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Exhibit 10.3
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HOUSEHOLD CONSUMER LOAN CORPORATION,
Seller,
HOUSEHOLD FINANCE CORPORATION,
Servicer,
and
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
Deposit Trustee
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FORM OF SUPPLEMENT FOR SERIES 1997-2
Dated as of November 1, 1997
to the
POOLING AND SERVICING AGREEMENT
Dated as of September 1, 1995
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HOUSEHOLD CONSUMER LOAN DEPOSIT TRUST I
Series 1997-2
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TABLE OF CONTENTS
Page
SECTION 1. Designation and Covenant to Exclude
Participation Interests................................... 1
Section 1.01 Designation................................................. 1
Section 1.02 Covenant to Exclude Participation Interests................. 1
SECTION 2. Definitions................................................. 2
SECTION 3. Servicing Compensation...................................... 10
SECTION 4. Article IV of Agreement..................................... 11
Section 4.07. Allocations.......................................... 11
Section 4.08. Determination of Monthly Interest.................... 11
Section 4.09. Determination of Monthly Principal................... 12
Section 4.10. [RESERVED]........................................... 12
Section 4.11. Application of Investor Finance Charge
and Administrative Collections on
Deposit in Collection Account...................... 12
Section 4.12. Investor Charge-Offs................................. 13
Section 4.13. [RESERVED]........................................... 13
SECTION 5. Distributions............................................... 13
SECTION 6. Statements to Series 1997-2 Participants.................... 14
SECTION 7. Additional Amortization Events.............................. 15
SECTION 8. Optional Repurchase......................................... 16
SECTION 9. Sale of Series 1997-2 Participants' Interest
pursuant to Section 2.06 or 10.01 of
Agreement................................................. 16
SECTION 10. Distributions pursuant to Section 8 or 9 of
this Series Supplement and Section 2.06,
10.01 or 12.02(c) of Agreement............................ 17
SECTION 11. Distribution of Proceeds of Sale, Disposition
or Liquidation of Receivables pursuant to
Section 9.02 of Agreement................................. 17
SECTION 12. Rating Agency Notice........................................ 18
SECTION 13. [RESERVED].................................................. 18
SECTION 14. [RESERVED].................................................. 18
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SECTION 15. Delivery of Series 1997-2 Participation
Interest.................................................. 18
SECTION 16. Ratification of Agreement................................... 18
SECTION 17. Counterparts................................................ 18
SECTION 18. Governing Law............................................... 18
SECTION 19. Forms of Certificates and Monthly Servicer's
Certificate............................................... 18
SECTION 20. Transfer Restrictions....................................... 19
EXHIBITS
Exhibit A-1 Series 1997-2 Participation Interest
Exhibit B Monthly Servicing Report
Exhibit C Investment Letter
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SERIES 1997-2 SUPPLEMENT, dated as of November 1, 1997 (this "Series
Supplement"), by and among Household Consumer Loan Corporation, a Nevada
corporation, as seller (the "Seller"), Household Finance Corporation, a
Delaware corporation, as servicer (the "Servicer"), and Texas Commerce Bank
National Association, a national banking association, as successor trustee to
The Chase Manhattan Bank, N.A. (together with successors in trust thereunder as
provided in the Pooling and Servicing Agreement referred to below, the "Deposit
Trustee"), under the Pooling and Servicing Agreement, by and among the Seller,
the Servicer and the Deposit Trustee dated as of September 1, 1995.
RECITALS
Section 6.03 of the Agreement provides, among other things, that the
Seller and the Deposit Trustee may at any time and from time to time enter into
a supplement to the Agreement for the purpose of authorizing the issuance by
the Deposit Trustee to the Seller for execution and redelivery to the Deposit
Trustee for authentication one or more Series of Series Participation
Interests. The Seller has tendered the notice of issuance required by Section
6.03(b)(i) of the Agreement and hereby enters into this Series Supplement with
the Servicer and the Deposit Trustee as required by such Section 6.03 to
provide for the issuance, authentication and delivery of the Series
Participation Interest, Series 1997-2 (the "Series 1997-2 Participation
Interest") and to specify the Principal Terms thereof.
In the event that any term or provision contained herein shall conflict
with or be inconsistent with any term or provision contained in the Agreement,
the terms and provisions of this Series Supplement shall govern.
SECTION 1. Designation and Covenant to Exclude Participation Interests.
Section 1.01 Designation. The Series 1997-2 Participation Interest
shall be deemed to be a "Series Participation Interest" for all purposes
under the Agreement and this Series Supplement. Notwithstanding any
provision to the contrary in the Agreement or in this Series Supplement,
the first Distribution Date with respect to Series 1997-2 shall be
December 12, 1997.
Section 1.02 Covenant to Exclude Participation Interests.
Notwithstanding any provisions to the contrary in the Agreement, for so
long as the Series 1997-2 Participation Interest is outstanding, each of
the Seller and the Servicer covenants and agrees not to enter into a
Participation Interest Agreement, and the Trust shall not acquire or hold
any interest in a Participation Interest. The entering into of any such
Participation Interest Agreement in ▇▇▇▇▇-
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tion of this Section 1.02 will be deemed to have an "Adverse Effect".
SECTION 2. Definitions.
(a) Whenever used in this Series Supplement and when used in the Agreement
with respect to the Series 1997-2 Participation Interest, the following words
and phrases shall have the following meanings, and the definitions of such
terms are applicable to the singular as well as the plural forms of such terms
and to the masculine as well as to the feminine and neuter genders of such
terms.
"Accelerated Amortization Date" shall mean ____________.
"Additional Balances" shall mean, with respect to any Credit Line,
amounts drawn under such Credit Line subsequent to the date such Credit
Line is designated to the Deposit Trust.
"Additional Interest" shall have the meaning set forth in Section
4.08(a) hereof.
"Adverse Effect" shall have the meaning assigned to such term in the
Agreement as supplemented by Section 1.02 hereof.
"Agreement" shall mean, for purposes of this Series Supplement, the
Pooling and Servicing Agreement, dated as of September 1, 1995, as such
agreement may be amended from time to time, by and among the Seller, the
Servicer and the Deposit Trustee (without regard to this Series
Supplement or supplements for other Series).
"Amortization Event" shall mean any of the events enumerated in
Section 9.01 of the Agreement or in Section 7 of this Series Supplement.
"Available Investor Principal Collections" shall mean, with respect
to any Distribution Date, the sum of (a) Investor Principal Collections,
(b) the Series 1997-2 Participation Interest Net Default Payment Amount,
and (c) the portion paid by the Seller pursuant to Section 9 hereof that
is included in clause (i) of the definition of Reassignment Amount.
"Calculation Date" shall mean the first day of the Interest Period.
"Closing Date" shall mean November ___, 1997.
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"Distribution Date" shall mean, with respect to Series 1997-2, the
14th day of each calendar month, or if such day is not a Business Day,
the next preceding Business Day, provided that the first Distribution
Date shall be December 12, 1997.
"Due Period" shall mean, with respect to the first Due Period, the
period from and including November 1, 1997 through November 30, 1997, and
thereinafter the meaning specified in the Agreement.
"Early Amortization Period" shall mean the period commencing with an
Amortization Event pursuant to Section 7 hereof or Section 9.01 of the
Agreement (after giving effect to any grace periods) and terminating upon
termination of the Trust pursuant to Section 12.01 of the Agreement.
"Eligible Investments" shall mean, with respect to funds allocable
to the Series 1997-2 Participation Interest in the Collection Account,
"Eligible Investments" as defined in the Agreement, except that all
references in such definition to "rating satisfactory to the Rating
Agency" shall mean ratings of not less than A-1 by Standard & Poor's, P-1
by Moody's, F-1 by Fitch (if rated by Fitch) and D-1 by Duff & ▇▇▇▇▇▇ (if
rated by Duff & ▇▇▇▇▇▇).
"Eligible Institution" shall mean any "Eligible Institution" as
defined in the Agreement, except that all references in such definition
to "rating satisfactory to the Rating Agency" shall mean long-term
ratings of not less than AAA by Standard and Poor's or Aaa by Moody's,
respectively, or short-term unsecured debt ratings of at least A-1 by
Standard and Poor's and P-1 by Moody's, respectively, except that no such
rating shall be required of an institution which maintains such Account
or such funds as a fully segregated trust account or subaccount with the
corporate trust department of such institution as long as such
institution maintains the credit rating of each Rating Agency in one of
its generic credit rating categories which signifies investment grade.
