EXHIBIT 1
HSBC PRIVATE LABEL CREDIT CARD
MASTER NOTE TRUST (USA) I
Series 2007-1
$434,285,000 Class A Floating Rate Asset Backed
Notes, Series 2007-1
$65,715,000 Class B Floating Rate Asset Backed
Notes, Series 2007-1
UNDERWRITING AGREEMENT
February 6, 2007
HSBC Securities (USA) Inc.
as Representative of the
Underwriters set forth herein (the
“Representative”)
452 Fifth Avenue
New York, New York 10018
Dear Sirs:
HSBC Bank Nevada, National
Association (the “Bank”) has conveyed and proposes to
further convey, from time to time, the receivables (the
“Receivables”) that are generated in a portfolio of
certain private label consumer revolving credit card accounts and
other rights and property to HSBC Private Label Acquisition
Corporation (USA) (“HSBC PLAC”), which has conveyed the
Receivables to HSBC Funding (USA) Inc. V (the
“Transferor”), which has conveyed and will convey the
Receivables to the HSBC Private Label Credit Card Master Note Trust
(USA) I (the “Issuer” or the “Trust”), and
the Transferor proposes to cause the Issuer to sell to you and to
the underwriters named in Schedule I hereto (the
“Underwriters”), for whom you are acting as the
Representative, $434,285,000 Class A Floating Rate Asset Backed
Notes, Series 2007-1 (the “Class A Notes”) and
$65,715,000 Class B Floating Rate Asset Backed Notes, Series 2007-1
(the “Class B Notes” and, together with the Class A
Notes, the “Notes”) in the Trust. The Receivables have
been, and will from time to time be, conveyed to HSBC PLAC by the
Bank pursuant to a Receivables Purchase Agreement, dated as of
October 25, 2006 (the “Bank RPA”), between the Bank and
HSBC PLAC. The Receivables have been, and will from time to time
be, conveyed to the Transferor by HSBC PLAC pursuant to an Amended
and Restated Receivables Purchase Agreement, dated as of August 11,
2006 (the “Transferor RPA”, and together with the Bank
RPA, the “Receivables Purchase Agreements”), between
HSBC PLAC and the Transferor. The Receivables have been, and will
from time to time be, conveyed by the Transferor to the Issuer
pursuant to an Amended and Restated Transfer and Servicing
Agreement, dated as of August 11, 2006 (the “Transfer and
Servicing Agreement”), among the Transferor, HSBC Finance
Corporation (“HSBC Finance”), as servicer (the
“Servicer”), and the Issuer. HSBC PLAC and the
Transferor are direct or indirect subsidiaries of HSBC Bank USA,
National Association (“HBUS”), the sponsor of the
transactions described in the registration statement referred to
herein. The Bank is a wholly-owned subsidiary of HSBC Finance. HBUS
and the Transferor are referred to collectively herein as the
“HSBC Entities.”
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The Issuer is a Delaware common law
trust governed by an Amended and Restated Trust Agreement, dated as
of August 11, 2006 (the “Trust Agreement”), between the
Transferor and Wilmington Trust Company (“WTC”), as
owner trustee (the “Owner Trustee”).
The Notes will be issued pursuant to
an Amended and Restated Master Indenture, dated as of August 11,
2006 (the “Master Indenture”), between the Issuer and
U.S. Bank National Association, as indenture trustee (the
“Indenture Trustee”), as supplemented by the Series
2007-1 Indenture Supplement with respect to the Notes to be dated
as of February 14, 2007 (the “Indenture Supplement,”
and together with the Master Indenture, the
“Indenture”). The Transfer and Servicing Agreement, the
Receivables Purchase Agreements, the Indenture and the Trust
Agreement are referred to herein, collectively, as the
“Transaction Documents.”
The Notes will be sold pursuant to
this Underwriting Agreement (this “Agreement”) and will
represent undivided interests in certain assets of the Trust (as
hereinafter described).
Capitalized terms used herein
without definition shall have the meanings set forth in the
Transaction Documents.
