<PAGE>

                                                                     Exhibit 4.6

                           INDEMNIFICATION AGREEMENT

                                     among

                      FINANCIAL SECURITY ASSURANCE INC.,

                           PEOPLEFIRST FINANCE, LLC

                             BARCLAYS CAPITAL INC.

                                      and

                      PRUDENTIAL SECURITIES INCORPORATED



                           Dated as of June 21, 2000

                $31,000,000 Class A-1 6.713% Asset Backed Notes

               $109,000,000 Class A-2 7.275% Asset Backed Notes

                $34,000,000 Class A-3 7.365% Asset Backed Notes

                $71,000,000 Class A-4 7.405% Asset Backed Notes
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                     Page
<S>                                                                                  <C>
Section 1.    Definitions.........................................................     1
Section 2.    Representations, Warranties and Agreements of Financial Security....     3
Section 3.    Representations, Warranties and Agreements of the Underwriter.......     6
Section 4.    Indemnification.....................................................     6
Section 5.    Indemnification Procedures..........................................     7
Section 6.    Contribution........................................................     8
Section 7.    Third-Party Beneficiaries...........................................     9
Section 8.    Miscellaneous.......................................................     9
</TABLE>

EXHIBIT A - Opinion of Assistant General Counsel
<PAGE>

                           INDEMNIFICATION AGREEMENT

          INDEMNIFICATION AGREEMENT dated as of June 21, 2000, among FINANCIAL
SECURITY ASSURANCE INC. ("Financial Security"), PEOPLEFIRST FINANCE, LLC (the
                          ------------------
"Company"), BARCLAYS CAPITAL INC. and PRUDENTIAL SECURITIES INCORPORATED
 -------
(collectively, the "Underwriter").
                    -----------

Section 1.   Definitions.  For purposes of this Agreement, the following terms
             -----------
shall have the meanings provided below:

          "Agreement" means this Indemnification Agreement, as the same may be
           ---------
amended, supplemented or otherwise modified from time to time in accordance with
the terms hereof.

          "Commission" means the Securities and Exchange Commission.
           ----------

          "Company Party" means any of the Company, its parent, subsidiaries and
           -------------
affiliates and any shareholder, director, officer, employee, agent or
"controlling person" (as such term is used in the Securities Act) of any of the
foregoing.

          "Depositor" means Prudential Securities Secured Financing Corporation.
           ---------

          "Federal Securities Laws" means the Securities Act, the Securities
           -----------------------
Exchange Act of 1934, the Trust Indenture Act of 1939, the Investment Company
Act of 1940, the Investment Advisers Act of 1940 and the Public Utility Holding
Company Act of 1935, each as amended from time to time, and the rules and
regulations in effect from time to time under such Acts.

          "Financial Security Agreements" means this Agreement, the Pledge
           -----------------------------
Agreement, the Reserve Account Agreement and the Insurance Agreement.

          "Financial Security Information" has the meaning provided in Section
           ------------------------------
2(g) hereof.

          "Financial Security Party" means any of Financial Security, its
           ------------------------
parent, subsidiaries and affiliates, and any shareholder, director, officer,
employee, agent or "controlling person" (as such term is used in the Securities
Act) of any of the foregoing.

          "Indemnified Party" means any party entitled to any indemnification
           -----------------
pursuant to Section 4 hereof.

          "Indemnifying Party" means any party required to provide
           ------------------
indemnification pursuant to Section 4 hereof.

          "Indenture" means the Indenture dated as of June 1, 2000 between the
           ---------
Trust and Norwest Bank Minnesota, National Association, as trustee, as the same
may be amended and supplemented from time to time in accordance with its terms.

                                      -1-
<PAGE>

          "Insurance Agreement" means the Insurance and Indemnity Agreement,
           -------------------
dated as of June 1, 2000, among Financial Security, the Trust, PF Funding II,
LLC and the Company, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the terms thereof.

