expenses of more than one counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances,
unless (i) if the defendants in any such action include one or more of the
indemnified parties and the indemnifying party, and one or more of the
indemnified parties shall have employed separate counsel after having reasonably
concluded that there may be legal defenses available to it or them that are
different from or additional to those available to the indemnifying party or to
one or more of the other indemnified parties or (ii) the indemnifying party
shall not have employed counsel reasonably satisfactory to the indemnified party
to represent the indemnified party within a reasonable time after notice of the
commencement of the action.
SECTION 10. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 9 is for any reason held to be unenforceable by the indemnified parties
although applicable in accordance with its terms, HFC and the Depositor on the
one hand, and the Underwriters, on the other, shall contribute to the aggregate
losses, liabilities, claims, damages and expenses of the nature contemplated by
said indemnity agreement incurred by the Depositor and one or more of the
Underwriters (i) in such proportion as shall be appropriate to reflect the
relative benefits to HFC and the Depositor on the one hand and the Underwriters
on the other hand from the offering of the Underwritten Certificates pursuant to
this Agreement or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law or otherwise prohibited hereby, in such proportion
as is appropriate to reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of HFC and the Depositor on the one
hand and the Underwriters or Underwriter, as applicable, on the other in
connection with the actions, statements or omissions that resulted in such
losses, claims, damages or liabilities, or actions in respect thereof, as well
as any other relevant equitable considerations; provided, however, that no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 0000 Xxx) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
The relative benefits received by HFC and the Depositor on the one hand
and the Underwriters on the other hand in connection with the offering of the
Underwritten Certificates pursuant to this Agreement shall be deemed to be in
the same respective proportions as the total net proceeds from the offering of
the Underwritten Certificates pursuant to this Agreement (before
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deducting expenses) received by HFC and the Depositor and the total underwriting
discount received by the Underwriters, in each case as set forth in the
Prospectus, bear to the aggregate initial public offering price of the
Underwritten Certificates as set forth in the Prospectus. The relative fault of
HFC and the Depositor on the one hand and the Underwriters on the other hand
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 HFC or the
Depositor, on the one hand, or the Underwriters, on the other hand, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission.
HFC, the Depositor and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this Section 10 were to be determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take into
account the equitable considerations referred to in the first sentence of this
Section 10. The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to in
the first sentence of this Section 10 shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating, preparing to defend or defending against any action or claim that
is the subject of this Section 10. Notwithstanding the provisions of this
Section 10, no Underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Underwritten Certificates
underwritten by such Underwriter and distributed to the public were offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise been required to pay in respect of such losses, liabilities, claims,
damages and expenses. The Underwriters' obligations in this Section 10 to
contribute are several in proportion to their respective underwriting
obligations and not joint. Each party entitled to contribution agrees that upon
the service of a summons or other initial legal process upon it in any action
instituted against it in respect to which contribution may be sought, it shall
promptly give written notice of such service to the party or parties from whom
contribution may be sought, but the omission so to notify such party or parties
of any such service shall not relieve the party from whom contribution may be
sought for any obligation it may have hereunder or otherwise (except as
specifically provided in Section 9 hereof). For purposes of this Section 10,
each person, if any, who controls any Underwriter within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as such Underwriter, and each respective director of the Depositor,
each respective officer of the Depositor who signed the Registration Statement,
and each person, if any, who controls the Depositor within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act shall have the same
rights to contribution as the Depositor.
SECTION 11. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or contained in certificates of officers of the Depositor or HFC
submitted pursuant hereto shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Underwriters or
controlling person thereof, or by or on behalf of the Depositor or HFC and shall
survive delivery of any Underwritten Certificates to the Underwriters.
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SECTION 12. Termination of Agreement. You, as Representative, may
terminate this Agreement after consultation with the Depositor and HFC,
immediately upon notice to the Depositor and HFC, at any time at or prior to the
Closing Time (i) if there has been an outbreak or material escalation of
hostilities involving the United States of America where armed conflict appears
imminent, or the declaration by the United States of America of a national
emergency or war, if the effect of any such event in the Underwriters'
reasonable judgment makes it impracticable or inadvisable to proceed with the
public offering of the Underwritten Certificates or (ii) if trading generally on
the New York Stock Exchange has been suspended (other than normal trading
restrictions resulting from the total number of trades on the NYSE), or minimum
prices have been established by the exchange or by order of the Commission or
any other governmental authority, or if a banking moratorium has been declared
by either federal or New York State authorities. In the event of any such
termination, the covenant set forth in subsection 5(b), the provisions of
Section 8, the indemnity agreement set forth in Section 9, and the provisions of
Sections 10 and 15 shall remain in effect.
