<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) September 28, 1999
Advanta Conduit Receivables, Inc., as Sponsor
on behalf of Advanta Revolving Home Equity Loan Trust 1999-B
(Exact name of registrant as specified in its charter)
<TABLE>
<CAPTION>
Nevada 333-75295 88-0360305
------------------------------- ------------------------ -------------------------------
<S> <C> <C>
(State or Other Jurisdiction of (Commission File Number) (I.R.S. Employer Identification
Incorporation) No.)
</TABLE>
Advanta Conduit Receivables, Inc.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
Nevada 333-77927 88-0360305
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) ID Number)
Attention: General Counsel
10790 Rancho Bernardo Road
San Diego, California 92127
(Address of principal executive (Zip Code)
offices)
Registrant's Telephone Number,
including area code: (619) 674-1800
</TABLE>
(Former name or former address, if changed since last report)
<PAGE> 2
Item 2. Acquisition or Disposition of Assets
Description of the Certificates and the Mortgage Loans
Advanta Conduit Receivables, Inc. (the "Registrant" or the
"Sponsor") registered an issuance of $1,699,051,007.20 in principal amount of
Advanta Revolving Home Equity Loan Asset Backed Notes on a delayed or continuous
basis pursuant to Rule 415 under the Securities Act of 1933, as amended (the
"Act"), by the Registration Statement on Form S-3 (File No. 333-75295) (the
"Registration Statement").
Pursuant to the Registration Statement, the Sponsor formed
Advanta Revolving Home Equity Loan Trust 1999-B (the "Trust") which issued
approximately $275,000,000 in aggregate principal amount of its Revolving Home
Equity Loan Asset Backed Notes (the "Notes"), on September 28, 1999 (the
"Closing Date").
This Current Report on Form 8-K is being filed to satisfy an
undertaking to file copies of certain opinions issued in connection with the
issuance of the Certificates, the forms of which were filed as Exhibits to the
Registration Statement.
The primary assets of the Trust are pool of adjustable-rate
home equity revolving credit line loans (the "Mortgage Loans"), used
predominantly to refinance an existing mortgage loan on more favorable terms, to
consolidate debt or to obtain cash proceeds by borrowing against the related
borrower's equity in the real property and improvements pledged to secure the
related Mortgage Loan, secured primarily by mortgages on single-family
residences (which may be detached, part of a two- to four-family dwelling, a
condominium unit or a unit in a planned unit development) which were conveyed to
the Trust on the Closing Date. As of the Closing Date, the Mortgage Loans had
the characteristics described in the Prospectus dated August 10, 1999, the
Preliminary Prospectus Supplement dated September 15, 1999 filed pursuant to
Rule 424(b)(3) of the Act with the Commission and the Prospectus Supplement
dated September 21, 1999 filed pursuant to Rule 424(b)(2) of the Act with the
Commission.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
(a) Not applicable
(b) Not applicable
(c) Exhibits:
5.1 Opinion of Dewey Ballantine LLP regarding legality of the
registered securities, dated September 28, 1999.
8.1 Opinion of Dewey Ballantine LLP regarding tax matters,
dated September 28, 1999.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this Report to be signed on its behalf by
the undersigned thereunto duly authorized.
ADVANTA CONDUIT RECEIVABLES, INC.
By: /s/ Michael Coco
----------------------------------------------
Name: Michael Coco
Title: Vice President
ADVANTA CONDUIT RECEIVABLES, INC., as Sponsor on
behalf of Advanta Revolving Home Equity Loan Trust
1999-B.
By: /s/ Michael Coco
----------------------------------------------
Name: Michael Coco
Title: Vice President
Dated: September 28, 1999
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
5.1 Opinion of Dewey Ballantine LLP regarding legality of the
registered securities, dated as of September 28, 1999.
8.1 Opinion of Dewey Ballantine LLP regarding tax matters, dated
as of September 28, 1999.
