EXHIBIT 1.1
HOUSEHOLD AUTOMOTIVE TRUST ___
SERIES _____
[$___________ ___% Class A-1 Notes
$___________ ___% Class A-2 Notes
$___________ ___% Class A-3 Notes
$___________ ___% Class A-4 Notes]
UNDERWRITING AGREEMENT
[Name of Lead Underwriter]
As Representative of the Underwriters
[address] [date]
Dear Sirs:
Household Finance Corporation, a corporation organized and
existing under the laws of Delaware, individually ("HFC") and as Master Servicer
(the "MASTER SERVICER"), Household Auto Receivables Corporation, a corporation
organized and existing under the laws of Nevada and a wholly owned subsidiary of
HFC, individually ("HARC") and as Seller (the "SELLER"), and Household
Automotive Finance Corporation, a corporation organized and existing under the
laws of Delaware and wholly owned subsidiary of HFC ("HAFC"), agree with you as
follows:
Section 1. ISSUANCE AND SALE OF SERIES _____ NOTES. The
Seller has authorized the issuance and sale of
[$___________ ___% Class A-1 Notes, $___________ ___% Class A-2 Notes,
$___________ ___% Class A-3 Notes and $___________ ___% Class A-4 Notes]
(collectively, the "SERIES _____ NOTES"). The Series _____ Notes are to be
issued by Household Automotive Trust ___ (the "TRUST") pursuant to an
Indenture, dated as of ____________, as supplemented by a Series ______
Supplement (the "INDENTURE") by and among HFC, the Master Servicer, the Trust
and __________________, a [New York] banking corporation, as indenture
trustee (the "INDENTURE TRUSTEE"). In addition to the Series _____ Notes, the
Trust will also issue the Series _____ Certificates (the "SERIES _____
CERTIFICATES") pursuant to a Trust Agreement, dated as of ____________,
between the Seller and the Owner Trustee as supplemented by a Series _____
Supplement (the "TRUST AGREEMENT"). The Series _____ Notes and the Series
_____ Certificates are referred to herein collectively as the "SERIES _____
SECURITIES." The assets of the Trust will include a pool of non-prime retail
installment sales contracts secured by new or used automobiles, light duty
trucks and vans (the "RECEIVABLES") and certain monies due thereunder on or
after __________ (the "CUT-OFF DATE").
As used herein, the term "SELLER AGREEMENTS" means the Master
Sale and Servicing Agreement dated as of _________ among the Trust, the Seller,
the Master Servicer and _____________________, as trustee (the "MASTER SALE AND
SERVICING AGREEMENT"), the Master Receivables Purchase Agreement dated as of
____________ between the Seller and HAFC (the "MASTER RECEIVABLES PURCHASE
AGREEMENT"), the Trust Agreement and this Underwriting Agreement (this
"AGREEMENT"); the term "HAFC AGREEMENTS" means the Master Receivables Purchase
Agreement and this Agreement; the term "HFC AGREEMENTS" means the Master Sale
and Servicing Agreement, the Indenture and this Agreement.
HFC, the Seller and HAFC are direct or indirect
subsidiaries of Household International, Inc. ("HOUSEHOLD"). HFC, the Seller
and HAFC are collectively referred to herein as the "HOUSEHOLD ENTITIES").
The Series _____ Notes are being purchased by the Underwriters
named in Schedule 1 hereto, and the Underwriters are purchasing, severally, only
the Series _____ Notes set forth opposite their names in Schedule 1, except that
the amounts purchased by the Underwriters may change in accordance with Section
10 of this Agreement. [Name of Lead Underwriter] is acting as representative of
the Underwriters and in such capacity, is hereinafter referred to as the
"REPRESENTATIVE."
The offering of the Series _____ Notes will be made by the
Underwriters and the Household Entities understand that the Underwriters propose
to make a public offering of the Series _____ Notes for settlement on
___________, as the Underwriters deem advisable.
None of the Series _____ Certificates are being purchased by
the Underwriters hereby.
Defined terms used herein and not otherwise defined shall have
their respective meanings as set forth in Section 2.01 of the Series _____
Supplement dated as of __________ among the Master Servicer, the Trust, the
Seller, the Indenture Trustee and ___________________, as Owner Trustee (the
"SERIES _____ SUPPLEMENT").
Section 2. REPRESENTATIONS AND WARRANTIES.
A. HAFC and the Seller, individually, represent and warrant
to, and agree with, the Underwriters as set forth in this Section 2(A).
Certain terms used in this Section 2(A) are defined in the second paragraph
of subsection 2(A)(i) below.
(i) The Seller meets the requirements for use of
Form S-3 under the Securities Act of 1933, as amended (the
"ACT"). A registration Statement on For S-3 (no.
333-______) has (a) been prepared by the Seller on such
Form in conformity with the requirements of the Act and the
rules and regulations of the United States Securities and
Exchange Commission (the "COMMISSION") thereunder, (b) been
filed with the Commission and (c) been declared effective
by the Commission, and no stop order suspending the
effectiveness of the Registration Statement has been
issued, and no proceeding for that purpose has
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been initiated or threatened, by the Commission. Copies of
such Registration Statement have been delivered by the
Seller to the Underwriters. There are no contracts or
documents of the Seller which are required to be filed as
exhibits to the Registration Statement pursuant to the Act
or the rules and regulations of the Commission which have
not been so filed or incorporated by reference therein on
or prior to the Effective Date of the Registration
Statement.
The terms which follow, when used in this Agreement, shall have the meanings
indicated. The term "EFFECTIVE DATE" shall mean each date that the
Registration Statement and any post-effective amendment or amendments thereto
became or become effective under the Act. "EXECUTION TIME" shall mean the
date and time that this Agreement is executed and delivered by the parties
hereto. The term "BASE PROSPECTUS" means the prospectus included in the
Registration Statement. The term "PROSPECTUS SUPPLEMENT" means the prospectus
supplement dated the date hereof, specifically relating to the Notes, as
filed with the Commission pursuant to Rule 424 of the Rules and Regulations.
The term "PROSPECTUS" means, together, then Base Prospectus and the
Prospectus Supplement. "REGISTRATION STATEMENT" shall mean the registration
statement referred to in the preceding paragraph and any registration
statement required to be filed under the Act or rules thereunder, including
amendments, all documents incorporated or deemed to be incorporated by
reference therein, exhibits and financial statements, in the form in which it
has or shall become effective and, in the event that any post-effective
amendment thereto becomes effective prior to the Closing Date (as hereinafter
defined), shall also mean such registration statement as amended or
supplemented pursuant to the Act or rules thereunder or the Exchange Act or
rules thereunder. Such term shall include Rule 430A Information deemed to be
included therein at the Effective Date as provided by Rule 430A. "RULE 424"
and "RULE 430A" refer to such rules under the Act. "RULE 430A INFORMATION"
means information with respect to the Series _____ Notes and the offering
thereof permitted to be omitted from the Registration Statement when it
becomes effective pursuant to Rule 430A. The "RULES AND REGULATIONS" shall
mean the rules and regulations of the Commission. All references in this
Agreement to financial statements and schedules and other information which
is "contained," included" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall be deemed to mean
and include all such financial statements and schedules and other information
which is or is deemed to be incorporated by reference in the Registration
Statement or the Prospectus, as the case may be; and all references in this
Agreement to amendments or supplements to the Registration Statement or the
Prospectus shall be deemed to mean and include the filing of any document
under the Exchange Act which is or is deemed to be incorporated by reference
in the Registration Statement or the Prospectus, as the case may be.