At or prior to the time the first
“contract of sale” within the meaning contemplated by
Rule 159 under the Securities Act of 1933, as amended (the
“Act”), was entered into, which was approximately 3:15
p.m. on February 6, 2007 (the “Time of Sale”), the
Transferor and Issuer had prepared the preliminary prospectus
supplement dated January 26, 2007 (the “Preliminary
Prospectus Supplement”) to the Base Prospectus (as defined
below) (collectively the “Preliminary Prospectus”). If,
subsequent to the Time of Sale and prior to the Closing Date, such
information included an untrue statement of material fact or
omitted 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 and the Underwriters terminate their
old “Contracts of Sale” (within the meaning of Rule 159
under the Act) and enter into new contracts of sale with investors
in the Notes, then the “Preliminary Prospectus” will
refer to the information conveyed to investors at the time of entry
into such new Contract of Sale, in an amended Preliminary
Prospectus approved by the Transferor and the Representative that
corrects such material misstatements or omissions (a
“Corrected Prospectus”) and “Time of Sale”
will refer to the time and date on which such new Contracts of Sale
were entered into.
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Section 1.
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Representations and Warranties of the Transferor
and HBUS .
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(a) Each
of the Transferor and HBUS, individually, represents and warrants
to, and agrees with, each Underwriter as set forth in this Section
1(a). Certain terms used in this Section 1(a) are defined in the
second paragraph of subsection 1(a)(i) below.
(i) The
Transferor meets the requirements for use of Form S-3 under the
Act, as set forth in the General Instructions to Form S-3, and the
conditions of Rule 415 under the Act have been satisfied. A
registration statement on Form S-3 (No. 333-138404), including a
form of Prospectus (as defined below) and such amendments thereto
as may have been filed prior to the date hereof, relating to the
Notes and the offering thereof in accordance with Rule 415 under
the Act, has
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been filed by the Transferor with,
and has been declared effective by, the Securities and Exchange
Commission (the “Commission”). If any post-effective
amendment to such registration statement has been filed with the
Commission prior to the execution and delivery of this Agreement,
the most recent such amendment has been declared effective by the
Commission and is still effective as of the date hereof.
The terms which follow, when used in
this Agreement, shall have the meanings indicated. The term
“Effective Date” shall mean the most recent date as of
which the Registration Statement was declared effective by the
Commission or any later date determined pursuant to Rule 430B(f)(2)
under the Act. “Execution Time” shall mean the date and
time that this Agreement is executed and delivered by the parties
hereto. “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 material incorporated
by reference therein and including all information (if any) deemed
to be part of the registration statement at the time of
effectiveness pursuant to Rule 430B under the Act, 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 so
amended. “Rule 424” refers to such rule under the Act.
The Transferor proposes to file with the Commission pursuant to
Rule 424(b) (“Rule 424(b)”) under the Act a supplement
dated February 6, 2007 (the “Prospectus Supplement”) to
the prospectus included in the Registration Statement (such
prospectus, in the form it appears in the Registration Statement or
in the form most recently revised and filed with the Commission
pursuant to Rule 424(b), is hereinafter referred to as the
“Base Prospectus”) relating to the Notes and the method
of distribution thereof. The Base Prospectus and the Prospectus
Supplement, together with any amendment thereof or supplement
thereto, are hereinafter referred to as the
“Prospectus.”
(ii) The
Commission has not issued any order preventing or suspending the
use of the Preliminary Prospectus or the Prospectus or any
“free writing prospectus” (as defined in Rule 405 of
the Act) relating to the Notes (each, a “Free Writing
Prospectus”) or suspending the effectiveness of the
Registration Statement, and no proceedings for such purpose are
pending or, to the Transferor’s knowledge, threatened by the
Commission.
(iii) On
the Effective Date, the Registration Statement and as of the
applicable effective date as to each part thereof pursuant to Rule
430B(f)(2) and any amendment thereto under the Act, conformed in
all respects to the requirements of the Act and the rules and
regulations of the Commission thereunder (the “Rules and
Regulations”) and the TIA and the rules and regulations
thereunder and did not include any untrue statement of a material
fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading,
and on the date of this Agreement
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and the Closing Date, the
Registration Statement and the Prospectus comply, and at the time
of filing of the Prospectus pursuant to Rule 424(b) the
Registration Statement and the Prospectus will comply, in all
respects with the requirements of the Act and the Rules and
Regulations and the TIA and the rules and regulations thereunder
and neither of such documents includes, or will include, any untrue
statement of a material fact or omits, or will omit, to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading; provided ,
however , that neither HBUS nor the Transferor makes
representations or warranties as to the information contained in or
omitted from the Registration Statement or the Prospectus (or any
supplements thereto) in reliance upon and in conformity with the
Underwriter Information (as defined below).
