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COPELCO CAPITAL
FUNDING CORP. X,
Issuer
AND
[MANUFACTURERS AND TRADERS TRUST COMPANY],
Trustee
-------------------------
FORM OF INDENTURE
Dated as of [May 1], 1997
-------------------------
$__________ in aggregate principal amount of
Lease-Backed Notes, Series 1997-A,
consisting of:
$__________ of ____% Class A-1 Lease-Backed Notes
$__________ of ____% Class A-2 Lease-Backed Notes
$__________ of ____% Class A-3 Lease-Backed Notes
$__________ of ____% Class A-4 Lease-Backed Notes
$__________ of ____% Class B Lease-Backed Notes
$__________ of ____% Class C Lease-Backed Notes
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COPELCO CAPITAL FUNDING CORP. X
Reconciliation and Tie between the Indenture
dated as of [May 1], 1997 and the
Trust Indenture Act of 1939, as amended
Trust Indenture Act Section Indenture Section
--------------------------- -----------------
ss.310(a)(1) ss. 7.08
(a)(2) 7.08
(a)(3) Not Applicable
(a)(4) Not Applicable
(b) 7.08; 7.09; 6.07;
1.05; 1.06
(c) Not Applicable
311(a) 7.14
(b) 7.14
312(a) 2.11
(b) 12.02
(c) 12.02
313(a) 7.15
(b)(1) Not Applicable
(b)(2) 7.15
(c) 7.15; 1.06
(d) 7.15
314(a) 8.12; 8.09; 1.06
(b) Not Applicable
(c)(1) 12.03
(c)(2) 12.03
(c)(3) 12.01
(d) 12.01
(e) 12.04
(f) Not Applicable
315(a) 7.01(a)
(b) 7.02; 1.06
(c) 7.01(b)
(d) 7.01(c)
(e) 6.14
316(a) (last sentence) 2.12
(a)(1)(A) 6.12
(a)(1)(B) 6.13
(a)(2) Not Applicable
317(a)(1) 6.03(c)
(a)(2) 6.04
(b) 8.03(c)
318(a) 12.01
(c) 12.01
TABLE OF CONTENTS
Page
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ARTICLE 1.
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION............................................................. 3
SECTION 1.01. General Definitions........................................................................ 3
SECTION 1.02. Compliance Certificates and Opinions....................................................... 22
SECTION 1.03. Form of Documents Delivered to Trustee..................................................... 23
SECTION 1.04. Acts of Noteholders, etc................................................................... 24
SECTION 1.05. Notices, etc., to Trustee, Servicer and
Company.................................................................................... 25
SECTION 1.06. Notice to Noteholders; Waiver.............................................................. 26
SECTION 1.07. Effect of Headings and Table of Contents................................................... 27
SECTION 1.08. Successors and Assigns..................................................................... 27
SECTION 1.09. GOVERNING LAW.............................................................................. 27
SECTION 1.10. Legal Holidays............................................................................. 27
SECTION 1.11. Execution in Counterparts.................................................................. 28
SECTION 1.12. Inspection................................................................................. 28
SECTION 1.13. Survival of Representations and Warranties................................................. 28
ARTICLE 2.
THE NOTES................................................................... 28
SECTION 2.01. General Provisions......................................................................... 28
SECTION 2.02. Execution, Authentication, Delivery, and
Dating..................................................................................... 31
SECTION 2.03. Transfer and Exchange...................................................................... 32
SECTION 2.04. Mutilated, Destroyed, Lost and Stolen Notes................................................ 33
SECTION 2.05. Book-Entry Registration of Class A Notes and
Class B Notes.............................................................................. 34
SECTION 2.06. Notice to Clearing Agency.................................................................. 36
SECTION 2.07. Definitive Class A Notes and Definitive
Class B Notes.............................................................................. 36
SECTION 2.08. Payment of Interest and Principal; Rights
Preserved.................................................................................. 37
SECTION 2.09. Persons Deemed Owners...................................................................... 38
SECTION 2.10. Cancellation............................................................................... 38
SECTION 2.11. Noteholder Lists........................................................................... 39
SECTION 2.12. Treasury Securities........................................................................ 39
ARTICLE 3.
ACCOUNTS; INVESTMENT OF MONEYS; COLLECTION
AND APPLICATION OF MONEYS; REPORTS....................................................... 39
SECTION 3.01. Trust Accounts; Investments by Trustee..................................................... 39
SECTION 3.02. Collection of Moneys....................................................................... 42
SECTION 3.03. Collection Account; Payments............................................................... 43
SECTION 3.04. The Reserve Account and the Residual
Account.................................................................................... 46
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SECTION 3.05. Reports by Trustee; Notices of Certain
Payments................................................................................... 47
SECTION 3.06. Trustee May Rely on Certain Information from
Copelco and Servicer....................................................................... 48
ARTICLE 4.
RELEASE OF LEASES AND EQUIPMENT........................................................ 48
SECTION 4.01. Release of Equipment....................................................................... 48
SECTION 4.02. Release of Leases Upon Final Lease Payment................................................. 49
SECTION 4.03. Execution of Documents..................................................................... 49
ARTICLE 5.
SERVICER EVENTS OF DEFAULT; SUBSTITUTE SERVICER................................................ 50
SECTION 5.01. Servicer Events of Default................................................................. 50
SECTION 5.02. Substitute Servicer........................................................................ 50
ARTICLE 6.
EVENTS OF DEFAULT; REMEDIES.......................................................... 51
SECTION 6.01. Events of Default.......................................................................... 51
SECTION 6.02. Acceleration of Maturity; Rescission and
Annulment.................................................................................. 52
SECTION 6.03. Remedies................................................................................... 54
SECTION 6.04. Trustee Shall File Proofs of Claim......................................................... 55
SECTION 6.05. Trustee May Enforce Claims Without
Possession of Notes........................................................................ 56
SECTION 6.06. Application of Money Collected............................................................. 56
SECTION 6.07. Limitation on Suits........................................................................ 58
SECTION 6.08. Unconditional Right of Noteholders to
Receive Principal and Interest............................................................. 59
SECTION 6.09. Restoration of Rights and Remedies......................................................... 59
SECTION 6.10. Rights and Remedies Cumulative............................................................. 59
SECTION 6.11. Delay or Omission Not Waiver............................................................... 59
SECTION 6.12. Control by Noteholders..................................................................... 60
SECTION 6.13. Waiver of Events of Default................................................................ 60
SECTION 6.14. Undertaking for Costs...................................................................... 61
SECTION 6.15. Waiver of Stay or Extension Laws........................................................... 61
SECTION 6.16. Sale of Trust Estate....................................................................... 61
ARTICLE 7.
THE TRUSTEE.................................................................. 63
SECTION 7.01. Certain Duties and Responsibilities........................................................ 63
SECTION 7.02. Notice of Defaults or Events of Default.................................................... 64
SECTION 7.03. Certain Rights of Trustee.................................................................. 65
SECTION 7.04. Not Responsible for Recitals or Issuance of
Notes...................................................................................... 66
SECTION 7.05. May Hold Notes............................................................................. 66
SECTION 7.06. Money Held in Trust........................................................................ 66
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SECTION 7.07. Compensation, Reimbursement, etc........................................................... 66
SECTION 7.08. Corporate Trustee Required; Eligibility.................................................... 67
SECTION 7.09. Resignation and Removal; Appointment of
Successor.................................................................................. 67
SECTION 7.10. Acceptance of Appointment by Successor..................................................... 68
SECTION 7.11. Merger, Conversion, Consolidation or
Succession to Business..................................................................... 69
SECTION 7.12. Co-trustees and Separate Trustees.......................................................... 69
SECTION 7.13. Acceptance by Trustee...................................................................... 71
SECTION 7.14. Preferential Collection of Claims Against
the Company................................................................................ 71
SECTION 7.15. Reports by Trustee to Noteholders.......................................................... 71
SECTION 7.16. No Proceedings............................................................................. 72
ARTICLE 8.
COVENANTS................................................................... 72
SECTION 8.01. Payment of Principal and Interest.......................................................... 72
SECTION 8.02. Maintenance of Office or Agency; Chief
Executive Office........................................................................... 72
SECTION 8.03. Money for Payments to Noteholders to be Held
in Trust................................................................................... 73
SECTION 8.04. Corporate Existence; Merger; Consolidation,
etc........................................................................................ 74
SECTION 8.05. Protection of Trust Estate; Further
Assurances................................................................................. 76
SECTION 8.06. [Reserved]................................................................................. 77
SECTION 8.07. Performance of Obligations; Sales and
Servicing Agreement........................................................................ 77
SECTION 8.08. Negative Covenants......................................................................... 77
SECTION 8.09. Information as to Company.................................................................. 78
SECTION 8.10. Taxes...................................................................................... 80
SECTION 8.11. Indemnification............................................................................ 80
SECTION 8.12. Commission Reports; Reports to Trustee;
Reports to Noteholders..................................................................... 80
ARTICLE 9.
SUPPLEMENTAL INDENTURES............................................................ 81
SECTION 9.01. Supplemental Indentures Without Consent of
Noteholders................................................................................ 81
SECTION 9.02. Supplemental Indentures with Consent of
Noteholders................................................................................ 82
SECTION 9.03. Execution of Supplemental Indentures....................................................... 83
SECTION 9.04. Effect of Supplemental Indentures.......................................................... 83
SECTION 9.05. Reference in Notes to Supplemental
Indentures................................................................................. 84
SECTION 9.06. Compliance with Trust Indenture Act........................................................ 84
ARTICLE 10.
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SATISFACTION AND DISCHARGE........................................................... 84
SECTION 10.01. Satisfaction and Discharge of Indenture................................................... 84
SECTION 10.02. Application of Trust Money................................................................ 85
ARTICLE 11.
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY................................................................. 86
SECTION 11.01. Corporate Organization and Authority...................................................... 86
SECTION 11.02. Pending Litigation........................................................................ 86
SECTION 11.03. Transactions Legal and Authorized......................................................... 87
SECTION 11.04. No Defaults............................................................................... 87
SECTION 11.05. Governmental Consent...................................................................... 87
SECTION 11.06. Use of Proceeds........................................................................... 88
SECTION 11.07. Compliance with Law....................................................................... 88
SECTION 11.08. Restrictions on Company................................................................... 88
SECTION 11.09. Legal, Valid and Binding Obligations...................................................... 88
SECTION 11.10. Perfected Security Interest............................................................... 89
SECTION 11.11. Taxes..................................................................................... 89
SECTION 11.12. Nonconsolidation.......................................................................... 89
ARTICLE 12.
MISCELLANEOUS................................................................. 90
SECTION 12.01. Trust Indenture Act Controls.............................................................. 90
SECTION 12.02. Communication by Noteholders with Other
Noteholders............................................................................... 90
SECTION 12.03. Officers' Certificate and Opinion of
Counsel as to Conditions Precedent........................................................ 91
SECTION 12.04. Statements Required in Certificate or
Opinion................................................................................... 91
SCHEDULES
SCHEDULE 1 Leases
EXHIBITS
EXHIBIT A Forms of Notes and Form of Trustee's
Certificate of Authentication
EXHIBIT B Form of Investor Letter
iv
INDENTURE
This INDENTURE dated as of [May 1], 1997, is between COPELCO CAPITAL
FUNDING CORP. X, a Delaware corporation (herein called the "Company"), and
[MANUFACTURERS AND TRADERS TRUST COMPANY], a New York banking corporation, as
trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the issuance of $__________________ in
aggregate principal amount of its Lease-Backed Notes, Series 1997-A, consisting
of $__________ aggregate principal amount of ______% Class A-1 Lease-Backed
Notes (the "Class A-1 Notes"), $__________ aggregate principal amount of ______%
Class A-2 Lease-Backed Notes (the "Class A-2 Notes"), $__________ aggregate
principal amount of ______% Class A-3 Lease-Backed Notes (the "Class A-3
Notes"), $__________ aggregate principal amount of ______% Class A-4
Lease-Backed Notes (the "Class A-4 Notes", together with the Class A-1 Notes,
Class A-2 Notes, and Class A-3 Notes, the "Class A Notes"), $__________
aggregate principal amount of ______% Class B Lease-Backed Notes (the "Class B
Notes"), $__________ aggregate principal amount of ______% Class C Lease-Backed
Notes (the "Class C Notes"; the Class A Notes, the Class B Notes and the Class C
Notes are referred to collectively as the "Notes"), of substantially the tenor
hereinafter set forth, and to provide therefor the Company has duly authorized
the execution and delivery of this Indenture. The Class A Notes, the Class B
Notes and the Class C Notes shall be entitled to payments of interest and
principal as set forth herein.
All things necessary to make the Notes, when executed by the Company and
authenticated and delivered hereunder, the valid obligations of the Company, and
to make this Indenture a valid agreement of the Company, in accordance with its
terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Notes by
the holders thereof, it is mutually covenanted and agreed, for the benefit of
all Noteholders, as follows:
GRANTING CLAUSE
The Company hereby Grants to the Trustee on the Issuance Date, for the
benefit and security of the
Noteholders, all of the Company's right, title and interest in and to (a) the
Leases and all Lease Payments, Casualty Payments, Termination Payments and other
amounts now due or becoming due with respect thereto since the Cut-Off Date
(other than any prepayments of rent required pursuant to the terms of any Lease
at or before the commencement of the Lease and any payments due before the
Cut-Off Date) and all Additional Leases and Substitute Leases and all Lease
Payments, Casualty Payments, Termination Payments and other amounts due or
becoming due with respect thereto since the effective date of their respective
addition or substitution (other than any prepayments of rent required by the
terms of any Lease at or before the commencement of the Lease and any payments
due before the effective date of such addition or substitution), (b) all rights
of the Company to or under any guarantees of or collateral (including all rights
of the Company in any security deposits and the Company's right to repayment by
Copelco Capital, Inc. ("Copelco") of any inter-company loans pursuant to Section
13.01 of the Sales and Servicing Agreement) for the Lessee's obligations under
any Lease, (c) all interests of the Company in the Equipment at any time subject
to any Lease, (d) all moneys from time to time held by the Trustee pursuant to
Section 3.01(a) hereof pending deposit in one of the accounts referred to
therein, (e) all moneys from time to time on deposit in any of the Trust
Accounts, including all investments and income from the investment of such
moneys, (f) all rights of the Company under the Sales and Servicing Agreement,
and (g) all proceeds of the conversion, whether voluntary or involuntary, of any
of the foregoing into cash or other property (collectively, the Granted Assets).
Such Grant is made in trust to secure (i) the payment of all amounts due on the
Class A Notes, the Class B Notes and the Class C Notes, in accordance with their
terms, equally and ratably without prejudice, priority, or distinction among any
of the Class A Notes, the Class B Notes and the Class C Notes, respectively, by
reason of differences in time of issuance or otherwise, (ii) the payment of all
other sums payable under this Indenture with respect to the Notes and (iii)
compliance with the provisions of this Indenture with respect to the Notes.
The Trustee acknowledges such Grant, accepts the trusts hereunder in
accordance with the provisions hereof, and agrees to perform the duties herein
required to the best of its ability and to the end that the interests of the
Noteholders may be adequately and effectively protected as hereinafter provided.
2
ARTICLE 1.
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01. General Definitions.
Except as otherwise specified or as the context may otherwise require, the
following terms have the meanings set forth below for all purposes of this
Indenture, and the definitions of such terms are applicable to the singular as
well as to the plural forms of such terms and to the masculine as well as to the
feminine and neuter genders of such terms.
Act: with respect to any Noteholder, as defined in Section 1.04.
Additional Lease: as defined in Section 12 of the Sales and Servicing
Agreement.
Additional Principal: with respect to each Payment Date, an amount equal to
(a) the difference between (i) the Discounted Present Value of the Performing
Leases as of the previous Determination Date and (ii) the Discounted Present
Value of the Performing Leases as of the related Determination Date, less (b)
the Class A-1 Principal Payment, Class A-2 Principal Payment, Class A-3
Principal Payment, Class A-4 Principal Payment, Class B Principal Payment and
the Class C Principal Payment to be paid on such Payment Date.