(ii) On the Effective Date, the Registration
Statement did or will comply in all material respects with
the applicable requirements of the Act and the Rules and
Regulations thereunder; assuming compliance by each
Underwriter with Sections 3(a), 3(b), 3(c) and 3(f) hereof
on the Effective Date and when the Prospectus is first
filed (if required) in accordance with Rule 424(b) and on
the Closing Date, the Prospectus will comply in all
material respects with the applicable requirements of the
Act and the Rules and Regulations; on the Effective Date,
the Registration Statement did not or will not contain any
untrue
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statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to
make the statements therein not misleading; and, on the
Effective Date, the Prospectus, if not filed pursuant to
Rule 424(b), did not or will not, and on the date of any
filing pursuant to Rule 424(b) and on the Closing Date, the
Prospectus (together with any supplement thereto) will not,
include any untrue statement of a material fact or omit to
state a material fact necessary in order to make the
Statements therein, in the light of the circumstances under
which they were made, not misleading; PROVIDED, HOWEVER,
that HAFC and the Seller make no representations or
warranties as to the information contained in or omitted
from the Registration Statement or the Prospectus in
reliance upon and in conformity with information furnished
in writing to HAFC or the Seller by the Representative
specifically for use in connection with the preparation of
the Registration Statement or the Prospectus. The documents
incorporated or deemed to be incorporated by reference in
the Prospectus, at the time they were or hereafter are
filed with the Commission, complied and will comply in all
material respects with the requirements of the Exchange Act
and the Rules and Regulations of the Commission under the
Exchange Act, and, when read together with the other
information in the Prospectus, at the time the Registration
Statement and any amendments thereto become effective and
at the Closing Date, will not contain an untrue statement
of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading.
(iii) Each of HAFC and the Seller is a
corporation duly organized and validly existing and in good
standing under the laws of its jurisdiction of
incorporation. Each of HAFC and the Seller 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 failure to have such
requisite power and authority or to be so qualified would
not have a material adverse effect on the business or
consolidated financial condition of HAFC or the Seller.
(iv) Neither HAFC nor the Seller is in violation
of its certificate of incorporation or in default in the
performance or observance of any material obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other
instrument to which it is a party or by which it may be
bound, or to which any of the property or assets of the
Seller or HAFC, as the case may be, is subject, except
where any such violation or default would not have a
material adverse effect on the transactions contemplated by
this Agreement.
(v) The execution, delivery and performance by
the Seller of each Seller Agreement, the issuance of the
Series _____ Securities and the
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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, other than
as contemplated in the Registration Statement, result in
the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Seller
pursuant to, any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the
Seller is a party or by which it may be bound, or to which
any of the property or assets of the Seller is subject, nor
will such action result in any violation of the provisions
of the certificate of incorporation or by-laws of the
Seller 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.
(vi) The execution, delivery and performance by
HAFC of each HAFC Agreement, the issuance of the Series
_____ Securities 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, other than as
contemplated by the Registration Statement, assets of HAFC
pursuant to, any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which HAFC is
a party or by which it may be bound, or to which any of the
property or assets of HAFC is subject, nor will such action
result in any violation of the provisions of the charter or
by-laws of HAFC 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.
(vii) Each Seller Agreement has been, or when
executed and delivered, will have been, duly executed and
delivered by the Seller; and each Seller Agreement
constitutes, or, when executed and delivered, will
constitute, legal, valid and binding instruments
enforceable against the Seller 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.
(viii) Each HAFC Agreement has been, or, when
executed and delivered, will have been duly executed and
delivered by HAFC; and each Seller Agreement constitutes,
or, when executed and delivered, will constitute, legal,
valid and binding instruments enforceable against HAFC in
accordance with their respective terms, subject as to the
enforceability (A) to applicable bankruptcy,
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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
law.
(ix) HAFC has authorized the conveyance of the
Receivables to the Seller; the Seller has authorized the
conveyance of the Receivables to the Trust; and the Seller
has directed the Trust to issue and sell the Series _____
Securities.
(x) Each of HAFC and the Seller is solvent and
will not become insolvent after giving effect to the
transactions contemplated by this Agreement and the other
Series _____ Related Documents. The Seller has no
indebtedness to any Person other than pursuant to this
Agreement and the Series _____ Related Documents. Each of
the Issuer, HAFC and the Seller, after giving effect to the
transactions contemplated by this Agreement and the other
Series _____ Related Documents, will have an adequate
amount of capital to conduct its business in the
foreseeable future.
(xi) Any taxes, fees and other governmental
charges in connection with the execution, delivery and
performance of any Seller Agreement, the Indenture and the
Securities shall have been paid or will be paid by the
Seller at or prior to the Closing Date.
(xii) The Series _____ Notes have been duly and
validly authorized, and, when validly executed,
authenticated, issued and delivered in accordance with the
Indenture and as provided herein will conform in all
material respects to the description thereof contained in
the Prospectus and will be validly issued and outstanding
and entitled to the benefits of the Indenture.
(xiii) There are no legal or governmental
proceedings pending, or to the knowledge of HAFC or the
Seller threatened, to which HAFC or the Seller is a party
or of which any property of any of them 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 such person and its subsidiaries
taken as a whole, or which would have a material adverse
effect upon the consummation of this Agreement.
(xiv) Xxxxxx Xxxxxxxx LLP is an independent
public accountant with respect to HAFC and Seller as
required by the Act and the Rules and Regulations.
(xv) 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 issue and sale of the
Series _____
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Notes, or the consummation by HAFC or the Seller of the
other transactions contemplated by this Agreement, the
Master Receivables Purchase Agreement, the Master Sale and
Servicing Agreement, the Trust Agreement or the Indenture,
except for (A) the registration under the Act of the Series
_____ Notes, (B) such consents, approvals, authorizations,
orders, registrations, qualifications, licenses or permits
as have been obtained or as may be required under state
securities or Blue Sky laws in connection with the purchase
of the Series _____ Notes and the subsequent distribution
of the Series _____ Notes 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 HAFC and its subsidiaries taken as a
whole or the Seller or the transactions contemplated by
such agreements.
(xvi) (a) HAFC has the power and authority to sell
the Receivables to the Trust, and (b) following the
conveyance of the Receivables to the Trust pursuant to the
Master Sale and Servicing Agreement, the Trust will own the
Receivables free and clear of any lien, mortgage, pledge,
charge, encumbrance, adverse claim or other security
interest (collectively, "LIENS") other than Liens created
by the Master Sale and Servicing Agreement.
(xvii) As of the Cutoff Date, each of the Receivables
will meet the eligibility criteria described in the
Prospectus.
(xviii) Neither HAFC nor the Seller will conduct
their operations while any of the Securities are
outstanding in a manner that would require the Seller 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.
(xix) Each of the Seller and HAFC 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 on the
Prospectus and neither the Seller nor HAFC has received
notice of any proceedings relating to the revocation or
modification of such license, certificate, authority or
permit which, singly or in the aggregate, if the subject of
an unfavorable decision, ruling or finding, is likely to
materially and adversely affect the conduct of its
business, operations, financial condition or income.
(xx) At the Closing Date, each of the representations
and warranties of HAFC set forth in the HAFC Agreements or
of the Seller set forth in the Seller Agreements will be
true and correct in all material respects.
(xxi) Since the respective dates as of which
information is given in the Prospectus, (x) there has not
been any material adverse change in or affecting
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the general affairs, business, management, financial
condition, stockholder's equity, results of operations,
regulatory situation or business prospects of HAFC and (y)
HAFC has not entered into any transaction or agreement
(whether or not in the ordinary course of business)
material to HAFC that, in either case, would reasonably be
expected to materially adversely affect the interests of
the holders of the Series _____ Notes, otherwise than as
set forth or contemplated in the Prospectus.
B. HFC represents, warrants and agrees with the
Underwriters, that:
(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 certificate of
incorporation or in default in the performance or
observance of any material obligation, agreement, covenant
or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument
to which HFC is a party or by which it may be bound, or to
which any of the property or assets of HFC is subject
except where any such violation or default would not have a
material adverse effect on the transactions contemplated by
this Agreement.