          "Losses" means (a) any actual out-of-pocket damages incurred by the
           ------
party entitled to indemnification or contribution hereunder, (b) any actual out-
of-pocket costs or expenses incurred by such party, including reasonable fees or
expenses of its counsel and other expenses incurred in connection with
investigating or defending any claim, action or other proceeding which entitle
such party to be indemnified hereunder (subject to the limitations set forth in
Section 5 hereof), to the extent not paid, satisfied or reimbursed from funds
provided by any other Person other than an affiliate of such party (provided
that the foregoing shall not create or imply any obligation to pursue recourse
against any such other Person), plus (c) interest on the amount paid by the
party entitled to indemnification or contribution from the date of such payment
to the date of payment by the party who is obligated to indemnify or contribute
hereunder at the statutory rate applicable to judgments for breach of contract.

          "Note Policy" means the financial guaranty insurance policy delivered
           -----------
by Financial Security with respect to the Securities.

          "Offering Document" means the Prospectus and any other material or
           -----------------
documents delivered by the Underwriter or any Underwriter Party to any Person in
connection with the offer or sale of the Securities.

          "Person" means any individual, partnership, joint venture,
           ------
corporation, trust, unincorporated organization or other organization or entity
(whether governmental or private).

          "Pledge Agreement" means the Pledge Agreement dated as of November, 1,
           ----------------
1999 among the Company, Norwest Bank Minnesota, National Association, as
Collateral Agent, and Financial Security.

          "Prospectus" means, collectively, the Prospectus, dated June 21, 2000,
           ----------
relating to the Securities, and the Prospectus Supplement.

          "Prospectus Supplement" means the Prospectus Supplement dated June 21,
           ---------------------
2000 relating to the Securities.

          "Rating Agencies" has the meaning provided in the last paragraph of
           ---------------
Section 2 hereof.

          "Reserve Account Agreement" means the Master Reserve Account Agreement
           -------------------------
dated as of November 1, 1999, among the PF Funding II, LLC, Financial Security,
the Collateral Agent and the Trustee specified therein, as supplemented by the
Series 2000-1 Supplement to Reserve Account Agreement, dated June 1, 2000, among

                                      -2-
<PAGE>

the same parties and as the same may be further amended, supplemented or
otherwise modified from time to time in accordance with the terms thereof.

          "Securities" means the Trust's $31,000,000 6.712% Asset Backed Notes,
           ----------
Class A-1, $109,000,000 7.275% Asset Backed Notes, Class A-2, $34,000,000 7.365%
Asset Backed Notes, Class A-3, and $71,000,000 7.405% Asset Backed Notes, Class
A-4 described in the Offering Document and issued pursuant to the Indenture.

          "Securities Act" means the Securities Act of 1933, as amended from
           --------------
time to time, and any rule or regulation in effect from time to time under such
Act.

          "Trust" means PeopleFirst.com Vehicle Receivables Owner Trust 2000-1.
           -----

          "Underwriter Information" has the meaning provided in Section 3(c)
           -----------------------
hereof.

          "Underwriter Party" means any of the Underwriter, its parent,
           -----------------
subsidiaries and affiliates and any shareholder, director, officer, employee, or
agent of the "controlling person" (as such item is used in the Securities Act)
of any of the foregoing.

          "Underwriting Agreement" means the Underwriting Agreement dated as of
           ----------------------
June 21, 2000 between the Company and the Underwriter with respect to the offer
and sale of the Securities, as the same may be amended, supplemented or
otherwise modified from time to time in accordance with the terms thereof.

     Section 2.  Representations, Warranties and Agreements of Financial
                 -------------------------------------------------------
Security. Financial Security represents, warrants and agrees with the parties
--------
hereto as follows:

          (a)  Organization, Etc.  Financial Security is a stock insurance
               -----------------
     company duly organized, validly existing and authorized to transact
     financial guaranty insurance business under the laws of the State of New
     York.

          (b)  Authorization, Etc.  The Note Policy and the Financial Security
               ------------------
     Agreements have been duly authorized, executed and delivered by Financial
     Security.

          (c)  Validity, Etc.  The Note Policy and the Financial Security
               -------------
     Agreements constitute valid and binding obligations of Financial Security,
     enforceable against Financial Security in accordance with their terms,
     subject, as to the enforcement of remedies, to bankruptcy, insolvency,
     reorganization, rehabilitation, moratorium and other similar laws affecting
     the enforceability of creditors' rights generally applicable in the event
     of the bankruptcy or insolvency of Financial Security and to the
     application of general principles of equity and subject, in the case of
     this Agreement, to principles of public policy limiting the right to
     enforce the indemnification provisions contained herein.