</TABLE>
<PAGE> 1
Exhibit 5.1
September 28, 1999
To the Addressees Listed on
the Appendix hereto:
Re: Advanta Revolving Home Equity Loan Trust 1999-B
Ladies and Gentlemen:
We have acted as special counsel to Advanta National Bank, a
national banking association ("ANB"), Advanta Finance Corp. ("AFC"), a Nevada
corporation (ANB and AFC together being the "Originators"), Advanta Mortgage
Corp. USA, a Delaware corporation (the "Master Servicer"), Advanta Conduit
Receivables, Inc., a Nevada corporation, (the "Sponsor"), and Advanta Mortgage
Holding Corporation, a Delaware corporation ("AMHC"), in connection with the
issuance and sale of $275,000,000 aggregate principal amount of Revolving Home
Equity Loan Asset-Backed Notes, Series 1999-B, (the "Notes") by the Advanta
Revolving Home Equity Loan Trust 1999-B (the "Trust") and the execution and
delivery of the following documents:
(i) Sale and Servicing Agreement dated as of September 1,
1999 (the "Sale and Servicing Agreement") among the Sponsor, the Master
Servicer, Advanta Holding Trust 1999-B (the "Holding Trust"), the Trust and
Bankers Trust Company of California, N.A., a national banking association, as
indenture trustee (the "Indenture Trustee");
(ii) Underwriting Agreement dated September 21, 1999 (the
"Underwriting Agreement") among the Sponsor, the Originators and Morgan Stanley
& Co. Incorporated, as the Representative of the Underwriters (the
"Representative");
(iii) Indenture dated as of September 1, 1999 (the
"Indenture") between the Trust and the Indenture Trustee;
(iv) Trust Agreement dated as of September 1, 1999 (the
"Holding Trust Agreement") between the Sponsor and Wilmington Trust Company, as
Owner Trustee (the "Owner Trustee");
(v) Trust Agreement dated as of September 1, 1999 (the
"Trust Agreement") among the Sponsor, the Holding Trust, as depositor, and
Wilmington Trust Company, as owner trustee (the "Owner Trustee");
(vi) Insurance and Indemnity Agreement dated as of
September 1, 1999 (the "Insurance Agreement") among the Sponsor, the Indenture
Trustee, the Trust, the Holding Trust, the Master Servicer and Ambac Assurance
Corporation, as insurer (the "Insurer");
(vii) Indemnification Agreement dated as of September 28,
1999 (the "Indemnification Agreement") among the Representative and the Insurer;
(viii) Purchase Agreement dated as of September 1, 1999 (the
"Purchase Agreement") among the Originators and the Sponsor;
(ix) A form of Bill of Sale and Assignment (the "Bill of
Sale"), to be entered into by Advanta Mortgage Funding Trust (the "Warehouse
Trust") and the Holding Trust in the event the Holding Trust purchases any
Subsequent Mortgage Loans from the Warehouse Trust;
(x) Two letter agreements executed and delivered by AMHC,
one of which is dated September 28, 1999 and is addressed to the Representative
and the Insurer, and one of which is dated September 28, 1999 and is addressed
to the Trust and the Insurer, pursuant to which AMHC acknowledges its
joint-and-several liability with respect to certain of the Sponsor's
obligations to the Underwriters, the Trust and the Insurer (collectively, the
"AMHC Guaranties").
Capitalized terms used herein, but not defined, shall have the
meanings assigned to them in the Sale and Servicing Agreement.
We have examined executed copies of the Sale and Servicing
Agreement, the Indenture, the Holding Trust Agreement, the Trust Agreement, the
Purchase Agreement, the Bill of Sale, the Underwriting Agreement, the
Indemnification Agreement and the Insurance Agreement (collectively, the
"Documents") and of the AMHC Guaranties. We have also examined a copy of the
executed Notes. We have also examined the Registration Statement (333-75295)
filed with the Securities and Exchange Commission (the "Commission") on Form
S-3, in the form in which such Registration Statement was declared effective,
the Prospectus dated August 10, 1999 and the Prospectus Supplement dated
September 21, 1999 (together, the "Prospectus") relating to the Notes.
We have also examined originals or photostatic or certified
copies of all such corporate records of the Sponsor, the Master Servicer, the
Originators, and AMHC and such certificates of public officials, certificates of
corporate officers, and other documents, and such questions of law, as we have
deemed relevant and necessary as a basis for the opinions hereinafter expressed.