(iv) The
Preliminary Prospectus, at the Time of Sale, did not, and the
Preliminary Prospectus and the Prospectus at the Closing Date will
not, contain 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 that neither the Transferor nor HBUS
makes any representation or warranty with respect to information
omitted from such Preliminary Prospectus in reliance on Rule 430B
under the Act or with respect to any statements or omissions made
in reliance upon and in conformity with the information contained
in the FOURTH and FIFTH paragraphs under the caption
“UNDERWRITING” in the Prospectus (the
“Underwriter Information”).
(v) Since
the respective dates as of which information is given in the
Registration Statement, the Preliminary Prospectus and the
Prospectus, there has not been any material adverse change in the
general affairs, management, financial condition or results of
operations of either the Transferor, HBUS, HSBC Finance or the
Issuer, or their subsidiaries (other than as contemplated in the
Registration Statement, the Preliminary Prospectus and the
Prospectus, as the case may be or in reports filed by HBUS or HSBC
Finance with the Commission pursuant to the Securities Exchange Act
of 1934, as amended (the “Exchange Act”)) which would
be expected to have a material adverse effect on either the ability
of such person to consummate the transactions contemplated by, or
to perform its respective obligations under, this Agreement, as
applicable, or any of the Transaction Documents to which it is a
party considered in the aggregate;
(vi) The
Transferor is a corporation duly organized and validly existing and
in good standing under the laws of its jurisdiction of
incorporation. The Transferor has all requisite power and authority
to own its properties and conduct its business as presently
conducted and to perform its obligations under this Agreement and
the Transaction Documents 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 be so qualified would not have a material adverse effect
on the business or consolidated financial condition of the
Transferor.
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(vii) The
Transferor is not in violation of its charter, 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 Transferor, is subject, except where any
such violation would not have a material adverse effect on the
transactions contemplated by this Agreement, as
applicable.
(viii) The
execution, delivery and performance by the Transferor of each of
this Agreement, the Transferor RPA, the Transfer and Servicing
Agreement and the Trust Agreement and the consummation of the
transactions contemplated hereby and thereby have been duly and
validly authorized by all necessary action or proceedings and will
not conflict with or constitute a breach of, or default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Transferor pursuant
to, any contract, indenture, mortgage, loan agreement, note, lease
or other instrument to which the Transferor is a party or by which
it may be bound, or to which any of the property or assets of the
Transferor is subject, nor will such action result in any violation
of the provisions of the charter or by-laws of the Transferor 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.
(ix) This
Agreement, the Transferor RPA, the Transfer and Servicing Agreement
and the Trust Agreement have been duly executed and delivered by
the Transferor; and such agreements constitute legal, valid and
binding instruments enforceable against the Transferor 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 and the rights and remedies of
creditors of thrifts, savings institutions or national banking
associations, (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.
(x) The
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.
(xi) There
are no legal or governmental proceedings pending, or to the
knowledge of the Transferor threatened, to which the Transferor 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
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such person and its subsidiaries
taken as a whole, or which would have a material adverse effect
upon the consummation of this Agreement.
(xii) KPMG
LLP (“KPMG”) is an independent public accountant with
respect to the Transferor, HBUS and HSBC Finance, as required by
the Act and the Rules and Regulations.
(xiii) 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 Notes, or the consummation by the
Transferor of the other transactions contemplated by this Agreement
or any Transaction Document to which it is a party, except for (A)
the registration under the Act of the Notes, (B) such consents,
approvals, authorizations, orders, registrations, filings,
qualifications, licenses or permits, as applicable, as have been
obtained or as may be required under State securities or Blue Sky
laws in connection with the purchase of the Notes and the
subsequent distribution of the 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 the Transferor or
the transactions contemplated by such agreements.
(xiv) The
Transferor will not conduct its operations while any of the Notes
are outstanding in a manner that would require the Transferor or
the Issuer 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.
(xv) The
Transferor is not an “ineligible issuer” as defined in
Rule 405 under the Act.
(b) HBUS
represents and warrants to, and agrees with, each Underwriter as
set forth in this Section 1(b).
(i) HBUS
is a national banking association duly chartered and validly
existing and in good standing under the laws of the United States.