"Final Scheduled Payment Date" shall mean the Payment Date in
___________.
"Fixed Allocation Percentage" shall mean, with respect to any
Distribution Date, the percentage equivalent of a fraction, the numerator
of which is the Series 1997-2 Participation Interest Invested Amount as
of the last day immediately preceding the commencement of an Early
Amortization Period that is continuing or preceding the Accelerated
Amortization Date, as applicable, and the denominator of which is the
greater of (x) the aggregate Principal Receivables as of the first day of
the related Due Period and the
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then outstanding amount of any Participation Interests in the Deposit
Trust as of the first day of the related Due Period and (y) the sum of
the numerators used to calculate the Allocation Percentage for
allocations with respect to Principal Receivables or Finance Charge and
Administrative Receivables, as applicable, for all outstanding Series for
such Distribution Date; provided, however, that, with respect to the
first Due Period, the Fixed Allocation Percentage shall mean the
percentage equivalent of a fraction, the numerator of which is the Series
1997-2 Participation Interest Initial Invested Amount and the denominator
of which is the total amount of Principal Receivables in the Deposit
Trust as of the Closing Date; provided, further, that, with respect to
any Due Period in which Aggregate Additional Credit Lines or
Participation Interest are added to the Trust or a removal of Credit
Lines pursuant to Section 2.10 of the Agreement occurs, the amount of
Principal Receivables and Participation Interests referred to in clause
(x) above shall be the average amount of Principal Receivables and
Participation Interests in the Deposit Trust on each Business Day during
such Due Period based upon the assumptions that (1) the aggregate amount
of Principal Receivables in the Deposit Trust at the end of the day on
the last day of the prior Due Period is the aggregate amount of Principal
Receivables and Participation Interests in the Deposit Trust on each
Business Day of the period from and including the first day of such Due
Period to but excluding the related Addition Date or Removal Date and (2)
the aggregate amount of Principal Receivables in the Deposit Trust at the
end of the day on the related Addition Date or Removal Date is the
aggregate amount of Principal Receivables and Participation Interests in
the Deposit Trust on each Business Day of the period from and including
the related Addition Date or Removal Date to and including the last day
of such Due Period.
"Floating Allocation Percentage" shall mean with respect to any
Distribution Date the percentage equivalent of a fraction, the numerator
of which is the Series 1997-2 Participation Interest Invested Amount as
of the last day of the related Due Period and the denominator of which is
the greater of (x) the aggregate Principal Receivables as of the first
day of the related Due Period and the then outstanding amount of any
Participation Interests in the Deposit Trust as of the first day of the
related Due Period and (y) the sum of the numerators used to calculate
the Allocation Percentage for allocations with respect to Principal
Receivables, Default Amounts, or Finance Charge and Administrative
Receivables, as applicable, for all outstanding Series for such
Distribution Date; provided, however, that, with respect to the first Due
Period, the Floating Allocation Percentage shall mean the percentage
equivalent of a fraction, the numerator of which is the Series 1997-2
Participa-
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tion Interest Initial Invested Amount and the denominator of which is the
total amount of Principal Receivables in the Deposit Trust as of the
first day of the related Due Period; provided, further, that, with
respect to any Due Period in which Aggregate Additional Credit Lines or
Participation Interest are added to the Trust or a removal of Credit
Lines pursuant to Section 2.10 of the Agreement occurs, the amount of
Principal Receivables and Participation Interests referred to in clause
(x) above shall be the average amount of Principal Receivables and
Participation Interests in the Deposit Trust on each Business Day during
such Due Period based upon the assumptions that (1) the aggregate amount
of Principal Receivables in the Deposit Trust at the end of the day on
the last day of the prior Due Period is the aggregate amount of Principal
Receivables and Participation Interests in the Deposit Trust on each
Business Day of the period from and including the first day of such Due
Period to but excluding the related Addition Date or Removal Date and (2)
the aggregate amount of Principal Receivables in the Deposit Trust at the
end of the day on the related Addition Date or Removal Date is the
aggregate amount of Principal Receivables and Participation Interests in
the Deposit Trust on each Business Day of the period from and including
the related Addition Date or Removal Date to and including the last day
of such Due Period.
"HCLC" shall mean Household Consumer Loan Corporation, a Nevada
corporation.
"Indenture" shall mean the indenture dated as of November 1, 1997
between the Issuer, as debtor, and The Bank of New York, as Indenture
Trustee, as may be amended from time to time.
"Interest Period" shall mean, with respect to any Distribution Date,
the period from and including the Distribution Date immediately preceding
such Distribution Date (or, in the case of the first Distribution Date,
from and including the Closing Date) to but excluding such Distribution
Date.
"Invested Amount" as defined in the Agreement shall mean the Series
1997-2 Participation Interest Invested Amount as defined herein.
"Investor Finance Charge and Administrative Collections" shall mean
with respect to any Distribution Date an amount equal to the sum of (a)
(i) if such Distribution Date is not during an Early Amortization Period,
the product of (x) the Floating Allocation Percentage for the related Due
Period and (y) Finance Charge and Administrative Collections during the
related Due Period and (ii) if such Distribution Date is during an Early
Amortization Period the product of
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(x) the Fixed Allocation Percentage for the related Due Period and (y)
Finance Charge and Administrative Collections during the related Due
Period and (b) the portion paid by the Seller pursuant to Section 9
hereof that is included in clauses (ii) and (iii) of the definition of
Reassignment Amount.
"Investor Principal Collections" shall mean, with respect to any Due
Period prior to the Accelerated Amortization Date and not during an Early
Amortization Period, the Floating Allocation Percentage of Net Principal
Collections for the related Due Period (or any partial Due Period which
occurs as the first Due Period during the Early Amortization Period);
provided that if Net Principal Collections for such Due Period is less
than the Minimum Principal Amount, then Investor Principal Collections
shall mean the Minimum Principal Amount. On and after the Accelerated
Amortization Date and during an Early Amortization Period, Investor
Principal Collections shall mean the Fixed Allocation Percentage of
Collections in respect of Principal Receivables for the related Due
Period.
"Issuer" shall mean the Household Consumer Loan Trust 1997-2, a
Delaware business trust, or its successor in interest.
"Minimum Principal Amount" shall mean, with respect to any
Distribution Date, the lesser of (a) the Floating Allocation Percentage
of Principal Collections for such Distribution Date and (b) the amount by
which ______% of the Series 1997-2 Participation Interest Invested Amount
exceeds the Series 1997-2 Participation Interest Net Default Payment
Amount for such Distribution Date to the extent of the amount of Investor
Finance Charge and Administrative Collections treated as principal
pursuant to Section 4.11(a)(iii) for such Distribution Date.
"Net Principal Collections" shall mean, with respect to any Due
Period prior to the Accelerated Amortization Date and not during an Early
Amortization Period, Collections in respect of Principal Receivables
during the related Due Period reduced by Additional Balances created
during such Due Period.
"Optional Repurchase Amount" shall mean, with respect to any
Distribution Date, after giving effect to any deposits and distributions
otherwise to be made on such Distribution Date, the sum of (i) the unpaid
principal balance of the Series 1997-2 Participation Interest, plus (ii)
accrued and unpaid interest on the unpaid principal balance of the Series
1997-2 Series Participation Interest through the day preceding such
Distribution Date, plus (iii) the amount of Additional Interest, if any,
for such Distri-
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bution Date and any Additional Interest previously due but not
distributed to the Series 1997-2 Participants, as applicable, on a prior
Distribution Date.
"Overcollateralization Amount" shall have the meaning set forth in
the Indenture.
"Performance Amortization Event" shall mean any of an Additional
Amortization Event pursuant to Section 7(a), (b) or (d) hereof.
"Prime" shall mean the rate set forth in H.15(519) opposite the
caption "Bank Prime Loan" for such day; provided, however, that the Prime
Rate with respect to any day which in the period beginning on the
Calculation Date through and including the calendar day first preceding a
Distribution Date, shall be the rate as described above in effect on such
Calculation Date. The Prime Rate is also available on Telerate,
currently at page 125. If any discrepancy arises between Telerate and
the printed version of H.15 (519), the printed version of H.15 (519) will
take precedence.
If, by the Calculation Date, the Prime Rate is not yet published in H.15
(519), then the Prime Rate will be determined by calculating the
arithmetic mean of the rates of interest publicly announced by each bank
named on Telerate under the heading "Prime Rate Top 30 U.S. Banks,"
currently at page 38, as such bank's U.S. dollar prime rate or base
lending rate as in effect on such day at 3:30 P.M. (New York City time).
If fewer than four such rates appear on Telerate for such Reset Date,
then the Prime Rate shall be the arithmetic mean of the rate of interest
publicly announced by three major banks in New York City, selected by the
Servicer, as their U.S. dollar prime rate or base lending rate as in
effect for such day.
"Rating Agency" shall mean Duff & Phelps, Fitch, Moody's, and
Standard & Poor's.
"Reassignment Amount" shall mean, with respect to any Distribution
Date, after giving effect to any deposits and distributions otherwise to
be made on such Distribution Date, the sum of (i) the unpaid principal
balance of the Series 1997-2 Participation Interest on such Distribution
Date, plus (ii) amounts accrued and unpaid at the Series 1997-2
Participation Interest Pass-Through Rate on the unpaid principal balance
of the Series 1997-2 Participation Interest through the day preceding
such Distribution Date, plus (iii) the amount of Additional Interest, if
any, for such Distribution Date and any Additional Interest previously
due but not distributed to the Series 1997-2 Participants on a prior
Distribution Date.
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"Required Seller Amount" shall mean an amount equal to 1.01% of the
Series 1997-2 Participation Interest Invested Amount.
"Securities" shall have the meaning assigned to such term in the
Indenture.
"Security Balance" shall have the meaning assigned to such term in
the Indenture.
"Series Cut-Off Date" shall mean the close of business on [October
31], 1997.
"Series 1997-2 Participant" shall mean the Issuer.
"Series 1997-2 Participants' Interest" shall mean 100% of the
interest evidenced by the Series 1997-2 Participation Interest.