                                      -3-
<PAGE>

          (d)  Exemption From Registration.  The Note Policy is exempt from
               ---------------------------
     registration under the Securities Act.

          (e)  No Conflicts.  Neither the execution or delivery by Financial
               ------------
     Security of the Note Policy or the Financial Security Agreements, nor the
     performance by Financial Security of its obligations thereunder, will
     conflict with any provision of the certificate of incorporation or the
     bylaws of Financial Security nor result in a breach of, or constitute a
     default under, any material agreement or other instrument to which
     Financial Security is a party or by which any of its property is bound nor
     violate any judgment, order or decree or any law regulation or rule
     applicable to Financial Security of any governmental or regulatory body,
     administrative agency, court or arbitrator having jurisdiction over
     Financial Security (except that, in the published opinion of the Securities
     and Exchange Commission, the indemnification provisions of this Agreement,
     insofar as they relate to indemnification for liabilities arising under the
     Securities Act, are against public policy as expressed in the Securities
     Act and are therefore unenforceable).

          (f)  Financial Information.  The consolidated balance sheets of
               ---------------------
     Financial Security as of December 31, 1999 and December 31, 1998 and the
     related consolidated statements of income, changes in shareholder's equity
     and cash flows for the fiscal years then ended and the interim consolidated
     balance sheet of Financial Security as of March 31, 2000, and the related
     statements of income, changes in shareholder's equity and cash flows for
     the interim period then ended, furnished by Financial Security to the
     Underwriter, fairly present in all material respects the financial
     condition of Financial Security as of such dates and for such periods in
     accordance with generally accepted accounting principles consistently
     applied (subject as to interim statements to normal year-end adjustments)
     and since the date of the most current interim consolidated balance sheet
     referred to above there has been no change in the financial condition of
     Financial Security which would materially and adversely affect its ability
     to perform its obligations under the Note Policy.

          (g)  Financial Security Information.  The information in the
               ------------------------------
     Prospectus Supplement set forth under the caption "THE INSURER"(as revised
     from time to time in accordance with the provisions hereof, the "Financial
                                                                      ---------
     Security Information") is limited and does not purport to provide the scope
     --------------------
     of disclosure required to be included in a prospectus with respect to a
     registrant in connection with the offer and sale of securities of such
     registrant registered under the Securities Act. Within such limited scope
     of disclosure, however, as of the date of the Prospectus Supplement and as
     of the date hereof, the Financial Security Information does not contain any
     untrue statement of a material fact, or omit to state a material fact
     necessary to make the statements contained therein, in the light of the
     circumstances under which they were made, not misleading.

                                      -4-
<PAGE>

          (h)  Additional Information.  Financial Security will furnish to the
               ----------------------
     Underwriter or the Company, upon request of the Underwriter or the Company,
     as the case may be, copies of Financial Security's most recent financial
     statements (annual or interim, as the case may be) which fairly present in
     all material respects the financial condition of Financial Security as of
     the dates and for the periods indicated, in accordance with generally
     accepted accounting principles consistently applied except as noted therein
     (subject, as to interim statements, to normal year-end adjustments).  In
     addition, if the delivery of a Prospectus relating to the Securities is
     required at any time prior to the expiration of nine months after the time
     of issuance of the Prospectus in connection with the offering or sale of
     the Securities, the Company or the Underwriter will notify Financial
     Security of such requirement to deliver a Prospectus and Financial Security
     will promptly provide the Underwriter with any revisions to the Financial
     Security Information that are in the judgment of Financial Security
     necessary to prepare a supplement to the Prospectus.

          (i)  Opinion of Counsel.  Financial Security will furnish to the
               ------------------
     Underwriter and the Company, on the closing date for the sale of the
     Securities an opinion of its Assistant General Counsel, to the effect set
     forth in Exhibit A attached hereto, dated such closing date and addressed
     to the Company and the Underwriter together with any related consents from
     its auditors.

          (j)  Consents and Reports of Independent Accountants.  Financial
               -----------------------------------------------
     Security will furnish to the Underwriter and the Company, upon request, as
     comfort from its independent accountants in respect of its financial
     condition, (i) at the expense of the Person specified in the Insurance
     Agreement, a copy of the Prospectus, including either a manually signed
     consent or a manually signed report of Financial Security's independent
     accountants and (ii) the quarterly review letter by Financial Security's
     independent accountants in respect of the most recent interim financial
     statements of Financial Security.