HBUS has all requisite power and authority to own its properties
and conduct its business as presently conducted and to perform its
obligations under this Agreement.
(ii) HBUS
is not in violation of its articles of association or in default in
the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument material
to the business of HBUS and its subsidiaries, to which HBUS is a
party or by which it may be bound, or to which any of the property
or assets of HBUS is subject, except where any such violation or
default would not have a material adverse effect on the business or
consolidated financial condition of HBUS or the transactions
contemplated by this Agreement.
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(iii) The
execution, delivery and performance by HBUS of this Agreement and
the consummation of the transactions contemplated hereby 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 HBUS pursuant to, any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which HBUS is a party or by which it may be bound, or
to which any of the property or assets of HBUS is subject, nor will
such action result in any violation of the provisions of the
articles of association or by-laws of HBUS 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 business or
consolidated financial condition of HBUS or the transactions
contemplated by this Agreement.
(iv) HSBC
Finance is a corporation duly organized and validly existing and in
good standing under the laws of its jurisdiction of incorporation.
HSBC Finance 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 HSBC
Finance and its subsidiaries taken as a whole or the transactions
contemplated by this Agreement.
(v) HSBC
Finance is not in violation of its restated articles of
incorporation or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument material to the business of HSBC Finance and its
subsidiaries, to which HSBC Finance is a party or by which it may
be bound, or to which any of the property or assets of HSBC Finance
is subject, except where any such violation or default would not
have a material adverse effect on the business or consolidated
financial condition of HSBC Finance or the transactions
contemplated by this Agreement.
(vi) The
execution, delivery and performance by HSBC Finance of the Transfer
and Servicing Agreement and the consummation of the transactions
contemplated 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 HSBC Finance pursuant to, any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which
HSBC Finance is a party or by which it may be bound, or to which
any of the property or assets of HSBC Finance is subject, nor will
such action result in any violation of the provisions of the
charter or by-laws of HSBC Finance or any applicable law,
administrative regulation or administrative or court decree, except
where any such conflict, breach, default, encumbrance or violation
would not
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have a material adverse effect on
the business or consolidated financial condition of HSBC Finance or
the transactions contemplated by this Agreement.
(vii) The
Bank is a national banking association duly chartered and validly
existing and in good standing under the laws of the United States.
The Bank has all requisite power and authority to own its
properties and conduct its business as presently conducted and to
perform its obligations under the Bank RPA.
(viii) The
Bank is not in violation of its articles of association or in
default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other
instrument material to the business of the Bank and its
subsidiaries, to which the Bank is a party or by which it may be
bound, or to which any of the property or assets of the Bank is
subject, except where any such violation or default would not have
a material adverse effect on the business or consolidated financial
condition of the Bank or the transactions contemplated by this
Agreement.
(ix) The
execution, delivery and performance by the Bank of the Bank RPA and
the consummation of the transactions contemplated 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 the Bank pursuant to,
any contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which the Bank is a party or by which it may be
bound, or to which any of the property or assets of the Bank is
subject, nor will such action result in any violation of the
provisions of the articles of association or by-laws of the Bank 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 business or consolidated financial condition of the
Bank.
(x) HSBC
PLAC is a corporation duly organized and validly existing and in
good standing under the laws of its jurisdiction of incorporation.
HSBC PLAC has all requisite power and authority to own its
properties and conduct its business as presently conducted and to
perform its obligations under the Transferor RPA 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 be so qualified would not
have a material adverse effect on the business or consolidated
financial condition of HSBC PLAC.
(xi) HSBC
PLAC is not in violation of its articles of incorporation, as
amended, or in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument material to the business of HSBC PLAC and its
subsidiaries, to which HSBC PLAC is a party or by which it may
be
NYK 1075516-5.021110.0062
bound, or to which any of the
property or assets of HSBC PLAC is subject, except where any such
violation or default would not have a material adverse effect on
the business or consolidated financial condition of HSBC PLAC or
the transactions contemplated by this Agreement.
(xii) The
execution, delivery and performance by HSBC PLAC of the Transferor
RPA 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 HSBC PLAC pursuant to, any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which HSBC PLAC
is a party or by which it may be bound, or to which any of the
property or assets of HSBC PLAC is subject, nor will such action
result in any violation of the provisions of the charter or by-laws
of HSBC PLAC 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 business or consolidated financial condition
of HSBC PLAC.