As to certain issues of fact material to the opinions expressed herein, we have,
with your consent, relied to the extent we deemed appropriate upon certificates
and representations of officers of the Sponsor, the Master Servicer, the
Originators and AMHC. In making our examinations and rendering the opinions
herein expressed, we have made the following assumptions:
<PAGE> 2
1) each party to each of the Documents (other than the
Sponsor, the Master Servicer, the Originators and AMHC, as
applicable) has the corporate power to enter into and
perform all of its obligations thereunder;
2) the due authorization, execution and delivery of the
Documents by all parties thereto (other than the Sponsor,
the Master Servicer, the Originators and AMHC, as
applicable) and the validity and binding effect on all
parties (other than the Sponsor, the Master Servicer, the
Originators and AMHC, as applicable or as otherwise
expressed herein) of each of the Documents;
3) the genuineness of all signatures;
4) the authenticity of all documents submitted to us as
originals and the conformity to originals of all documents
submitted to us as copies; and
5) as to Paragraph 30 below, we assume that the parties to
the Documents have and will perform their respective
obligations thereunder, including the delivery to the
Indenture Trustee of the Credit Line Agreements relating to
the Mortgage Loans following payment of legal and sufficient
consideration therefor, without any such Credit Line
Agreement having been discharged or the related Mortgage
satisfied or released and without the Indenture Trustee
having actual or constructive notice of the existence with
respect to the Credit Line Agreements and Mortgages of any
claim, lien, charge, mortgage, security interest,
encumbrance or right of the Sponsor, the Originators, or
creditors of the Sponsor, the Originators or others. Further
we have assumed the absence of any defense against
enforcement of, or right of offset against, each such Credit
Line Agreement and the related Mortgage. We have undertaken
no independent review of the Mortgage Loans, including the
Credit Line Agreements and the Mortgages and have relied
solely upon the representations of the Sponsor and of the
Originators in the Sale and Servicing Agreement and the
Purchase Agreement that they have title to the Mortgage
Loans.
We have further assumed that the Mortgages and rights to
receive payment under the Mortgage Loans are not subject to any right, lien or
interest of any government or any agency or instrumentality thereof (including
without limitation any federal or state tax lien, or lien arising under Title IV
of ERISA) and that they are not subject to any lien arising by operation of law
or any judicial lien.
The opinions expressed in paragraphs 5, 7, 9, 11 and 13 with
respect to the enforceability of certain agreements are subject to the following
additional qualifications:
(a.) The effect of bankruptcy, insolvency, reorganization, moratorium,
receivership, or other similar laws of general applicability relating to or
affecting creditors' rights generally or the rights of creditors of
national banking associations in the event of bankruptcy, insolvency,
reorganization, moratorium or receivership.
2
<PAGE> 3
(b.) The application of general principles of equity, including, but not
limited to, the right of specific performance (regardless of whether
enforceability is considered in a proceeding in equity or at law).
In addition, we wish to advise you that the enforceability of
certain provisions set forth in the Underwriting Agreement which purport to
provide for indemnification for losses due to securities laws violations may be
limited by public policy considerations.
We are admitted to the Bars of the States of New York and
California, and we express no opinion as to the laws of any other jurisdiction
except as to matters that are governed by federal law and the corporate and
other applicable laws of the States of Delaware and Nevada. With respect to the
corporate laws of the States of Delaware and Nevada, the opinions expressed
below are based solely on our review of statutes as in effect in those States
and judicial decisions with respect thereto. All opinions expressed herein are
based on laws, regulations and policy guidelines currently in force and may be
affected by future regulations. Furthermore, no opinion is expressed herein
regarding the applicable state Blue Sky, legal investment or real estate
syndication laws.
Based upon the foregoing and subject to the last paragraph
hereof, we are of the opinion that:
1. The Sponsor has been duly organized and is validly existing as
a corporation in good standing under the laws of the State of
Nevada, and is qualified to do business in each state necessary
to enable it to perform its obligations under the Purchase
Agreement, the Sale and Servicing Agreement, the Trust Agreement,
the Holding Trust Agreement, the Insurance Agreement and the
Underwriting Agreement. The Sponsor has the requisite power and
authority to execute and deliver, engage in the transactions
contemplated by, and perform and observe the conditions of the
Purchase Agreement, the Sale and Servicing Agreement, the Trust
Agreement, the Holding Trust Agreement, the Insurance Agreement
and the Underwriting Agreement.
2. The Master Servicer has been duly organized and is validly
existing as a corporation in good standing under the laws of the
State of Delaware, and is qualified to do business in each state
necessary to enable it to perform its obligations under the
Insurance Agreement and the Sale and Servicing Agreement. The
Master Servicer has the requisite power and authority to execute
and deliver, engage in the transactions contemplated by, and
perform and observe the conditions of the Sale and Servicing
Agreement and the Insurance Agreement.
3. Each Originator has been duly organized and is validly
existing and in good standing under the laws of its jurisdiction
of incorporation, and is qualified to do business in each state
necessary to enable it to perform its obligations under the
Documents to which they are a party. Each Originator has the
requisite power and authority to execute and deliver, engage in
the transactions contemplated by, and perform and observe the
conditions of the Documents to which they are a party.