Nothing in this Agreement shall be construed as a representation or warranty by
Financial Security concerning the rating of its insurance financial strength by
Moody's Investors Service, Inc. or its insurer financial strength by Standard &
Poor's Ratings Services, a division of The McGraw-Hill Companies, or any other
rating agency (collectively, the "Rating Agencies").  The Rating Agencies, in
                                  ---------------
assigning such ratings, take into account facts and assumptions not described in
the Prospectus and the facts and assumptions considered by the Rating Agencies,
and the ratings issued thereby, are subject to change over time.

Section 3.   Representations, Warranties and Agreements of the Underwriter.  The
             -------------------------------------------------------------
Underwriter represents, warrants and agrees with the parties hereto as follows:

          (a)  Compliance With Laws.  The Underwriter will comply in all
               --------------------
     material respects with all legal requirements in connection with offers and
     sales of

                                      -5-
<PAGE>

     the Securities and make such offers and sales in the manner provided in the
     Offering Document.

          (b)  Offering Document.  The Underwriter will not use, or distribute
               -----------------
     to other broker-dealers for use, any Offering Document in connection with
     the offer and sale of the Securities unless such Offering Document includes
     such information as has been furnished by Financial Security for inclusion
     therein and the information therein concerning Financial Security has been
     approved by Financial Security in writing. Financial Security hereby
     consents to the information in respect of Financial Security included in
     the Prospectus Supplement. Each Offering Document will include the
     following statement:

     "The Note Policy is not covered by the property/casualty insurance security
     fund specified in Article 76 of the New York Insurance Law."

     Each Offering Document including financial information (other than
     financial information included in the Financial Security Information) with
     respect to Financial Security prepared in accordance with generally
     accepted accounting principles will include the following statement
     immediately preceding such financial information:

     "The New York State Insurance Department recognizes only statutory
     accounting practices for determining and reporting the financial condition
     and results of operations of an insurance company, for determining its
     solvency under the New York Insurance Law, and for determining whether its
     financial condition warrants the payment of a dividend to its stockholders.
     No consideration is given by the New York State Insurance Department to
     financial statements prepared in accordance with generally accepted
     accounting principles in making such determinations."

          (c)  Underwriter Information.  All material provided by the
               -----------------------
     Underwriter for inclusion in the Offering Document (as revised from time to
     time, the "Underwriter Information"), insofar as such information relates
                ------------------------
     to the Underwriter is true and correct in all material respects. In respect
     of the Prospectus Supplement, the Underwriter Information is limited to the
     information identified in the Underwriting Agreement as "Underwriter
     Information."

     Section 4. Indemnification.
                ---------------

          (a)  Financial Security agrees, upon the terms and subject to the
     conditions provided herein, to indemnify, defend and hold harmless each
     Company Party, each Underwriter Party and the Depositor against (i) any and
     all Losses incurred by them with respect to the offer and sale of the
     Securities and resulting from Financial Security's breach of any of its
     representations, warranties or agreements set forth in Section 2 hereof and
     (ii) any and all Losses to which any Company Party or Underwriter Party may
     become subject, under the

                                      -6-
<PAGE>

     Securities Act or otherwise, insofar as such Losses arise out of or result
     from an untrue statement of a material fact contained in any Offering
     Document or the omission to state therein a material fact required to be
     stated therein or necessary to make the statements therein not misleading,
     in each case to the extent, but only to the extent, that such untrue
     statement or omission was made in the Financial Security Information
     included therein in accordance with the provisions hereof.

          (b)  The Underwriter agrees, upon the terms and subject to the
     conditions provided herein, to indemnify, defend and hold harmless each
     Financial Security Party against (i) any and all Losses incurred by them
     with respect to the offer and sale of the Securities and resulting from the
     Underwriter's breach of any of its representations, warranties or
     agreements set forth in Section 3 hereof and (ii) any and all Losses to
     which any Financial Security Party may become subject, under the Securities
     Act or otherwise, insofar as such Losses arise out of or result from an
     untrue statement of a material fact contained in any Offering Document or
     the omission to state therein a material fact required to be stated therein
     or necessary to make the statements therein not misleading, in each case to
     the extent, but only to the extent, that such untrue statement or omission
     was made in the Underwriter Information included therein.