(xiii) This
Agreement has been duly executed and delivered by HBUS; the
Transfer and Servicing Agreement has been duly executed and
delivered by HSBC Finance; the Bank RPA and the Transferor RPA have
been duly executed and delivered by HSBC PLAC; and the Bank RPA has
been duly executed and delivered by the Bank; and such agreements
constitute legal, valid and binding instruments enforceable against
such parties thereto 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.
(xiv) Except
as set forth in or contemplated in reports filed by it with the
Commission pursuant to the Exchange Act, there has been no material
adverse change in the business or the consolidated financial
condition of HBUS and its subsidiaries taken as a whole since the
respective dates as of which any information is given in the
Preliminary Prospectus or the Prospectus.
(xv) There
are no legal or governmental proceedings pending, or to the
knowledge of HBUS threatened, to which HBUS 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 HBUS and its subsidiaries taken
as a whole or which would have a material adverse effect upon the
consummation of this Agreement and the transactions contemplated
hereby.
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(xvi) There
are no legal or governmental proceedings pending, or to the
knowledge of HSBC Finance threatened, to which HSBC Finance 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
HSBC Finance and its subsidiaries taken as a whole or which would
have a material adverse effect on the transactions contemplated by
this Agreement.
(xvii) There are no
legal or governmental proceedings pending, or to the knowledge of
the Bank threatened, to which the Bank 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 the Bank and its subsidiaries
taken as a whole or which would have a material adverse effect on
the transactions contemplated by this Agreement.
(xviii) There
are no legal or governmental proceedings pending, or to the
knowledge of HSBC PLAC threatened, to which HSBC PLAC 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
HSBC PLAC and its subsidiaries taken as a whole or which would have
a material adverse effect on the transactions contemplated by this
Agreement.
(xix) 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 HBUS of the transactions contemplated by this
Agreement, except for (A) the registration under the Act of the
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 Notes and the
subsequent distribution of the 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 HBUS and its
subsidiaries taken as a whole or the transactions contemplated by
such agreements.
(xx) 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 HSBC Finance of the transactions contemplated
by the Transfer and Servicing Agreement, except for 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 HSBC Finance and its subsidiaries taken as a
whole or the transactions contemplated by such
agreement.
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(xxi) 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 the Bank of the transactions contemplated by
the Bank RPA, except for 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 the Bank and its subsidiaries taken as a whole or the
transactions contemplated by such agreement.
(xxii) 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 HSBC PLAC of the transactions contemplated by
the Transferor RPA, except for 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 HSBC PLAC and its subsidiaries taken as a whole or the
transactions contemplated by such agreement.
(xxiii) There
has been no material adverse change in the business or the
financial condition of HSBC Finance since the respective dates as
of which any information is given in the Preliminary Prospectus or
the Prospectus that would materially affect its ability to act as
Servicer under the Transaction Documents.
(c) Any
certificate signed by an officer on behalf of any of the HSBC
Entities and delivered to the Underwriters or counsel for the
Underwriters in connection with an offering of the Notes shall be
deemed, and shall state that it is, a representation and warranty
as to the matters covered thereby to each person to whom the
representations and warranties in this Section 1 are
made.
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Section 2.
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Purchase and Sale .
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(a) Subject
to the terms and conditions and in reliance upon the covenants,
representations and warranties herein set forth, the Transferor
agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from
the Transferor the principal amount of Class A Notes set forth
opposite such Underwriter’s name in Schedule I pursuant to
the terms of this Agreement at a purchase price equal to 99.825% of
the aggregate principal amount represented by the Class A
Notes.
(b) Subject
to the terms and conditions and in reliance upon the covenants,
representations and warranties herein set forth, the Transferor
agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from
the Transferor the principal amount of Class B Notes set forth
opposite such Underwriter’s name in Schedule I pursuant to
the terms of this Agreement at a purchase price equal to 99.800% of
the aggregate principal amount represented by the Class B
Notes.
NYK 1075516-5.021110.0062
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Section 3.
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Delivery and Payment .
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Delivery of and payment for the
Notes to be purchased by the Underwriters in accordance with this
Agreement shall be made at 9:00 A.M. at the offices of McDermott
Will & Emery LLP on 340 Madison Avenue, New York, New York
10017 on February 14, 2007 which date, time or place may be
postponed or changed by agreement between the Representative and
the Transferor (such date and time of delivery and payment for the
Notes being herein referred to as the “Closing Date”).