"Series 1997-2 Participation Interest" shall be a Series
Participation Interest for the purposes of the Agreement and shall mean
the Series Participation Interest executed by the Seller and
authenticated by or on behalf of the Deposit Trustee, substantially in
the form of Exhibit A-1.
"Series 1997-2 Participation Interest Charge-Offs" shall have the
meaning specified in Section 4.12(a) hereof.
"Series 1997-2 Participation Interest Default Amount" shall mean,
with respect to each Distribution Date, an amount equal to the product of
the Defaulted Amount for the related Due Period and the Floating
Allocation Percentage for such Distribution Date.
"Series 1997-2 Participation Interest Initial Invested Amount" shall
mean the initial principal amount represented by the Series 1997-2
Participation Interest on the Issuance Date, which amount is
$_____________.
"Series 1997-2 Participation Interest Interest Shortfall" shall have
the meaning specified in Section 4.08(a) hereof.
"Series 1997-2 Participation Interest Invested Amount" shall mean,
when used with respect to any date, an amount equal to (a) the Series
1997-2 Participation Interest Initial Invested Amount, minus (b) the
amount of principal payments made to the Series 1997-2 Series
Participants prior to and including such date, minus (c) the excess, if
any, of the aggregate amount of Series 1997-2 Participation Interest
Charge-Offs over Series 1997-2 Participation Interest
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Charge-Offs reimbursed pursuant to Section 4.11(a) hereof prior to and
including such date.
"Series 1997-2 Participation Interest Monthly Interest" shall mean
the monthly interest distributable in respect of the Series 1997-2
Participation Interest as calculated in accordance with Section 4.08(a)
hereof.
"Series 1997-2 Participation Interest Monthly Principal" shall mean
the monthly principal distributable in respect of the Series 1997-2
Participation Interest as calculated in accordance with Section 4.09(a)
hereof.
"Series 1997-2 Participation Interest Net Default Payment Amount"
shall mean with respect to any Distribution Date the Series 1997-2
Participation Interest Default Amount for such Distribution Date to the
extent of the amount of Investor Finance Charge and Administrative
Collections treated as principal pursuant to clauses (iii) and (iv) of
Section 4.11(a) for such Distribution Date.
"Series 1997-2 Participation Interest Pass-Through Rate" shall mean
as to each Interest Period the Prime Rate minus _____%; provided that the
Series 1997-2 Participation Interest Pass-Through Rate for any Interest
Period shall not be less than the sum of (i) a per annum rate which will
result in an amount of Series 1997-2 Monthly Interest for such Interest
Period which will be sufficient to pay the amount of interest due on the
Notes and to make a full distribution on the Trust Certificates in
respect of the Certificate Rate on the related Payment Date and (ii)
_____% per annum of the Series 1997-2 Participation Interest Invested
Amount for Distribution Dates occurring prior to __________ and _____%
per annum of the Series 1997-2 Participation Interest Invested Amount for
Distribution Dates occurring in __________ and thereafter, in each case,
calculated on the basis of a year consisting of twelve months each
consisting of 30 days.
"Series 1997-2 Participation Interest Pool Factor" shall mean, with
respect to any Record Date, a number carried out to eight decimals
representing the ratio of the Series 1997-2 Participation Interest
Invested Amount as of such Record Date (determined after taking into
account any increases or decreases in the Series 1997-2 Participation
Interest Invested Amount which will occur on the following Distribution
Date) to the Series 1997-2 Participation Interest Initial Invested
Amount.
"Series 1997-2 Servicing Fee" shall have the meaning specified in
Section 3 hereof.
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"Series 1997-2 Termination Date" shall mean the earlier
of the date the Securities are paid in full and the date the Deposit
Trust is terminated pursuant to Section 12.01 of the Agreement.
"Servicing Fee Rate" shall mean 2% per annum.
"Telerate Page 3750" shall mean the display page so designated on
the Dow ▇▇▇▇▇ Telerate Service (or such other page as may replace that
page on that service for the purpose of displaying comparable rates or
prices).
"Termination Proceeds" shall mean any Termination Proceeds arising
out of a sale of Receivables (or interests therein) pursuant to Section
12.02(c) of the Agreement with respect to Series 1997-2.
"Trust Agreement" shall mean the trust agreement dated as of
November 1, 1997 between HCLC, as Seller and holder of the Designated
Certificate, and Chase Manhattan Bank Delaware, as Owner Trustee.
"Trust Certificates" shall mean the certificates, issued pursuant to
the Trust Agreement.
(b) All capitalized terms used herein and not otherwise defined herein
have the meanings ascribed to them in the Agreement.
(c) The words "hereof", "herein" and "hereunder" and words of similar
import when used in this Series Supplement shall refer to this Series
Supplement as a whole and not to any particular provision of this Series
Supplement; references herein to any Article, Section or Exhibit are references
to Articles, Sections and Exhibits in or to this Series Supplement unless
otherwise specified; and the term "including" means "including without
limitation".
(d) The following defined terms used herein are used with the meanings
assigned thereto in the Trust Agreement or the Indenture, as applicable:
"Notes", "Note Rate", "Security Balance", "Owner Trustee",
"Overcollateralization Amount", "Initial Overcollateralization Percentage",
"Payment Date" and "Indenture Trustee".
SECTION 3. Servicing Compensation.
The monthly servicing fee (the "Series 1997-2 Servicing Fee") shall be
payable to the Servicer, in arrears, on each Distribution Date in respect of
any Due Period (or portion thereof) occurring prior to the first Distribution
Date on which the Series 1997-2 Series Participation Interest Invested Amount
is zero, in an amount equal to 1/12th of, or with respect to the
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first Due Period, ____/360th of the product of (i) the Servicing Fee Rate and
(ii) the Series 1997-2 Invested Amount on the last day of the related Due
Period or with respect to the first Due Period, the Closing Date.
SECTION 4. Article IV of Agreement.
Sections 4.01 through 4.06 of the Agreement shall be read in their
entirety as provided in the Agreement. Article IV of the Agreement (except for
Sections 4.01 through 4.06 thereof) shall, with respect to the Series 1997-2
Participation Interest, be read in its entirety as follows:
ARTICLE IV
RIGHTS OF SERIES 1997-2 PARTICIPANTS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
Section 4.07. Allocations. Collections of Finance Charge and
Administrative Receivables, Principal Receivables and Defaulted
Receivables allocated to the Series 1997-2 Participation Interest
pursuant to Article IV of the Agreement shall be allocated and
distributed as set forth in this Article.
Section 4.08. Determination of Monthly Interest. (a) The amount
of collections of Finance Charge and Administrative Receivables
distributable from the Collection Account with respect to the Series
1997-2 Participation Interest on any Distribution Date shall be an amount
equal to the product of (i) the Series 1997-2 Participation Interest
Pass-Through Rate and (ii) the unpaid principal balance of the Series
1997-2 Participation Interest on the first day of the related Interest
Period determined on the basis of the actual number of days in such
Interest Period and a 360-day year ("Series 1997-2 Participation Interest
Monthly Interest").
On the Determination Date preceding each Distribution Date, the
Servicer shall determine an amount (the "Series 1997-2 Participation
Interest Interest Shortfall") equal to the sum of (a) (x) the Series
1997-2 Participation Interest Monthly Interest for the Interest Period
applicable to such Distribution Date minus (y) the amount of collections
of Finance Charge and Administrative Receivables which will be on deposit
in the Collection Account and allocable to the Series 1997-2
Participation Interest on such Distribution Date and (b) the sum of the
amounts calculated pursuant to clause (a) on each preceding Distribution
Date. If the Series 1997-2 Participation Interest Interest Shortfall
with respect to any Distribution Date is greater than zero, on each
subsequent Distribution Date until such Series 1997-2 Participation
Interest Interest Shortfall is fully paid,
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pursuant to Section 4.11(a), an additional amount ("Additional Interest")
shall be payable as provided herein with respect to the Series 1997-2
Participation Interest Monthly Interest on each Distribution Date
following such Distribution Date, excluding the Distribution Date on
which the Series 1997-2 Participation Interest Interest Shortfall is paid
to the Series 1997-2 Participants equal to the product of (i) the Series
1997-2 Participation Interest Pass-Through Rate and (ii) such Series
1997-2 Participation Interest Interest Shortfall (or the portion thereof
which has not been paid to the Series 1997-2 Participants) determined on
the basis of the actual number of days in the related Interest Period and
a 360-day year. Notwithstanding anything to the contrary herein,
Additional Interest shall be payable or distributed to the Series 1997-2
Participants.
Section 4.09. Determination of Monthly Principal. (a) The amount
of monthly principal ("Series 1997-2 Participation Interest Monthly
Principal") distributable from the Collection Account with respect to the
Series 1997-2 Participation Interest shall be an amount equal to the
Available Investor Principal Collections on deposit in the Collection
Account with respect to such Distribution Date.
Section 4.10. [RESERVED]
Section 4.11. Application of Investor Finance Charge and
Administrative Collections on Deposit in Collection Account. With
respect to the Series 1997-2 Participation Interest, prior to 12:00 noon,
New York City time, on each Distribution Date, the Servicer shall provide
written directions to the Deposit Trustee to apply Investor Finance
Charge and Administrative Collections on deposit in the Collection
Account with respect to such Distribution Date in the following manner:
(a) An amount equal to Investor Finance Charge and Administrative
Collections with respect to such Distribution Date, plus any other funds
available to the Deposit Trust for application pursuant to this clause
will be distributed in the following priority:
(i) if HFC is not the Servicer under this Agreement, an amount
equal to the Series 1997-2 Servicing Fee for such date (to the
extent such amount has not been netted from deposits made in the
related Due Period), plus any unpaid Series 1997-2 Servicing Fee
(but only with respect to the then current Servicer) shall be paid
to the Servicer.