Affiliate: of any specified Person: any other Person which directly or
indirectly controls, or is controlled by, or is under common control with, such
specified Person. The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract, or otherwise.
Authorized Officer: with respect to any matter, any officer of or other
Person representing the Company, Copelco or the Servicer, as the case may be,
who is authorized to act for the Company, Copelco or the Servicer, as the case
may be.
Available Reserve Amount: the amount on deposit in the Reserve Account.
Available Funds: With respect to any Payment Date, the amount on deposit in
the Collection Account with respect to the immediately preceding Due Period,
including,
3
without limitation, (a) Lease Payments due during the immediately preceding Due
Period (net of any Excess Copy Charges and Fee Per Scan Charges), (b) Residual
Realizations up to the Residual Amount Cap; (c) recoveries from Non-Performing
Leases to the extent the Seller has not substituted Substitute Leases for such
Non-Performing Leases (except to the extent required to reimburse unreimbursed
Servicer Advances pursuant to Section 4 of the Sales and Servicing Agreement);
(d) proceeds from repurchases by Copelco of Leases as a result of breaches of
representations and warranties by Copelco to the extent Copelco has not
substituted Substitute Leases for such Leases; (e) proceeds from the investment
of funds in the Collection Account, the Residual Account and the Reserve
Account; (f) Casualty Payments; (g) Servicer Advances; (h) Termination Payments;
and late charges on delinquent Lease Payments not advanced by the Servicer.
Available Funds Shortfall: as defined in Section 3.04(b).
Available Residual Amount: the excess of (a) the Residual Amount Cap over
(b) the Utilized Residual Amount.
Book-Entry Class A-1 Notes: beneficial interests in the Class A-1 Notes,
the ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.05.
Book-Entry Class A-2 Notes: beneficial interests in the Class A-2 Notes,
the ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.05.
Book-Entry Class A-3 Notes: beneficial interests in the Class A-3 Notes,
the ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.05.
Book-Entry Class A-4 Notes: beneficial interests in the Class A-4 Notes,
the ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.05.
Book-Entry Class B Notes: beneficial interests in the Class B Notes, the
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.05.
Business Day: any day that is not a Saturday, Sunday or other day on which
commercial banking institutions in the city in which the Corporate Trust Office
and the
4
Servicer is located are authorized or obligated by law or executive order to
remain closed.
Casualty Payment: any payment pursuant to a Lease on account of the loss,
theft, condemnation, governmental taking, destruction, or damage beyond repair
of any item of Equipment subject thereto which results, in accordance with the
terms of the Lease, in a reduction in the number or amount of any future Lease
Payments due thereunder or in the termination of the Lessee's obligation to make
future Lease Payments thereunder.
Casualty Pay-Through Amount: with respect to any Lease (or portion thereof)
with respect to which a Casualty Payment has been made, an amount equal to the
Discounted Present Value of such Lease (or portion thereof) as of the Payment
Date immediately preceding the date on which such Casualty Payment is made.
Cede & Co.: the initial registered holder of the Class A Notes and the
Class B Notes, acting as nominee of The Depository Trust Company.
Class A Notes: as defined in the Recitals hereto.
Class A Percentage: 94.00%.
Class A Principal Payment: (a) while the Class A-1 Notes are
outstanding, (i) on all Payment Dates prior to the June 1998 Payment
Date, the lesser of (1) the amount necessary to reduce the Outstanding
Principal Amount on the Class A-1 Notes to zero and (2) the difference
between (A) the Discounted Present Value of the Performing Leases as of
the previous Determination Date and (B) the Discounted Present Value of
the Performing Leases as of the related Determination Date, and (ii) on
the June 1998 Payment Date and thereafter, the entire Outstanding
Principal Amount on the Class A-1 Notes, and (b) after the Class A-1
Notes have been paid in full, the amount necessary to reduce the
aggregate Outstanding Principal Amount on the Class A Notes to the Class
A Target Investor Principal Amount.
Class A Target Investor Principal Amount: with respect to each Payment
Date, an amount equal to the product of (a) the Class A Percentage and (b) the
Discounted Present Value of the Performing Leases as of the related
Determination Date.
Class A-1 Note Interest Rate: the rate at which interest accrues on the
Class A-1 Notes, which rate with respect to each Due Period shall be at a rate
per annum equal to ____%.
Class A-1 Note Owner: with respect to a Book-Entry Class A-1 Note, the
Person who is the beneficial owner of such Book-Entry Class A-1 Note, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency).
5
Class A-1 Noteholder: Cede & Co. or a holder of a Definitive Class A-1
Note.
Class A-1 Notes: as defined in the Recitals hereto.
Class A-2 Note Interest Rate: the rate at which interest accrues on the
Class A-2 Notes, which rate with respect to each Due Period shall be at a rate
per annum equal to ____%.
Class A-2 Note Owner: with respect to a Book-Entry Class A-2 Note, the
Person who is the beneficial owner of such Book-Entry Class A-2 Note, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency).
Class A-2 Noteholder: Cede & Co. or a holder of a Definitive Class A-2
Note.
Class A-2 Notes: as defined in the Recitals hereto.
Class A-3 Note Interest Rate: the rate at which interest accrues on the
Class A-3 Notes, which rate with respect to each Due Period shall be at a rate
per annum equal to ____%.
Class A-3 Note Owner: with respect to a Book-Entry Class A-3 Note, the
Person who is the beneficial owner of such Book-Entry Class A-3 Note, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency).
Class A-3 Noteholder: Cede & Co. or a holder of a Definitive Class A-3
Note.
Class A-3 Notes: as defined in the Recitals hereto.
Class A-4 Note Interest Rate: the rate at which interest accrues on the
Class A-4 Notes, which rate with respect to each Due Period shall be at a rate
per annum equal to ____%.
Class A-4 Note Owner: with respect to a Book-Entry Class A-4 Note, the
Person who is the beneficial owner of such Book-Entry Class A-4 Note, as
reflected on the books of the Clearing Agency, or on the books of a Person
6
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency).
Class A-4 Noteholder: Cede & Co. or a holder of a Definitive Class A-4
Note.
Class A-4 Notes: as defined in the Recitals hereto.
Class B Floor: with respect to each Payment Date, an amount equal to the
total of (a) 2.50% of the initial Discounted Present Value of the Leases as of
the Cut-Off Date, plus (b) the Cumulative Loss Amount with respect to such
Payment Date, minus (c) the sum, as of the related Determination Date, of the
Outstanding Principal Amount of the Class C Notes and the amount on deposit in
the Reserve Account after giving effect to any withdrawals to be made on such
Payment Date.
Class B Note Interest Rate: the rate at which interest accrues on the Class
B Notes, which rate shall be ____% per annum.
Class B Note Owner: with respect to a Book-Entry Class B Note, the Person
who is the beneficial owner of such Book-Entry Class B Note, as reflected on the
books of the Clearing Agency, or on the books of a Person maintaining an account
with such Clearing Agency (directly or as an indirect participant, in accordance
with the rules of such Clearing Agency).
Class B Noteholder: Cede & Co. or a holder of a Definitive Class B Note.
Class B Notes: as defined in the Recitals hereto.
Class B Percentage: 400%.
Class B Principal Payment: (a) while the Class A-1 Notes are outstanding,
zero and (b) after the Outstanding Principal Amount on the Class A-1 Notes has
been reduced to zero, the amount necessary to reduce the Outstanding Principal
Amount of the Class B Notes to the greater of the Class B Target Investor
Principal Amount and the Class B Floor.
Class B Target Investor Principal Amount: with respect to each Payment
Date, an amount equal to the product of (a) the Class B Percentage and (b) the
Discounted Present Value of the Performing Leases as of the related
Determination Date.
7
Class C Floor: with respect to each Payment Date, an amount equal to the
total of (a) 1.00% of the initial Discounted Present Value of the Leases as of
the Cut-Off Date, plus (b) the Cumulative Loss Amount with respect to such
Payment Date, minus (c) the amount on deposit in the Reserve Account after
giving effect to withdrawals to be made on such Payment Date; provided, however,
that if the Outstanding Class B Principal Amount is equal to the Class B Floor
on such Payment Date, the Class C Floor will equal the Outstanding Class C
Principal Amount utilized in the calculation of the Class B Floor Amount for
such Payment Date.
Class C Note Interest Rate: the rate at which interest accrues on the Class
C Notes, which rate shall be ____% per annum.
Class C Noteholder: a holder of a Class C Note.
Class C Notes: as defined in the Recitals hereto.
Class C Percentage: 200%.
Class C Principal Payment: (a) while the Class A-1 Notes are outstanding,
zero and (b) after the Outstanding Principal Amount on the Class A-1 Notes has
been reduced to zero, the amount necessary to reduce the Outstanding Principal
Amount of the Class C Notes to the greater of the Class C Target Investor
Principal Amount and the Class C Floor.
Class C Target Investor Principal Amount: with respect to each Payment
Date, an amount equal to the product of (a) the Class C Percentage and (b) the
Discounted Present Value of the Performing Leases as of the related
Determination Payment Date.
Clearing Agency: an organization registered as a "clearing agency" pursuant
to Section 17A of the Securities Exchange Act of 1934, as amended.
Clearing Agency Participant: a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Clearing Agency effects
book-entry transfers and pledges of securities deposited with the Clearing
Agency.
Collection Account: the account or accounts by that name established and
maintained by the Trustee pursuant to Section 3.01.
Commission: the Securities and Exchange Commission.
8
Company: the Person named as the "Company" in the first paragraph of this
instrument.
Company Order or Company Request: a written order or request delivered to
the Trustee and signed in the name of the Company by an Authorized Officer.
Copelco: Copelco Capital, Inc., a corporation organized and existing under
the laws of the State of Delaware, and its successors.
Corporate Trust Office: the principal corporate trust office of the Trustee
located at [One M&T Plaza, 7th Floor, Buffalo, New York 14203,] or at such other
address as the Trustee may designate from time to time by notice to the
Noteholders, the Company and Copelco.
Cumulative Loss Amount: with respect to each Payment Date, an amount equal
to the excess, if any, of (a) the total of (i) the Outstanding Principal Amount
of the Notes as of the immediately preceding Payment Date after giving effect to
all payments made on such Payment Date, minus (ii) the lesser of (A) the
Discounted Present Value of the Performing Leases as of the Determination Date
relating to the immediately preceding Payment Date minus the Discounted Present
Value of the Performing Leases as of the related Determination Date and (B)
Available Funds for such Payment Date (including any funds withdrawn from the
Reserve Account or the Residual Account as a result of an Available Funds
Shortfall) remaining after the payment of amounts owing the Servicer and in
respect of interest on the Notes on such Payment Date over (b) the Discounted
Present Value of Performing Leases as of the related Determination Date.
Cut-Off Date: the close of business on April 30, 1997.
DCR: Duff & Xxxxxx Credit Rating Co, and any such successor.
Default: any occurrence that is, or with notice or the lapse of time or
both would become, an Event of Default.
Definitive Class A-1 Note: a definitive, fully registered Class A-1 Note
issued pursuant to Section 2.07.
Definitive Class A-2 Note: a definitive, fully registered Class A-2 Note
issued pursuant to Section 2.07.
Definitive Class A-3 Note: a definitive, fully registered Class A-3 Note
issued pursuant to Section 2.07.
9
Definitive Class A-4 Note: a definitive, fully registered Class A-4 Note
issued pursuant to Section 2.07.
Definitive Class B Note: a definitive, fully registered Class B Note issued
pursuant to Section 2.07.
Delinquent Lease: as of any Determination Date, any Lease (other than a
Lease which became a Non-Performing Lease prior to such Determination Date) with
respect to which the Lessee has not paid all Lease Payments then due.
Depository Agreement: the letter of representations, between the Company
and the Depository Trust Company, as Clearing Agency.
Determination Date: with respect to any Payment Date, the fifth Business
Day immediately preceding such Payment Date.
Discount Rate: with respect to any Determination Date, ____%, which equals
the sum of (a) the weighted-average interest rate of the Class A Notes
(utilizing the Class A-4 Note Interest Rate), Class B Note Interest Rate and the
Class C Note Interest Rate on the Issuance Date and (b) the Servicing Fee rate
of 0.75% per annum.
Discounted Present Value of the Leases: with respect to any Lease as of the
Cut-Off Date or any date thereafter, an amount equal to the net present value of
all Lease Payments (not including delinquent amounts) to become due thereunder
following the Cut-Off Date or the Due Period preceding the following Payment
Date, as the case may be (determined by discounting on a monthly basis (assuming
a calendar year consisting of twelve 30-day months), at a rate equal to the
Discount Rate, each such Lease Payment from the Payment Date following such
Lease Payment to such date). In determining the Discounted Present Value of the
Leases on any Determination Date or with respect to a Payment Date, the future
remaining Lease Payments will be calculated after giving effect to any payments
received prior to such date of calculation to the extent such payments relate to
Lease Payments due and payable by the Lessees with respect to the related Due
Period and any prior Due Period.
Discounted Present Value of the Delinquent Leases: with respect to any
Payment Date or Determination Date, the Discounted Present Value of the Leases
that are not Non-Performing Leases as to which a Lease Payment, or any portion
thereof, was 63 or more days overdue as of the last day of the Due Period
immediately preceding such Payment Date.
10
Discounted Present Value of the Performing Leases: the Discounted Present
Value of the Leases, reduced by the Discounted Present Value of the Leases that
are Non-Performing Leases. In determining the Discounted Present Value of the
Performing Leases on any Determination Date or with respect to a Payment Date,
the future remaining Lease Payments will be calculated after giving effect to
any payments received prior to such date of calculation to the extent such
payments relate to Lease Payments due and payable by the Lessees with respect to
the related Due Period and any prior Due Period.
Due Period: with respect to any Payment Date and the Determination Date
with respect thereto, the period beginning on the first day and ending on the
last day of the calendar month prior to the month in which such Payment Date and
such Determination Date occurs.
Eligible Account: either (a) an account maintained with a depository
institution or trust company acceptable to the Rating Agency or (b) a trust
account or similar account maintained in the corporate trust department with a
federal or state chartered depository institution, which may be an account
maintained with the Trustee.
Eligible Investments: any one or more of the following obligations or
securities:
(a) direct non-callable obligations of, and non- callable obligations
fully guaranteed by, the United States of America, or any agency or
instrumentality of the United States of America the obligations of which
are backed by the full faith and credit of the United States of America;
(b) demand and time deposits in, certificates of deposits of, and
bankers' acceptances issued by, any depository institution or trust company
(including the Trustee acting in its commercial capacity) incorporated
under the laws of the United States of America or any state thereof, having
a combined capital and surplus of at least $100,000,000, and subject to
supervision and examination by federal and/or state banking authorities, so
long as at the time of such investment or contractual commitment providing
for such investment the commercial paper or other short-term debt
11
obligations of such depository institution or trust company (or, in the
case of a depository institution that is the principal subsidiary of a
holding company, the commercial paper or other short-term debt obligations
of such holding company) have the highest short-term credit ratings
available from S&P, Moody's and, to the extent rated by DCR and Fitch, DCR
and Fitch;
(c) repurchase obligations with respect to and collateralized by (i)
any security described in clause (a) above or (ii) any other security
issued or guaranteed by an agency or instrumentality of the United States
of America, in each case entered into with a depository institution or
trust company (acting as principal) of the type described in clause (b)
above, provided that the Trustee has taken delivery of such security;
(d) commercial paper (including both non-interest bearing discount
obligations and interest-bearing obligations) payable on demand or on a
specified date not more than one year after the date of issuance thereof
having the highest short-term credit ratings from S&P, Moody's and, to the
extent rated by DCR and Fitch, DCR and Fitch at the time of such
investment;
(e) money market funds that redeem their shares on demand, invest only
in other Eligible Investments, and are rated AAAm or AAAm-G by S&P and Aaa
by Moody's; and
(f) such other investments as may be approved by S&P, Moody's, DCR and
Fitch.