SECTION 13. Default by One or More of the Underwriters. If one or
more of the Underwriters participating in the public offering of the
Underwritten Certificates shall fail at the Closing Time to purchase the
Underwritten Certificates which it is (or they are) obligated to purchase
hereunder (the "Defaulted Certificates"), then such of the non-defaulting
Underwriters shall have the right, within 24 hours thereafter, to make
arrangements for one or more of the non-defaulting Underwriters, or any other
underwriters, to purchase all, but not less than all, of the Defaulted
Certificates in such amounts as may be agreed upon and upon the terms herein set
forth. If, however, you have not completed such arrangements within such 24-hour
period, then:
(i) if the aggregate principal amount of Defaulted Certificates
does not exceed 10% of the aggregate principal amount of the
Underwritten Certificates to be purchased pursuant to this Agreement,
the non-defaulting Underwriters named in this Agreement shall be
obligated to purchase the full amount thereof in the proportions that
their respective underwriting obligations hereunder bear to the
underwriting obligations of all such non-defaulting Underwriters, or
(ii) if the aggregate principal amount of Defaulted Certificates
exceeds 10% of the aggregate principal amount of the Underwritten
Certificates to be purchased pursuant to this Agreement, this Agreement
shall terminate, without any liability on the part of any
non-defaulting Underwriters.
No action taken pursuant to this Section 13 shall relieve any
defaulting Underwriter from the liability with respect to any default of such
Underwriter under this Agreement.
In the event of a default by any Underwriters as set forth in this
Section 13, either you or the Depositor shall have the right to postpone the
Closing Time for a period not exceeding five (5) Business Days in order that any
required changes in the Registration Statement or Prospectus or in any other
documents or arrangements may be effected.
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SECTION 14. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representative at the address set forth on
the first page hereof and by facsimile to the attention of _______________, at
______________. Notices to the Depositor or HFC shall be directed to Household
Finance Corporation, 0000 Xxxxxxx Xxxx, Xxxxxxxx Xxxxxxx, Xxxxxxxx 00000, to the
attention of the Secretary, with a copy to the Treasurer and by facsimile to the
attention of _________________, at ______________.
SECTION 15. Parties. This Agreement shall inure to the benefit of
and be binding upon the Underwriters, the Depositor and HFC, and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended nor shall it be construed to give any person, firm or corporation,
other than the parties hereto and their respective successors and the
controlling persons and officers and directors referred to in Sections 9 and 10
and their heirs and legal representatives, any legal or equitable right, remedy
or claim under or with respect to this Agreement or any provision herein
contained. This Agreement and all conditions and provisions hereof are intended
to be for the sole and exclusive benefit of the parties and their respective
successors and said controlling persons and officers and directors and their
heirs and legal representatives (to the extent of their rights as specified
herein) and except as provided above for the benefit of no other person, firm or
corporation. No purchaser of Underwritten Certificates from the Underwriters
shall be deemed to be a successor by reason merely of such purchase.
SECTION 16. Governing Law and Time. This Agreement shall be governed
by the law of the State of New York and shall be construed in accordance with
such law. Specified times of day refer to New York City time.
SECTION 17. Counterparts. This Agreement may be executed in
counterparts, each of which shall constitute an original of any party whose
signature appears on it, and all of which shall together constitute a single
instrument.
* * *
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If the foregoing is in accordance with the Underwriters' understanding of
our agreement, please sign and return to us a counterpart hereof, whereupon this
instrument along with all counterparts will become a binding agreement among the
Underwriters, the Depositor and HFC in accordance with its terms.
Very truly yours,
HFC REVOLVING CORPORATION
By:
----------------------------------
Name:
Title:
HOUSEHOLD FINANCE CORPORATION
By:
----------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED, as of the date
first above written:
[NAME OF UNDERWRITER]
as Representative of the Underwriters
By:
----------------------------------
Name:
Title:
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Schedule I
CLASS A CERTIFICATES
Principal Amount
----------------
Name of [Underwriter] . . . . . . . . . . . . . . . . . . . . . $
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
----------------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
================
CLASS M CERTIFICATES
Principal Amount
----------------
Name of [Underwriter] . . . . . . . . . . . . . . . . . . . . . $
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
----------------
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
================
A-1