(ii) an amount equal to the Series 1997-2 Participation
Interest Monthly Interest for such Distribution
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Date, plus the amount of any Series 1997-2 Participation Interest
Interest Shortfall, plus the amount of any Additional Interest for
such Distribution Date;
(iii) an amount equal to the Series 1997-2 Participation
Interest Default Amount for such Distribution Date shall be treated
as a portion of Available Investor Principal Collections for such
Distribution Date;
(iv) an amount equal to the aggregate amount of the Series
1997-2 Participation Interest Charge-Offs which have not been
previously reimbursed shall be treated as a portion of Available
Investor Principal Collections with respect to such Distribution
Date.
(v) so long as HFC is the Servicer under the Agreement, an
amount equal to the Series 1997-2 Servicing Fee for such date (to
the extent such amount has not been netted from deposits to cover
losses in the related Due Period), plus any previously unpaid
Series 1997-2 Servicing Fee (but only with respect to the then
current Servicer) shall be paid to the Servicer; and
(vi) the balance, if any, shall be paid to the Seller with
respect to the HCLC Seller Participation Interest and the
Designated HCLC Seller Participation Interest, pro rata.
Section 4.12. Investor Charge-Offs. (a) If on any Distribution
Date, the amount to be distributed on the Series 1997-2 Participation
Interest pursuant to Section 4.11(a)(iii) exceeds the amount of Investor
Finance Charge and Administrative Collections for the related Due Period
(net of any portion thereof to be paid pursuant to Section 4.11(a)(i) and
(ii)), then the Series 1997-2 Participation Interest Invested Amount
shall be reduced by the amount of such excess ("Series 1997-2
Participation Interest Charge-Offs"), but not more than the Series 1997-2
Participation Interest Default Amount for such Distribution Date.
(b) Notwithstanding any other provision of this Series Supplement,
the Series 1997-2 Participation Interest Invested Amount shall never be
reduced below zero.
Section 4.13. [RESERVED]
SECTION 5. Distributions.
(a) On each Distribution Date, the Paying Agent shall distribute to each
Series 1997-2 Participant of record on the Record Date for such Distribution
Date (other than as provided in Section 12.02 of the Agreement respecting a
final distribution)
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17
such Series 1997-2 Participant's pro rata share (based on the aggregate
fractional undivided interests represented by the Series 1997-2 Participation
Interest held by such Series 1997-2 Participant) of the amounts on deposit in
the Collection Account pursuant to Section 4.11(a)(ii).
(b) On each Distribution Date, the Paying Agent shall distribute to each
Series 1997-2 Participant of record on the Record Date for such Distribution
Date (other than as provided in Section 12.02 of the Agreement respecting a
final distribution) such Series 1997-2 Participant's pro rata share (based on
the aggregate fractional undivided interests represented by the Series 1997-2
Participation Interest held by such Series 1997-2 Participant) of the amounts
on deposit in the Collection Account with respect to Available Investor
Principal Collections.
(c) Except as provided in Section 12.02 of the Agreement with respect to a
final distribution, distributions to each Series 1997-2 Participant hereunder
shall be made in immediately available funds by wire transfer to the account
designated by such Series 1997-2 Participant.
SECTION 6. Statements to Series 1997-2 Participants.
(a) On each Distribution Date, the Paying Agent, on behalf of the Deposit
Trustee, shall forward to each Series 1997-2 Participant a statement
substantially in the form of Exhibit B prepared by the Servicer setting forth
certain information relating to the Deposit Trust and the Series 1997-2
Participation Interest.
(b) On or before January 31 of each calendar year, beginning January 31,
1998, the Paying Agent, on behalf of the Deposit Trustee, shall furnish or
cause to be furnished to each Person who at any time during the preceding
calendar year was a Series 1997-2 Participant, a statement prepared by the
Servicer containing the information which is required to be contained in the
statement to the Series 1997-2 Participants, as set forth in subsection (a)
above, aggregated for such preceding calendar year or the applicable portion
thereof (the initial statement shall cover the period beginning on the Closing
Date and ending on December 31, 1997) during which such Person was a Series
1997-2 Participant, together with such other customary information as is
necessary to enable the Series 1997-2 Participants to prepare their tax
returns. Such obligation of the Servicer shall be deemed to have been
satisfied to the extent that substantially comparable information shall be
provided by the Paying Agent pursuant to any requirements of the Internal
Revenue Code, as from time to time in effect.
(c) The form of the Monthly Servicer's Report set forth as Exhibit B
hereto may be modified as the Servicer may determine to be necessary or
desirable; provided, however, that no such modi-
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18
fication shall serve to exclude information required by this Section 6. The
Servicer shall, upon making such determination, deliver to the Deposit Trustee
an Officer's Certificate to which shall be annexed the form of Exhibit B, as so
changed. Upon the delivery of such Officer's Certificate to the Deposit
Trustee, Exhibit B, as so changed, shall for all purposes of this Agreement
constitute Exhibit B. The Deposit Trustee may conclusively rely upon such
Officer's Certificate as to such change conforming to the requirements of the
Agreement.
SECTION 7. Additional Amortization Events. If any one of the following shall
occur:
(a) failure on the part of the Seller (i) to make any payment or deposit
required under the Agreement within five Business Days after the date such
payment or deposit is required to be made or (ii) to observe or perform in any
material respect any other covenants or agreements of the Seller set forth in
the Agreement, which failure has a material adverse effect on the Series 1997-2
Participation Interest and which continues unremedied for a period of 60 days
after written notice;
(b) any representation or warranty made by the Seller in the Agreement
proves to have been incorrect in any material respect when made, as a result of
which the interests of holders of interest in the Deposit Trust are materially
and adversely affected, and which continues to be incorrect in any material
respect and continues to materially and adversely affect the interests of
holders of interest in the Deposit Trust for a period of 60 days after written
notice; provided, however, that an Amortization Event shall not be deemed to
occur if the Seller has repurchased the related Receivables, during such period
(or within an additional 60 days with the consent of the Deposit Trustee) in
accordance with the provisions of the Agreement;
(c) the Deposit Trust or the Issuer becomes subject to regulation by the
Commission as an investment company within the meaning of the Investment
Company Act of 1940, as amended;
(d) a Servicer Default shall occur which has a material adverse effect on
the Series 1997-2 Participants;
(e) the average, for any three consecutive Payment Dates (after making all
distributions on such Payment Dates), of the percentage equivalent of (i) the
Overcollateralization Amount divided by (ii) the unpaid principal balance of
the Series 1997-2 Participation Interest, is less than _____%; and
(f) the Seller's Trust Amount owned by HCLC is reduced below the
Aggregate Required Seller Amount,
then, in the case of any event described in (a), (b) or (d), an
Amortization Event will be deemed to have occurred only if,
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19
after any applicable grace period described in such clauses, either the
Deposit Trustee or holders of Series Participation Interests evidencing more
than 50% of the unpaid principal balance of the Series 1997-2 Participation
Interest, by written notice to the Seller and the Servicer (and to the Deposit
Trustee, if given by the Series 1997-2 Participants) declare that an
Amortization Event has occurred as of the date of such notice. In the case of
any event described in clauses (c), (e) or (f), an Amortization Event will be
deemed to have occurred and an Early Amortization Period will occur without any
notice or other action on the part of the Deposit Trustee or the Series 1997-2
Participants immediately upon the occurrence of such event.
SECTION 8. Optional Repurchase.
On the Distribution Date occurring on or after the date on which the
aggregate of the Security Balances is reduced to $______________ (10% of the
aggregate of the Security Balances on the Closing Date) or less, the Seller
shall have the option to purchase the Series 1997-2 Participants' Interest at a
purchase price equal to the Optional Repurchase Amount. The Seller shall give
the Servicer, the Rating Agency and the Deposit Trustee at least 10 days prior
written notice of the date on which the Seller intends to exercise such option
to purchase. Not later than 10:00 A.M., New York City time, on such
Distribution Date, the Seller shall deposit the Optional Repurchase Amount into
the Collection Account in immediately available funds. Such purchase option is
subject to payment in full of the Optional Repurchase Amount. The Optional
Repurchase Amount shall be distributed as set forth in Section 10 hereof.
SECTION 9. Sale of Series 1997-2 Participants' Interest pursuant to Section
2.06 or 10.01 of Agreement.
(a) The amount to be paid by the Seller with respect to the Series 1997-2
Participants' Interest in connection with a repurchase of the Series 1997-2
Participants' Interest pursuant to Section 2.06 of the Agreement shall equal
the Reassignment Amount for the first Distribution Date following the Due
Period in which the reassignment obligation arises under the Agreement.