Equipment: each item of personal property, together with any replacement
parts, additions, and repairs thereto, any replacements thereof, and any
accessories incorporated therein and/or affixed thereto, subject to a Lease or,
following expiration or termination of the Lease to which the same was
previously subject, remaining subject to the lien of this Indenture in
accordance with the provisions hereof.
Event of Default: as defined in Section 6.01.
Exchange Act: the Securities Exchange Act of 1934, as amended.
Excess Copy Charge: with respect to any Lease, means the amount owing by
such Lessee under such Lease reflecting usage of the related Equipment in excess
of a specified copy amount per month.
12
Fee Per Scan Charge: with respect to any Lease, means the amount owing by
such Lessee under such Lease reflecting usage of the related Equipment in excess
of a specified scan amount per month.
Financing Statement: as defined in Section 12 of the Sales and Servicing
Agreement.
Fitch: Fitch Investors Service, X.X.
Xxxxx: xxxxx, bargain, sell, convey, assign, transfer, mortgage, pledge,
create and grant a security interest in and right of set-off against, deposit,
set over and confirm. The Grant of the Trust Estate effected by this Indenture
shall include all rights, powers, and options (but none of the obligations) of
the Company with respect thereto, including, without limitation, the immediate
and continuing right to claim for, collect, receive, and give receipts for Lease
Payments in respect of the Leases and all other moneys payable thereunder, to
give and receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options, to bring judicial proceedings in
the name of the Company or otherwise, and generally to do and receive anything
that the Company is or may be entitled to do or receive thereunder or with
respect thereto.
Granted Assets: as defined in the Granting Clause.
Holder: a holder of a Class A Note, Class B Note or a Class C Note.
Indenture: this instrument as originally executed and as from time to time
supplemented or amended pursuant to the applicable provisions hereof.
Initial Payment Date: July 21, 1997.
Inter-Company Loans: as defined in Section 13 of the Sales and Servicing
Agreement.
Interest Payments: as defined in Section 2.01(c).
Issuance Date: May __, 1997.
Lease: at any time, each separate lease agreement and each lease schedule
or supplement (and each master lease agreement insofar as the same relates to
any such schedule or supplement) described in Schedule 1 hereto, as the same may
be amended or modified from time to time in accordance with the provisions
hereof and thereof unless and until released from the lien of this Indenture.
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Lease Delinquency Payment: any payment made with respect to a Lease in an
amount equal to all or part of any specific Lease Payment due with respect to
such Lease (a) by the Servicer pursuant to Section 4.01 of the Sales and
Servicing Agreement, (b) by a transfer from the Reserve Account pursuant to
Section 3.04, or (c) by the Company in its sole discretion.
Lease Payment: each periodic installment of rent payable by a Lessee under
a Lease. Casualty Payments, Termination Payments, prepayments of rent required
pursuant to the terms of a Lease, at or before the commencement of the Lease,
payments becoming due on or before the Cut-Off Date and supplemental or
additional payments required by the terms of a Lease with respect to taxes,
insurance, maintenance (including, without limitation, any Maintenance Charges),
or other specific charges shall not be Lease Payments hereunder. For purposes of
calculating the Discounted Present Value of the Leases and the Discounted
Present Value of the Performing Leases, the amount of any Excess Copy Charges
and Fee Per Scan Charges that may be payable under such Lease shall not be
included in such calculation.
Lease Repurchase Amount: as defined in Section 12 of the Sales and
Servicing Agreement.
Lessee: with respect to any Lease, the lessee thereunder.
Lien: as defined in Section 12 of the Sales and Servicing Agreement.
Maintenance Charges: with respect to any Lease, the amount owing by the
Lessee under the terms of the related Lease in respect of maintenance services
being provided in connection therewith.
Maturity: with respect to any installment of principal of or interest on
any Note, the date on which such installment is due and payable as therein or
herein provided, whether at the Stated Maturity, by declaration of acceleration,
or otherwise.
Moody's: Xxxxx'x Investor Services, Inc. and any successors thereto.
Monthly Delinquency Percentage: with respect to any Payment Date, the
percentage equivalent of a fraction (a) the numerator of which is the Discounted
Present Value of the Delinquent Leases determined as of the related
Determination Date and (b) the denominator of which is the
14
Discounted Present Value of the Performing Leases as of the related
Determination Date.
Monthly Servicer Realization Percentage: with respect to any Payment Date,
the percentage equivalent of a fraction (a) the numerator of which is the
aggregate amount of Servicer Residual Realizations collected during the
immediately preceding Due Period and (b) the denominator of which is equal to
the aggregate Servicer Booked Residual Values with respect to the leases for
which Servicer Residual Realizations have been collected in respect of such
immediately preceding Due Period.
Nominal Buy-Out Lease: as defined in Section 12 of the Sales and Servicing
Agreement.
Non-Performing Lease: as of any Determination Date, any Lease with respect
to which at any time following the Cut-Off Date or related Transfer Date, as the
case may be, either (a) a Lease Payment, or any portion thereof, was 123 or more
days overdue as of the last day of the Due Period with respect to such
Determination Date, unless on or before such Determination Date such Lease
Payment (or portion thereof) has been paid or (b) the Servicer has accelerated
the remaining payments or has determined such Lease to be uncollectible in
accordance with the Servicer's customary practices prior to the last day of the
Due Period with respect to such Determination Date.
Non-Performing Lease Pay-Through Amount: with respect to any Lease with
respect to which a Lease Payment is made or due, an amount equal to the
Discounted Present Value of such Lease as of the Payment Date immediately
following the first Determination Date on which such Lease was a Non-Performing
Lease.
Noteholder: at any time, any Person in whose name a Note is registered in
the Note Register.
Note Interest Rate: the Class A-1 Note Interest Rate, the Class A-2 Note
Interest Rate, the Class A-3 Note Interest Rate, the Class A-4 Interest Rate,
the Class B Note Interest Rate or the Class C Note Interest Rate, as the case
may be.
Note Owner: a Class A-1 Note Owner, Class A-2 Note Owner, Class A-3 Note
Owner, Class A-4 Note Owner or Class B Note Owner, as the case may be.
Note Register: as defined in Section 2.03.
Notes: any notes authorized by, and authenticated and delivered under, this
Indenture.
15
Officers' Certificate: a certificate delivered to the Trustee and signed by
the Chairman, the President, or a Vice President of the Company, and by another
Vice President, the Treasurer, and Assistant Treasurer, the Secretary, or an
Assistant Secretary of the Company who is not the same Person as the other
officer signing such certificate.
Opinion of Counsel: a written opinion, which shall be satisfactory in form
and substance to the Trustee, of counsel who may, except as otherwise expressly
provided in this Indenture, be inside or outside counsel for the Company and who
shall be satisfactory to the Trustee.
Other Lease Payments: all payments on or in respect of leases which are not
Lease Payments, Lease Delinquency Payments, Casualty Payments, Termination
Payments, Similar Transaction Payments or Residual Realizations.
Outstanding: with respect to the Notes, as of any date of determination,
all Notes theretofore authenticated and delivered under this Indenture except:
(a) Notes theretofore cancelled by the Trustee or delivered to the
Trustee for cancellation;
(b) Notes or portions thereof for whose payment money in the necessary
amount has been theretofore irrevocably deposited with the Trustee in trust
for the holders of such Notes; and
(c) Notes in exchange for or in lieu of which other Notes have been
authenticated and delivered pursuant to this Indenture unless proof
satisfactory to the Trustee is presented that any such Notes are held by a
Person in whose hands the Note is a valid obligation;
provided, however, that in determining whether the holders of the requisite
percentage of the Outstanding Principal Amount of the Notes have given any
request, demand, authorization, direction, notice, consent, or waiver hereunder,
Notes owned by the Company or any Affiliate of the Company shall be disregarded
and deemed not to be Outstanding, except that, in determining whether the
Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent, or waiver, only Notes that a
Responsible Officer of the Trustee actually knows to be so owned shall be so
disregarded.
16
Outstanding Class A Principal Amount: The aggregate principal amount of the
Class A Notes Outstanding at any time.
Outstanding Class A-1 Principal Amount: the aggregate principal amount of
the Class A-1 Notes Outstanding at any time.
Outstanding Class A-2 Principal Amount: the aggregate principal amount of
the Class A-2 Notes Outstanding at any time.
Outstanding Class A-3 Principal Amount: the aggregate principal amount of
the Class A-3 Notes Outstanding at any time.
Outstanding Class A-4 Principal Amount: the aggregate principal amount of
the Class A-4 Notes Outstanding at any time.
Outstanding Class B Principal Amount: the aggregate principal amount of the
Class B Notes Outstanding at any time.
Outstanding Class C Principal Amount: the aggregate principal amount of the
Class C Notes Outstanding at any time.
Outstanding Principal Amount: the aggregate unpaid principal amount of the
Notes Outstanding at any time.
Paying Agent: each agent of the Company appointed for the purpose of making
payments on the Notes, including the Trustee.
Payment Date: the 20th day of each month, commencing on the Initial Payment
Date, and ending on the latest Stated Maturity.
Person: any individual, corporation, partnership, joint venture,
association, limited liability company, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
Placement Agent Agreement: the Placement Agent Agreement, among the
Company, Copelco, Xxxxxx Brothers Inc. and First Union Capital Markets Corp.
Predecessor Notes: with respect to any particular Note, every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and,
17
for the purpose of this definition, any Note authenticated and delivered under
Section 2.04 in lieu of a lost, destroyed or stolen Note (or a mutilated Note
surrendered to the Trustee) shall be deemed to evidence the same debt as the
lost, destroyed or stolen Note (or a mutilated Note surrendered to the Trustee).
Principal Payments: as defined in Section 2.01(b).
Rating Agency: DCR, Xxxxx'x, Fitch and S&P.
Record Date: with respect to any Payment Date, the last day of the calendar
month immediately preceding such Payment Date.
Required Deposit Date: as defined in Section 3.03(a).
Required Payment: as defined in Section 3.04(b).
Required Reserve Amount: shall equal the lesser of (a) 1.00% of the
Discounted Present Value of the Leases as of the Cut-off Date and (b) the
Outstanding Principal Amount of the Notes.
Reserve Account: the account or accounts by that name established and
maintained by the Trustee pursuant to Section 3.01.
Residual Account: the account or accounts by that name established and
maintained by the Trustee pursuant to Section 3.01.
Residual Amount Cap: an amount equal to $_________ which equals 8% of the
Discounted Present Value of the Leases as of the Cut-Off Date.
Residual Event: means the occurrence of one or more of the following: (a)
Copelco is no longer the Servicer, (b) with respect to the __________, 1997 Due
Period and each Due Period thereafter, the Three-Month Servicer Realization
Percentage calculated on any Determination Date is less than 100%; or (c) with
respect to the _________, 1997 Due Period and each Due Period thereafter, the
Three-Month Delinquency Percentage is greater than 5%; provided, however, that
the Residual Event referred to in clause (b) may be cured if the Three-Month
Servicer Realization Percentage is greater than or equal to 100% for three
consecutive months thereafter and the Residual Event referenced in clause (c)
may be cured if the Three-Month Delinquency Percentage for any Due Period
thereafter is less than or equal to 5%.
Residual Realizations: the aggregate cash flows realized from the sale
(including pursuant to a Lessee's
18
purchase option) or reletting of any Equipment following the termination of the
related Lease. Amounts received in respect of Non-Performing Leases shall only
be included as Residual Realizations to the extent such amounts exceed the
related Non-Performing Lease Pay-Through Amount.
Responsible Officer: with respect to the Trustee, any person regularly
engaged in the administration or supervision of corporate trust accounts
(including, in the case of the original Trustee hereunder, any officer in its
Corporate Trust Administration) and also, with respect to a particular corporate
trust matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
S&P: Standard & Poor's Ratings Services, a division of the XxXxxx-Xxxx
Companies Inc. and any successor thereto.
Sales and Servicing Agreement: the Sales and Servicing Agreement dated as
of the date hereof between the Company and Copelco, as the same may be amended
or modified from time to time in accordance with the provisions hereof and
thereof.
Securities Act: the Securities Act of 1933, as amended.
Servicer: Copelco and any successor Servicer appointed pursuant to the
terms hereof and of the Sales and Servicing Agreement and, to the extent that it
at any time is performing the functions of the Servicer, the Trustee, subject to
the terms of Section 5.01 hereof.
Servicer Advance: a payment by the Servicer under clause (a) of the
definition of Lease Delinquency Payment.
Servicer Booked Residual Values: the estimated residual value of the
equipment included in the Servicing Portfolio and recorded on the books of the
Seller or its subsidiaries.
Servicer Event of Default: as defined in Section 8.01 of the Sales and
Servicing Agreement.
Servicer Order: a written order or request delivered to the Trustee and
signed in the name of the Servicer by an Authorized Officer.
Servicer Residual Realizations: the aggregate cash flows realized from the
sale (including pursuant to a Lessee's purchase option) or releasing of any
Equipment
19
following the termination of the related lease for leases in the Servicing
Portfolio.
Servicing Fee: with respect to any Payment Date, the Servicing Fee payable
at a rate of 0.75% per annum to the Servicer on such Payment Date pursuant to
the Sales and Servicing Agreement.
Servicing Portfolio: the leases and the related equipment owned by the
Seller and its subsidiaries or serviced by the Servicer (including Danka leases)
to the extent such leases were originated or acquired by the Seller in its
Business Technology Division, its Healthcare Division, or their predecessors or
successors.
Servicing Report: as defined in Section 5.01(b) of the Sales and Servicing
Agreement.
Similar Transaction Agreement: an indenture between the Trustee and a
wholly-owned special purpose subsidiary of Copelco other than the Company,
substantially similar to this Indenture, pursuant to which notes, substantially
similar to the Notes, have been issued.
Similar Transaction Amount: for each Required Deposit Date, the amount of
all Similar Transaction Payments received by the Servicer and deposited in the
Collection Account pursuant to Section 3.02(a) and reported by the Servicer for
such Required Deposit Date pursuant to Section 5.03(a) of the Sales and
Servicing Agreement.
Similar Transaction Payments: all payments on or in respect of leases
subject to the lien of any Similar Transaction Agreement.
Stated Maturity: the date on which the entire remaining unpaid Outstanding
Principal Amount of each class of Notes is due and payable, which date is the
___________ Payment Date, ________ Payment Date, _________ Payment Date,
________ Payment Date, _________ Payment Date and ________ Payment Date for the
Class X- 0 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes, Class B
Notes and the Class C Notes, respectively.
Substitute Lease: as defined in Section 12 of the Sales and Servicing
Agreement.
Termination Payment: a payment payable by a Lessee under a Lease upon the
early termination of such Lease (but not on account of a casualty or a Lease
default) which may be agreed upon by the Servicer, acting in the name of the
Company, and the Lessee in accordance with the provisions of Section 3.02 of the
Sales and Servicing
20
Agreement.
Three-Month Delinquency Percentage: with respect to any Payment Date, the
percentage equivalent of fraction, (a) the numerator of which is the sum of the
Monthly Delinquency Percentage for such Payment Date and the two immediately
preceding Payment Dates and (b) the denominator of which is three.
Three-Month Servicer Realization Percentage: with respect to any Payment
Date, the percentage equivalent of a fraction, (a) the numerator of which is the
sum of the Monthly Servicer Realization Percentage for such Payment Date and the
two immediately preceding Payment Dates and (b) the denominator of which is
three.
Transaction Payment Amount: for each Required Deposit Date, the amount of
all Lease Payments, Lease Delinquency Payments, Non-Performing Lease Payments,
Casualty Payments, Termination Payments and other payments on or in respect of a
Lease received by the Servicer and deposited in the Collection Account pursuant
to Section 3.02(a) and reported by the Servicer for such Required Deposit Date
in accordance with Section 5.03(a) of the Sales and Servicing Agreement.
Trust Accounts: the Collection Account, the Reserve Account and the
Residual Account.
Trust Estate: all money, instruments and other property subject to or
intended to be subject to the lien of this Indenture including all proceeds
thereof.