(iii) The execution, delivery and performance by HFC
of the HFC Agreements, 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 certificate of incorporation 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) Each HFC Agreement has been, or, when executed
and delivered, will have been, duly executed and delivered
by HFC; and each HFC Agreement constitutes, or, when
executed and delivered, will constitute, legal, valid and
binding instruments enforceable against HFC in accordance
with their
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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) HFC will, upon request by any Underwriter,
provide to such Underwriter complete and correct copies of
all reports filed by it with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT"), during 1997, 1998 and 1999. Except as set forth in
or contemplated in such reports, there has been no material
adverse change in the consolidated financial condition of
HFC and its subsidiaries taken as a whole.
(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 the HFC Agreements, except
for (A) the registration under the Act of the Series _____
Notes, (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
purchase of the Series _____ Notes and the subsequent
distribution of the Series _____ Notes 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 as required by the Act and
the Rules and Regulations.
Section 3. REPRESENTATIONS AND WARRANTIES OF THE
UNDERWRITERS. Each Underwriter severally, and not jointly, represents and
warrants to, and agrees with the other Underwriters, HAFC, the Seller and HFC
that:
(a) Prior to the Effective Date, such Underwriter has not
furnished and will not furnish, in writing or by electronic transmission, any
Derived Information relating to the Series _____ Notes to any prospective
investor.
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(b) Such Underwriter shall provide the Seller no later than
one Business Day after any Collateral Term Sheet is delivered to a prospective
investor, or in the case of any Structural Term Sheets and Computational
Materials no later than one Business Day before the date on which the Prospectus
is required to be filed pursuant to Rule 424, all such Derived Information
delivered to a prospective investor by it during the period commencing on the
Effective Date and ending on the date the Prospectus is filed with the
Commission. Such Underwriter shall deliver to the Seller a hard copy and, in a
mutually agreed upon format, a disk or electronic transmission of such Derived
Information.
(c) Assuming the accuracy of the Seller-Provided Information
used in the preparation of Derived Information, the Derived Information,
delivered by such Underwriter, as of the date thereof, is accurate in all
material respects, taking into account the assumptions set forth in such Derived
Information, but without making any representations as to the appropriateness of
such assumptions.
(d) Each Underwriter acknowledges that none of HAFC, the
Seller or HFC will be deemed to have breached any representation and warranty or
to have failed to satisfy any other agreement contained herein, to the extent
any such breach or failure on the part of such party resulted solely from an
Underwriter's breach of the representation and warranty set forth in subsection
(a), (b) or (c) above, PROVIDED, HOWEVER, that the rights and obligations
otherwise available to an Underwriter pursuant to Section 10 and 11 hereof are
not limited solely as a result of an Underwriter's breach of the representation
and warranty set forth in subsection (a) above.
(e) For purposes of this Agreement, "DERIVED INFORMATION"
means the type of information defined as Collateral Term Sheets, Structural Term
Sheets or Computational Materials (as such terms are interpreted in the
No-Action Letters). The terms "COLLATERAL TERM SHEET" and "STRUCTURAL TERM
SHEET" shall have the respective meanings assigned to them in the February 13,
1995 letter (the "PSA LETTER") of Cleary, Gottlieb, Xxxxx & Xxxxxxxx on behalf
of the Public Securities Association (which letter, and the Commission staff's
response thereto, were publicly available February 17, 1995), and with respect
to "Collateral Term Sheet" includes any subsequent Collateral Term Sheet that
reflects a substantive change in the information presented. The term
"COMPUTATIONAL MATERIALS" has the meaning assigned to it in the May 17, 1994
letter (the "Xxxxxx Letter" and together with the PSA Letter, the "No-Action
Letters") of Xxxxx & Xxxx on behalf of Xxxxxx, Peabody & Co., Inc. (which
letter, and the Commission staff's response thereto, were publicly available May
20, 1994). "SELLER-PROVIDED INFORMATION" means the information contained on any
computer tape furnished to the Underwriters by the Seller concerning the assets
comprising the Issuer.
(f) Any "electronic roadshow" presentation used by such
Underwriter (an "ER PRESENTATION") shall be made available only to institutional
investors, investment advisors and other persons of a type the Underwriter would
customarily invite to a road show who have been provided with a password by such
Underwriter. If the ER Presentation is transmitted during the "waiting period"
between filing and effectiveness of the Registration Statement, a preliminary
prospectus pursuant to Section 10(b) of the Act will be made available to the
prospective investor
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prior to the release of the password to such investor. In such event, the ER
Presentation will be preceded and conclude with the following statement:
A preliminary prospectus has been furnished to each person
authorized to receive this transmission. You should refer to
such prospectus, and to the registration statement of which it
is a part, for more complete information about the offering.
By electing to view this transmission, you represent, warrant
and agree that you will not videotape, record or otherwise
attempt to reproduce or retransmit the contents of this
transmission.
In addition an ER Presentation transmitted during the waiting
period shall also include a legend complying in substance with Rule 134(b) of
the Act. Any ER Presentation transmitted prior to effectiveness of the
Registration Statement will be coded so that viewers will not be able to copy,
print or down-load information contained in the ER Presentation and will be able
to view the ER Presentation only during the 24-hour period beginning with
initial access to the ER Presentation.
If the Registration Statement is effective at the time the ER
Presentation is transmitted, a prospectus pursuant to Section 10(a) of the Act
will be made available to each prospective investor that is provided access to
the ER Presentation, or if a prospectus pursuant to Section 10(a) of the Act is
not yet available, then a preliminary prospectus pursuant to Section 10(b) of
the Act will be made available to each prospective investor that is provided
access to the ER Presentation.
The content of the ER Presentation shall be approved by HAFC,
the Seller and HFC prior to transmission and shall not be inconsistent with the
prospectus made available to such investors prior to the ER Presentation
transmission.
Section 4. PURCHASE AND SALE. The Underwriters' commitment
to purchase the Series _____ Notes pursuant to this Agreement shall be deemed
to have been made on the basis of the representations and warranties of the
Household Entities herein contained and shall be subject to the terms and
conditions herein set forth. The Seller agrees to instruct the Trust to issue
the Series _____ Notes to the Underwriters, and the Underwriters agree to
purchase the Series _____ Notes on the date of issuance thereof. The purchase
prices for the Series _____ Notes shall be as set forth on Schedule 1 hereto.
Section 5. DELIVERY AND PAYMENT. Payment of the purchase
price for, and delivery of, any Series _____ Notes to be purchased by the
Underwriters shall be made at the office of Xxxxx Xxxxxxxxxx LLP, 1301 Avenue
of the Americas, New York, New York, or at such other place as shall be
agreed upon by the Representative and the Household Entities, at 10:00 a.m.
New York City time on __________ (the "CLOSING DATE"), or at such other time
or date as shall be agreed upon in writing by the Representative and the
Household Entities. Payment shall be made by wire transfer of same day funds
payable to the account designated by HAFC. Each of the Series _____ Notes so
to be delivered shall be represented by one or more global Series _____ Notes
registered in the name of Cede & Co., as nominee for The Depository Trust
Company.
11
The Household Entities agree to have the Series _____ Notes
available for inspection, checking and packaging by the Representative in New
York, New York, not later than 12:00 P.M. New York City time on the business day
prior to the Closing Date.
Section 6. OFFERING BY UNDERWRITERS.
(a) It is understood that the Underwriters propose to offer
the Series _____ Notes for sale to the public as set forth in the Prospectus.
(b) Each Underwriter represents and agrees that (i) it has not
offered or sold and, prior to the expiry of six months from the Closing Date,
will not offer or sell any Series _____ Notes to persons in the United Kingdom
except to persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments (as principal or agent) for the purpose of
their businesses or otherwise in circumstances which have not resulted and will
not result in an offer to the public in the United Kingdom within the meaning of
the Public Offers of Securities Regulations 1995; (ii) it has complied and will
comply with all applicable provisions of the Financial Services Xxx 0000 with
respect to anything done by it in relation to the Series _____ Notes in, from or
otherwise involving the United Kingdom; and (iii) it has only issued or passed
on, and will only issue or pass on, in the United Kingdom any document received
by it in connection with the issue of the Series _____ Notes, to a person who is
of a kind described in the Article 11(3) of the Financial Services Xxx 0000
(Investment Advertisements) (Exemptions) Order 1995 or to a person to whom such
document may otherwise lawfully be issued, distributed or passed on.