          (c)  Upon the incurrence of any Losses for which a party is entitled
     to indemnification hereunder, the Indemnifying Party shall reimburse the
     Indemnified Party promptly upon establishment by the Indemnified Party to
     the Indemnifying Party of the Losses incurred.

     Section 5.  Indemnification Procedures.  Except as provided below in
                 --------------------------
Section 6 with respect to contribution, the indemnification provided herein by
an Indemnifying Party shall be the exclusive remedy of any and all Indemnified
Parties for the breach of a representation, warranty or agreement hereunder by
an Indemnifying Party; provided, however, that each Indemnified Party shall be
                       --------  -------
entitled to pursue any other remedy at law or in equity for any such breach so
long as the damages sought to be recovered shall not exceed the Losses incurred
thereby resulting from such breach. In the event that any action or regulatory
proceeding shall be commenced or claim asserted which may entitle an Indemnified
Party to be indemnified under this Agreement, such party shall give the
Indemnifying Party written or telegraphic notice of such action or claim
reasonably promptly after receipt of written notice thereof.  The Indemnifying
Party shall be entitled to participate in and, upon notice to the Indemnified
Party, assume the defense of any such action or claim in reasonable cooperation
with, and with the reasonable cooperation of, the Indemnified Party.  The
Indemnified Party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof at the expense of the
Indemnified Party; provided, however, that the fees and expenses of such
                   --------  -------
separate counsel shall be at the expense of the Indemnifying Party if (i) the
Indemnifying Party has agreed to pay such fees and expenses, (ii) the
Indemnifying Party shall have failed to assume the defense of such action or
proceeding and employ counsel satisfactory to the Indemnified Party in any such
action or proceeding or (iii) the named parties to any such action or proceeding
(including any impleaded parties) include both the Indemnified

                                      -7-
<PAGE>

Party and the Indemnifying Party, and the Indemnified Party shall have been
advised by counsel that (A) there may be one or more legal defenses available to
it which are different from or additional to those available to the Indemnifying
Party and (B) the representation of the Indemnifying Party and the Indemnified
Party by the same counsel would be inappropriate or contrary to prudent
practice, in which case, if the Indemnified Party notifies the Indemnifying
Party in writing that it elects to employ separate counsel at the expense of the
Indemnifying Party, the Indemnifying Party shall not have the right to assume
the defense of such action or proceeding on behalf of such Indemnified Party, it
being understood, however, that the Indemnifying Party shall not, in connection
with any one such action or proceeding or separate but substantially similar or
related actions or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for all the
Company Parties, one such firm for all Underwriter Parties and one such firm for
all Financial Security Parties, as the case may be, which firm shall be
designated in writing by the Company in respect of the Company Parties, by the
Underwriter in respect of the Underwriter Parties and by Financial Security in
respect of the Financial Security Parties. The Indemnifying Party shall not be
liable for any settlement of any such claim or action unless the Indemnifying
Party shall have consented thereto or be in default in its obligations
hereunder. Any failure by an Indemnified Party to comply with the provisions of
this Section shall relieve the Indemnifying Party of liability only if such
failure is prejudicial to the position of the Indemnifying Party and then only
to the extent of such prejudice.

     Section 6.   Contribution.
                  ------------

          (a)     To provide for just and equitable contribution if the
     indemnification provided by any Indemnifying Party is determined to be
     unavailable for any Indemnified Party (other than due to application of
     this Section), each Indemnifying Party shall contribute to the Losses
     arising from any breach of any of its representations, warranties or
     agreements contained in this Agreement on the basis of the relative fault
     of each of the parties as set forth in Section 6(b) below; provided,
                                                                --------
     however, that an Indemnifying Party shall in no event be required to
     -------
     contribute to all Indemnified Parties an aggregate amount in excess of the
     Losses incurred by such Indemnified Parties resulting from the breach of
     representations, warranties or agreements contained in this Agreement.