3
<PAGE> 4
4. Each of the Purchase Agreement, the Sale and Servicing
Agreement, the Insurance Agreement, the Holding Trust Agreement,
the Trust Agreement, the Indemnification Agreement and the
Underwriting Agreement has been duly and validly authorized,
executed and delivered by the Sponsor, all requisite corporate
action having been taken with respect thereto.
5. Each of the Sale and Servicing Agreement, the Purchase
Agreement, the Insurance Agreement, the Holding Trust Agreement,
the Trust Agreement, the Indemnification Agreement and the
Underwriting Agreement constitutes the valid, legal and binding
agreement of the Sponsor, and is enforceable against the Sponsor
in accordance with its terms.
6. Each of the Sale and Servicing Agreement and the
Insurance Agreement has been duly and validly authorized,
executed and delivered by the Master Servicer, all requisite
corporate action having been taken with respect thereto.
7. Each of the Sale and Servicing Agreement and the
Insurance Agreement constitutes the valid, legal and binding
agreement of the Master Servicer, and is enforceable against the
Master Servicer, in accordance with its terms.
8. Each of the Documents to which they are a party has been
duly and validly authorized, executed and delivered by each
Originator, all requisite corporate action having been taken
with respect thereto.
9. Each of the Documents to which they are a party
constitutes the legal, valid and binding agreement of the
Originators and is enforceable against the Originators in
accordance with its terms.
10. AMHC has been duly organized and is validly existing as
a corporation in good standing under the laws of the State of
Delaware, and is qualified to do business in each state
necessary to enable it to perform its obligations under the AMHC
Guaranties and where the conduct of its business requires
qualification AMHC has the requisite power and authority to
execute and deliver, engage in the transactions contemplated by,
and perform and observe the conditions of, the AMHC Guaranties.
11. Each of the Documents to which they are a party
constitutes the legal, valid and binding agreement of the Trust,
the Holding Trust and the Warehouse Trust, respectively, and is
enforceable against the Trust, the Holding Trust and the
Warehouse Trust, respectively, in accordance with its terms.
12. The AMHC Guaranties have been duly and validly
authorized, executed and delivered by AMHC, all requisite
corporate action having been taken with respect thereto.
13. Each of the AMHC Guaranties constitutes the valid,
legal and binding agreement of AMHC, and is enforceable against
AMHC in accordance with its terms.
4
<PAGE> 5
14. The Notes, assuming the due execution by the Trust and
due authentication by the Indenture Trustee and payment
therefor, are validly issued and outstanding and is entitled to
the benefits of the Indenture.
15. No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental
authority or court is required under federal laws or the laws of
the States of New York, Delaware and California, for the
execution, delivery and performance of either the Sale and
Servicing Agreement or of the Insurance Agreement or the
consummation of any other transaction contemplated thereby by
the Master Servicer, except such which have been obtained.
16. No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental
authority or court is required under federal laws or the laws of
the States of New York, Nevada and California, for the
execution, delivery and performance of any of the Sale and
Servicing Agreement, the Underwriting Agreement, the Holding
Trust Agreement, the Trust Agreement, the Purchase Agreement,
the Indemnification Agreement and the Insurance Agreement or the
consummation of any other transaction contemplated thereby by
the Sponsor, except such which have been obtained.
17. No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental
authority or court is required under federal laws or the laws of
the States of New York, Delaware, Nevada and California, for the
execution, delivery and performance of the Documents to which
they are a party or the offer, issuance, sale or delivery of the
Notes or the consummation of any other transaction contemplated
thereby by the Originators, except such which have been
obtained.
18. No consent, approval, authorization or order of,
registration or filing with, or notice to, any governmental
authority or court is required under federal laws or the laws of
the States of New York, Delaware and California, for the
execution, delivery and performance of the AMHC Guaranties by
AMHC, except such which have been obtained.
19. To the best of our knowledge, following due inquiry
made of the appropriate officers of the Sponsor, the Master
Servicer and the Originators, there are no actions, proceedings
or investigations pending or, to our knowledge, threatened
against the Sponsor, the Master Servicer or the Originators
before any court, governmental agency or body or other tribunal
(a) asserting the invalidity of the Documents or the Notes, (b)
seeking to prevent the issuance of the Notes or the consummation
of any of the transactions contemplated by the Documents, or (c)
which would materially and adversely affect the performance by
the Sponsor, the Master Servicer or the Originators, as
applicable, of obligations under, or the validity or
enforceability of, the Documents or the Notes.