Section 7. COVENANTS OF THE HOUSEHOLD ENTITIES. The Household
Entities, covenant with the Underwriters as follows:
A. The Seller will use its best efforts to cause the Registration
Statement and any amendment thereto, if not effective at the Execution Time,
to become effective. If the Registration Statement has become or becomes
effective pursuant to Rule 430A, or filing of the Prospectus is otherwise
required under Rule 424(b), the Seller will file the Prospectus properly
completed, pursuant to Rule 424(b) within the time period prescribed and will
promptly evidence satisfactory to the Underwriters of such timely filing. The
Seller will promptly advise the Underwriters (i) when the Registration
Statement shall have become effective, (ii) when any amendment thereof shall
have become effective, (iii) of any request by the Commission for any
amendment or supplement of the Registration Statement or the Prospectus or
for any additional information, (iv) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose, and (v) of the
receipt by the Seller of any modification with respect to the suspension of
the qualification of the Series _____ Notes for sale in any jurisdiction or
the initiation or threatening of any proceeding for such purpose. The Seller
will not file any amendment of the Registration Statement or supplement to
the Prospectus to which the Underwriters reasonably object. The Seller will
use its best efforts to prevent the issuance of any such stop order and if
issued, to obtain as soon as possible the withdrawal thereof.
12
B. If, at any time when a Prospectus relating to the Series
_____ Notes is required to be delivered under the Act, any event occurs as a
result of which the Prospectus as then supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein in the light of the circumstances under which
they were made not misleading, or if it shall be necessary to supplement such
Prospectus to comply with the Act or the rules thereunder, the Seller shall
be required to notify the Underwriters and upon the Underwriters' request to
prepare and furnish without charge to the Underwriters as many copies as the
Underwriters may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which shall correct such
statement or omission or effect such compliance.
C. As soon as practicable, but in any event within 120
days of the close of the period covered thereby, the Seller will make
generally available to Noteholders and to the Underwriters an earnings
statement or statements of the Trust which will satisfy the provisions of
Section 11(a) of the Act and Rule 158 under the Act.
D. The Seller will furnish to the Underwriters and counsel
for the Underwriters, without charge, signed copies of the Registration
Statement (including exhibits thereto) and, so long as delivery of a
prospectus by the Underwriters or dealer may be required by the Act, as many
copies of the Prospectus and any supplement thereto as the Underwriters may
reasonably request.
E. The Household Entities, jointly and severally, agree to
pay all expenses incidental to the performance of their obligations under
this Agreement, including without limitation (i) expenses of preparing,
printing and reproducing the Registration Statement, the Prospectus, and any
document incorporated by reference in the Prospectus (including exhibits
thereto), (ii) any fees charged by any rating agency for the rating of the
Series _____ Notes, (iii) any expenses (including reasonable fees and
disbursements of counsel not to exceed $10,000) incurred by the Underwriters
in connection with qualification of the Series _____ Notes for sale under the
laws of such jurisdictions as the Underwriters designate, (iv) the fees and
expenses of (A) Xxxxx Xxxxxxxxxx LLP as special counsel for the Household
Entities and (B) Xxxxxx Xxxxxxxx LLP, (v) the fees and expenses of the
Indenture Trustee and any agent of the Indenture Trustee and the fees and
disbursements of counsel for the Indenture Trustee in connection with the
Indenture, the Trust Agreement and the Series _____ Notes, (vi) the fees and
expenses of the Owner Trustee and any agent of the Owner Trustee and the fees
and disbursements of counsel for the Owner Trustee in connection with the
Indenture, the Trust Agreement and the Series _____ Notes, and (vii) the cost
of delivering the Series _____ Notes to the offices of the Underwriters,
insured to the satisfaction of the Underwriters (it being understood that,
except as provided in this paragraph (E) and in Sections 9 and 10 hereof,
each Underwriter will pay its own expenses, including the expense of
preparing, printing and reproducing this Agreement, the fees and expenses of
counsel for the Underwriters, any transfer taxes on resale of any of the
Series _____ Notes by it and advertising expenses connected with any offers
that the Underwriters may make).
13
F. The Seller will take all reasonable actions requested by
the Underwriters to arrange for the qualification of the Series _____ Notes
for sale under the laws of such jurisdictions within the United States or as
necessary to qualify for the Euroclear System or Cedel Bank, societe anonyme
and as the Underwriters may designate, will maintain such qualifications in
effect so long as required for the distribution of the Series _____ Notes and
will arrange for the determination of the legality of the Series _____ Notes
for purchase by institutional investors.
G. For so long as the Series _____ Notes are outstanding,
the Household Entities will furnish to the Underwriters (i) as soon as
practicable after the end of each fiscal year of the Trust, all documents
required to be distributed to Noteholders under the Master Sale and Servicing
Agreement or the Indenture and (ii) as soon as practicable after filing, any
other information concerning the Household Entities filed with any government
or regulatory authority which is otherwise publicly available, as the
Underwriters may reasonably request.
H. To apply the net proceeds from the sale of the Series
_____ Notes in the manner set forth in the Prospectus.
I. If, between the date hereof or, if earlier, the dates as
of which information is given in the Prospectus and the Closing Date, to the
knowledge of the Seller, there shall have been any material change, or any
development involving a prospective material change in or affecting the
general affairs, management, financial position, shareholders' equity or
results of operations of any of the Household Entities, the Seller will give
prompt written notice thereof to the Underwriters.
J. The Seller, during the period when the Prospectus is
required to be delivered under the Act or the Exchange Act, will file all
documents required to be filed with the Commission pursuant to Section 13, 14
or 15 of the Exchange Act within the time periods required by the Act and the
Rules and Regulations thereunder.
K. To the extent, if any, that the ratings provided with
respect to the Series _____ Notes by the Rating Agency that initially rate
the Series _____ Notes are conditional upon the furnishing of documents or
the taking of any other actions by the Seller or HAFC, the Seller shall use
its best efforts to furnish or cause to be furnished such documents and take
any such other actions.
L. Neither HAFC nor the Seller will, with the prior written
consent of the Representative, contract to sell any automobile
receivable-backed certificates or notes or other similar securities either
directly or indirectly for a period of five (5) business days after the later
of the termination of the underwriting syndicate or the Closing Date.
M. So long as any of the Series _____ Notes are
outstanding, the Household Entities shall furnish to the Underwriters as soon
as such statements are furnished to the Trustee: (i) the annual statement as
to compliance of the Master Servicer delivered to the Trustee pursuant to
Section 4.10(a) of the Master Sale and Servicing Agreement, and (ii) the
annual statement of a
14
firm of independent public accountants furnished to the Trustee pursuant to
Section 4.11(a) of the Master Sale and Servicing Agreement with respect to
the Master Servicer.