(b) The amount to be paid by the Seller with respect to Series 1997-2
Participants' Interest in connection with a repurchase of the Series 1997-2
Participant's Interest pursuant to Section 10.01 of the Agreement shall equal
the sum of (x) the Reassignment Amount for the Distribution Date of such
repurchase and (y) the excess, if any, of (I) a price equivalent to the
average of bids quoted on the Record Date preceding the date of repurchase or,
if not a Business Day, on the next succeeding Business Day by at least two
recognized dealers selected by the Deposit Trustee (which may be selected from
the list attached as Schedule 1), for the purchase by such dealers of a
security which is similar to the Series 1997-2 Participation Interest with a
16
20
remaining maturity approximately equal to the remaining maturity of the Series
1997-2 Participation Interest over (II) the portion of the Reassignment Amount
attributable to the Series 1997-2 Participation Interest.
SECTION 10. Distributions pursuant to Section 8 or 9 of this Series Supplement
and Section 2.06, 10.01 or 12.02(c) of Agreement.
(a) With respect to the Optional Repurchase Amount deposited into the
Collection Account pursuant to Section 8, the Reassignment Amount deposited
into the Collection Account pursuant to Section 9 or any Termination Proceeds
deposited into the Collection Account pursuant to Section 12.02(c) of the
Agreement, the Deposit Trustee shall, not later than 1:00 P.M., New York City
time, on the date of deposit, make deposits of the following amounts (in the
priority set forth below and, in each case, after giving effect to any deposits
and distributions otherwise to be made on such date) in immediately available
funds as follows: the Series 1997-2 Participation Interest Invested Amount on
such date and the amount of accrued and unpaid interest on the unpaid balance
of the Series 1997-2 Participation Interest, plus the amount of the Series
1997-2 Participation Interest Additional Interest previously due but not paid
on any prior Distribution Date, for distribution to the Series 1997-2
Participants.
(b) Notwithstanding anything to the contrary in this Series Supplement or
the Agreement, the entire amount deposited in the Collection Account pursuant
to Section 8 or Sections 9(a) or (b) and 10(a) hereof and all other amounts on
deposit therein for distribution to the Series 1997-2 Participants shall be
distributed in full to the Series 1997-2 Participants on such date and shall be
deemed to be a final distribution pursuant to Section 12.02 of the Agreement.
SECTION 11. Distribution of Proceeds of Sale, Disposition or Liquidation of
Receivables pursuant to Section 9.02 of Agreement.
(a) Not later than 1:00 P.M., New York City time, on the Distribution Date
following the date on which the Insolvency Proceeds are received, such proceeds
shall be deposited into the Collection Account pursuant to Section 9.02(b) of
the Agreement.
(b) [RESERVED]
(c) Notwithstanding anything to the contrary in this Series Supplement or
the Agreement, the entire amount deposited in the Collection Account pursuant
to this Section 11 and all other amounts on deposit therein for distribution
for the Series 1997-2 Participants shall be distributed in full to the Series
1997-2 Participants on the Distribution Date on which funds are deposited
pursuant to this Section (or, if not so deposited on a Distribution Date, on
the immediately following Distribution Date) and
17
21
shall be deemed to be a final distribution pursuant to Section 12.02 of the
Agreement.
SECTION 12. Rating Agency Notice.
In the event a Tax Opinion is delivered pursuant to Section 2.09(e)(vi) of
the Agreement and the Series 1997-2 Participation Interest is outstanding, such
opinion shall be also delivered to Moody's.
SECTION 13. [RESERVED]
SECTION 14. [RESERVED]
SECTION 15. Delivery of Series 1997-2 Participation Interest.
The Deposit Trustee shall deliver the Series 1997-2 Participation Interest
to the Seller when authenticated in accordance with Section 6.02 of the
Agreement.
SECTION 16. Ratification of Agreement.
As supplemented by this Series Supplement, the Agreement is in all
respects ratified and confirmed and the Agreement, as so supplemented by this
Series Supplement shall be read, taken and construed as one and the same
instrument.
SECTION 17. Counterparts.
This Series Supplement may be executed in two or more counterparts, each
of which when so executed shall be deemed to be an original, but all of which
shall together constitute but one and the same instrument.
SECTION 18. Governing Law.
THIS SERIES SUPPLEMENT SHALL BE CONSTRUED AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT PREFERENCE TO ITS CONFLICT OF LAW
PROVISIONS.
SECTION 19. Forms of Certificates and Monthly Servicer's Certificate.
The Series 1997-2 Participation Interest and Monthly Servicer's
Certificate with respect to Series 1997-2 shall be in substantially the
respective forms attached hereto as Exhibits A-1 and B, respectively.
18
22
SECTION 20. Transfer Restrictions.
Registration of transfer of any Series 1997-2 Participation Interest
containing the legend set forth on the Series 1997-2 Participation Interest
attached hereto as Exhibit A-1 shall be effected only if such transfer is made
to a Person that certifies to the Transfer Agent in writing that it is not an
employee benefit plan, trust or account, including an individual retirement
account, that is subject to ERISA or that is described in Section 4975(e)(1) of
the Code or an entity whose underlying assets include plan assets by reason of
a plan's investment in such entity (each a "Benefit Plan"). By accepting and
holding a Series 1997-2 Participation Interest, a Series 1997-2 Participant
shall be deemed to have represented and warranted that it is not a Benefit Plan
and is not purchasing a Series 1997-2 Participation Interest on behalf of a
Benefit Plan. By acquiring any interest in a Book-Entry Certificate
representing a Series 1997-2 Participation Interest, a Certificate Owner shall
be deemed to have represented and warranted that it is not a Benefit Plan and
is not purchasing a Series 1997-2 Participation Interest on behalf of a Benefit
Plan.
No transfer of a Series 1997-2 Participation Interest shall be made unless
a Tax Opinion is delivered and such transfer is exempt from the registration
requirements of the Securities Act of 1933, as amended (the "1933 Act") and any
applicable state securities laws or is made in accordance with said Act and
laws. In the event of any such transfer, (i) unless such transfer is made in
reliance upon Rule 144A under the 1933 Act, the Deposit Trustee or the Seller
may require a written Opinion of Counsel (which may be in-house counsel)
acceptable to and in form and substance reasonably satisfactory to the Deposit
Trustee and the Seller that such transfer may be made pursuant to an exemption,
describing the applicable exemption and the basis therefor, from said Act and
laws or is being made pursuant to said Act and laws, which Opinion of Counsel
shall not be an expense of the Deposit Trustee or the Seller and (ii) the
Deposit Trustee shall require the transferee to execute an investment letter
(in substantially the form attached hereto as Exhibit C) acceptable to and in
form and substance reasonably satisfactory to the Seller and the Deposit
Trustee certifying to the Seller and the Deposit Trustee the facts surrounding
such transfer, which investment letter shall not be an expense of the Deposit
Trustee or the Seller. A Series 1997-2 Participant desiring to effect such
transfer shall, and does hereby agree to indemnify the Deposit Trustee and the
Seller against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.
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23
IN WITNESS WHEREOF, the Seller, the Servicer and the Deposit Trustee have
caused this Series Supplement to be fully executed by their respective officers
as of the day and year first above written.
HOUSEHOLD CONSUMER LOAN
CORPORATION, as Seller
By:
---------------------------------------
Name:
Title:
HOUSEHOLD FINANCE CORPORATION,
as Servicer
By:
---------------------------------------
Name:
Title:
TEXAS COMMERCE BANK NATIONAL
ASSOCIATION, as Deposit Trustee
By:
---------------------------------------
Name:
Title:
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24
EXHIBIT A-1
FORM OF SERIES 1997-2 PARTICIPATION INTEREST
THIS SERIES 1997-2 PARTICIPATION INTEREST HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED. NEITHER THIS SERIES 1997-2
PARTICIPATION INTEREST NOR ANY PORTION HEREOF MAY BE OFFERED OR SOLD EXCEPT IN
COMPLIANCE WITH THE REGISTRATION PROVISIONS OF SUCH ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS.
THIS SERIES 1997-2 PARTICIPATION INTEREST IS NOT PERMITTED TO BE
TRANSFERRED, ASSIGNED, EXCHANGED OR OTHERWISE PLEDGED OR CONVEYED EXCEPT IN
COMPLIANCE WITH THE TERMS OF THE POOLING AND SERVICING AGREEMENT AND THE SERIES
1997-2 SUPPLEMENT THERETO, BOTH REFERRED TO HEREIN.
No. R-__ One Unit
HOUSEHOLD CONSUMER LOAN DEPOSIT TRUST I
SERIES 1997-2 PARTICIPATION INTEREST
THIS CERTIFICATE REPRESENTS AN INTEREST
IN CERTAIN ASSETS OF
HOUSEHOLD CONSUMER LOAN DEPOSIT TRUST I
Evidencing an interest in a trust, the corpus of which consists primarily of
participation interests and receivables generated from time to time in the
ordinary course of business in a portfolio of credit lines provided by
Household Consumer Loan Corporation.