Trustee: the Person named as the "Trustee" in the first paragraph of this
instrument until a successor Person shall have become the Trustee pursuant to
the applicable provisions of this Indenture, and thereafter "Trustee" shall mean
such successor Person; provided, that the provisions of Section 7.07 and Section
8.11, as applicable to any Person at any time serving as Trustee hereunder,
shall survive the termination of such Person's status as Trustee hereunder and
the succession of any other Person to such status.
Trust Indenture Act: the Trust Indenture Act of 1939 as in effect on the
date on which this Indenture is qualified under the Trust Indenture Act, except
as provided in Section 9.06 hereof.
Underwriting Agreement: the Underwriting Agreement, among the Company,
Copelco, Xxxxxx Brothers Inc.
21
and First Union Capital Markets Corp and, with respect to the Class A Notes,
Xxxxxx Xxxxxxx & Co. Incorporated.
Uniform Commercial Code: with respect to a particular jurisdiction, the
Uniform Commercial Code, as in effect from time to time in such jurisdiction, or
any successor statute thereto.
Utilized Residual Amount: on any day of determination, the sum of (a) the
total Residual Realizations applied to make payments of amounts owing the
Servicer and the Noteholders (including any such amounts withdrawn from the
Reserve Account and the Residual Account) and (b) the amount on deposit in the
Reserve Account and the Residual Account on such date allocable to Residual
Realizations.
Vice President: with respect to the Company, any vice president, whether or
not designated by a number or a word or words added before or after the title
"vice president."
Warranty Lease: a Lease subject to repurchase by the Seller as a result of
a breach of a representation or warranty in accordance with the provisions of
Section 4 of the Sales and Servicing Agreement.
SECTION 1.02. Compliance Certificates and Opinions.
Upon any written application or request (or oral application with prompt
written or telecopied confirmation) by the Company to the Trustee to take any
action under any provision of this Indenture, other than any request that (a)
the Trustee authenticate the Notes specified in such request, (b) the Trustee
invest moneys in any of the Trust Accounts pursuant to the written directions
specified in such request, or (c) the Trustee pay moneys due and payable to the
Company hereunder to the Company's assignee specified in such request, the
Trustee shall require the Company to furnish to the Trustee an Officers'
Certificate stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with and that the
request otherwise is in accordance with the terms of the Indenture, and an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with, except that, in the case
of any such requested action as to which other evidence of satisfaction of the
conditions precedent thereto is specifically required by any provision of this
Indenture, no additional certificate or opinion need be furnished.
22
SECTION 1.03. Form of Documents Delivered to Trustee.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company delivered to the
Trustee may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such officer's certificate or opinion and
any Opinion of Counsel may be based, insofar as it relates to factual matters,
upon a certificate or opinion of, or representations by, an officer or officers
of the Company as to such factual matters unless such officer or counsel knows,
or in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to such matters are erroneous. Any
Opinion of Counsel may be based on the written opinion of other counsel, in
which event such Opinion of Counsel shall be accompanied by a copy of such other
counsel's opinion and shall include a statement to the effect that such counsel
believes that such counsel and the Trustee may reasonably rely upon the opinion
of such other counsel.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Wherever in this Indenture, in connection with any application or
certificate or report to the Trustee, it is provided that the Company shall
deliver any document as a condition of the granting of such application, or as
evidence of compliance with any term hereof, it is intended that the truth and
accuracy, at the time of the granting of such application or at the effective
date of such certificate or report (as the case may be), of the facts and
opinions stated in such document shall in such case be conditions precedent to
the right of the Company to have such application granted or to the sufficiency
of such
23
certificate or report. The foregoing shall not, however, be construed to affect
the Trustee's right to rely upon the truth and accuracy of any statement or
opinion contained in any such document as provided in Section 7.01(a)(ii).
Whenever in this Indenture it is provided that the absence of the
occurrence and continuation of a Default or Event of Default or Servicer Event
of Default is a condition precedent to the taking of any action by the Trustee
at the request or direction of the Company, then, notwithstanding that the
satisfaction of such condition is a condition precedent to the Company's right
to make such request or direction, the Trustee shall be protected in acting in
accordance with such request or direction if it does not have knowledge of the
occurrence and continuation of such Default or Event of Default or Servicer
Event of Default. For all purposes of this Indenture, the Trustee shall not be
deemed to have knowledge of any Default or Event of Default nor shall the
Trustee have any duty to monitor or investigate to determine whether a default
has occurred (other than an Event of Default of the kind described in Section
6.01(a)) or Servicer Event of Default unless a Responsible Officer of the
Trustee shall have actual knowledge thereof or shall have been notified in
writing thereof by the Company, the Servicer, or any Noteholder.
SECTION 1.04. Acts of Noteholders, etc.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided by this Indenture to be given or taken by Noteholders
may be embodied in and evidenced by one or more instruments of substantially
similar tenor signed by such Noteholders in person or by agents duly appointed
in writing; and, except as herein otherwise expressly provided, such action
shall become effective when such instrument or instruments are delivered to the
Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Noteholders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 7.01) conclusive in favor of
the Trustee and the Company, if made in the manner provided in this Section
1.04.
(b) The fact and date of the execution by any Person of any such instrument
or writing may be proved by the affidavit of a witness of such execution or by a
certificate of a notary public or other officer authorized by law to take
acknowledgments of deeds, certifying that the individual signing such instrument
or writing acknowledged
24
to him the execution thereof. Where such execution is by a signer acting in a
capacity other than his individual capacity, such certificate or affidavit shall
also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient.
(c) Any request, demand, authorization, direction, notice, consent, waiver
or other Act of the holder of any Note shall bind every future holder of the
same Note and the holder of every Note issued upon the registration of transfer
thereof or in exchange therefore or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Trustee or the Company in reliance
thereon, whether or not notation of such action is made upon such Note.
(d) By accepting the Notes issued pursuant to this Indenture, each
Noteholder irrevocably appoints the Trustee hereunder as the special
attorney-in-fact for such Noteholder vested with full power on behalf of such
Noteholder to effect and enforce the rights of such Noteholder and the revisions
pursuant hereto for the benefit of such Noteholder; provided that nothing
contained in this Section 1.04(d) shall be deemed to confer upon the Trustee any
duty or power to vote on behalf of the Noteholders with respect to any matter on
which the Noteholders have a right to vote pursuant to the terms of this
Indenture.
SECTION 1.05. Notices, etc., to Trustee, Servicer and Company.
Any request, demand, authorization, direction, notice, consent, waiver, Act
of Noteholders, or other document provided or permitted by this Indenture to be
made upon, given or furnished to, or filed with, the Trustee, the Company or the
Servicer shall be sufficient for every purpose hereunder (unless otherwise
herein expressly provided) if in writing and mailed, first-class postage prepaid
or certified mail return receipt requested, or sent by private courier or
confirmed telecopy. Unless otherwise specifically provided herein, no such
request, demand, authorization, direction, notice, consent, waiver, Act of
Noteholders or other document shall be effective until received and any
provision hereof requiring the making, giving, furnishing, or filing of the same
on any date shall be interpreted as requiring the same to be sent or delivered
in such fashion that it will be received on such date. Any such request, demand,
authorization, direction, notice, consent, waiver, Act of Noteholders, or other
document shall be sent or delivered to the following addresses:
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(a) if to the Trustee, at the Corporate Trust Office, Attention:
Corporate Trust Administration (Number for telecopy: (000) 000-0000), or
at any other address previously furnished in writing to the Company and the
Servicer by the Trustee; or
(b) if to the Company, at East Gate Center, 000 Xxxx Xxxx Xxxxx, Xxxxx
Xxxxxx, Xxx Xxxxxx 00000-0000, Attention: President (Number for telecopy:
609-273-9288), or at any other address previously furnished in writing to
the Trustee and the Servicer by the Company; or
(c) if to the Servicer, at East Gate Center, 000 Xxxx Xxxx Xxxxx,
Xxxxx Xxxxxx, Xxx Xxxxxx 00000-0000, Attention: Xxxxxxx Xxxxxx (Number for
telecopy: 609-273-9288), or at any other address previously furnished in
writing to the Trustee and the Company by the Servicer.
SECTION 1.06. Notice to Noteholders; Waiver.
(a) Where this Indenture provides for notice to Noteholders of any event,
or the mailing of any report to Noteholders, such notice or report shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid or certified mail return receipt
requested, or sent by private courier or confirmed telecopy to each Noteholder
affected by such event or to whom such report is required to be mailed, at its
address as it appears in the Note Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such notice or
the mailing of such report. In any case where a notice or report to Noteholders
is mailed, neither the failure to mail such notice or report, nor any defect in
any notice or report so mailed, to any particular Noteholder shall affect the
sufficiency of such notice or report with respect to other Noteholders. Where
this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Noteholders shall be filed with the Trustee, but such filing shall not
be a condition precedent to the validity of any action taken in reliance upon
such waiver.
(b) In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to mail or send notice to
Noteholders, in accordance with Section 1.06(a), of any event or any report to
Noteholders when such notice or report is required to be delivered pursuant to
any provision
26
of this Indenture, then such notification or delivery as shall be made with the
approval of the Trustee shall constitute a sufficient notification for every
purpose hereunder.
SECTION 1.07. Effect of Headings and Table of Contents.
The Article and Section headings herein and in the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.08. Successors and Assigns.
All covenants and agreements in this Indenture by the Company or the
Trustee shall bind its respective successors and permitted assigns, whether so
expressed or not.
SECTION 1.09. GOVERNING LAW.
THIS INDENTURE AND THE NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. THIS INDENTURE IS SUBJECT TO
THE TRUST INDENTURE ACT OF 1939 AND SHALL BE GOVERNED THEREBY AND CONSTRUED IN
ACCORDANCE THEREWITH.
SECTION 1.10. Legal Holidays.
In any case where any Payment Date or the Stated Maturity or any other date
on which principal of or interest on any Note is proposed to be paid shall not
be a Business Day, then (notwithstanding any other provision of this Indenture
or of the Notes) such payment need not be made on such date, but may be made on
the next succeeding Business Day with the same force and effect as if made on
such Payment Date, Stated Maturity, or other date on which principal of or
interest on any Note is proposed to be paid, provided that no interest shall
accrue for the period from and after such Payment Date, Stated Maturity, or any
other date on which principal of or interest on any Note is proposed to be paid,
as the case may be, until such next succeeding Business Day.
SECTION 1.11. Execution in Counterparts.
This Indenture may be executed in any number of counterparts, each of which
so executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
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SECTION 1.12. Inspection.
The Company agrees that, on reasonable prior notice, it will permit the
representatives of the Trustee or any Noteholder holding Notes, or a beneficial
interest therein, evidencing at least 25% of the Outstanding Principal Amount of
the Notes, during the Company's normal business hours, to examine all of the
books of account, records, reports and other papers of the Company, to make
copies thereof and extracts therefrom, to cause such books to be audited by
independent accountants selected by the Company and reasonably acceptable to the
Trustee or such Noteholder, as the case may be, and to discuss its affairs,
finances and accounts with its officers, employees and independent accountants
(and by this provision the Company hereby authorizes its accountants to discuss
with such representatives such affairs, finances and accounts), all at such
reasonable times and as often as may be reasonably requested for the purpose of
reviewing or evaluating the financial condition or affairs of the Company or the
performance of and compliance with the covenants and undertakings of the Company
in this Indenture, the Sales and Servicing Agreement or any of the other
documents referred to herein or therein. Any expense incident to the exercise by
the Trustee at any time or any Noteholder during the continuance of any Default
or Event of Default, of any right under this Section 1.12 shall be borne by the
Company.
SECTION 1.13. Survival of Representations and Warranties.
The representations, warranties and certifications of the Company made in
this Indenture or in any certificate or other writing delivered by the Company
pursuant hereto shall survive the authentication and delivery of the Notes
hereunder.
ARTICLE 2.
THE NOTES
SECTION 2.01. General Provisions.
(a) The Notes shall consist of $_________ principal amount of Class A-1
Notes, $_________ principal amount of Class X- 0 Notes, $_________ principal
amount of Class A-3 Notes, $________ principal amount of Class A-4 Notes,
$_________ principal amount of Class B Notes and $_________ principal amount
of Class C Notes, and the forms thereof and of the Trustee's certificate of
authentication shall be in substantially the forms set forth in Exhibit A
hereto, with such appropriate insertions, omissions,
28
substitutions, and other variations as are required or permitted by this
Indenture.
The aggregate principal amount of Notes which may be authenticated and
delivered under this Indenture is limited to $549,743,000, except for Notes
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, other Notes pursuant to Section 2.03, 2.04, or 9.05. The
Notes shall be issuable only in registered form and only in minimum
denominations of at least $100,000 and integral multiples of $1,000, in excess
thereof; provided that the foregoing shall not restrict or prevent the transfer
in accordance with Section 2.03 of any Note having a remaining Outstanding
Principal Amount of other than an integral multiple of $1,000, or the issuance
of a single Class A Note, a single Class B Note and a single Class C Note with a
denomination less than $100,000.
(b) For each Payment Date, payments of principal (the "Principal Payments")
on the Notes will be made in accordance with Sections 3.03(b) or 6.06, as
applicable. Except as otherwise provided in Section 6.02, no part of the
principal of any Note shall be paid prior to the Payment Date on which such
principal is due in accordance with the preceding provisions of this Section
2.01(b), except that the Company may redeem the Notes in their entirety, without
premium, as of any Payment Date on which the Discounted Present Value of the
Performing Leases is less than or equal to ten percent (10%) of the aggregate
Discounted Present Value of the Leases as of the Cut-Off Date (after giving
effect to all Principal Payments on such Payment Date). The Company will give
notice of any such redemption to each Noteholder and the Trustee at least 30
days before the Payment Date fixed for such prepayment by certified mail return
receipt requested, hand delivery or overnight courier. Notice of such prepayment
having been so given, the remaining unpaid principal as of the Payment Date
fixed for prepayment together with all interest accrued and unpaid to such
Payment Date, shall become due and payable on such Payment Date.
(c) For each Payment Date, the interest due and payable (the "Interest
Payments") with respect to the Class A-1 Notes, Class A-2 Notes, Class A-3
Notes, Class A-4 Notes, the Class B Notes and the Class C Notes will be the
interest that has accrued on the respective Notes since the last Payment Date
or, in the case of the first Payment Date, since the Closing Date, at the Class
A-1 Interest Rate, Class A-2 Interest Rate, Class A-3 Interest Rate, Class A-4
Interest Rate, Class B Interest Rate and Class C Interest Rate, respectively,
applied to the then Outstanding Principal Amounts of the Class A-1 Notes, Class
A-2 Notes, Class A-3 Notes, Class A-4 Notes, Class B Notes, and the Class C
Notes
29
respectively, on the preceding Payment Date. Interest Payments will be made in
accordance with Sections 3.03(b) and 6.06, as applicable.
(d) All payments made with respect to any Note shall be made in such coin
or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts and shall be applied first to the
interest then due and payable on such Notes, then to the principal thereof, and
finally to premium, if any.
(e) All Class A-1 Notes issued under this Indenture shall be in all
respects equally and ratably entitled to the benefits hereof without preference,
priority or distinction on account of the actual time or times of authentication
and delivery, all in accordance with the terms and provisions of this Indenture.
Payments of principal and interest on the Class A-1 Notes shall be made pro rata
among all Outstanding Class A-1 Notes, without preference or priority of any
kind.
(f) All Class A-2 Notes issued under this Indenture shall be in all
respects equally and ratably entitled to the benefits hereof without preference,
priority or distinction on account of the actual time or times of authentication
and delivery, all in accordance with the terms and provisions of this Indenture.
Payments of principal and interest on the Class A-2 Notes shall be made pro rata
among all Outstanding Class A-2 Notes, without preference or priority of any
kind.
(g) All Class A-3 Notes issued under this Indenture shall be in all
respects equally and ratably entitled to the benefits hereof without preference,
priority or distinction on account of the actual time or times of authentication
and delivery, all in accordance with the terms and provisions of this Indenture.
Payments of principal and interest on the Class A-3 Notes shall be made pro rata
among all Outstanding Class A-3 Notes, without preference or priority of any
kind.