Section 8. CONDITIONS OF THE OBLIGATIONS OF THE
UNDERWRITERS. The obligations of the Underwriters to purchase the Series
_____ Notes on the Closing Date pursuant to this Agreement are subject to (i)
the material accuracy of the representations and warranties on the part of
the Household Entities herein contained as of the Execution Time, (ii) the
material accuracy of the statements of officers of the Household Entities
made pursuant hereto, (iii) the performance by the Household Entities of all
of their respective obligations hereunder, and the performance by the
Household Entities of all of their respective obligations under the Seller
Agreements, HAFC Agreements and the HFC Agreements and (iv) the following
conditions as of the Closing Date:
A. If the Registration Statement has not become effective
prior to the Execution Time, unless the Underwriters agree in writing to a
later time, the Registration Statement shall have become effective not later
than 12:00 Noon New York City time on the business day following the day on
which the public offering price was determined; if filing of the Prospectus,
or any supplement thereto, is required pursuant to Rule 424(b), the
Prospectus shall have been filed in the manner and within the time period
required by Rule 424(b); and no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
B. Each of the Household Entities shall have delivered a
certificate, dated the Closing Date signed by its President or any Vice
President and its principal financial or principal accounting officer or its
Treasurer or any Assistant Treasurer or its Secretary or any Assistant
Secretary to the effect that the signers of such certificate, on behalf of
the named Household Entity, have carefully examined Series _____ Related
Documents, the Prospectus (and any supplements thereto) and the Registration
Statement, stating that:
(i) the representations and warranties of such
Household Entity in this Agreement are true and correct in
all material respects at and as of the date of such
certificate as if made on and as of such date (except to
the extent they expressly relate to an earlier date);
(ii) such Household Entity has complied, in all
material respects, with all the agreements and satisfied,
in all material respects, all the conditions on its part to
be performed or satisfied at or prior to the date of such
certificate;
(iii) nothing has come to the attention of such
Household Entity that would lead it to believe that the
Registration Statement contains any untrue statement of a
material fact 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; and
15
(iv) no stop order suspending the effectiveness of
the Registration Statement has been issued and no
proceedings for that purpose have been instituted. or, to
the knowledge of the xxxxxx, threatened.
C. Xxxx Xxxxxx, Vice President - Corporate Law and
Assistant Secretary of Household International, Inc., shall have delivered a
favorable opinion with respect to clauses (i) through (x) of this paragraph
(C), and Xxxxx Xxxxxxxxxx LLP, special counsel to the Household Entities,
shall have delivered a favorable opinion with respect to clauses (xi) through
(xiii) of this paragraph (C) each opinion shall be dated the Closing Date and
shall be satisfactory in form and substance to the Underwriters and counsel
for the Underwriters, to the effect that:
(i) each of HFC, HAFC and the Seller is duly
incorporated and validly existing as a corporation in good
standing under the laws of its jurisdiction of
incorporation with corporate power and authority to own its
properties and to conduct its business, except where
failure to have such power and authority do not have a
material adverse effect, as applicable, on the business or
consolidated financial condition of HFC and its
subsidiaries, taken as a whole, or HFC, HAFC, or the
Seller, to enter into and perform its obligation under the
HFC Agreements, the HAFC Agreements or the Seller
Agreements, as applicable, and to consummate the
transactions contemplated hereby and thereby;
(ii) each of the HFC Agreements, the HAFC Agreements
or the Seller Agreements has been duly authorized, executed
and delivered by HFC, HAFC or the Seller, as applicable,
and constitute the legal, valid and binding agreement of
HFC, HAFC or the Seller, as applicable, enforceable in
accordance with its terms subject, as to enforceability (A)
to applicable bankruptcy, reorganization, insolvency,
moratorium or other similar laws affecting creditors'
rights generally and the rights, (B) to general principles
of equity (regardless of whether enforcement is sought in a
proceedings in equity or at law) and (C) with respect to
rights of indemnity to limitations of public policy under
applicable securities laws;
(iii) the issuance and sale of the Series _____ Notes
have been duly authorized and, when executed and
authenticated in accordance with the terms of the Indenture
and delivered to and paid for by the Underwriters pursuant
to this Agreement, will be validly issued and outstanding,
entitled to the benefits of the Indenture, enforceable in
accordance with their terms subject, as to enforceability
(A) to applicable bankruptcy, reorganization, insolvency,
moratorium or other similar laws affecting creditors'
rights generally and the rights and remedies of creditors
of thrifts, savings institutions or national banking
associations and (B) to general principles of equity
(regardless of whether enforcement is sought in a
proceeding in equity or at law);
(iv) neither the execution nor the delivery of the
Underwriting Agreement, the Master Receivables Purchase
Agreement, the Trust Agreement,
16
the Indenture, the Master Sale and Servicing Agreement or
the Series _____ Supplement nor the issuance or delivery of
the Series _____ Notes, nor the consummation of any of the
transactions contemplated herein or therein, nor the
fulfillment of the terms of the Series _____ Notes, the
Underwriting Agreement, the Master Receivables Purchase
Agreement, the Trust Agreement, the Indenture, the Master
Sale and Servicing Agreement or the Series _____ Supplement
will conflict with or violate any term or provision of the
charter or by-laws of the Household Entities, or result in
a breach or violation of, or default under, or result in
the creation or imposition of any lien, charge or
encumbrance upon any property or assets of any of the
Household Entities pursuant to, any material statute
currently applicable to any of them or the Trust or any
order or regulation known to such counsel to be currently
applicable to any of them or the Trust of any court,
regulatory body, administrative agency or governmental body
having jurisdiction over the Household Entities or the
Trust, as the case may be, or the terms of any indenture or
other agreement or instrument known to such counsel to
which the Household Entities or the Trust is a party or by
which any of them or any of their properties are bound,
except where any such conflict, breach, violation, default
or encumbrance would not have a material adverse effect on
the transactions contemplated by this Agreement.
(v) to the best knowledge of such counsel, there is
no pending or threatened action, suit or proceeding before
any court or governmental agency, authority or body or any
arbitrator with respect to the Underwriting Agreement, the
Trust, the Series _____ Notes, the Master Receivables
Purchase Agreement, the Trust Agreement, the Indenture, the
Master Sale and Servicing Agreement or the Series _____
Supplement or any of the transactions contemplated herein
or therein or with respect to the Household Entities which,
in the case of any such action, suit or proceeding with
respect to any of them, would have a material adverse
effect on the Noteholders or the Trust or upon the ability
of any of the Household Entities to perform their
obligations under any of such agreements, and there is no
material contract, franchise or document relating to the
Trust or property conveyed to the Trust which is not
disclosed in the Registration Statement or Prospectus; and
the statements included in the Registration Statement and
Prospectus describing statutes (other than those relating
to tax and ERISA matters), legal proceedings, contracts and
other documents fairly summarize the matters therein
described;
(vi) the Registration Statement has become effective
under the Act; any required filing of the Prospectus or any
supplement thereto pursuant to Rule 424 has been made in
the manner and within the time period required by Rule 424;
to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement
has been issued, no proceedings for that purpose have been
instituted or threatened; the Registration Statement and
the Prospectus (and any supplements thereto) (other than
financial and statistical information contained therein as
to which such counsel need express no opinion)
17
comply as to form in all material respects with the
applicable requirements of the Act and the rules thereunder;
(vii) such counsel has no reason to believe that at
the Effective Date the Registration Statement contained any
untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading or that the
Prospectus, as of its date, includes any untrue statement
of a material fact or omits to state a material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading
(other than financial and statistical information contained
therein as to which such counsel need express no opinion);
(viii) to the best knowledge of such counsel, no
consent, approval, authorization, order, registration,
filing, qualification, license or permit of or with any
court or governmental agency or regulatory body under the
federal law of the United States or the laws of the State
of New York is required in connection with the consummation
of the transactions contemplated in the Underwriting
Agreement, the Trust Agreement, the Indenture, the Master
Receivables Purchase Agreement, the Master Sale and
Servicing Agreement or the Series _____ Supplement, except
(A) such consents, approvals, authorizations, orders,
registrations, filings, qualifications, licenses or permits
as have been made or obtained or as may be required under
the State securities or blue sky laws of any jurisdiction
in connection. with the purchase of the Series _____ Notes
by the Underwriters and the subsequent distribution of the
Series _____ Notes by the Underwriters or (B) where the
failure to have such consents, approvals, authorizations,
orders, registrations, filings, qualifications, licenses or
permits would not have a material adverse effect on the
Trust's interests in the Receivables or the transactions
contemplated by such agreements;
(ix) the Series _____ Notes, the Underwriting
Agreement, the Master Receivables Purchase Agreement, the
Trust Agreement, the Master Sale and Servicing Agreement
and the Indenture conform in all material respects to the
descriptions thereof contained in the Registration
Statement and the Prospectus;
(x) the Indenture has been duly qualified under the
Trust Indenture Act of 1939 and the Issuer is not required
to be registered under the Investment Company Act of 1940;
(xi) the statements in the Prospectus Supplement
under the captions "Summary of Terms -- Tax Status,"
"Summary of Terms -- ERISA Considerations," "ERISA
Considerations" and "Material Federal Income Tax
Consequences," "Certain Legal Aspects of the Receivables"
to the extent that they constitute matters of law or legal
conclusions with respect thereto, have been reviewed by
counsel and represent a fair and accurate summary of the
matters addressed therein, under existing law and the
assumptions stated therein;
18
(xii) the statements in the Base Prospectus under
the captions "Summary of Terms -- Tax Status," "Summary of
Terms -- ERISA Considerations," "ERISA Considerations" and
"Material Federal Income Tax Consequences," "Certain Legal
Aspects of the Receivables" to the extent that they
constitute matters of law or legal conclusions with respect
thereto, have been reviewed by counsel and represent a fair
and accurate summary of the matters addressed therein,
under existing law and the assumptions stated therein;
(xiii) no other filings or other actions, with
respect to the Indenture Trustee's interest in the
Receivables, are necessary to perfect the interest of the
Indenture Trustee in the Receivables, and proceeds thereof,
against third parties, except that appropriate continuation
statements must be filed in accordance with the applicable
state's requirements, which is presently at least every
five years; and
(xiv) the conditions to the use of a registration
statement on Form S-3 under the Act, as set forth in the
General Instructions to Form S-3, have been satisfied with
respect to the Registration Statement and the Prospectus.