(Not an interest in or obligation of Household Consumer Loan
Corporation or any affiliate thereof)
This certifies that _______________, is the registered owner of a
fractional interest in the assets of a trust (the "Trust") pursuant to the
Pooling and Servicing Agreement dated as of September 1, 1995 (the
"Agreement"), by and among Household Consumer Loan Corporation, as seller (the
"Seller"), Household Finance Corporation, as servicer (the "Servicer"), and
Texas Commerce Bank National Association, the successor to The Chase Manhattan
Bank, N.A., as deposit trustee (the "Trustee"), as supplemented by the
Supplement for Series 1997-2 dated as of November 1, 1997 (the "Supplement"),
by and among the Seller, the Servicer and the Trustee. The corpus of the Trust
consists of (a) receivables originated under certain fixed and variable rate
revolving unsecured consumer credit lines (the "Credit Lines"), (b) the
preferred stock of the Seller and (c) certain monies
1
25
constituting Recoveries allocated to the Trust pursuant to the Agreement and
any Supplement. Although a summary of certain provisions of the Agreement and
the Supplement is set forth below, this Series 1997-2 Participation Interest
does not purport to summarize the Agreement or the Supplement and reference is
made to the Agreement and the Supplement for information with respect to the
interests, rights, benefits, obligations, proceeds and duties evidenced hereby
and the rights, duties and obligations of the Trustee. A copy of the Agreement
and the Supplement may be requested from the Trustee by writing to the Trustee
at the Corporate Trust Office. To the extent not defined herein, the
capitalized terms used herein have the meanings ascribed to them in the
Agreement or the Supplement, as applicable.
This Series 1997-2 Participation Interest is issued under and is subject
to the terms, provisions and conditions of the Agreement and the Supplement, to
which the holder of this Series 1997-2 Participation Interest by virtue of the
acceptance hereof assents and is bound.
The Receivables consist of amounts payable by obligors on the Credit Lines
from time to time, including amounts payable for Principal Receivables and
Finance Charge and Administrative Receivables.
This Certificate is the Series 1997-2 Participation Interest which
represents an interest in certain assets of the Trust, which includes the right
to receive a portion of the Collections and other amounts at the times and in
the amounts specified in the Agreement and Supplement. The aggregate interest
represented by the Series 1997-2 Participation Interest at any time in the
Receivables in the Trust shall not exceed the Series 1997-2 Participation
Interest Invested Amount at such time. In addition to the Series 1997-2
Participation Interest, (i) Investor Certificates and additional Series
Participation Interests may be issued to investors pursuant to the Agreement,
which will represent the Certificateholders' Interest and (ii) Supplemental
Seller Participation Interests may be issued pursuant to the Agreement, which
will represent that portion of the Seller's Interest not allocated to the
Seller.
In general, this Series 1997-2 Participation Interest is entitled to
receive distributions in respect of the collections of the Trust in accordance
with the terms of the Agreement and Supplement on the 14th day of each calendar
month or if such day is not a business day then on the next preceding business
day, commencing in December 1997.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual or facsimile signature, this Series 1997-2
Participation Interest shall not be entitled to any benefit under the Agreement
or the Supplement, or be valid for any purpose.
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26
IN WITNESS WHEREOF, the Seller has caused this Series 1997-2 Participation
Interest to be duly executed.
HOUSEHOLD CONSUMER LOAN CORPORATION
By:
---------------------------------------
Name:
Title:
Dated: November ___, 1997
TRUSTEE'S CERTIFICATE OF AUTHORIZATION
This is one of the Series 1997-2 Participation Interests
described in the within-mentioned
Pooling and Servicing Agreement and Supplement.
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
as Trustee
By:
-----------------------------------
Authorized Signatory
3
27
HOUSEHOLD CONSUMER LOAN DEPOSIT TRUST I
SERIES 1997-2 PARTICIPATION INTEREST
Summary of Terms and Conditions
The Series 1997-2 Participation Interest constitutes an undivided
beneficial interest in the Receivables held in the Trust. The holder of the
Series 1997-2 Participation Interest shares on the basis of a specified
percentage of the principal balance of the Receivables held as assets of the
Trust. The Series 1997-2 Participation Interest initially represents a
principal balance of $______________. Thereafter, the Series 1997-2
Participation Interest Invested Amount with respect to any date will be an
amount equal to the Series 1997-2 Participation Interest Initial Invested
Amount minus the sum of the Series 1997-2 Participation Interest Principal
Distribution Amount paid for all Distribution Dates and the Defaulted Amounts
allocated to the Series 1997-2 Participation Interest during the related and
all prior Due Periods that have not been included in the Series 1997-2
Participation Interest Principal Distribution Amount on the current or any
prior Distribution Date.
On each Distribution Date, the Paying Agent shall distribute to each
Series 1997-2 Participant of record on the Record Date for such Distribution
Date (other than as provided in Section 12.02 of the Agreement respecting a
final distribution) such Series 1997-2 Participant's pro rata share (based on
the aggregate fractional undivided interests represented by Series 1997-2
Participation Interests held by such Series 1997-2 Participant) of the amounts
on deposit in the Collection Account pursuant to the Agreement and the
Supplement.
Except as provided in the Agreement with respect to a final distribution,
distributions to Series Participants shall be made in immediately available
funds by wire transfer to the account designated by such Series 1997-2
Participant.
The Seller shall have the option to purchase the Series 1997-2
Participation Interest at a purchase price equal to the Optional Repurchase
Amount in accordance with the provisions of Section 8 of the Supplement. Such
purchase option is subject to payment in full of the Optional Repurchase
Amount. The Optional Repurchase Amount shall be distributed as set forth in
the Agreement and Supplement.
This Series 1997-2 Participation Interest does not represent an obligation
of, or an interest in, the Seller, the Servicer or any affiliate of any of them
and is not insured or guaranteed by any other governmental agency or
instrumentality. This Series 1997-2 Participation Interest is limited in right
of payment to certain collections representing the Receivables and any
Participation Interests (and certain other amounts) all as more specif-
4
28
ically set forth herein above and in the Agreement and the Supplement.
The Agreement and the Supplement may be amended by the Seller, the
Servicer and the Trustee, without the consent of the Series 1997-2
Participants. The Trustee may, but shall not be obligated to, enter into any
such amendment which affects the Trustee's rights, duties or immunities under
the Agreement or otherwise.
The Agreement and the Supplement may be amended by the Seller, the
Servicer and the Trustee with the consent of the Holders of Investor
Certificates evidencing not less than 66-2/3% of the aggregate unpaid principal
amount of the Investor Certificates and the Series Participants of all
adversely affected Series for which the Seller has not delivered an Officer's
Certificate stating that there is no Adverse Effect, for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of the Agreement or any Supplement or of modifying in any manner the
rights of Investor Certificateholders or Series Participants; provided,
however, that no such amendment shall (a) reduce in any manner the amount of,
or delay the timing of, distributions to Investor Certificateholders or holder
of any Series Participation Interest without the consent of each such Holder,
(b)(i) change the definition of or the manner of calculating the interest of
any Investor Certificateholder or Series Participant without the consent of
each affected Investor Certificateholder or Series Participant or (ii) reduce
the aforesaid percentage required to consent to any such amendment, in either
case without the consent of each Investor Certificateholder or Series
Participant. Any such amendment and any such consent by the holder of the
Series 1997-2 Participants shall be conclusive and binding on such Series
1997-2 Participants and upon all future holders of this Series 1997-2
Participation Interest and of any Series 1997-2 Participation Interest issued
in exchange hereof or in lieu hereof whether or not notation thereof is made
upon this Series 1997-2 Participation Interest.
As set forth in Section 6.05 of the Agreement, the transfer of this Series
1997-2 Participation Interest shall be registered in the Certificate Register
upon surrender of this Series 1997-2 Participation Interest for registration of
transfer at any office or agency maintained by the Transfer Agent and Registrar
accompanied by a written instrument of transfer, in a form satisfactory to the
Trustee or the Transfer Agent and Registrar, duly executed by the Series 1997-2
Participant or such Series 1997-2 Participant's attorney, and duly authorized
in writing with such signature guaranteed, and thereupon one or more new Series
1997-2 Participation Interests of authorized denominations and for the same
aggregate Fractional Undivided Interest will be issued to the designated
transferee or transferees.
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29
As provided in the Agreement and subject to certain limitations therein
set forth, the Series 1997-2 Participation Interests are exchangeable for new
Series 1997-2 Participation Interests evidencing like aggregate fractional
undivided interests as requested by the holder surrendering such Series 1997-2
Participation Interest. No service charge may be imposed for any such exchange
but the Servicer or Transfer Agent and Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
connection therewith.
The Seller, the Servicer, the Trustee, the Paying Agent and the Transfer
Agent and Registrar and any agent of any of them, may treat the person in whose
name this Series 1997-2 Participation Interest is registered as the owner
hereof for all purposes, and neither the Servicer nor the Seller, the Trustee,
the Paying Agent, the Transfer Agent and Registrar, nor any agent of any of
them, shall be affected by notice to the contrary except in certain
circumstances described in the Agreement.
THIS SERIES 1997-2 PARTICIPATION INTEREST SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK.
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30
ASSIGNMENT
Social Security or other identifying number of assignee
-------------------------------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
---------------------------------------------------------------------------
-------------------------------------------------------------------------------
(name and address of assignee)
the within certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints __________________ attorney, to transfer said
certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated:
------------------------
(1) A Non-U.S. Person as defined Note: The signature(s) to
in the Internal Revenue Code of this Assignment
1986, as amended, must certify must correspond
to the Trustee in writing with the name(s)
as to its Non-U.S. Person status as written on the
and such further information as may face of the
be required under the Code or within certificate
reasonably requested by the in every particular
Trustee. without alteration
or enlargement or
any change
whatsoever.