20. None of the transfer of the Mortgage Loans to the
Trust, the issuance or sale of the Notes, or the execution,
delivery or performance by the Master Servicer of the
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<PAGE> 6
Sale and Servicing Agreement and the Insurance Agreement (a)
conflicts or will conflict with or results or will result in a
breach of, or constitutes or will constitute a default under (i)
any term or provision of the certificate of incorporation or
bylaws of the Master Servicer; (ii) any term or provision of any
material agreement, contract, instrument or indenture, to which
the Master Servicer, is a party or is bound which has been
identified to us by an officer or representative of the Master
Servicer; (iii) any order, judgment, writ, injunction or decree
of any court or governmental agency or body or other tribunal
having jurisdiction over the Master Servicer which has been
identified to us by an officer or representative of the Master
Servicer; or (iv) any law, rule or regulation of the States of
New York, California or Delaware or the federal government
(including, without limitation, any bulk sales law), or (b)
results in, or will result in, the creation or imposition of any
lien, charge or encumbrance upon the Trust Estate or upon the
Notes, except as otherwise contemplated by the Indenture.
21. None of the transfer of the Mortgage Loans to the Trust,
the issuance or sale of the Notes, or the execution, delivery or
performance by either Originator of the Documents to which either
of them is a party (a) conflicts or will conflict with or results
or will result in a breach of, or constitutes or will constitute
a default under (i) any term or provision of the certificate of
incorporation or bylaws of either Originator; (ii) any term or
provision of any material agreement, contract, instrument or
indenture, to which either Originator is a party or is bound,
which has been identified to us by appropriate officers of either
Originator; (iii) any order, judgment, writ, injunction or decree
of any court or governmental agency or body or other tribunal
having jurisdiction over either Originator, which has been
identified to us by appropriate officers of either Originator; or
(iv) any law, rule or regulation of the States of New York,
California, Nevada or Delaware or the federal government, or (b)
results or will result in the creation or imposition of any lien,
charge or encumbrance upon the Trust Estate, except as otherwise
contemplated by the Indenture.
22. None of the transfer of the Mortgage Loans to the Trust,
the issuance or sale of the Notes, or the execution, delivery or
performance by the Sponsor of the Sale and Servicing Agreement,
the Purchase Agreement, the Holding Trust Agreement, the Trust
Agreement, the Insurance Agreement, the Indemnification Agreement
and the Underwriting Agreement (a) conflicts or will conflict
with or results or will result in a breach of, or constitutes or
will constitute a default under (i) any term or provision of the
certificate of incorporation or bylaws of the Sponsor; (ii) any
term or provision of any material agreement, contract, instrument
or indenture, to which the Sponsor is a party or is bound, which
has been identified to us by appropriate officers of the Sponsor;
(iii) any order, judgment, writ, injunction or decree of any
court or governmental agency or body or other tribunal having
jurisdiction over the Sponsor, which has been identified to us by
appropriate officers of the Sponsor; or (iv) any law, rule or
regulation of the States of New York, California or Nevada or the
federal government, or (b) results or will result in the creation
or imposition of any lien, charge or encumbrance upon the Trust
Estate, except as otherwise contemplated by the Indenture.
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<PAGE> 7
23. None of the transfer of the Mortgage Loans to the Trust,
the issuance or sale of the Notes, or the execution, delivery or
performance by the Holding Trust of the Documents to which it is
a party (a) conflicts or will conflict with or results or will
result in a breach of, or constitutes or will constitute a
default under (i) any term or provision of the organization
documents of the Holding Trust; (ii) any term or provision of any
material agreement, contract, instrument or indenture, to which
the Holding Trust is a party or is bound, which has been
identified to us by appropriate officers of the Holding Trust;
(iii) any order, judgment, writ, injunction or decree of any
court or governmental agency or body or other tribunal having
jurisdiction over the Holding Trust, which has been identified to
us by appropriate officers of the Holding Trust; or (iv) any law,
rule or regulation of the States of New York or Delaware or the
federal government, or (b) results or will result in the creation
or imposition of any lien, charge or encumbrance upon the Trust
Estate, except as otherwise contemplated by the Indenture.
24. None of the transfer of any Mortgage Loans to the Trust,
the issuance or sale of the Notes, or the execution, delivery or
performance by the Warehouse Trust of the Documents to which it
is a party (a) conflicts or will conflict with or results or will
result in a breach of, or constitutes or will constitute a
default under (i) any term or provision of the organization
documents of the Warehouse Trust; (ii) any term or provision of
any material agreement, contract, instrument or indenture, to
which the Warehouse Trust is a party or is bound, which has been
identified to us by appropriate officers of the Warehouse Trust;
(iii) any order, judgment, writ, injunction or decree of any
court or governmental agency or body or other tribunal having
jurisdiction over the Warehouse Trust, which has been identified
to us by appropriate officers of the Warehouse Trust; or (iv) any
law, rule or regulation of the States of New York or Delaware or
the federal government, or (b) results or will result in the
creation or imposition of any lien, charge or encumbrance upon
the Trust Estate, except as otherwise contemplated by the
Indenture.