There are no contracts or documents which are required to
be filed as exhibits to the Registration Statement pursuant
to the Act or the Rules and Regulations thereunder which
have not been filed.
In rendering such opinion, counsel may rely (A) as to matters
involving the application of the law of any jurisdiction other than, in the case
of Xxxx X. Xxxxxx, the laws of the State of Illinois, and in the case of Xxxxx
Xxxxxxxxxx LLP, the laws of the State of New York, the corporate law of the
State of Delaware and the United States Federal laws, to the extent deemed
proper and stated in such opinion, upon the opinion of other counsel of good
standing believed by such counsel to be reliable and acceptable to you and your
counsel, and (B) as to matters of fact, to the extent deemed proper and as
stated therein, on the certificates of responsible officers of the Trust,
Household Entities and public officials.
D. Xxxxx Xxxxxxxxxx LLP, counsel for the Underwriters,
shall have delivered a favorable opinion dated the Closing Date with respect
to the validity of the Series _____ Notes, the Underwriting Agreement, the
Series _____ Supplement, the Registration Statement, the Prospectus and such
other related matters as the Underwriters may reasonably require and the
Household Entities shall have furnished to such counsel such documents as
they reasonably request for the purpose of enabling them to pass on such
matters. In giving their opinion, Xxxxx Xxxxxxxxxx LLP may rely (i) as to
matters of California, Illinois, Nevada and Delaware law (other than Delaware
corporation law) upon the opinions of counsel delivered pursuant to
subsection (C) above, (ii) as to matters involving the application of laws of
any jurisdiction other than the State of New York, the United States Federal
laws or the corporation law of the State of Delaware, to the extent deemed
proper and specified in such opinion, upon the opinion of other counsel of
good standing believed to be reliable, and (iii) as to matters of fact, to
the extent deemed proper and as stated therein on certificates of responsible
officers of the Trust, Household Entities and public officials.
19
E. Counsel to the Indenture Trustee shall have delivered a
favorable opinion, dated the Closing Date, and satisfactory in form and
substance to the Underwriters and counsel for the Underwriters, the Household
Entities and their counsel, to the effect that:
(i) The Indenture Trustee has been duly
incorporated and is validly existing as a banking
corporation in good standing under the laws of the United
States of America.
(ii) The Indenture Trustee has full corporate trust
power and authority to enter into and perform its
obligations under the Indenture, including, but not limited
to, its obligation to serve in the capacity of the
Indenture Trustee and to execute, issue, countersign and
deliver the Series _____ Notes.
(iii) The Indenture has been duly authorized,
executed and delivered by the Indenture Trustee and
constitutes a legal, valid and binding obligation of the
Indenture Trustee enforceable against the Indenture
Trustee, in accordance with its terms, except that as to
enforceability such enforcement may (A) be subject to
applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the rights of
creditors generally and (B) be limited by general
principles of equity (whether considered in a proceeding at
law or in equity).
(iv) The Series _____ Notes have been duly
authorized, executed and authenticated by the Indenture
Trustee on the date hereof on behalf of the Trust in
accordance with the Indenture.
(v) The execution, delivery and performance of the
Indenture and the Series _____ Notes by the Indenture
Trustee will not conflict with or result in a breach of any
of the terms or provisions 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 Indenture Trustee pursuant to the terms of the articles
of association or the by-laws of the Indenture Trustee or
any statute, rule, regulation or order of any governmental
agency or body, or any court having jurisdiction over the
Indenture Trustee or its property or assets or any
agreement or instrument known to such counsel, to which the
Indenture Trustee is a party or by which the Indenture
Trustee or any of its respective property or assets is
bound.
(vi) No authorization, approval, consent or order
of, or filing with, any state or federal court or
governmental agency or authority is necessary in connection
with the execution, delivery and performance by the
Indenture Trustee of the Indenture and the Series _____
Notes.
F. Counsel to the Owner Trustee shall have delivered a
favorable opinion, dated the Closing Date and satisfactory in form and
substance to the Underwriters and counsel for the Underwriters, the Household
Entities and their counsel, to the effect that:
(i) The Owner Trustee has been duly incorporated and
is validly existing as a banking corporation in good
standing under the laws of the United States of America.
20
(ii) The Owner Trustee has full corporate trust
power and authority to enter into and perform its
obligations under the Trust Agreement, as the case may be,
including, but not limited to, its obligation to serve in
the capacity of Owner Trustee and to execute, issue,
countersign and deliver the Notes.
(iii) The Trust Agreement has been duly authorized,
executed and delivered by the Owner Trustee and constitutes
a legal, valid and binding obligation of the Owner Trustee
enforceable against the Owner Trustee, in accordance with
its terms, except that as to enforceability such
enforcement may (A) be subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other similar
laws affecting the rights of creditors generally and (B) be
limited by general principles of equity (whether considered
in a proceeding at law or in equity).
(iv) The execution, delivery and performance of the
Trust Agreement by the Owner Trustee will not conflict with
or result in a breach of any of the terms or provisions 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 Owner Trustee pursuant to the
terms of the articles of association or the by-laws of the
Owner Trustee or any statute, rule, regulation or order of
any governmental agency or body, or any court having
jurisdiction over the Owner Trustee or its property or
assets or any agreement or instrument known to such
counsel, to which the Owner Trustee is a party or by which
the Owner Trustee or any of its respective property or
assets is bound.
(v) No authorization, approval, consent or order of,
or filing with, any state or federal court or governmental
agency or authority is necessary in connection with the
execution, delivery and performance by the Owner Trustee of
the Trust Agreement and the Notes, as applicable.
G. [Name of Owner Trustee] shall have furnished to the
Underwriters and the Household Entities a certificate of
[Name of Owner Trustee], signed by one or more duly authorized officers of
___ [Name of Owner Trustee], dated the Closing Date, as to the due
authorization, execution and delivery of the Trust Agreement by ___
[Name of Owner Trustee] and the acceptance by the Owner Trustee of the trusts
created thereby and the due execution and such other matters as the
Underwriters and the Household Entities shall reasonably request.
H. [Name of Indenture Trustee] shall have furnished to the
Underwriters and the Household Entities a certificate of ____
[Name of Indenture Trustee], signed by one or more duly authorized officers
of _____ [Name of Indenture Trustee], dated the Closing Date, as to the due
authorization, execution and delivery of the Indenture and the Master Sale
and Servicing Agreement by _____ [Name of Indenture Trustee] and the
acceptance by the Indenture Trustee of the trusts created thereby and the due
execution and delivery of the Series _____ Notes by the Indenture Trustee
under the Indenture and such other matters as the Underwriters shall
reasonably request.