Delivery of one or more global notes representing the Notes shall
be made to the accounts of the several Underwriters against payment
by the several Underwriters of the purchase price therefor, to or
upon the order of the Transferor by one or more wire transfers in
immediately available funds. The global notes to be so delivered
shall be registered in the name of Cede & Co., as nominee for
The Depository Trust Company (“DTC”). The interests of
beneficial owners of the Notes will be represented by book entries
on the records of DTC and participating members thereof. Definitive
Notes representing the Notes will be available only under limited
circumstances as described in the Indenture.
The Transferor agrees to have copies
of the global notes or the Definitive Notes available for
inspection, checking and packaging by the Underwriters in New York,
New York, not later than 1:00 p.m., New York City time, on the
business day prior to the Closing Date.
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Section 4.
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Offering by Underwriters .
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Each Underwriter severally
represents, warrants and covenants as follows:
(a) Such
Underwriter shall offer and/or solicit offers for the Notes for
sale to the public as set forth in the Preliminary Prospectus and
the Prospectus and agrees that all offers, solicitations and sales
shall be made in compliance with all applicable laws and
regulations. Furthermore, such Underwriter shall comply with all
applicable laws and regulations in connection with the use of Free
Writing Prospectuses, including, but not limited to, Rules 164 and
433 under the Act.
(b) No
Underwriter shall convey or deliver any “written
communication” within the meaning of Rule 405 of the Act to
any person in connection with the offering of the Notes, unless
such written communication is: (a) the Prospectus; (b) the
Preliminary Prospectus; (c) an Underwriter Free Writing Prospectus
that constitutes a Bloomberg Information; (d) a written
confirmation of sale or a notice of allocation of securities sold
or to be sold made in reliance on Rule 172 under the Act; or (e)
such other written communication specifically agreed to by HBUS and
the Underwriters. “Bloomberg Information” means
customary information provided by an Underwriter to Bloomberg, for
use by investors and prospective investors (following delivery of
the Preliminary Prospectus) that does not contain information other
than identifying information relating to the Trust and the Notes;
the nature of the offering, the expected pricing date, the expected
closing date and first payment date for the Notes; expected
principal amount and class amounts, principal payment windows;
pricing speeds/prepayment assumptions; duration/modified duration;
expected weighted average life, expected ratings, expected final
payment date, expected legal final payment date and expected
interest rate index; preliminary guidance as to the interest rate
and/or yield the Notes and final interest rate or yield
information; names of lead managers and co-managers; information
about the principal amount
NYK 1075516-5.021110.0062
of the Notes; average lives; ratings
and ratings agencies; 100% pot vs. retention status; percent
interest only; geographic concentration; 2a-7 eligibility; other
similar or related information such as expected pricing parameters
and benchmarks; pricing guidance; status of subscriptions and
Underwriters’ retentions and ERISA eligibility; provided
that, references to “expected” in the foregoing
includes ranges, windows or references to benchmarks.
(c) Each
Underwriter severally agrees that if it is a foreign broker-dealer
not eligible for membership in the National Association of
Securities Dealers, Inc. (the “NASD”), it will not
effect any transaction in the Notes within the United States or
induce or attempt to induce the purchase of or sale of the Notes
within the United States, except that it shall be permitted to make
sales to the other Underwriters or to its United States affiliates
provided that such sales are made in compliance with an exemption
of certain foreign brokers or dealers under Rule 15a-6 under the
Exchange Act and in conformity with the NASD’s Conduct Rules
as such Rules apply to non-NASD brokers or dealers.
(d) Each
Underwriter severally represents and agrees that (i) it has only
communicated or caused to be communicated and will only communicate
or cause to be communicated any invitation or inducement to engage
in investment activity (within the meaning of section 21 of the
Financial Services and Markets Act 2000 (the “FSMA”)
received by it in connection with the issue or sale of any Notes in
circumstances in which section 21(1) of the FSMA does not apply to
the Issuer; and (ii) it has complied and will comply with all
applicable provisions of the FSMA with respect to anything done by
it in relation to the Notes in, from or otherwise involving the
United Kingdom.