7
31
EXHIBIT B
FORM OF MONTHLY SERVICER'S CERTIFICATE
(To be delivered pursuant to Section 3.04(b)
of the Amended and Restated Pooling and Servicing
Agreement not later than the second Business
Day preceding each Distribution Date)
HOUSEHOLD FINANCE CORPORATION
HOUSEHOLD CONSUMER LOAN CORPORATION
HOUSEHOLD CONSUMER LOAN TRUST 1997-2
Consumer Loan Asset Backed Notes, Series 1997-2,
Class A-1, Class A-2, Class A-3 and Class B
------------------
The undersigned, a duly authorized representative of Household Finance
Corporation, as servicer (the "Servicer"), pursuant to the Pooling and
Servicing Agreement dated as of September 1, 1995 (the "Pooling and Servicing
Agreement") by and among Household Consumer Loan Corporation, as seller (the
"Seller"), the Servicer, and Texas Commerce Bank National Association, the
successor to The Chase Manhattan Bank, N.A., as deposit trustee (the "Deposit
Trustee"), does hereby certify with respect to the information set forth below
as follows:
1. Capitalized terms used in this Certificate shall
have the respective meanings set forth in the Pooling
and Servicing Agreement.
2. Household Finance Corporation is, as of the date
hereof, the Servicer under the Pooling and Servicing
Agreement.
3. The undersigned is a Servicing Officer.
4. This Certificate relates to the Distribution
Date occurring on .
-----------------
5. Deposit Trust Information.
(a) Total Pool Balance of the Receivables for the Due
Period preceding such Distribution
Date was equal to.................................... $
--------
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(b) Amount of Sub-total Unsecured Consumer
Loans for the Due Period preceding such
Distribution Date was equal to....................... $
--------
(c) Amount of Sub-total Personal Homeowner
Lines for the Due Period preceding such
Distribution Date was equal to....................... $
--------
(d) Amount of Series 1997-2 Principal Collections
for the preceding Due Period is...................... $
--------
(e) Amount of Series 1997-2 Finance Charge
and Administrative Collections as of the
last day of the immediately preceding
Due Period is........................................ $
--------
(f) Amount of Additional Balances for
such Distribution Date is............................ $
--------
(g) Amount of New Credit Lines is........................ $
--------
(h) Amount of Additional Credit Lines is................. $
--------
(i) Amount of Removed Credit Lines is.................... $
--------
(j) Defaulted Amount is.................................. $
--------
(k) Amount of Repurchased Credit Lines
pursuant to Section 2.10 of the Pooling and
Servicing Agreement is............................... $
--------
(l) Applicable allocation percentages for
principal and interest for such Distribution
Date are............................................. %
-------
-------%
(m) Series 1997-2 Participation Interest
Distribution Amount is............................... $
--------
(n) Accelerated Principal Distribution Amount is......... $
--------
(o) Series 1997-2 Participation Interest
Principal Distribution Amount is..................... $
--------
2
33
(p) Net Charge-Off Amounts (monthly and
cumulative) are...................................... $
--------
$
--------
(q) Reversals (monthly and cumulative)
are.................................................. $
--------
$
--------
(r) Servicing Fee........................................ $
--------
IN WITNESS WHEREOF, the undersigned has duly executed and delivered this
Certificate this day of , 199 .
------ ---------- ---
HOUSEHOLD FINANCE CORPORATION,
as Servicer
By:
------------------------------------
Name:
Title:
3
34
EXHIBIT C
[FORM OF RULE 144A INVESTMENT REPRESENTATION]
Description of Rule 144A Securities, including numbers:
_______________________________________________
_______________________________________________
_______________________________________________
_______________________________________________
The undersigned seller, as registered holder (the "Seller"), intends to
transfer the Rule 144A Securities described above to the undersigned buyer (the
"Buyer").
1. In connection with such transfer and in accordance with the agreements
pursuant to which the Rule 144A Securities were issued, the Seller hereby
certifies the following facts: Neither the Seller nor anyone acting on its
behalf has offered, transferred, pledged, sold or otherwise disposed of the
Rule 144A Securities, any interest in the Rule 144A Securities or any other
similar security to, or solicited any offer to buy or accept a transfer, pledge
or other disposition of the Rule 144A Securities, any interest in the Rule 144A
Securities or any other similar security from, or otherwise approached or
negotiated with respect to the Rule 144A Securities, any interest in the Rule
144A Securities or any other similar security with, any person in any manner,
or made any general solicitation by means of general advertising or in any
other manner, or taken any other action, that would constitute a distribution
of the Rule 144A Securities under the Securities Act of 1933, as amended (the
"1933 Act"), or that would render the disposition of the Rule 144A Securities a
violation of Section 5 of the 1933 Act or require registration pursuant
thereto, and that the Seller has not offered the Rule 144A Securities to any
person other than the Buyer or another "qualified institutional buyer" as
defined in Rule 144A under the ▇▇▇▇ ▇▇▇.
2. The Buyer warrants and represents to, and covenants with, the Deposit
Trustee, and the Seller (as defined in the Pooling and Servicing Agreement (the
"Agreement") dated as of September 1, 1995 among Household Consumer Loan
Corporation, as Seller and as Holder of the Designated Certificate, and Texas
Commerce Bank National Association, the successor to The Chase Manhattan Bank,
N.A., as Deposit Trustee) as follows:
a. The Buyer understands that the Rule 144A Securities have not been
registered under the 1933 Act or the securities laws of any state.
35
b. The Buyer considers itself a substantial, sophisticated
institutional investor having such knowledge and experience in financial
and business matters that it is capable of evaluating the merits and
risks of investment in the Rule 144A Securities.
c. The Buyer has been furnished with all information regarding the
Rule 144A Securities that it has requested from the Seller and the
Deposit Trustee or the Servicer.
d. Neither the Buyer nor anyone acting on its behalf has offered,
transferred, pledged, sold or otherwise disposed of the Rule 144A
Securities, any interest in the Rule 144A Securities or any other similar
security to, or solicited any offer to buy or accept a transfer, pledge
or other disposition of the Rule 144A Securities, any interest in the
Rule 144A Securities or any other similar security from, or otherwise
approached or negotiated with respect to the Rule 144A Securities, any
interest in the Rule 144A Securities or any other similar security with,
any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action,
that would constitute a distribution of the Rule 144A Securities under
the 1933 Act or that would render the disposition of the Rule 144A
Securities a violation of Section 5 of the 1933 Act or require
registration pursuant thereto, nor will it act, nor has it authorized or
will it authorize any person to act, in such manner with respect to the
Rule 144A Securities.
e. The Buyer is a "qualified institutional buyer" as that term is
defined in Rule 144A under the 1933 Act and has completed either of the
forms of certification to that effect attached hereto as Annex 1 or Annex
2. The Buyer is aware that the sale to it is being made in reliance on
Rule 144A. The Buyer is acquiring the Rule 144A Securities for its own
account or the accounts of other qualified institutional buyers,
understands that such Rule 144A Securities may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account
of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A, or
(ii) pursuant to another exemption from registration under the 1933 Act.
[3. The Buyer warrants and represents to, and covenants with, the Seller,
the Deposit Trustee, Servicer and the Seller that either (1) the Buyer is (A)
not an employee benefit plan (within the meaning of Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")), or a
plan (within the meaning of Section 4975(e)(1) of the Internal Revenue
Code of 1986 ("Code")), which (in either case) is subject to
2
36
ERISA or Section 4975 of the Code (both a "Plan"), and (B) is not
directly or indirectly purchasing the Rule 144A Securities on behalf of, as
investment manager of, as named fiduciary of, as trustee of, or with "plan
assets" of a Plan, or (2) the Buyer understands that registration of transfer
of any Rule 144A Securities to any Plan, or to any Person acting on behalf of
any Plan, will not be made unless such Plan delivers an opinion of its counsel,
addressed and satisfactory to the Certificate Registrar and the Seller, to the
effect that the purchase and holding of the Rule 144A Securities by, on behalf
of or with "plan assets" of any Plan would not constitute or result in a
prohibited transaction under Section 406 of ERISA or Section 4975 of the Code,
and would not subject the Seller, the Servicer, the Indenture Trustee or the
Issuer to any obligation or liability (including liabilities under ERISA or
Section 4975 of the Code) in addition to those undertaken in the Agreement or
any other liability.]
4. The Buyer has otherwise complied with any conditions for transfer set
forth in the Trust Agreement, and (h), either (i) is a "C Corporation" under
the Internal Revenue Code of 1986, as amended, or (ii) has provided such
disclosure concerning our status for federal income tax purposes and the status
and economic interest of our beneficial owners, as the Issuer or its
representatives have reasonably requested to determine that the Buyer's
acquisition of the Certificates will not subject the Issuer to an entity level
tax.
5. This document may be executed in one or more counterparts and by the
different parties hereto on separate counterparts, each of which, when so
executed, shall be deemed to be an original; such counterparts, together, shall
constitute one and the same document.
IN WITNESS WHEREOF, each of the parties has executed this document as of
the date set forth below.
--------------------------- -----------------------------
Print Name of Seller Print Name of Buyer
By: By:
------------------------ --------------------------
Name: Name:
Title: Title:
Taxpayer Identification: Taxpayer Identification:
No. No.