(h) All Class A-4 Notes issued under this Indenture shall be in all
respects equally and ratably entitled to the benefits hereof without preference,
priority or distinction on account of the actual time or times of authentication
and delivery, all in accordance with the terms and provisions of this Indenture.
Payments of principal and interest on the Class A-4 Notes shall be made pro rata
among all Outstanding Class A-4 Notes, without preference or priority of any
kind.
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(i) The Class B Notes shall be subordinated to the Class A Notes to the
extent set forth herein. All Class B Notes issued under this Indenture shall be
in all respects equally and ratably entitled to the benefits hereof without
preference, priority or distinction on account of the actual time or times of
authentication and delivery, all in accordance with the terms and provisions of
this Indenture. Payments of principal and interest on the Class B Notes shall be
made pro rata among all Outstanding Class B Notes, without preference or
priority of any kind.
(j) The Class C Notes shall be subordinated to the Class A Notes and the
Class B Notes to the extent set forth herein. All Class C Notes issued under
this Indenture shall be in all respects equally and ratably entitled to the
benefits hereof without preference, priority or distinction on account of the
actual time or times of authentication and delivery, all in accordance with the
terms and provisions of this Indenture. Payments of principal and interest on
the Class C Notes shall be made pro rata among all Outstanding Class C Notes,
without preference or priority of any kind.
SECTION 2.02. Execution, Authentication, Delivery, and Dating.
(a) The Notes shall be manually executed on behalf of the Company by its
President or one of its Vice Presidents, under its corporate seal reproduced
thereon.
(b) Any Note bearing the signature of an individual who was at the time of
execution thereof a proper officer of the Company shall bind the Company,
notwithstanding that such individual ceases to hold such office prior to the
authentication and delivery of such Note or did not hold such office at the date
of such Note.
(c) No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Note a
certificate of authentication substantially in the form provided for herein,
executed by the Trustee by manual signature, and such certificate upon any Note
shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder. Each Note shall be dated the date of
its authentication.
(d) The Notes may from time to time be executed by the Company and
delivered to the Trustee for authentication together with a Company Request to
the Trustee directing the authentication and delivery of such Notes and
thereupon the same shall be authenticated and delivered by the Trustee in
accordance with such Company Request.
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SECTION 2.03. Transfer and Exchange.
(a) The Company shall cause to be kept at the Corporate Trust Office a
register (the "Note Register") in which, subject to such reasonable regulations
as the Trustee may prescribe, the Company shall provide for the registration of
Notes and of transfers of Notes. The Trustee is hereby appointed "Note
Registrar" for the purpose of registering Notes and transfers of Notes as herein
provided.
No transfer of any Class C Note may be made unless that transfer is made
pursuant to an effective registration statement under the Securities Act and an
effective registration or a qualification under applicable state securities
laws, or is made in a transaction that does not require such registration or
qualification because the transfer satisfies one of the following: (i) such
transfer is in compliance with Rule 144A under the Securities Act, to a person
who the transferor reasonably believes is a Qualified Institutional Buyer (as
defined in Rule 144A) that is purchasing for its own account or for the account
of a Qualified Institutional Buyer and to whom notice is given that such
transfer is being made in reliance upon Rule 144A under the Securities Act as
certified by such transferee in a letter in the form of Exhibit B hereto; (ii)
after the appropriate holding period, such transfer is pursuant to an exemption
from registration under the Securities Act provided by Rule 144 under the
Securities Act; (iii) such transfer is to a transferee who is an accredited
investor in a transaction exempt from the registration requirements of the
Securities Act, in each case in accordance with any applicable securities laws
of any State of the United States or (iv) such transfer is otherwise exempt from
the registration requirements of the Securities Act. The Trustee will require,
in order to assure compliance with such laws, that the Class C Noteholder's
prospective transferee referred to in the preceding clauses (iii) or (iv)
deliver an investment letter certifying to the Company and the Trustee as to the
facts surrounding such transfer in the form of Exhibit B hereto. Except in the
case of a transfer of Class C Notes to a transferee referred to in the preceding
clause (i) or, in general, a transfer that is to be made after three years from
the Issuance Date, the Trustee shall require an opinion of counsel satisfactory
to it to the effect that such transfer may be made pursuant to an exemption from
the Securities Act without such registration (which opinion of counsel shall not
be an expense of the Trustee or the Servicer or the Company). None of the
Company, the Servicer or the Trustee is obligated to register or qualify the
Class C Notes under the Securities Act or any other securities law or to take
any
32
action not otherwise required under this Indenture to permit the transfer of any
Class C Note without registration.
(b) Subject to Section 2.03(a), upon surrender for registration of transfer
of any Note at the office of the Company designated pursuant to Section 8.02 for
such purpose, the Company shall execute and the Trustee upon request shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Notes of any authorized denominations and of a like
aggregate original principal amount. The Trustee shall make a notation on any
such new Note of the amount of principal, if any, that has been paid on such
Note.
(c) All Notes issued upon any registration of transfer or exchange of Notes
shall be the valid obligations of the Company, evidencing the same debt, and
entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
(d) Every Note presented or surrendered for registration of transfer or for
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Trustee duly executed, by the holder thereof or his attorney
duly authorized in writing.
(e) No service charge shall be made for any registration of transfer or
exchange of Notes, but the Company or the Trustee may require payment by the
transferor of a sum sufficient to cover any tax or other governmental charge
that may be imposed in connection with any registration of transfer or exchange
of Notes, other than exchanges pursuant to Section 9.05 not involving any
transfer.
SECTION 2.04. Mutilated, Destroyed, Lost and Stolen Notes.
(a) If any mutilated Note is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefore a
replacement Note of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
(b) If there shall be delivered to the Company and the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Note and (ii)
such security or indemnity as may be required by them to save each of them and
any agent of either of them harmless, then, in the absence of actual notice to
the Company or the Trustee that such Note has been acquired by a bona fide
33
purchaser, the Company shall execute and upon its request the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen Note, a
replacement Note of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
(c) In case the final installment of principal on any such mutilated,
destroyed, lost or stolen Note has become or will at the next Payment Date
become due and payable, the Company in its discretion may, instead of issuing a
replacement Note, pay such Note.
(d) Upon the issuance of any replacement Note under this Section, the
Company or the Trustee may require the payment by the Noteholder of a sum
sufficient to cover any tax or other governmental charge that may be imposed as
a result of the issuance of such replacement Note.
(e) Every replacement Note issued pursuant to this Section 2.04 in lieu of
any destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Note shall be at any time enforceable by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately with any and all
other Notes duly issued hereunder.
(f) The provisions of this Section 2.04 are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.05. Book-Entry Registration of Class A Notes and Class B Notes.
Each of the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4
Notes and the Class B Notes, upon original issuance, shall be issued in the form
of one or more typewritten Class A-1 Notes, Class A-2 Notes, Class A-3 Notes,
Class A-4 Notes and one or more typewritten Class B Notes, respectively, (the
"Book-Entry Class A-1 Notes," "Book-Entry Class A-2 Notes," "Book-Entry Class
A-3 Notes," Book-Entry Class A-4 Notes" and "Book-Entry Class B Notes",
respectively) to be delivered to The Depository Trust Company, the initial
Clearing Agency, by, or on behalf of, the Company. Each of the Class A-1 Notes,
Class A-2 Notes, Class A-3 Notes, Class A-4 Notes and the Class B Notes shall
initially be registered on the Note Register in the name of Cede & Co., the
nominee of The Depository Trust Company, as the initial Clearing Agency, and no
Class A-1 Note Owner, Class A-2 Note Owner, Class A-3 Note Owner, Class A-4 Note
Owner or Class B Note Owner will receive a definitive note representing such
Note Owner's interest in the Class A-1
34
Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes or Class B Notes, as
the case may be, except as provided in Section 2.07. Unless and until Definitive
Class A-1 Notes, Definitive Class A-2 Notes, Definitive Class A-3 Notes,
Definitive Class A-4 Notes and/or Definitive Class B Notes have been issued to
the applicable Note Owners pursuant to Section 2.07:
(a) the provisions of this Section 2.05 shall be in full force and effect
with respect to the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4
Notes or the Class B Notes, as the case may be;
(b) the Company, the Servicer and the Trustee may deal with the Clearing
Agency and the Clearing Agency Participants for all purposes with respect to the
Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes or Class B
Notes, as the case may be, (including the making of distributions on the Class
A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes and the Class B
Notes, as the case may be) as the authorized representatives of the respective
Note Owners;
(c) to the extent that the provisions of this Section 2.05 conflict with
any other provisions of this Indenture, the provisions of this Section 2.05
shall control; and
(d) the rights of the respective Note Owners shall be exercised only
through the Clearing Agency and the Clearing Agency Participants and shall be
limited to those established by law and agreements between such respective Note
Owners and the Clearing Agency and/or the Clearing Agency Participants. Pursuant
to the Depository Agreement, unless and until Definitive Class A-1 Notes,
Definitive Class A-2 Notes, Definitive Class A-3 Notes, Definitive Class A-4
Notes or Definitive Class B Notes, as the case may be, are issued pursuant to
Section 2.07, the initial Clearing Agency will make book-entry transfers among
the Clearing Agency Participants and receive and transmit distributions of
principal and interest on the related Class A-1 Notes, Class A-2 Notes, Class
A-3 Notes, Class A-4 Notes and Class B Notes, as the case may be, to such
Clearing Agency Participants.
For purposes of any provision of this Indenture requiring or permitting
actions with the consent of, or at the direction of, holders of Class A-1 Notes,
Class A-2 Notes, Class A-3 Notes, Class A-4 Notes or Class B Notes, as the case
may be, evidencing a specified percentage of the Outstanding Principal Amount of
the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes or the
Class B Notes, respectively, such direction or consent may be given
35
by Note Owners (acting through the Clearing Agency and the Clearing Agency
Participants) owning Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class
A-4 Notes or Class B Notes evidencing the requisite percentage of the
Outstanding Principal Amount of such Notes, respectively.
SECTION 2.06. Notice to Clearing Agency.
Whenever notice or other communication to the Class A-1 Noteholders, Class
A-2 Noteholders, Class A-3 Noteholders, Class A-4 Noteholders or Class B
Noteholders is required under this Agreement, unless and until Definitive Class
A-1 Notes, Definitive Class A-2 Notes, Definitive Class A-3 Notes, Definitive
Class A-4 Notes or Definitive Class B Notes shall have been issued to the
related Note Owners pursuant to Section 2.07, the Trustee shall give all such
notices and communications specified herein to be given to such Noteholders to
the applicable Clearing Agency which shall give such notices and communications
to the related Class A-1 Note Owners, Class A-2 Note Owners, Class A-3 Note
Owners, Class A-4 Note Owners and Class B Note Owners in accordance with its
applicable rules, regulations and procedures.
SECTION 2.07. Definitive Class A Notes and Definitive Class B Notes. If (a)
(i) the Company advises the Trustee in writing that the Clearing Agency is no
longer willing or able to properly discharge its responsibilities under the
Depository Agreement with respect to the Class A-1 Notes, Class A-2 Notes, Class
A-2 Notes, Class A-4 Notes and/or the Class B Notes and (ii) the Trustee or the
Company is unable to locate a qualified successor, (b) the Company, at its
option, advises the Trustee in writing that it elects to terminate the
book-entry system with respect to the Class A-1 Notes, Class A-2 Notes, Class
A-2 Notes, Class A-4 Notes and/or the Class B Notes through the Clearing Agency
or (c) after the occurrence of a Servicer Event of Default, Class A-1 Note
Owners, Class A-2 Note Owners, Class A-3 Note Owners, Class A-4 Note Owners and
Class B Note Owners, with respect to the Class A-1 Notes, Class A-2 Notes, Class
A-3 Notes, Class A-4 Notes and Class B Notes evidencing not less than 50% of the
aggregate unpaid Outstanding Principal Amount of the Class X- 0 Notes, Class A-2
Notes, Class A-3 Notes, Class A-4 Notes and Class B Notes, respectively, advise
the Trustee and the Clearing Agency through the Clearing Agency Participants in
writing that the continuation of a book-entry system with respect to the Class
A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4 Notes or the Class B
Notes, respectively, through the Clearing Agency is no longer in the best
interests of the Class A-1 Note Owners, Class A-2 Note Owners, Class A-3 Note
Owners, Class A-4 Note Owners or Class B Note Owners, as the case may be, the
Trustee shall notify all Class A-1 Note
36
Owners, Class A-2 Note Owners, Class A-3 Note Owners, Class A-4 Note Owners and
Class B Note Owners with respect to the Class A-1 Notes, Class A-2 Notes, Class
A-3 Notes, Class A-4 Notes and Class B Notes, respectively, through the Clearing
Agency, of the occurrence of any such event and of the availability of
Definitive Class A-1 Notes, Definitive Class A-2 Notes, Definitive Class A-3
Notes, Definitive Class A-4 Notes and Definitive Class B Notes to Class A-1 Note
Owners, Class A-2 Note Owners, Class A-3 Note Owners, Class A-4 Note Owners and
Class B Note Owners, respectively, requesting the same. Upon surrender to the
Trustee of the Class A-1 Notes, Class A-2 Notes, Class A-3 Notes, Class A-4
Notes or Class B Notes, as the case may be, by the Clearing Agency, accompanied
by registration instructions from the Clearing Agency for registration, the
Company shall execute and the Trustee shall authenticate and deliver the
Definitive Class A-1 Notes, Definitive Class A-2 Notes, Definitive Class A-3
Notes, Definitive Class A-4 Notes or Definitive Class B Notes, as the case may
be. Neither the Company nor the Trustee shall be liable for any delay in
delivery of such instructions and may conclusively rely on, and shall be
protected in relying on, such instructions. Upon the issuance of Definitive
Class A-1 Notes, Definitive Class A-2 Notes, Definitive Class A-3 Notes,
Definitive Class A-4 Notes or Definitive Class B Notes, as the case may be, all
references herein to obligations imposed upon or to be performed by the Clearing
Agency shall be deemed to be imposed upon and performed by the Trustee, to the
extent applicable with respect to such Definitive Class A-1 Notes, Definitive
Class A-2 Notes, Definitive Class A-3 Notes, Definitive Class A-4 Notes or
Definitive Class B Notes, respectively, and the Trustee shall recognize the
holders of the Definitive Class A-1 Notes as Class A-1 Noteholders, holders of
the Definitive Class A-2 Notes as Class A-2 Noteholders, holders of the
Definitive Class A-3 Notes as Class A-3 Noteholder, holders of the Definitive
Class A-4 Notes as Class A-4 Noteholders and/or the holders of the Definitive
Class B Notes as Class B Noteholders hereunder.
SECTION 2.08. Payment of Interest and Principal; Rights Preserved.
(a) Any installment of interest or principal, payable on any Note that is
punctually paid or duly provided for by the Company on the applicable Payment
Date shall be paid to the Person in whose name such Note was registered at the
close of business on the Record Date for such Payment Date by wire transfer of
federal funds to the account and number specified in the Note Register on such
Record Date for such Person (which shall be, as to each original purchaser of
the Notes, the account and number specified below such purchaser's signature to
the Note Agreement until such time as such purchaser notifies the Trustee in
writing
37
of a change therein) or, if no such account or number is so specified, then by
check mailed to such Person's address as it appears in the Note Register on such
Record Date.
(b) All reductions in the principal amount of a Note effected by payments
of installments of principal made on any Payment Date shall be binding upon all
holders of such Note and of any Note issued upon the registration of transfer
thereof or in exchange therefore or in lieu thereof, whether or not such payment
is noted on such Note. All payments on the Notes shall be paid without any
requirement of presentment but each holder of any Note shall be deemed to agree,
by its acceptance of the same, to surrender such Note at the Corporate Trust
Office against payment of the final installment of principal of such Note (or in
the case of the Class C Notes promptly thereafter).
SECTION 2.09. Persons Deemed Owners.
Prior to due presentment of a Note for registration of transfer, the
Company, the Trustee, and any agent of the Company or the Trustee may treat the
registered Noteholder as the owner of such Note for the purpose of receiving
payment of principal of and interest on such Note and for all other purposes
whatsoever, whether or not such Note be overdue, and neither the Company, the
Trustee, nor any agent of the Company or the Trustee shall be affected by notice
to the contrary.