21
I. [The Class A-1 Notes] shall have been rated "[A-1+]" or
its equivalent, and [the Class A-2 Notes, Class A-3 Notes and the Class A-4
Notes] shall have been rated "[AAA]" or its equivalent, in each case, by at
least two nationally recognized Ratings Agencies.
J. The Underwriters shall have received copies of letters
dated as of the Closing Date, from the Ratings Agencies stating the current
ratings of the Series _____ Notes as set forth in Section I above.
K. The Underwriters shall have received from Xxxxx
Xxxxxxxxxx LLP, counsel to the Household Entities, a favorable opinion, dated
the Closing Date and satisfactory in form and substance to the Underwriters
and counsel for the Underwriters, as to true sale matters relating to the
transaction, and the Underwriters shall be addressees of any opinions of
counsel supplied to the rating organizations relating to the Series _____
Notes.
L. All proceedings in connection with the transactions
contemplated by this Agreement, and all documents incident hereto, shall be
reasonably satisfactory in form and substance to the Underwriters and counsel
for the Underwriters, and the Underwriters and counsel for the Underwriters
shall have received such other information, opinions, certificates and
documents as they may reasonably request in writing.
M. The Prospectus and any supplements thereto shall have
been filed (if required) with the Commission in accordance with the rules and
regulations under the Act and Section 2 hereof, and prior to the Closing
Date, no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been instituted or shall be contemplated by the Commission or by any
authority administering any state securities or Blue Sky law.
N. At the Closing Date, Xxxxxx Xxxxxxxx LLP shall have
furnished to the Underwriters a letter or letters, dated as of the Closing
Date, in form and substance satisfactory to the Underwriters and counsel for
the Underwriters.
If any condition specified in this Section 8 shall not have
been fulfilled when and as required to be fulfilled, (i) this Agreement may be
terminated by the Representative by notice to both of the Household Entities at
any time at or prior to the Closing Date, and such termination shall be without
liability of any party to any other party except as provided in Section 9 and
(ii) the provisions of Section 9, the indemnity set forth in Section 10, the
contribution provisions set forth in Section 10 and the provisions of Sections
13 and 16 shall remain in effect.
Section 9. REIMBURSEMENT OF EXPENSES. If the sale of the
Series _____ Notes provided for herein is not consummated because any
condition to the Underwriter's obligations set forth in Section 8 hereof is
not satisfied, because of any termination pursuant to Section 12 hereof or
because of any refusal, inability or failure on the part of the Indenture
Trustee or the Household Entities to perform any agreement herein or comply
with any provision hereof other than by reason of a default by the
Underwriters, the Household Entities, jointly and severally, will reimburse
the Underwriters upon demand for all out-of-pocket expenses (including
22
reasonable fees and disbursements of counsel) that shall have been incurred
by it in connection with the proposed purchase and Sale of the Series _____
Notes.
Section 10. INDEMNIFICATION.
A. The Household Entities jointly and severally agree to
indemnify and hold harmless the Underwriters and each person, if any, who
controls the Underwriters within the meaning of the Act or the Exchange Act,
from and against any and all loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases and sales of
the Series _____ Notes), to which the Underwriters or any such controlling
person may become subject, under the Act or the Exchange Act or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus, (ii)
the omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading
or (iii) the omission or alleged omission to state therein a material fact
required to be stated or necessary to make the statements therein, in the
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 Seller, or information, if any, electronically transmitted
to the Seller by the Underwriters expressly for use in the Registration
Statement (or any amendment thereof) or (b) such loss, liability, claim,
damage or expense is incurred by an Underwriter solely as a result of the
dissemination by it of Derived Information in violation of Section 3(a)
hereof; and shall reimburse the Underwriters and each such controlling person
promptly upon demand for any documented legal or documented other expenses
reasonably incurred by the Underwriters or such controlling person in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred;
PROVIDED, HOWEVER, that the foregoing indemnity with respect to any untrue
statement contained in or omission from the Prospectus shall not inure to the
benefit of the Underwriters if a Household Entity shall sustain the burden of
proving that the person asserting against the Underwriters the loss,
liability, claim, damage or expense purchased any of the Series _____ Notes
which are the subject thereof and was not sent or given a copy of the
appropriate Prospectus (or the appropriate Prospectus as amended or
supplemented) (the term Prospectus as used in this clause shall not include
documents incorporated by reference thereto), if required by law, at or prior
to the written confirmation of the sale of such Series _____ Notes (unless
such Prospectus is amended or supplemented after the Prospectus has been
delivered pursuant to Rule 424(b)) to such person and the untrue statement
contained in or omission from such preliminary prospectus was corrected in
the appropriate Prospectus (or the appropriate Prospectus as amended or
supplemented).
The foregoing indemnity agreement is in addition to any
liability which a Household Entity may otherwise have to the Underwriters or any
controlling person of any of the Underwriters.
23
B. Each of the Underwriters agrees to severally and not
jointly indemnify and hold harmless the Household Entities, the directors and
the officers of the Household Entities who signed the Registration Statement,
and each person, if any, who controls any Household Entity within the meaning
of the Act or the Exchange Act against any and all loss, claim, damage or
liability, or any action in respect thereof, to which a Household Entity or
any such director, officer or controlling person thereof may become subject,
under the Act or the Exchange Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in the
Underwriter Information (as defined below), or (ii) the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, and shall reimburse the
applicable Household Entity, promptly on demand, and any such director,
officer or controlling person for any documented legal or other documented
expenses reasonably incurred by such Household Entity, or any director,
officer or controlling person in connection with investigating or defending
or preparing to defend against any such loss, claim, damage, liability or
action as such expenses are incurred. Underwriter Information means the
information set forth under the caption "Underwriting" in the Prospectus
Supplement and the Base Prospectus.
The foregoing indemnity agreement is in addition to any
liability which the Underwriters may otherwise have to any Household Entity or
any such director, officer or controlling person.
C. Promptly after receipt by any indemnified party under
this Section 10 of notice of any claim or the commencement of any action,
such indemnified party shall, if a claim in respect thereof is to be made
against any indemnifying party under this Section 10, promptly notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify an indemnifying party
shall not relieve it from any liability which it may have under this Section
10 except to the extent it has been materially prejudiced by such failure;
and PROVIDED, FURTHER, that the failure to notify any indemnifying party
shall not relieve it from any liability which it may have to any indemnified
party otherwise than under this Section 10.
If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to the
indemnified party, unless such indemnified party reasonably objects to such
assumption on the ground that there may be legal defenses available to it which
are different from or in addition to those available to such indemnifying party.
After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, except to the extent
provided in the next following paragraph, the indemnifying party shall not be
liable to the indemnified party under this Section 10 for any fees and expenses
of counsel subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation.
24
Any indemnified party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless: (i) the employment thereof has been specifically authorized by the
indemnifying party in writing; (ii) such indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party and in the reasonable judgment of such counsel it is
advisable for such indemnified party to employ separate counsel; or (iii) the
indemnifying party has failed to assume the defense of such action and employ
counsel reasonably satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to local counsel) at any time for all such indemnified parties, which
firm shall be designated in writing by the Representative, if the indemnified
parties under this Section 9 consist of the Underwriters or any of their
controlling persons, or by the Household Entities, if the indemnified parties
under this Section 9 consist of any of the Household Entities or any of the
Household Entities' directors, officers or controlling persons, but in either
case reasonably satisfactory to the indemnified party.
Each indemnified party, as a condition of the indemnity
agreements contained in Sections 10A and B, shall use its best efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which such
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any claims
that are the subject matter of such action.
Notwithstanding the foregoing, if (x) the indemnified party
has made a proper request to the indemnifying party for the payment of the
indemnified party's legal fees and expenses, as permitted hereby, and (y) such
request for payment has not been honored within thirty days, then, for so long
as such request thereafter remains unhonored, the indemnifying party shall be
liable for any settlement entered into by the indemnified party whether or not
the indemnifying party consents thereto.