(e) In
relation to each Member State of the European Economic Area which
has implemented the Prospectus Directive (each, a “Relevant
Member State”), with effect from and including the date on
which the Prospectus Directive is implemented in that Relevant
Member State (the “Relevant Implementation Date”), such
Underwriter has not made and will not make an offer of Notes to the
public in that Relevant Member State prior to the publication of a
prospectus in relation to the Notes that has been approved by the
competent authority in that Relevant Member State or, where
appropriate, approved in another Relevant Member State and notified
to the competent authority in that Relevant Member State, all in
accordance with the Prospectus Directive, except that it may, with
effect from and including the Relevant Implementation Date, make an
offer of Notes to the public in that Relevant Member State at any
time:
(i) to
legal entities that are authorized or regulated to operate in the
financial markets or, if not so authorized or regulated, whose
corporate purpose is solely to invest in securities;
(ii) to
any legal entity that has two or more of (1) an average of at least
250 employees during the last financial year; (2) a total balance
sheet of more than €43,000,000 and (3) an annual net turnover
of more than €50,000,000, as shown in its last annual or
consolidated accounts; or
(iii) in
any other circumstances that do not require the publication by the
issuer entity of a prospectus pursuant to Article 3 of the
Prospectus Directive.
NYK 1075516-5.021110.0062
For the purposes of this provision,
(A) the expression an “offer of Notes to the public” in
relation to any Notes in any Relevant Member State means the
communication in any form and by any means of sufficient
information on the terms of the offer and the Notes to be offered
so as to enable an investor to decide to purchase or subscribe the
Notes, as the same may be varied in that Member State by any
measure implementing the Prospectus Directive in that Member State
and (B) the expression “Prospectus Directive” means
Directive 2003/71/EC and includes any relevant implementing measure
in each Relevant Member State.
The countries comprising the
“European Economic Area” are Austria, Belgium, Cyprus,
Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece,
Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta,
Netherlands, Poland, Portugal, Slovak Republic, Slovenia, Spain,
Sweden, United Kingdom, Iceland, Liechtenstein and
Norway.
(f) Such
Underwriter has complied and will comply with all applicable
provisions of the FSMA with respect to anything done by it in
relation to the Notes in, from or otherwise involving the United
Kingdom.
(g) Such
Underwriter and each of its affiliates (i) has anti-money
laundering policies and procedures in place in accordance with the
requirements imposed by Title III of the Uniting and Strengthening
America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, as amended, and any rules and
regulations promulgated thereunder, and the Foreign Assets Control
Regulations issued by the Office of Foreign Assets Control of the
United States Department of the Treasury, in each case to the
extent applicable to them; and (ii) has implemented an anti-money
laundering compliance program pursuant to NASD Rule 3011, to the
extent applicable to them.
Each of the HSBC Entities, each as
to itself, covenants and agrees with the several Underwriters
that:
(a) The
Transferor will prepare a Preliminary Prospectus and Prospectus,
and will transmit the Preliminary Prospectus and Prospectus, to the
Commission pursuant to Rule 424(b) by a means reasonably calculated
to result in filing with the Commission pursuant to Rule 424(b), in
each case no later than the time specified by such Rule. The
Transferor will promptly advise the Representative (i) when the
Registration Statement shall have become effective, (ii) when any
amendment thereof shall have become effective, (iii) of the receipt
of any comments from the Commission with respect to the Prospectus,
(iv) of any request by the Commission for any amendment or
supplement of the Registration Statement or the Prospectus or any
Preliminary Prospectus or for any additional information, (v) 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 (vi) of the
receipt by the Transferor of any notification with respect to the
suspension of the qualification of the Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose. The Transferor will not file any amendment of the
Registration Statement or supplement to the Prospectus or any
Preliminary Prospectus to which the Representative reasonably
objects. The Transferor will use its best efforts to prevent the
issuance of any such stop order and, if issued, to obtain as
soon
NYK 1075516-5.021110.0062
as possible the withdrawal thereof.
The Transferor will file with the Commission any Free Writing
Prospectus delivered to investors in accordance with Section 7 as
required to be filed under the Act and the Rules and Regulations,
and to do so within the applicable period of time required under
the Act and the Rules and Regulations, provided that, the
Transferor receives such Free Writing Prospectus from the
Underwriters in accordance with Section 7(g) hereof.
(b) The
Transferor will give the Underwriters notice of its intention to
file any amendment to the Registration Statement or any
amendment,