SECTION 2.10. Cancellation.
All Notes surrendered for registration of transfer or exchange or following
final payment shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company may
at any time deliver to the Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Notes so delivered shall be promptly cancelled by the
Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section, except as expressly permitted by this
Indenture. All cancelled Notes held by the Trustee may be disposed of in the
normal course of its business or as directed by a Company Order.
SECTION 2.11. Noteholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Noteholders and shall otherwise comply with Section 3.12(a) of the Trust
Indenture Act. In the event the Trustee no longer serves as the Note
38
Registrar, the Company (or any other obligor upon the Notes) shall furnish to
the Trustee at least five Business Days before each interest payment date (and
in all events in intervals of not more than 6 months) and at such other times as
the Trustee may request in writing a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of Noteholders,
and the Company shall otherwise comply with Section 3.12(a) of the Trust
Indenture Act.
SECTION 2.12. Treasury Securities.
In determining whether the Noteholders of the required Outstanding
Principal Amount of the Notes have concurred in any direction, waiver or
consent, Notes owned by the Company, any other obligor upon the Notes or an
Affiliate of the Company shall be considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Notes which a Responsible
Officer knows are so owned shall be so disregarded.
ARTICLE 3.
ACCOUNTS; INVESTMENT OF MONEYS; COLLECTION
AND APPLICATION OF MONEYS; REPORTS
SECTION 3.01. Trust Accounts; Investments by Trustee.
(a) On or before the Issuance Date, the Trustee shall establish in the name
of the Trustee for the benefit of the Noteholders and the Company to the extent
of their interests therein as provided in this Indenture and in the Sales and
Servicing Agreement, the following accounts, which accounts shall be Eligible
Accounts maintained at the Corporate Trust Office:
(i) Collection Account;
(ii) Reserve Account; and
(iii) Residual Account
Subject to the further provisions of this Section 3.01(a), the Trustee shall,
upon receipt or upon transfer from another account, as the case may be, deposit
into such accounts all amounts received by it which are required to be deposited
therein in accordance with the provisions of this Indenture. All such amounts
and all investments made with such amounts, including all income and other gain
from such
39
investments, shall be held by the Trustee in such accounts as part of the Trust
Estate as herein provided, subject to withdrawal by the Trustee in accordance
with, and for the purposes specified in the provisions of, this Indenture.
(b) The Trustee shall hold in trust but shall not be required to deposit in
any account specified in Section 3.01(a) any payment received by it until such
time as the Trustee shall have identified to its reasonable satisfaction the
nature of such payment and, on the basis thereof, the proper account or accounts
into which such payment is to be deposited. In determining into which of the
accounts, if any, referred to above any amount received by the Trustee is to be
deposited, the Trustee may conclusively rely (in the absence of bad faith on the
part of the Trustee) on the advice of the Servicer. Unless the Trustee is
advised differently in writing by the Lessee making the payment or by the
Servicer in writing (with the Servicer's instruction controlling), the Trustee
shall assume that any amount remitted to it by such Lessee is to be deposited
into the Collection Account pursuant to Section 3.03. The Trustee may establish
from time to time such deadline or deadlines as it shall determine are
reasonable or necessary in the administration of the Trust Estate after which
all amounts received or collected by the Trustee on any day shall not be deemed
to have been received or collected until the next succeeding Business Day.
(c) Neither the Servicer, Trustee nor the institution then acting as
Trustee shall have any right of set-off with respect to the Collection Account,
the Reserve Account or the Residual Account, or any investment therein.
(d) So long as no Event of Default shall have occurred and be continuing,
all or a portion of the amounts in the Collection Account, the Reserve Account
and the Residual Account shall be invested and reinvested by the Trustee
pursuant to a Company Order or Servicer Order in one or more Eligible
Investments. Subject to the restrictions on the maturity of investments set
forth in Section 3.01(f), each such Company Order or Servicer Order may
authorize the Trustee to make the specific Eligible Investments set forth
therein, to make Eligible Investments from time to time consistent with the
general instructions set forth therein, or to make specific Eligible Investments
pursuant to instructions received in writing or by telegraph or facsimile
transmission from the employees or agents of the Company or the Servicer, as the
case may be, identified therein, in each case in such amounts as such Company
Order or Servicer Order shall specify. The Company agrees to report as income
for financial reporting and tax purposes (to the extent reportable) all
investment earnings on amounts in the Collection Account, the Reserve Account or
the Residual Account. Each of the Company and the Servicer agrees to give
appropriate and timely investment directions to the Trustee so that there will
not be more than two Business Days in any one calendar year at the end of which
funds in the Collection Account, the Reserve Account or
40
the Residual Account are not invested, directly or indirectly, pursuant to a
Company Order or a Servicer Order in Eligible Investments that mature on or
after the opening of business on the next Business Day.
(e) In the event that either (i) the Company or the Servicer, as the case
may be, shall have failed to give investment directions to the Trustee by 9:30
A.M., New York City time on any Business Day on which there may be uninvested
cash or (ii) an Event of Default shall be continuing, the Trustee shall promptly
invest and reinvest the funds then in the Collection Account, the Reserve
Account or the Residual Account, as the case may be, to the fullest extent
practicable in one or more Eligible Investments. All investments made by the
Trustee shall mature no later than the maturity date therefore permitted by
Section 3.01(f) unless the Trustee shall have received written confirmation from
each Rating Agency, that the liquidation of such Eligible Investments prior to
their respective maturity dates, will not result in the reduction or withdrawal
of such Rating Agency's then-current rating of the Notes.
(f) No investment of any amount held in the Collection Account, the Reserve
Account or the Residual Account shall mature later than the Business Day
immediately preceding the Payment Date which is scheduled to occur immediately
following the date of investment. All income or other gains (net of losses) from
the investment of moneys deposited in the Collection Account, the Reserve
Account and the Residual Account shall be deposited by the Trustee in such
account immediately upon receipt.
(g) Any investment of any funds in the Collection Account, the Reserve
Account and the Residual Account and any sale of any investment held in such
accounts, shall be made under the following terms and conditions:
(i) each such investment shall be made in the name of the Trustee or
in the name of a nominee of the Trustee, in each case in such manner as
shall be necessary to maintain the identity of such investments as assets
of the Trust Estate;
(ii) any certificate or other instrument evidencing such investment
shall be delivered directly to the Trustee or its agent and the Trustee
shall have
41
sole possession of such instrument, and all income on such investment; and
(iii) the proceeds of any sale of an investment shall be remitted by
the purchaser thereof directly to the Trustee for deposit in the account in
which such investment was held.
(h) If any amounts are needed for disbursement from the Collection Account,
the Reserve Account or the Residual Account and sufficient uninvested funds are
not collected and available therein to make such disbursement, in the absence of
a Company Order or Servicer Order for the liquidation of investments held
therein in an amount sufficient to provide the required funds, the Trustee shall
select and cause to be sold or otherwise converted to cash a sufficient amount
of the investments in such accounts.
(i) The Trustee shall not in any way be held liable by reason of any
insufficiency in the Collection Account, the Reserve Account or the Residual
Account resulting from losses on investments made in accordance with the
provisions of this Section 3.01 (but the institution serving as Trustee shall at
all times remain liable for its own debt obligations, if any, constituting part
of such investments). The Trustee shall not be liable for any investment made by
it in accordance with this Section 3.01 on the grounds that it could have made a
more favorable investment or a more favorable selection for sale of an
investment.
SECTION 3.02. Collection of Moneys.
(a) On or before the Issuance Date, the Servicer shall designate an address
for the receipt directly from Lessees of all Lease Payments, Casualty Payments
and Termination Payments on or in respect of each Lease (which payments may be
aggregated by the Lessee paying the same with Similar Transaction Payments and
Other Lease Payments and which designated address may be the same designated
address to which such Similar Transaction Payments and Other Lease Payments may
be sent). The Servicer shall, within two Business Days of receipt of any payment
at such designated address, deposit such payment in the Collection Account. All
Lease Payments, Casualty Payments, Termination Payments and other payments
relating to a Lease received at such designated address and so deposited in the
Collection Account shall constitute part of the Trust Estate. Any Similar
Transaction Payments and Other Lease Payments from time to time received at such
designated address or otherwise received by the Servicer or deposited in the
Collection Account shall not constitute part of the Trust Estate.
42
(b) The Trustee shall from time to time, in accordance with instructions of
the Servicer and the provisions of the Similar Transaction Agreements, withdraw
from the Collection Account any amounts in the Collection Account which the
Servicer advises the Trustee are (i) Similar Transaction Payments and apply such
payments in accordance with the Similar Transaction Agreements and (ii) Other
Lease Payments. Prior to such payment, the Trustee shall have rights to and an
interest in such amounts to the extent (but only to the extent) it is determined
that such amounts actually constitute Transaction Payment Amounts.
(c) If at any time the Company shall receive any payment on or in respect
of any Lease, it shall hold such Payment in trust for the benefit of the Trustee
and the holders of the Notes, shall segregate such payment from the other
property of the Company, and shall, promptly (but in no event later than the
next following Business Day) upon receipt, deliver such payment in the form
received to the Trustee.
SECTION 3.03. Collection Account; Payments.
(a) The Servicer shall within two Business Days of receipt (a "Required
Deposit Date") deposit the following funds, as received, into the Collection
Account:
(i) Lease Payments (net of any Excess Copy Charges and Fee Per Scan
Charges);
(ii) Residual Realizations up to the Residual Amount Cap;
(iii) recoveries from Non-Performing Leases to the extent Copelco has
not substituted Substitute Leases for such Non-Performing Leases (except to
the extent required to reimburse unreimbursed Servicer Advances);
(iv) late charges on delinquent Lease payments not advanced by the
Servicer;
(v) proceeds from repurchases by Copelco of Leases as a result of
breaches of representations and warranties by Copelco to the extent Copelco
has not substituted Substitute Leases for such Leases;
(vi) proceeds from investment of funds in the Collection Account, the
Reserve Account and the Residual Account;
(vii) Casualty Payments;
43
(viii) Servicer Advances;
(ix) Termination Payments; and
(x) payments from the Seller to effect a redemption pursuant to
Section 2.01(b).
(b) Unless the Notes have been declared due and payable pursuant to Section
6.02 and moneys collected by the Trustee are being applied in accordance with
Section 6.06, Available Funds on deposit in the Collection Account and the
amounts, if any, deposited into the Collection Account from the Reserve Account
and the Residual Account in accordance with the provisions of Section 3.04 shall
be withdrawn on or before each Payment Date from the Collection Account, in the
amounts required, for application in the following order of priority, to make
the following required payments:
(i) to pay the Servicing Fee;
(ii) to reimburse unreimbursed Servicer Advances in respect of a prior
Payment Date;
(iii) concurrently: (A) to make Interest Payments on the Class A-1
Notes; (B) to make Interest Payments on the Class A- 2 Notes; (C) to make
Interest payments on the Class A-3 Notes; (D) to make Interest payments on
the Class A-4 Notes;
(iv) to make Interest Payments on the Class B Notes;
(v) to make Interest Payments on the Class C Notes;
(vi) to make the Class A Principal Payment (i) to the Class A-1
Noteholders only until the Outstanding Principal Amount on the Class A-1
Notes is reduced to zero, then (ii) to the Class A-2 Noteholders only
until the Outstanding Principal Amount on the Class A-2 Notes is reduced
to zero, then (iii) to the Class A-3 Noteholders only until the
Outstanding Principal Amount on the Class A-3 Notes is reduced to zero, and
finally, (iv) to the Class A-4 Noteholders until the Outstanding
Principal Amount on the Class A-4 Notes is reduced to zero;
44
(vii) to pay the Class B Principal Payment to the Class B Noteholders;
(viii) to pay the Class C Principal Payment to the Class C
Noteholders;
(ix) to pay the Additional Principal, if any, as an additional
reduction of principal, first to the Class A-2 Noteholders until the
Outstanding Class A-2 Principal Amount has been reduced to zero, second to
the Class A-3 Noteholders until the Outstanding Class A-3 Principal Amount
has been reduced to zero, third to the Class A-4 Noteholders until the
Outstanding Class A-4 Principal Amount has been reduced to zero, thereafter
to the Class B Noteholders as an additional reduction of principal until
the Outstanding Class B Principal Amount has been reduced to zero and,
thereafter to the Class C Noteholders until the Outstanding Class C
Principal Amount has been reduced to zero;
(x) to make a deposit to the Reserve Account in an amount equal to
the excess of the Required Reserve Amount over the Available Reserve
Amount;
(xi) during such time as a Residual Event has occurred and is
continuing, to make a deposit to the Residual Account in an amount equal to
the balance of the remaining Residual Realizations on deposit in the
Collection Account and included in Available Funds up to the Residual
Amount Cap after giving effect to the allocations in clauses (i) through
(x) above on such Payment Date; and
(xii) to the Company, the balance, if any.
Notwithstanding the foregoing, the Trustee shall retain in the Collection
Account an amount equal to all Lease Payments received that were due since the
prior Due Period, and all Casualty Payments and Termination Payments received by
the Trustee after the Determination Date for such Payment Date and shall not
distribute any such amounts on such Payment Date. If at any time any amount or
portion thereof previously distributed pursuant to this Section 3.03(b) shall
have been recovered, or shall be subject to recovery, in any proceeding with
respect to the Company or otherwise, then for purposes of determining future
distributions pursuant to this Section 3.03(b) such amount
45
or portion thereof shall be deemed to have not been previously so distributed.
(c) The total amount of Residual Realizations which are required to be
deposited into the Collection Account on any day, is an amount up to the
Available Residual Amount on such date.
SECTION 3.04. The Reserve Account and the Residual Account.
(a) On each Payment Date, the Trustee shall transfer (i) to the Reserve
Account from the Collection Account such amounts as shall be required by Section
3.03(b)(x) and (ii) to the Residual Account from the Collection Account such
amounts as shall be required by Section 3.03(b)(xi).
(b) If by 12:00 noon, New York City time, on the third Business Day
preceding any Payment Date, the amount of collected funds on deposit in the
Collection Account available for distribution under Section 3.03(b) is
insufficient to permit on such Payment Date all distributions required by
Section 3.03(b)(i) through 3.03(b)(ix) (such payments, the "Required Payments"
and such shortfall, an "Available Funds Shortfall") , then, to the extent of the
Available Reserve Amount on deposit in the Reserve Account, the Trustee shall
transfer, not later than the end of such Business Day, from the Reserve Account
to the Collection Account such amount as shall be necessary to make on such
Payment Date all Required Payments. In addition, in the event that the Available
Funds Shortfall is greater than the Available Reserve Amount, then, the Trustee
shall transfer, not later than the end of such Business Day, from the Residual
Account to the Collection Account, an amount equal to the lesser of (i) the
remaining Available Funds Shortfall and (ii) the amount, if any, on deposit in
the Residual Account and available therefore.
(c) In the event that after giving effect to all the disbursements required
to be made on any Payment Date, the Available Reserve Amount exceeds the
Required Reserve Amount, the Trustee shall transfer, not later than the end of
business on such Payment Date, an amount equal to such excess to the Company.
(d) In the event that there are funds on deposit in the Residual Account,
the Trustee shall transfer, not later than the close of Business on such Payment
Date after making required withdrawals, if any on such Payment Date pursuant to
Section 3.04(b), an amount equal to the amount on deposit in the Residual
Account to the Reserve Account to the extent that the amount on deposit in the
Reserve Account is less than the Required Reserve Amount and thereafter, to the
Company. Funds on deposit in the Residual Account shall only be available for
46
allocation pursuant to Section 3.04(b) during such time as a Residual Event has
occurred and is continuing.
(e) Upon termination of this Indenture, any balance remaining in the
Reserve Account and the Residual Account, after all obligations to the
Noteholders hereunder have been fully satisfied, shall be paid to reimburse the
Trustee for any amounts owing to it arising from the performance of its
obligations under this Indenture and, then, to the Company.
SECTION 3.05. Reports by Trustee; Notices of Certain Payments.