D. If the indemnification provided for in this Section 10
shall for any reason be unavailable to hold harmless an indemnified party
under Section 10A or B in respect of any loss, claim, damage or liability, or
any action in respect thereof, referred to therein, then each
25
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a
result of such loss, claim, damage or liability, or action in respect
thereof, (i) in such proportion as shall be appropriate to reflect the
relative benefits received by the Household Entities on the one hand and the
Underwriters on the other from the offering of the Notes or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Household Entities on the one hand and the Underwriters on the other with
respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any other
relevant equitable considerations.
The relative benefits of the Underwriters and the Household
Entities shall be deemed to be in such proportion so that the Underwriters are
responsible for that portion represented by the percentage that the underwriting
discount appearing on the cover page of the Prospectus Supplement bears to the
public offering price appearing on the cover page of the Prospectus Supplement.
The relative fault of the Underwriters and the Household
Entities shall be determined by reference to whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Household Entities or by
one of the Underwriters, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement or
omission and other equitable considerations.
The Household Entities and the Underwriters agree that it
would not be just and equitable if contributions pursuant to this Section 10D
were to be determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section 10D shall be deemed to include, for purposes
of this Section 10D, any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim.
Each person, if any, who controls each Underwriter within the
meaning of the Act or the Exchange Act shall have the same rights to
contribution as each of the Underwriters and each director of a Household
Entity, each officer of a Household Entity who signed the Registration
Statement, and each person, if any, who controls a Household Entity within the
meaning of the Act or the Exchange Act shall have the same rights to
contribution as the applicable Household Entity.
Except in the case of any loss, claim, damage, liability or
expense resulting solely from a breach of the Underwriter's representation and
warranty set forth in Section 3(a), (b) or (c) hereof, in no case shall any
Underwriter be responsible for any amount in excess of the underwriting discount
applicable to the Series _____ Notes purchased by such Underwriter hereunder. No
person guilty of fraudulent misrepresentation (within the meaning of
26
Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
E. The Underwriters severally confirm that the information
(i) set forth in the Prospectus Supplement relating to market making, (ii)
set forth under the caption "Underwriting" in the Prospectus Supplement, and
(iii) provided in response to Section 3(b) hereof, assuming the accuracy of
the Seller-Provided Information used in the preparation of Derived
Information, is correct and constitutes the only information furnished in
writing to a Household Entity by or on behalf of the Underwriters
specifically for inclusion in the Registration Statement and/or the
Prospectus.
Section 11. DEFAULT BY ONE OR MORE OF THE UNDERWRITERS. If
one or more of the Underwriters participating in the public offering of the
Series _____ Notes shall fail at the Closing Date to purchase the Series
_____ Notes which it is obligated to purchase hereunder (the "DEFAULTED
SECURITIES"), then the non-defaulting Underwriter shall have the right,
within 24 hours thereafter, to make arrangements to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed
upon and upon the terms herein set forth. If, however, the Underwriter have
not completed such arrangements within such 24-hour period, then:
(i) if the aggregate principal amount of Defaulted
Securities does not exceed 10% of the aggregate principal
amount of the Series _____ Notes to be purchased pursuant
to this Agreement, the non-defaulting Underwriter shall be
obligated to purchase the full amount thereof, or
(ii) if the aggregate principal amount of Defaulted
Securities exceeds 10% of the aggregate principal amount of
the Series _____ Notes to be purchased pursuant to this
Agreement, this Agreement shall terminate, without any
liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section shall relieve the
defaulting Underwriter from the liability with respect to any default of such
Underwriter under this Agreement.
In the event of a default by an Underwriter as set forth in
this Section, each of the Underwriters and the Seller shall have the right to
postpone the Closing Date for a period not exceeding five Business Days in order
that any required changes in the Registration Statement or Prospectus or in any
other documents or arrangements may be effected.
Section 12. TERMINATION. This Agreement shall be subject to
termination in the absolute discretion of the Representative, by notice given
to the Seller and HAFC prior to delivery of and payment for the Series _____
Notes if prior to such time (i) trading in securities generally on the New
York Stock Exchange or the National Association of Securities Dealers
National Market System shall have been suspended or limited, or minimum
prices shall have been established on such exchange or market system; a
banking moratorium shall have been declared by either Federal, New York State
authorities or the State of California; or (ii) there shall have occurred any
outbreak or material escalation of hostilities involving the United States of
America where armed conflict or the declaration of war appears imminent, if,
the effect of
27
such event makes it, in the reasonable judgment of the Representative,
impractical or inadvisable to proceed with the completion of the sale and
payment for the Series _____ Notes. Upon such notice being given, the parties
to this Agreement shall (except for any liability arising before or in
relation to such termination) be released and discharged from their
respective obligations under this Agreement.
Section 13. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO
SURVIVE DELIVERY. All representations, warranties and agreements contained in
this Agreement or contained in certificates of officers of the Household
Entities submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of the
Representative or controlling person of the Representative, or by or on
behalf of the Household Entities or any officers, directors or controlling
persons and shall survive delivery of any certificates to the Representative
or any controlling person.
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 to the Underwriters at
[Name of Lead Underwriter), [address], attention: __________, Fax: __________;
if sent to any Household Entity to 0000 Xxxxxxx Xxxx, Xxxxxxxx Xxxxxxx, Xxxxxxxx
00000, attention of General Counsel, Fax: (000) 000-0000.
Section 15. PARTIES. This Agreement shall inure to the
benefit of and be binding upon the Representative and the Household Entities,
and their respective successors or assigns. 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 or thereto and their respective
successors and the controlling persons and officers and directors referred to
in Section 9 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 therein) and except as
provided above for the benefit of no other person, firm or corporation. No
purchaser of Series _____ Notes from the Representative 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 LAWS OF THE STATE OF NEW YORK AND SHALL BE CONSTRUED IN
ACCORDANCE WITH SUCH LAWS WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS
THEREOF. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
Section 17. COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but together they
shall constitute but one instrument.
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Section 18. HEADINGS. The headings herein are inserted for convenience
of reference only and are not intended to be part of or affect the meaning or
interpretation of, this Agreement.
29
If the foregoing is in accordance with the Representative's
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 between the Representative, the Seller, HAFC and HFC in
accordance with its terms.
Very truly yours,
HOUSEHOLD FINANCE CORPORATION
By:
------------------------------
Name:
Title:
HOUSEHOLD AUTO RECEIVABLES
CORPORATION
By:
------------------------------
Name:
Title:
HOUSEHOLD AUTOMOTIVE FINANCE
CORPORATION
By:
------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED, as of
the date first above written:
[Name of Lead Underwriter]
Acting on its own behalf and as Representative of the
Underwriters referred to in the foregoing Agreement
By:
------------------------------
Name:
Title: Authorized Signatory
30
[Underwriting Agreement]
31
Schedule 1
Purchase Price (excluding accrued interest)
Class A-1 Class A-2 Class A-3 Class A-4
--------- --------- --------- ----------
[List Names of Underwriters] _____% _____% _____% _____%
_____________________________ _____% _____% _____% _____%
_____________________________ _____% _____% _____% _____%
_____________________________ _____% _____% _____% _____%
Notional Principal Amount
Class A-1 Class A-2 Class A-3 Class A-4
--------- --------- --------- ---------
[List Names of Underwriters] $__________ $__________ $__________ $__________
____________________________ __________ __________ __________ __________
____________________________ __________ __________ __________ __________
____________________________ __________ __________ __________ __________
Total $__________ $__________ $__________ $__________
Proceeds (excluding accrued interest)
Class A-1 Class A-2 Class A-3 Class A-4
--------- --------- --------- ----------
[List Names of Underwriters] $__________ $__________ $__________ $__________
____________________________ __________ __________ __________ __________
____________________________ __________ __________ __________ __________
____________________________ __________ __________ __________ __________
Total $__________ $__________ $__________ $__________
32