------------------------ --------------------------
Date: Date:
---------------------- ------------------------
3
37
ANNEX 1 TO EXHIBIT C
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers Other Than Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial
Officer, Senior Vice President or other executive officer of the Buyer.
2. In connection with purchases by the Buyer, the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because (i) the Buyer owned and/or
invested on a discretionary basis $______________________(1) in securities
(except for the excluded securities referred to below) as of the end of the
Buyer's most recent fiscal year (such amount being calculated in accordance
with Rule 144A) and (ii) the Buyer satisfies the criteria in the category
marked below.
___ Corporation, etc. The Buyer is a corporation (other than a bank, savings
and loan association or similar institution), Massachusetts or similar
business trust, partnership, or charitable organization described in
Section 501(c)(3) of the Internal Revenue Code.
___ Bank. The Buyer (a) is a national bank or banking institution organized
under the laws of any State, territory or the District of Columbia, the
business of which is substantially confined to banking and is supervised
by the State or territorial banking commission or similar official or is a
foreign bank or equivalent institution, and (b) has an audited net worth
of at least $25,000,000 as demonstrated in its latest annual financial
statements, a copy of which is attached hereto.
------------------
(1) Buyer must own and/or invest on a discretionary basis at least $100,000,000
in securities unless Buyer is a dealer, and, in that case, Buyer must own
and/or invest on a discretionary basis at least $10,000,000 in securities.
1
38
___ Savings and Loan. The Buyer (a) is a savings and loan association,
building and loan association, cooperative bank, homestead association or
similar institution, which is supervised and examined by a State or
Federal authority having supervision over any such institutions or is a
foreign savings and loan association or equivalent institution and (b) has
an audited net worth of at least $25,000,000 as demonstrated in its latest
annual financial statements.
___ Broker-Dealer. The Buyer is a dealer registered pursuant to Section 15 of
the Securities Exchange Act of 1934.
___ Insurance Company. The Buyer is an insurance company whose primary and
predominant business activity is the writing of insurance or the
reinsuring of risks underwritten by insurance companies and which is
subject to supervision by the insurance commissioner or a similar official
or agency of a State or territory or the District of Columbia.
___ State or Local Plan. The Buyer is a plan established and maintained by a
State, its political subdivisions, or any agency or instrumentality of the
State or its political subdivisions, for the benefit of its employees.
___ ERISA Plan. The Buyer is an employee benefit plan within the meaning of
Title I of the Employee Retirement Income Security Act of 1974.
___ Investment Adviser. The Buyer is an investment adviser registered under
the Investment Advisers Act of 1940.
___ SBIC. The Buyer is a Small Business Investment Company licensed by the
U.S. Small Business Administration under Section 301(c) or (d) of the
Small Business Investment Act of 1958.
___ Business Development Company. The Buyer is a business development company
as defined in Section 202(a)(22) of the Investment Advisers Act of 1940.
___ Trust Fund. The Buyer is a trust fund whose trustee is a bank or trust
company and whose participants are exclusively (a) plans established and
maintained by a State, its political subdivisions, or any agency or
instrumentality of the State or its political subdivisions, for the
benefit of its employees, or (b) employee benefit plans within the meaning
of Title I of the Employee Retirement Income Security Act of
2
39
1974, but is not a trust fund that includes as participants
individual retirement accounts or H.R. 10 plans.
3. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer, (ii) securities that are part of an
unsold allotment to or subscription by the Buyer, if the Buyer is a dealer,
(iii) bank deposit notes and certificates of deposit, (iv) loan participations,
(v) repurchase agreements, (vi) securities owned but subject to a repurchase
agreement and (vii) currency, interest rate and commodity swaps.
4. For purposes of determining the aggregate amount of securities owned
and/or invested on a discretionary basis by the Buyer, the Buyer used the cost
of such securities to the Buyer and did not include any of the securities
referred to in the preceding paragraph. Further, in determining such aggregate
amount, the Buyer may have included securities owned by subsidiaries of the
Buyer, but only if such subsidiaries are consolidated with the Buyer in its
financial statements prepared in accordance with generally accepted accounting
principles and if the investments of such subsidiaries are managed under the
Buyer's direction. However, such securities were not included if the Buyer is
a majority-owned, consolidated subsidiary of another enterprise and the Buyer
is not itself a reporting company under the Securities Exchange Act of 1934.
5. The Buyer acknowledges that it is familiar with Rule 144A and
understands that the seller to it and other parties related to the Certificates
are relying and will continue to rely on the statements made herein because one
or more sales to the Buyer may be in reliance on Rule 144A.
___ ___ Will the Buyer be purchasing the Rule 144A
Yes No Securities only for the Buyer's own account?
6. If the answer to the foregoing question is "no", the Buyer agrees that,
in connection with any purchase of securities sold to the Buyer for the account
of a third party (including any separate account) in reliance on Rule 144A, the
Buyer will only purchase for the account of a third party that at the time is a
"qualified institutional buyer" within the meaning of Rule 144A. In addition,
the Buyer agrees that the Buyer will not purchase securities for a third party
unless the Buyer has obtained a current representation letter from such third
party or taken other appropriate steps contemplated by Rule 144A to conclude
that such third party independently meets the definition of "qualified
institutional buyer" set forth in Rule 144A.
3
40
7. The Buyer will notify each of the parties to which this certification
is made of any changes in the information and conclusions herein. Until such
notice is given, the Buyer's purchase of Rule 144A Securities will constitute a
reaffirmation of this certification as of the date of such purchase.
8. The Buyer has otherwise complied with any conditions for transfer set
forth in the Trust Agreement, and, either (i) is a "C Corporation" under the
Internal Revenue Code of 1986, as amended, or (ii) has provided such disclosure
concerning our status for federal income tax purposes and the status and
economic interest of our beneficial owners, as the Issuer or its
representatives have reasonably requested to determine that the Buyer's
acquisition of the Certificates will not subject the Issuer to an entity level
tax.
-------------------------------------
Print Name of Buyer
By:
----------------------------------
Name:
Title:
Date:
--------------------------------
4
41
ANNEX 2 TO EXHIBIT C
QUALIFIED INSTITUTIONAL BUYER STATUS UNDER SEC RULE 144A
[For Buyers That Are Registered Investment Companies]
The undersigned hereby certifies as follows in connection with the Rule
144A Investment Representation to which this Certification is attached:
1. As indicated below, the undersigned is the President, Chief Financial
Officer or Senior Vice President of the Buyer or, if the Buyer is a "qualified
institutional buyer" as that term is defined in Rule 144A under the Securities
Act of 1933, as amended ("Rule 144A") because Buyer is part of a Family of
Investment Companies (as defined below), is such an officer of the Adviser.
2. In connection with purchases by Buyer, the Buyer is a "qualified
institutional buyer" as defined in SEC Rule 144A because (i) the Buyer is an
investment company registered under the Investment Company Act of 1940, and
(ii) as marked below, the Buyer alone, or the Buyer's Family of Investment
Companies, owned at least $100,000,000 in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent fiscal
year. For purposes of determining the amount of securities owned by the Buyer
or the Buyer's Family of Investment Companies, the cost of such securities was
used.
____ The Buyer owned $___________________ in securities (other than the
excluded securities referred to below) as of the end of the Buyer's most
recent fiscal year (such amount being calculated in accordance with Rule
144A).
____ The Buyer is part of a Family of Investment Companies which owned in the
aggregate $______________ in securities (other than the excluded
securities referred to below) as of the end of the Buyer's most recent
fiscal year (such amount being calculated in accordance with Rule 144A).
3. The term "Family of Investment Companies" as used herein means two or
more registered investment companies (or series thereof) that have the same
investment adviser or investment advisers that are affiliated (by virtue of
being majority owned subsidiaries of the same parent or because one investment
adviser is a majority owned subsidiary of the other).
1
42
4. The term "securities" as used herein does not include (i) securities of
issuers that are affiliated with the Buyer or are part of the Buyer's Family of
Investment Companies, (ii) bank deposit notes and certificates of deposit,
(iii) loan participations, (iv) repurchase agreements, (v) securities owned but
subject to a repurchase agreement and (vi) currency, interest rate and
commodity swaps.
5. The Buyer is familiar with Rule 144A and understands that each of the
parties to which this certification is made are relying and will continue to
rely on the statements made herein because one or more sales to the Buyer will
be in reliance on Rule 144A. In addition, the Buyer will only purchase for the
Buyer's own account.
6. The undersigned will notify each of the parties to which this
certification is made of any changes in the information and conclusions herein.
Until such notice, the Buyer's purchase of Rule 144A Securities will
constitute a reaffirmation of this certification by the undersigned as of the
date of such purchase.
7. The Buyer has otherwise complied with any conditions for transfer set
forth in the Trust Agreement, and (h), either (i) is a "C Corporation" under
the Internal Revenue Code of 1986, as amended, or (ii) has provided such
disclosure concerning our status for federal income tax purposes and the status
and economic interest of our beneficial owners, as the Issuer or its
representatives have reasonably requested to determine that the Buyer's
acquisition of the Certificates will not subject the Issuer to an entity level
tax.
--------------------------------------
Print Name of Buyer
By:
----------------------------------
Name:
-----------------------------
Title:
-----------------------------
IF AN ADVISER:
--------------------------------------
Print Name of Buyer
Date:
---------------------------------
2