(a) The Trustee shall within two Business Days after the request of the
Company, the Servicer or any Noteholder, deliver to the requesting person a
written report setting forth the amounts on deposit in the Collection Account,
the Reserve Account and the Residual Account and identifying the investments
included therein.
(b) Within five Business Days following each Payment Date or as promptly as
possible thereafter but in no event later than two Business Days following the
receipt of the Monthly Status Report from the Servicer pursuant to Section 5.01
of the Sales and Servicing Agreement, the Trustee shall mail to the Company,
Copelco, each Rating Agency and the Servicer and make available to each
Noteholder the following information:
(i) the principal amount of all Outstanding Class A-1 Notes, Class A-2
Notes, Class A-3 Notes, Class A-4 Notes, Class B Notes, and Class C Notes,
respectively, and of the Outstanding Class A-1 Notes, Class A-2, Class A-3
Notes, Class A-4 Notes, Class B Notes and Class C Notes, respectively, held
by each Noteholder on the Record Date with respect to such Payment Date;
(ii) the amount of Interest Payments and payments in reduction of
principal paid on such Payment Date with respect to all Class A-1 Notes,
Class A-2 Notes, Class A-3 Notes, Class A-4 Notes, Class B Notes and Class
C Notes, respectively, and with respect to the Notes held by each
Noteholder;
(iii) the amount of the Servicing Fee and unreimbursed Servicer
Advances paid on such Payment Date pursuant to Section 3.03(b)(i) and
Section 3.03(b)(ii);
(iv) the Available Residual Amount and the Utilized Residual Amounts
as of the date of the most
47
recent Monthly Status Report delivered pursuant to Section 5.01 of the
Sales and Servicing Agreement;
(v) the amounts, if any, paid to the Servicer or Copelco pursuant to
the last paragraph of Section 3.03(b); and
(vi) the amount on deposit in the Collection Account, the Reserve
Account and the Residual Account, in each case after giving effect to all
of the withdrawals and applications or transfers required on or before such
Payment Date pursuant to Sections 3.02, 3.03 and 3.04.
With each report of the Trustee furnished pursuant to this Section 3.05(b)
following any Payment Date, the Trustee shall enclose a copy of the Servicing
Report and the report required to be furnished to the Trustee by the Servicer
following such Payment Date pursuant to Section 5.01 of the Sales and Servicing
Agreement or, if such reports have not been received, a statement to such
effect.
SECTION 3.06. Trustee May Rely on Certain Information from Copelco and
Servicer.
Pursuant to Sections 3.01, 4.05 and 5.01 through 5.03 of the Sales and
Servicing Agreement and Section 3.02 hereof, the Servicer is required to furnish
to the Trustee from time to time certain information and make various
calculations which are relevant to the performance of the Trustee's duties in
this Article Three and in Article Four of this Indenture. The Trustee shall be
entitled to rely in good faith on such information or calculations in the
performance of its duties hereunder (i) unless and until a Responsible Officer
of the Trustee has actual knowledge, or is advised by any Noteholder (either in
writing or orally with prompt written or telecopied confirmation), that such
information or calculations is or are incorrect, or (ii) unless there is a
manifest error in any such information.
ARTICLE 4.
RELEASE OF LEASES AND EQUIPMENT
SECTION 4.01. Release of Equipment.
Subject to the satisfaction of the provisions of Section 4.02, the Trustee
shall release Equipment from the Lien of the Indenture upon the occurrence of
any of the following events: (a) the sale of such Equipment pursuant to Section
3.03(b) of the Sales and Servicing Agreement (unless retained by the Company for
re-leasing), (b) the expiration
48
of the related Lease upon the payment of the final Lease Payment due and payable
under such Lease and the deposit of any Residual Realization in respect thereof
subject to the Residual Amount Cap, (c) the repurchase of the related Lease in
accordance with the provisions of Section 4 of the Sales and Servicing
Agreement, (d) the addition of an Additional Lease to the extent new Equipment
is provided in replacement of such Equipment in accordance with the provisions
of Section 9 of the Sales and Servicing Agreement and (e) upon the substitution
of a Substitute Lease in accordance with the provisions of Section 9 of the
Sales and Servicing Agreement. The proceeds of any such sale, repurchase or
releasing shall be deposited in the Collection Account for disposition under
this Indenture.
SECTION 4.02. Release of Leases Upon Final Lease Payment.
In the event that the Trustee shall have received notice (either in writing
or orally with prompt written or telecopied confirmation) from the Servicer that
the Trustee has received from amounts paid by the Lessee, from the Lease
Repurchase Amount or from the proceeds of the Equipment subject to any Lease (i)
the final Lease Payment due and payable under such Lease and the deposit of any
Residual Realization in respect thereof, (ii) a Termination Payment in respect
of such Lease and the deposit of any Residual Realization in respect thereof,
(iii) a Casualty Payment under such Lease (and, following such final Lease
Payment, Casualty Payment or Termination Payment, no further payments on or in
respect of such Lease are or will be due and payable), or (iv) the full amount
of any Non-Performing Lease Pay-Through Amount with respect to such Lease, such
Lease shall be released from the lien of this Indenture.
SECTION 4.03. Execution of Documents.
The Trustee shall promptly execute and deliver such documents, including
without limitation partial releases and termination statements (which shall be
furnished to the Trustee by the Company), and take such other actions as the
Company, by Company Request, may reasonably request (including the return of any
Lease which has been released) to fully effectuate the release from this
Indenture of any Lease and interests in the related Equipment required to be so
released pursuant to Sections 4.01 or 4.02.
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ARTICLE 5.
SERVICER EVENTS OF DEFAULT; SUBSTITUTE SERVICER
SECTION 5.01. Servicer Events of Default.
If a Servicer Event of Default shall have occurred and be continuing, the
Trustee shall, upon the written request of the holders of 66-2/3% of the then
Outstanding Principal Amount of the Notes, give notice in writing to the
Servicer of the termination of all of the rights and obligations of the Servicer
under the Sales and Servicing Agreement (but none of Copelco's obligations
pursuant to Section 4 of the Sales and Servicing Agreement, which shall survive
such termination). On and after the giving of such written notice, all rights
and obligations of the Servicer under the Sales and Servicing Agreement,
including, without limitation, the Servicer's right thereunder to receive the
Servicing Fee, but none of the Servicer obligations pursuant to Section 4
thereof, shall pass to, be vested in, and be assumed by the Trustee, and the
Trustee shall be authorized to, and shall, execute and deliver, on behalf of the
Servicer, as attorney-in-fact or otherwise, any and all documents and other
instruments, and to do or accomplish all other acts or things necessary or
appropriate to effect the purposes of such termination and of such passing,
vesting, and assumption; provided that in performing the duties of the Servicer
under the Sales and Servicing Agreement the Trustee shall at all times be deemed
to be acting as the Trustee hereunder and shall be entitled to the full benefit
of all the protections, benefits, immunities and indemnities provided in this
Indenture for or with respect to the Trustee, including without limitation those
set forth in Article Seven hereof.
SECTION 5.02. Substitute Servicer.
Notwithstanding the provisions of Section 5.01, the Trustee may, if it
shall be unwilling to continue to act as the successor to the Servicer in
accordance with Section 5.01, or shall, if it is unable to continue to so act or
is so instructed in writing by the holders of 66-2/3% of the then Outstanding
Principal Amount of the Notes, appoint a successor to the Servicer in accordance
with the provisions of Section 8.03 of the Sales and Servicing Agreement.
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ARTICLE 6.
EVENTS OF DEFAULT; REMEDIES
SECTION 6.01. Events of Default.
"Event of Default," wherever used herein, means any one of the following
(whatever the reason for such Event of Default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(a) default in making of Principal Payments or Interest Payments when
such become due and payable;
(b) default in the performance, or breach, of any covenant set forth
in Section 8.07(b) and Section 8.08;
(c) default in the performance, or breach, of any covenant of the
Company in this Indenture (other than a covenant dealing with a default in
the performance of which or the breach of which is specifically dealt with
elsewhere in this Section 6.01) or the Sales and Servicing Agreement, and
continuance of such default or breach for a period of 30 days after the
earliest of (i) any officer of the Company first acquiring knowledge
thereof, (ii) the Trustee's giving written notice thereof to the Company or
(iii) the holders of a majority of the then Outstanding Principal Amount of
the Notes giving written notice thereof to the Company and the Trustee;
(d) if any representation or warranty of the Company or Copelco made
in this Indenture or the Sales and Servicing Agreement or any other writing
provided to the holders of the Notes shall prove to be incorrect in any
material respect as of the time when the same shall have been made;
provided, however, that the breach of any representation or warranty made
by Copelco or the Company in the Sales and Servicing Agreement shall be
deemed to be "material" for purposes of this Section 6.01(d) only if the
facts or circumstances causing such representation or warranty to be
incorrect shall negatively affect the Trust Estate in some material
respect, the enforceability hereof or of the Notes and provided further,
that a material breach of any representation or warranty made by Copelco in
Section 2.04 or 2.05(b) of the Sales and Servicing Agreement with respect
to any of the Leases or the interests in the Equipment subject thereto
shall not constitute an Event of Default if Copelco repurchases such Lease
and interests in the related
51
Equipment in accordance with Section 4.05(a) of the Sales and Servicing
Agreement;
(e) the entry by a court having jurisdiction in the premises of (i) a
decree or order for relief in respect of the Company in an involuntary case
or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization, or other similar law or (ii) a decree or order adjudging
the Company a bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization, arrangement, adjustment, or composition of
or in respect of the Company under any applicable federal or state law, or
appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator, or other similar official of the Company or of any
substantial part of its property, or ordering the winding up or liquidation
of its affairs, and the continuance of any such decree or order for relief
or any such other decree or order unstayed and in effect for a period of 60
consecutive days; or
(f) the commencement by the Company of a voluntary case or proceeding
under any applicable federal or state bankruptcy, insolvency,
reorganization, or other similar law or of any other case or proceeding to
be adjudicated a bankrupt or insolvent, or the consent by it to the entry
of a decree or order for relief in respect of the Company in an involuntary
case or proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization, or other similar law or to the commencement of
any bankruptcy or insolvency case or proceeding against it, or the filing
by it of a petition or answer or consent seeking reorganization or relief
under any applicable federal or state law, or the consent by it to the
filing of such petition or to the appointment of or taking possession by a
custodian, receiver, liquidator, assignee, trustee, sequestrator, or
similar official of the Company or of any substantial part of its property,
or the making by it of an assignment for the benefit of creditors, or the
Company's failure to pay its debts generally as they become due, or the
taking of corporate action by the Company in furtherance of any such
action.
SECTION 6.02. Acceleration of Maturity; Rescission and Annulment.
(a) If an Event of Default of the kind specified in Section 6.01(e) or
Section 6.01(f) occurs, the unpaid principal amount of the Notes shall
automatically become due and payable at par together with all accrued and unpaid
52
interest thereon, without presentment, demand, protest or notice of any kind,
all of which are hereby waived by the Company. If an Event of Default (other
than an Event of Default of the kind described in Section 6.01 (e) and Section
6.01(f)) occurs and is continuing, then and in every such case the Trustee
shall, if so directed by the holders of Notes evidencing 66-2/3% (33-1/3% in the
case of an Event of Default of the kind described in Section 6.01(a)) of the
then Outstanding Class A Principal Amount (or if the Class A Notes are no longer
Outstanding, the holders of Notes evidencing 66-2/3% of the then Outstanding
Class B Principal Amount or if the Class A Notes and Class B Notes are no longer
outstanding, the holders of Notes evidencing 66-2/3% of the then Outstanding
Class C Principal Amount), or the holders of such percentages of the then
Outstanding Principal Amount of Notes may, declare the unpaid principal amount
of all the Notes to be due and payable immediately, by a notice in writing to
the Company (and to the Trustee if given by Noteholders), and upon any such
declaration such principal amount shall become immediately due and payable
together with all accrued and unpaid interest thereon, without presentment,
demand, protest or other notice of any kind, all of which are hereby waived by
the Company.
(b) At any time after such a declaration of acceleration has been made and
before a judgment or decree for payment of the money due has been obtained by
the Trustee as hereinafter in this Article provided, the holders of Notes
evidencing 66-2/3% of the then Outstanding Class A Principal Amount of the Class
A Notes (or if the Class A Notes are no longer Outstanding, the holders of Notes
evidencing 66-2/3% of the then Outstanding Class B Principal Amount of the Class
B Notes or if the Class A Notes and Class B Notes are no longer outstanding, the
holders of Notes evidencing 66-2/3% of the then Outstanding Class C Principal
Amount), by written notice to the Company and the Trustee, may rescind and annul
such declaration and its consequences if:
(i) the Company has paid or deposited with the Trustee a sum
sufficient to pay:
(A) all Principal Payments on any Class A Notes, Class B Notes
and Class C Notes which have become due otherwise than by such
declaration of acceleration and interest thereon from the date when
the same first became due until the date of payment or deposit at the
appropriate Note Interest Rate,
(B) all Interest Payments due with respect to any Class A Notes,
Class B Notes and the Class C Notes and, to the extent that payment of
such
53
interest is lawful, interest upon overdue interest from the date when
the same first became due until the date of payment or deposit at a
rate per annum equal to the appropriate Note Interest Rates, and
(C) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements, and advances of the
Trustee, its agents and counsel;
and
(ii) all Events of Default, other than the non-payment of the
Outstanding Principal Amount of the Notes which has become due solely by
such declaration of acceleration, have been cured or waived as provided in
Section 6.13.
No such rescission shall affect any subsequent Event of Default or impair any
right consequent thereon.
SECTION 6.03. Remedies.
(a) If an Event of Default occurs and is continuing of which a Responsible
Officer has actual knowledge, the Trustee shall immediately give notice to each
Noteholder as set forth in Section 7.02 and shall solicit the Noteholders for
advice. The Trustee shall then take such action as so directed by the holders of
Notes evidencing 66-2/3% (33-1/3% in the case of an Event of Default of the kind
described in Section 6.01(a)) of the then Outstanding Class A Principal Amount
(or if the Class A Notes are no longer outstanding, the holders of Notes
evidencing 66-2/3% of the then Outstanding Class B Principal Amount or if the
Class A Notes and Class B Notes are no longer outstanding, the holders of Notes
evidencing 66-2/3% of the then Outstanding Class C Principal Amount).
(b) Following any acceleration of the Notes, the Trustee shall have all of
the rights, powers and remedies with respect to the Trust Estate as are
available to secured parties under the Uniform Commercial Code or other
applicable law. Such rights, powers and remedies may be exercised by the Trustee
in its own name as trustee of an express trust.
(c) If an Event of Default specified in Section 6.01(a) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust against the Company for the whole amount of
principal and interest remaining unpaid.
(d) In exercising its rights and obligations under this Section 6.03, the
Trustee may sell the Trust Estate; provided that if the Event of Default
involves other than non-payment of principal or interest on the Notes, then such
sale must be for an amount greater than or equal to amounts due under clauses
first through fourth in Section 6.06. Neither the Trustee nor any Noteholder
shall have any rights against the Company other than to enforce the Lien
54
against the Leases and the Equipment and to sell the Trust Estate.
SECTION 6.04. Trustee Shall File Proofs of Claim.
(a) In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition, or other
judicial proceeding relative to the Company, Copelco, the Servicer or any other
obligor upon the Notes or the other obligations secured hereby or relating to
the property of the Company, Copelco, the Servicer or of such other obligor or
their creditors, the Trustee (irrespective of whether the principal of the Notes
shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Trustee shall have made any demand on
the Company, Copelco or the Servicer for the payment of overdue principal or
interest or any such other obligation) shall by intervention in such proceeding
or otherwise,
(i) file and prove a claim for the whole amount of principal and
interest owing and unpaid in respect of the Notes and any other obligation
secured hereby and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of
the Noteholders allowed in such judicial proceeding, and
(ii) collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator, or
other similar official in any such judicial proceeding is hereby authorized by
each Noteholder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Noteholders
to pay to the Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07.
(b) Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder any plan
of reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any holder thereof or to authorize the Trustee to vote in respect
of the claim of any Noteholder in any such proceeding.