          (b)     The relative fault of each Indemnifying Party, on the one
     hand, and of each Indemnified Party, on the other, shall be determined by
     reference to, among other things, whether the breach of, or alleged breach
     of, any representations, warranties or agreements contained in this
     Agreement relates to information supplied by, or action within the control
     of, the Indemnifying Party or the Indemnified Party and the parties'
     relative intent, knowledge, access to information and opportunity to
     correct or prevent such breach.

          (c)     The parties agree that Financial Security shall be solely
     responsible for the Financial Security Information and the Underwriter
     shall be solely

                                      -8-
<PAGE>

     responsible for the Underwriter Information and that the balance of each
     Offering Document shall be the responsibility of the Company.

          (d)     Notwithstanding anything in this Section 6 to the contrary,
     the Underwriter shall not be required to contribute an amount in excess of
     the amount by which the total underwriting discounts and commissions
     received by the Underwriter exceeds the amount of any damages that such
     Underwriter has otherwise been required to pay in respect of any breach by
     the Underwriter of its representations or warranties contained in Section 3
     hereof.

          (e)     No Person guilty of fraudulent misrepresentation (within the
     meaning of Section 11(f) of the Securities Act) shall be entitled to
     contribution from any Person who was not guilty of such fraudulent
     misrepresentation.

          (f)     Upon the incurrence of any Losses entitled to contribution
     hereunder, the contributor shall reimburse the party entitled to
     contribution promptly upon establishment by the party entitled to
     contribution to the contributor of the Losses incurred.

     Section 7.  Third-Party Beneficiaries.  Except as otherwise provided in
                 -------------------------
this Agreement, no other Person shall have any right or obligation hereunder.
This Agreement shall also inure to the benefit of the Depositor. Without
limiting the generality of the foregoing, all covenants and agreements in this
Agreement which confer rights upon the Depositor shall be for the benefit of and
run directly to the Depositor and the Depositor shall be entitled to rely on and
enforce such covenants, subject, however, to the limitations on such rights
provided in this Agreement and the Basic Documents.

     Section 8.  Miscellaneous.
                 -------------

          (a)  Notices. All notices and other communications provided for under
               -------
     this Agreement shall be delivered to the address set forth below or to such
     other address as shall be designated by the recipient in a written notice
     to the other party or parties hereto:

     If to Financial Security:  Financial Security Assurance Inc.
                                350 Park Avenue
                                New York, NY 10022
                                Attention: Senior Vice President -- Transaction
                                Oversight Department (with a copy to the
                                attention of the General Counsel)
                                Re: PeopleFirst.com Auto Receivables Owner
                                Trust, 2000-1, $31,000,000 Class A-1 6.713%
                                Asset Backed Notes, $109,000,000 Class A-2
                                7.275% Asset Backed Notes, $34,000,000 Class A-3
                                7.365% Asset Backed Notes and $71,000,000 Class
                                A-4 7.405% Asset Backed Notes.

                                      -9-
<PAGE>

                                Confirmation: (212) 826-0100 Facsimile Nos.:
                                (212) 339-3518, (212) 339-3529 (in each case in
                                which notice or other communication to Financial
                                Security refers to an Event of Default, a claim
                                on the Note Policy or with respect to which
                                failure on the part of Financial Security to
                                respond shall be deemed to constitute consent or
                                acceptance, then a copy of such notice or other
                                communication should also be sent to the
                                attention of each of the General Counsel and the
                                Head-Financial Guaranty Group and shall be
                                marked to indicate "URGENT MATERIAL ENCLOSED.")

     If to the Company:         PeopleFirst Finance, LLC
                                401 West A Street, Suite 1000
                                San Diego, CA 92101
                                Attention: Randy Ellspermann, CFO
                                Facsimile No: (619) 232-4565
                                Confirm No: (619) 544-0815

     If to the Underwriter:     Prudential Securities Incorporated
                                One New York Plaza, 14/th/ Floor
                                New York, NY 10292
                                Attention: Asset-Backed Group

          (b)  Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
               -------------
     IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

          (c)  Assignments.  This Agreement may not be assigned by any party
               -----------
     without the express written consent of each other party.  Any assignment
     made in violation of this Agreement shall be null and void.

          (d)  Amendments.  Amendments of this Agreement shall be in writing
               ----------
     signed by each party hereto.