25. The execution, delivery or performance by AMHC of the
AMHC Guaranties does not conflict with or will not conflict with
and does not result or will not result in a breach of, and does
not constitute or will not constitute a default under: (i) any
term or provision of the certificate of incorporation or bylaws
of AMHC; (ii) any term or provision of any material agreement,
contract, instrument or indenture, to which AMHC is a party or is
bound, which have been identified to us by appropriate officers
of AMHC; (iii) any order, judgment, writ, injunction or decree of
any court or governmental authority having jurisdiction over
AMHC, which have been identified to us by appropriate officers of
AMHC; or (iv) any law, rule or regulation of the States of New
York, Delaware, Nevada or California or the federal government.
26. To the best of our knowledge, following due inquiry made
of the appropriate officers of AMHC, there are no actions,
proceedings or investigations pending or to our knowledge
threatened against AMHC before any court, administrative agency
or other tribunal (a) asserting the invalidity of the AMHC
Guaranties, (b) seeking to prevent the consummation of any of the
transactions contemplated by the AMHC
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<PAGE> 8
Guaranties, or (c) which would materially and adversely
affect the performance by AMHC of obligations of the
AMHC Guaranties.
27. The Registration Statements and the Prospectus (other
than the financial and statistical data included therein, as to
which we are not called upon to express any opinion), including
the Incorporated Documents, at the time the Registration
Statements became effective and as of the date of execution of
the Underwriting Agreement comply as to form in all material
respects with the requirements of the Securities Act of 1933, as
amended (the "1933 Act"), and the rules and regulations
thereunder, and the Exchange Act and the rules and regulations
thereunder, and we do not know of any amendment to the
Registration Statements required to be filed, or of any
contracts, indentures or other documents of a character required
to be filed as an exhibit to the Registration Statements or
required to be described in the Registration Statements or the
Prospectus, which has not been filed or described as required.
28. The Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended. Neither the Holding Trust nor
the Trust is required to be registered pursuant to the Investment
Company Act of 1940, as amended.
29. The Indenture, upon execution and delivery, is effective
to create a valid and enforceable security interest in favor of
the Indenture Trustee, for the benefit of the Noteholders and the
Insurer, in all of the Trust's right, title and interest in the
Mortgage Loans.
30. The security interest in favor of the Indenture Trustee,
for the benefit of the Noteholders and the Insurer, will
constitute a first perfected security interest upon the delivery
of the Mortgage Files to the Indenture Trustee, on behalf of the
Noteholders, and the recording of instruments in accordance with
the provisions of the Sale and Servicing Agreement; provided,
however, that we express no opinion (a) as to the continuation of
a security interest in the Mortgage Loans in the event that the
Indenture Trustee relinquishes possession of the Credit Line
Agreements, (b) as to the continuation of a security interest in
the Credit Line Agreements or the Mortgages in the event the
related Originator or the Warehouse Trust discharges or releases
the Credit Line Agreements or the Mortgages prior to delivery of
the Credit Line Agreements to the Indenture Trustee and the
recording of instruments of assignment in respect of the
Mortgages in the appropriate recording offices, (c) as to title
in any Mortgaged Property or the existence of priority in any
lien with respect to such property or as the to the
enforceability of any remedy that may be dependent on that title
or such lien, or (d) as to the priority of any security interest
against any liens, claims or other interest that by operation of
law take priority over previously perfected security interest
(including, in certain circumstances, certain federal and state
tax liens, liens arising under the Employee Retirement Income
Security Act of 1974, as amended, and certain claims of the
United States Government). Our conclusion that the security
interest described in above would be a "first perfected security
interest" is based upon (x) the Indenture Trustee's
certification, delivered on the date hereof, to the effect that
the Indenture Trustee has received the endorsed
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<PAGE> 9
Credit Line Agreements, (y) the mortgage assignment recording
requirements of the Sale and Servicing Agreement, and (z)
representations of the Originators in the Sale and Servicing
Agreement. We further note that, until such time as assignments
of mortgage are recorded in the name of the Indenture Trustee in
the appropriate jurisdictions, (x) the Indenture Trustee may not,
in certain jurisdictions, be independently able to enforce the
Mortgage against the related Mortgaged Property or the related
Mortgagor, (y) the Originators or the Warehouse Trust, as
applicable, could record an assignment of a Mortgage in the name
of a third party or record a discharge and satisfaction of a
Mortgage and (z) any notices which may be given to the record
holder of a Mortgage would be given to the Originators or the
Warehouse Trust, as applicable.