          (e)  Survival, Etc.  The indemnity and contribution agreements
               -------------
     contained in this Agreement shall remain operative and in full force and
     effect, regardless of (i) any investigation made by or on behalf of any
     Indemnifying Party, (ii) the issuance of the Securities or (iii) any
     termination of this Agreement or the Note Policy.  The indemnification
     provided in this Agreement will be in addition to any liability which the
     parties may otherwise have and shall in no way limit any obligations of the
     parties to the Underwriting Agreement or the Insurance Agreement.

                                      -10-
<PAGE>

          (f)  Counterparts.  This Agreement may be executed in counterparts by
               ------------
     the parties hereto, and all such counterparts shall constitute one and the
     same instrument.

                                      -11-
<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this
Indemnification Agreement to be duly executed and delivered as of the date first
above written.

                                         FINANCIAL SECURITY ASSURANCE
                                         INC.

                                         By:    /s/ Mark Castiglione
                                             __________________________________
                                             Name:  Mark Castiglione
                                             Title: Director

                                         PEOPLEFIRST FINANCE, LLC

                                         By:     /s/ Gary J. Miller
                                              __________________________________
                                              Name: Gary J. Miller
                                              Title: Chief Executive Officer

                                         BARCLAYS CAPITAL INC.

                                         By:     /s/ James Pratt
                                              __________________________________
                                              Name:  James Pratt
                                              Title: Associate Director

                                         PRUDENTIAL SECURITIES
                                         INCORPORATED

                                         By:         Robert M. DiOrio
                                              __________________________________
                                              Name:  Robert M. DiOrio
                                              Title: Director
<PAGE>

                                   EXHIBIT A

                      OPINION OF ASSISTANT GENERAL COUNSEL

          Based upon the foregoing, I am of the opinion that:

     1.   Financial Security is a stock insurance company duly organized,
validly existing and authorized to transact financial guaranty insurance
business under the laws of the State of New York.

     2.   The Note Policy and the Financial Security Agreements have been duly
authorized, executed and delivered by Financial Security.

     3.   The Note Policy and the Financial Security Agreements constitute valid
and binding obligations of Financial Security, enforceable against Financial
Security in accordance with their terms, subject, as to the enforcement of
remedies, to bankruptcy, insolvency, reorganization, rehabilitation, moratorium
and other similar laws affecting the enforceability of creditors' rights
generally applicable in the event of the bankruptcy or insolvency of Financial
Security and to the application of general principles of equity and subject, in
the case of the Indemnification Agreement, to principles of public policy
limiting the right to enforce the indemnification provisions contained therein
insofar as they relate to indemnification for liabilities arising under
applicable securities laws.

     4.   The Note Policy is exempt from registration under the Securities Act
of 1933, as amended (the "Act").

     5.   Neither the execution nor delivery by Financial Security of the Note
Policy or the Financial Security Agreements, nor the performance by Financial
Security of its obligations thereunder, will conflict with any provision of the
certificate of incorporation or the bylaws of Financial Security or, to the best
of my knowledge, result in a breach of, or constitute a default under, any
agreement or other instrument to which Financial Security is a party or by which
it or any of its property is bound or, to the best of my knowledge, violate any
judgment, order or decree applicable to Financial Security of any governmental
or regulatory body, administrative agency, court or arbitrator having
jurisdiction over Financial Security (except that in the published opinion of
the Securities and Exchange Commission the indemnification provisions of the
Indemnification Agreement, insofar as they relate to indemnification for
liabilities arising under the Act, are against public policy as expressed in the
Act and are therefore unenforceable).

     In addition, please be advised that I have reviewed the description of
Financial Security under the caption "THE INSURER" in the Prospectus Supplement
dated June 21, 2000 (the "Offering Document") with respect to the Securities.
The information provided in the Offering Document with respect to Financial
Security is limited and does not purport to provide the scope of disclosure
required to be included in a prospectus with respect to a registrant under the
Act in connection with the public offer and sale of securities of such
registrant.  Within such limited scope of disclosure, however, there has

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<PAGE>

not come to my attention any information which would cause me to believe that
the description of Financial Security referred to above, as of the date of the
Prospectus Supplement, contained any untrue statement of a material fact or
omitted to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading
(except that no opinion is rendered with respect to any financial statements or
other financial information contained or referred to therein).

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