31. Except as to any financial or statistical data contained
in the Registration Statements, the statements set forth in the
Prospectus under the caption "The Insurer and the Policy" and
Annex I to the Prospectus, as to which we are not called upon to
express any opinion or belief, to the best of our knowledge, the
Registration Statement does not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
therein not misleading.
32. The statements in the Prospectus set forth under the
captions "Description of the Notes" and " Provisions of the
Agreements," to the extent such statements purport to summarize
certain provisions of the Notes or of the Indenture or the Sale
and Servicing Agreement, are fair and accurate in all material
respects.
33. The statements in the Prospectus set forth under the
captions "ERISA Considerations," "Material Federal Income Tax
Consequences" and "Legal Matters," to the extent that they
constitute matters of federal, New York or California law, or
federal, New York or California legal conclusions, provide a fair
and accurate summary of such law or conclusions.
34. To the best of our knowledge, the Commission has not
issued any stop order suspending the effectiveness of the
Registration Statement or any order directed to any prospectus or
prospectus supplement relating to the Notes (including the
Prospectus), and has not initiated or threatened any proceeding
for that purpose.
35. The provision in the Sale and Servicing Agreement which
provides for the laws of New York to be the governing law would
be upheld by a court applying New York or California law, or, if
not upheld, then such court applying New York or California law
would hold that California law is the governing law for the Sale
and Servicing Agreement.
Assuming that the Trust's acquisition of any Subsequent
Mortgage Loan is effected in accordance with the provisions of the Sale and
Servicing Agreement, our opinions set forth above refer to such Subsequent
Mortgage Loans as well as the Initial Mortgage Loans held by the Trust.
9
<PAGE> 10
We have rendered legal advice and assistance to the
Originators, the Sponsor and the Master Servicer in the course of the
preparation of the Registration Statement, the Prospectus, the Prospectus
Supplement, and other matters relating to the sale of the Notes. Rendering such
assistance involved, among other things, discussions and inquiries concerning
various legal and related subjects and reviews of certain records, documents,
opinions and certificates in accordance with instructions of the Originators,
the Sponsor and the Master Servicer. We also participated with the Originators,
the Sponsor and the Master Servicer in conference with representatives of the
Representative and its counsel during which the contents of the Registration
Statement, the Prospectus, the Prospectus Supplement and related matters were
discussed. Although we are not passing upon, and do not assume responsibility
for, the accuracy, completeness or fairness of the statements contained in the
Registration Statement, the Prospectus and the Prospectus Supplement, in the
course of our examination of the Registration Statement, the Prospectus, the
Prospectus Supplement and certain other documents and our participation in the
discussions hereinabove mentioned, no facts have come to our attention which
lead us to believe that the Registration Statement, the Prospectus and the
Prospectus Supplement (other than the financial statements and other financial
and statistical data contained therein, as to which we are not called upon to
express any belief), at the time the Registration Statement became effective,
contained any untrue statement of material fact or omitted to state a material
fact necessary in order to make the statements therein not misleading, or that
the Prospectus and the Prospectus Supplement (other than the financial
statements and other financial and statistical data contained therein, as to
which we are not called upon to express any belief) as of its date and on the
date hereof contain or contains any untrue statement of a material fact, or
omits to state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
This opinion is furnished by us as special counsel to the
Sponsor, the Originators, the Master Servicer and AMHC and is solely for the
benefit of the addressees hereof and their respective counsel. It may not be
relied upon by any other person or for any other purpose without our prior
written consent.
Very truly yours,
<PAGE> 11
APPENDIX
Advanta Conduit Receivables, Inc. Advanta Finance Corp.
10790 Rancho Bernardo Drive 10790 Rancho Bernardo Drive
San Diego, California 92127 San Diego, California 92127
Advanta Mortgage Corp. USA Morgan Stanley & Co. Incorporated
10790 Rancho Bernardo Drive as Representative of the Underwriters
San Diego, California 92127 1585 Broadway
New York, New York 10036
Ambac Assurance Corporation
One State Street Plaza Bankers Trust Company of
New York, New York 10004 California, N.A.,
as Indenture Trustee
Moody's Investors Service, Inc. Three Park Plaza
99 Church Street 16th Floor
New York, NY 10007 Irvine, California 92714
Advanta National Bank Standard & Poor's
Brandywine Corporate Center Ratings Services
650 Naamans Road 55 Water Street
Claymont, DE 19703 New York, New York 10041
Advanta Revolving Home Equity
Loan Trust 1999-B
c/o Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Wilmington Trust Company,
as Owner Trustee
Rodney Square North
1108 North Market Street
Wilmington, Delaware 19890-0001
<PAGE> 1
Exhibit 8.1
September 28, 1999
To the Addressees Listed
on Schedule I hereto
Re: Advanta Revolving Home Equity Loan Trust 1999-B
Revolving Home Equity Loan Asset-Backed Notes
Series 1999-B
Ladies and Gentlemen:
We have acted as special tax counsel in connection with the
issuance and delivery of the certain asset-backed notes denominated Advanta
Revolving Home Equity Loan Trust 1999-B, Revolving Home Equity Loan Asset-Backed
Notes, Series 1999-B, (the " Notes") pursuant to an Indenture dated as of
September 1, 1999 (the "Indenture) between Advanta Revolving Home Equity Loan
Trust 1999-B (the "Trust") and Bankers Trust Company of California N.A., as
Indenture Trustee (the "Indenture Trustee").
As special tax counsel, we have examined such documents as we
deemed appropriate for the purposes of rendering the opinions set forth below,
including the following: (a) Prospectus dated August 10, 1999 and Prospectus
Supplement dated September 21, 1999 (together the "Prospectus") with respect to
the Notes, and (b) an executed copy of the Indenture and the exhibits attached
thereto.
We have examined the question of whether the Notes will be
treated as indebtedness for federal income tax purposes. Our analysis is based
on provisions of the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations promulgated thereunder as in effect on the date hereof and on
existing judicial and administrative interpretations thereof. These authorities
are subject to change and to differing interpretations, which could apply
retroactively. The opinion of special tax counsel is not binding on the courts
or the Internal Revenue Service ("IRS").
In general, whether a transaction constitutes the issuance of
indebtedness for federal income tax purposes is a question of fact, the
resolution of which is based primarily upon the economic substance of the
instruments and the transaction pursuant to which they are issued rather than
the form of the transaction or the manner in which the instruments are labeled.
The IRS and the courts have set forth various factors to be taken into account
in determining whether or not a transaction constitutes the issuance of
indebtedness for federal income tax purposes, which we have reviewed as they
apply to this transaction.
Based on the foregoing, and such legal and factual
investigations as we have deemed appropriate, we are of the opinion that (a) for
federal income tax purposes the Notes will be treated as indebtedness because
(i) the characteristics of the transaction strongly indicate that in economic
substance, the Notes are indebtedness, and (ii) the parties have stated
unambiguously their intention to treat the Notes as indebtedness for tax
purposes and (b) the trust
<PAGE> 2
will not be treated as an association (or a publicly traded partnership) taxable
as a corporation or a taxable mortgage pool.
Capitalized terms used in this opinion letter and not defined
herein shall have their respective meanings as set forth in the Indenture.
Assuming that the Trust's acquisition of any Subsequent
Mortgage Loan is effected in accordance with the provisions of the Sale and
Servicing Agreement, our opinions set forth above refer to such Subsequent
Mortgage Loans as well as the Initial Mortgage Loans held by the Trust.
We express no opinion on any matter not discussed in this
letter. This opinion letter is rendered as of the Closing Date, at the request
of the Sponsor, for the sole benefit of each addressees hereof, and no other
person or entity is entitled to rely hereon without our prior written consent.
Copies of this opinion letter may not be furnished to any other person or
entity, nor may any portion of this opinion letter be quoted, circulated or
referred to in any other document, without our prior written consent.
Very truly yours,
<PAGE> 3
September 28, 1999
Page two
SCHEDULE I
Morgan Stanley & Co. Incorporated
as Representative of the Underwriters
1585 Broadway
New York, New York 10036
Advanta Mortgage Corp. USA
10790 Rancho Bernardo Drive
San Diego, California 92127
Advanta Conduit Receivables, Inc.
10790 Rancho Bernardo Drive
San Diego, California 92127
Standard & Poor's Ratings Services,
55 Water Street
New York, New York 10041
Ambac Assurance Corporation
One State Street Plaza
New York, New York 10504
Moody's Investors Service, Inc.
99 Church Street
New York, New York 10007
Bankers Trust Company of California, N.A.,
as Indenture Trustee
Three Park Plaza, 16th Floor
Irvine, California 92714
Advanta Revolving Home Equity
Loan Trust 1999-B
c/o Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