55
SECTION 6.05. Trustee May Enforce Claims Without Possession of Notes.
All rights of action and claims under this Indenture or the Notes may be
prosecuted and enforced by the Trustee without the possession of any of the
Notes or the production thereof in any proceeding relating thereto, and any such
proceeding instituted by the Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment shall, after provision for the
payment of the reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel, be for the ratable benefit of the holders
of the Notes in respect of which such judgment has been recovered.
SECTION 6.06. Application of Money Collected.
Any money collected by the Trustee pursuant to this Article, and any moneys
that may then be held or thereafter received by the Trustee shall be applied in
the following order, at the date or dates fixed by the Trustee and, in case of
the distribution of the entire amount due on account of principal or interest,
upon presentation of the Notes and surrender thereof:
First to the payment of all costs and expenses of collection incurred
by the Trustee and the Noteholders (including the reasonable fees and
expenses of any counsel to the Trustee and the Noteholders);
Second if the person then acting as Servicer under the Sales and
Servicing Agreement is not Copelco Capital or an Affiliate of Copelco
Capital, to the payment of all Servicer's Fees then due to such person;
Third first, pro-rata to the payment of all accrued and unpaid
interest on the Outstanding Class A-1 Principal Amount, Outstanding Class
A-2 Principal Amount, Outstanding Class A-3 Principal Amount and
Outstanding Class A-4 Principal Amount, respectively, to the date of
payment thereof, including (to the extent permitted by applicable law)
interest on any overdue installment of interest and principal from the
maturity of such installment to the date of payment thereof at the rate per
annum equal to the Class A-1 Note Interest Rate, Class A-2 Note Interest
Rate and Class A-3 Note Interest Rate and Class A-4 Note Interest Rate,
respectively, second, to the payment of all accrued and unpaid interest on
the Outstanding Class B Principal Amount to the date of payment thereof,
including (to the extent permitted by applicable law) interest on any
overdue installment of interest and principal from the maturity of such
installment to the date of payment thereof at the rate per annum equal to
the Class B Note Interest Rate, third, to the payment of all accrued and
unpaid interest on the Outstanding Class C Principal Amount to the date of
payment thereof, including (to the extent permitted by applicable law)
interest on any overdue installment of interest and principal from the
maturity of such installment to the date of payment thereof at the rate per
annum equal to the Class C Note Interest Rate, fourth, to the payment of
the Outstanding Class A-1 Principal Amount, fifth, to the payment of the
Outstanding Class A-2 Principal Amount, Outstanding Class A-3 Principal
Amount and Outstanding Class A-4 Principal Amount pro-rata, sixth, to the
payment of the Outstanding Class B Principal Amount and seventh, to the
payment of the Outstanding Class C Principal Amount; provided, that the
Noteholders may allocate such payments for interest, principal and premium
at their own discretion, except that no such allocation shall affect the
allocation of such amounts or future payments received by any other
Noteholder;
56
Fourth to the payment of amounts then due the Trustee hereunder;
Fifth if the person then acting as Servicer is Copelco Capital or an
Affiliate of Copelco Capital, to the payment of all Servicer's Fees then
due to such Person; and
Sixth to the payment of the remainder, if any, to the Company or any
other Person legally entitled thereto.
57
SECTION 6.07. Limitation on Suits.
None of the Noteholders shall have any right to institute any proceeding,
judicial or otherwise, with respect to this Indenture, or for the appointment of
a receiver or trustee, or for any other remedy hereunder, unless:
(i) such Noteholder has previously given written notice to the Trustee
of a continuing Event of Default;
(ii) the holders of not less than 25% of the then Outstanding Class A
Principal Amount of the Class A Notes (or if the Class A Notes are no
longer outstanding, the holders of Notes evidencing 66-2/3% of the then
Outstanding Class B Principal Amount of the Class B Notes or if the Class A
Notes and Class B Notes are no longer outstanding, the holders of Notes
evidencing 66-2/3% of the then Outstanding Class C Principal Amount) shall
have made written request to the Trustee to institute proceedings in
respect of such Event of Default in its own name as Trustee hereunder;
(iii) such Noteholder or Noteholders have offered to the Trustee
adequate indemnity (which the Trustee agrees, in the case of the original
purchasers of the Notes, need only be the written promise of such Person)
against the costs, expenses and liabilities to be incurred in compliance
with such request;
(iv) the Trustee for 30 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(v) so long as any of the Notes remain Outstanding, no direction
inconsistent with such written request has been given to the Trustee during
such 30-day period by the holders of a majority of the then Outstanding
Principal Amount of the Notes;
it being understood and intended that no one or more Noteholders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb, or prejudice the rights of any other
Noteholders, or to obtain or to seek to obtain priority or preference over any
other Noteholders or to enforce any right under this Indenture, except in the
manner herein provided and for the equal and ratable benefit of all the
Noteholders. It is further understood and intended that so long as any portion
of the Notes remains Outstanding, Copelco shall not have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture (other
than for the enforcement of Sections 3.03(b), 3.04, 4.01 and 4.02 hereof) or for
the appointment of a receiver or trustee (including without limitation a
proceeding under the Bankruptcy Code), or for any other remedy hereunder.
Nothing in this Section 6.07 shall be construed as limiting the rights of
otherwise qualified
58
Noteholders to petition a court for the removal of a Trustee pursuant to Section
7.09(h) hereof.
SECTION 6.08. Unconditional Right of Noteholders to Receive Principal and
Interest.
Notwithstanding any other provision in this Indenture, other than the
provisions hereof limiting the right to recover amounts due on the Notes to
recoveries from the property of the Trust Estate, the holder of any Note shall
have the absolute and unconditional right to receive payment of the principal of
and interest on such Note on the Maturities for such payments, including the
Stated Maturity, and to institute suit for the enforcement of any such payment,
and such rights shall not be impaired without the consent of such Noteholder.
SECTION 6.09. Restoration of Rights and Remedies.
If the Trustee or any Noteholder has instituted any proceeding to enforce
any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Noteholder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Noteholders
shall be restored severally and respectively to their former positions hereunder
and thereafter all rights and remedies of the Trustee and the Noteholders
continue as though no such proceeding had been instituted.
SECTION 6.10. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment of
mutilated, destroyed, lost, or stolen Notes in the last paragraph of Section
2.04, no right or remedy herein conferred upon or reserved to the Trustee or to
the Noteholders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.11. Delay or Omission Not Waiver.
No delay or omission of the Trustee or of any holder of any Note to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by
59
this Article or by law to the Trustee or to the Noteholders may be exercised
from time to time, and as often as may be deemed expedient, by the Trustee or by
the Noteholders, as the case may be.
SECTION 6.12. Control by Noteholders.
Except as may otherwise be provided in this Indenture, until such time as
the conditions specified in Sections 10.01(a)(i) and (ii) have been satisfied in
full, the holders of 66-2/3% of the then Outstanding Class A Principal Amount
of the Class A Notes (or if the Class A Notes are no longer outstanding, the
holders of Notes evidencing 66-2/3% of the then Outstanding Class B Principal
Amount of the Class B Notes or if the Class A Notes and Class B Notes are no
longer outstanding, the holders of Notes evidencing 66-2/3% of the then
Outstanding Class C Principal Amount) shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee.
Notwithstanding the foregoing,
(i) no such direction shall be in conflict with any rule of law or
with this Indenture;
(ii) the Trustee shall not be required to follow any such direction
which the Trustee reasonably believes might result in any personal
liability on the part of the Trustee for which the Trustee is not
adequately indemnified; and
(iii) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with any such direction; provided that
the Trustee shall give notice of any such action to each Noteholder.
SECTION 6.13. Waiver of Events of Default.
(a) The holders of 66-2/3% of the then Outstanding Class A Principal
Amount of the Class A Notes (or if the Class A Notes are no longer outstanding,
the holders of Notes evidencing 66-2/3% of the then Outstanding Class B
Principal Amount of the Class B Notes or if the Class A Notes and Class B Notes
are no longer outstanding, the holders of Notes evidencing 66-2/3% of the then
Outstanding Class C Principal Amount) may, by one or more instruments in
writing, waive any Event of Default hereunder and its consequences, except a
continuing Event of Default:
(i) in respect of the payment of the principal of or premium or
interest on any Note (which may only be waived by the holder of such Note),
or
(ii) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the holder of
each Outstanding Note affected (which only may be waived by the holders of
all Outstanding Notes affected).
(b) A copy of each waiver pursuant to Section 6.13(a) shall be furnished by
the Company to the Trustee. Upon any such waiver, such Event of Default shall
cease to exist and shall be deemed to have been cured, for every
60
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other Event of Default or impair any right consequent thereon.
SECTION 6.14. Undertaking for Costs.
All parties to this Indenture agree (and each holder of any Note by its
acceptance thereof shall be deemed to have agreed) that any court may in its
discretion require, in any suit for the enforcement of any right or remedy under
this Indenture, or in any suit against the Trustee for any action taken,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Noteholder, or group of Noteholders,
holding in the aggregate more than 10% of the then Outstanding Principal Amount
of the Notes, or to any suit instituted by any Noteholder for the enforcement of
the payment of the principal of or interest on any Note on or after the
Maturities for such payments, including the Stated Maturity as applicable.
SECTION 6.15. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
SECTION 6.16. Sale of Trust Estate.
(a) The power to effect any sale of any portion of the Trust Estate
pursuant to Section 6.03 shall not be exhausted by any one or more sales as to
any portion of the Trust Estate remaining unsold, but shall continue unimpaired
until the entire Trust Estate shall have been sold or all amounts payable on the
Notes shall have been paid. The Trustee may from time to time, upon directions
in accordance
61
with Section 6.12, postpone any public sale by public announcement made at the
time and place of such sale. For any public sale of the Trust Estate, the
Trustee shall have provided each Noteholder with notice of such sale at least
two weeks in advance of such sale which notice shall specify the date, time and
location of such sale.
(b) To the extent permitted by applicable law, the Trustee shall not in any
private sale sell to a third party the Trust Estate, or any portion thereof
unless,
(i) until such time as the conditions specified in Sections
10.01(a)(i) and (ii) have been satisfied in full, the holders of 66-2/3% of
the then Outstanding Principal Amount of each Class of the Notes voting
separately consent to or direct the Trustee in writing to make such sale;
or
(ii) the proceeds of such sale would be not less than the sum of all
amounts due to the Trustee hereunder and the entire unpaid principal amount
of the Notes and interest due or to become due thereon in accordance with
Section 6.06 on the Payment Date next succeeding the date of such sale.
The foregoing provisions shall not preclude or limit the ability of the Trustee
to purchase all or any portion of the Trust Estate at a private sale.
(c) In connection with a sale of all or any portion of the Trust Estate:
(i) any one or more Noteholders may bid for and purchase the property
offered for sale, and upon compliance with the terms of sale may hold,
retain, and possess and dispose of such property, without further
accountability, and any Noteholder may, in paying the purchase money
therefore, deliver in lieu of cash any Outstanding Notes or claims for
interest thereon for credit in the amount that shall, upon distribution of
the net proceeds of such sale, be payable thereon, and the Notes, in case
the amounts so payable thereon shall be less than the amount due thereon,
shall be returned to the Noteholders after being appropriately stamped to
show such partial payment;
(ii) the Trustee shall execute and deliver an appropriate instrument
of conveyance transferring its interest in any portion of the Trust Estate
in connection with a sale thereof;
(iii) the Trustee is hereby irrevocably appointed the agent and
attorney-in-fact of the Company to transfer and convey its interest in any
portion of the Trust Estate in connection with a sale thereof, and to take
all action necessary to effect such sale; and
62
(iv) no purchaser or transferee at such a sale shall be bound to
ascertain the Trustee's authority, inquire into the satisfaction of any
conditions precedent or see to the application of any moneys.
(d) The method, manner, time, place and terms of any sale of all or any
portion of the Trust Estate shall be commercially reasonable.
(e) The provisions of this Section 6.16 shall not be construed to restrict
the ability of the Trustee to exercise any rights and powers against the Company
or the Trust Estate that are vested in the Trustee by this Indenture, including,
without limitation, the power of the Trustee to proceed against the collateral
subject to the lien of this Indenture and to institute judicial proceedings for
the collection of any deficiency remaining thereafter.
ARTICLE 7.
THE TRUSTEE
SECTION 7.01. Certain Duties and Responsibilities.
(a) Except during the continuance of an Event of Default known to the
Trustee,
(i) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture; but in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture.
(b) In case an Event of Default has occurred and is continuing to the
actual knowledge of a Responsible Officer of the Trustee, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in their exercise, as
63
a prudent person would exercise or use under the circumstances in the conduct of
his own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that:
(i) this subsection shall not be construed to limit the effect of
subsection (a) of this Section;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved, subject to
Section 7.03(f) hereof, that the Trustee was negligent in ascertaining the
pertinent facts;
(iii) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction
of the Noteholders in accordance with Section 6.12 relating to the time,
method, and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred upon the Trustee,
under this Indenture; and
(iv) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any
of its rights or powers, if it shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section.
SECTION 7.02. Notice of Defaults or Events of Default.
Within two Business Days after a Responsible Officer obtaining knowledge of
the occurrence of any Default or Event of Default hereunder, the Trustee shall
transmit, by certified mail return receipt requested, hand delivery or overnight
courier, to all Noteholders, as their names and addresses appear in the Note
Register, and the Rating Agencies notice of such Default or Event of Default
hereunder known to the Trustee, unless such Default or Event of Default shall
have been cured or waived.
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SECTION 7.03. Certain Rights of Trustee.
Subject to the provisions of Section 7.01:
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
note, debenture, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the
proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any action
of the Company may be sufficiently evidenced by a Company Order;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel as to legal matters and the
written advice of any such counsel selected by the Trustee with due care
shall be full and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction
of any of the Noteholders pursuant to this Indenture, unless such
Noteholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
note, debenture, other evidence of indebtedness, or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled
65
to examine the books, records and premises of the Company, personally or by
agent or attorney; and
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by
it hereunder.
SECTION 7.04. Not Responsible for Recitals or Issuance of Notes.
The recitals contained herein and in the Notes, except the Trustee's
certificates of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Notes. The Trustee shall not be accountable for the use or application by
the Company of the proceeds of the Notes.
SECTION 7.05. May Hold Notes.
The Trustee, in its individual or any other capacity, may become the owner
or pledgee of Notes and may otherwise deal with the Company with the same rights
it would have if it were not Trustee.
SECTION 7.06. Money Held in Trust.
Money and investments held by the Trustee shall be held in trust in one or
more trust accounts hereunder, but need not be segregated from other funds
except to the extent required by law.
SECTION 7.07. Compensation, Reimbursement, etc.
Subject to Section 3.04(c) of the Sales and Servicing Agreement, the
Company agrees:
(a) to pay to the Trustee from time to time, solely from and only to
the extent that amounts are available, such compensation for all services
rendered by it hereunder as the Company and the Trustee may agree in
writing (which compensation shall not be limited by any provision of law in
regard to the compensation of a trustee of an express trust); and
(b) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request, solely from and only to the extent that amounts
are available under clause twelfth of Section 3.03(b) or
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clause first of Section 6.06(a), for all reasonable expenses,
disbursements, and advances incurred or made by the Trustee in accordance
with any provision of this Indenture (including the reasonable compensation
and the expenses and disbursements of its agents and counsel), except any
such expense, disbursement, or advance as may be attributable to its
negligence or bad faith.
SECTION 7.08. Corporate Trustee Required; Eligibility.
There shall at all times be a Trustee hereunder which shall (a) be a
corporation organized and doing business under the laws of the United States of
America, any state thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers; (b) have a combined capital and surplus
of at least $100,000,000; (c) be subject to supervision or examination by
federal or state authority; and (d) at the time of appointment, shall have
long-term debt obligations (or, if the Trustee does not have outstanding
long-term debt obligations and is a subsidiary of a holding company, which
holding company shall have long-term obligations) having a credit rating of at
least "A-" from S&P and Baa3 from Xxxxx'x.
If such corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of said supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter specified
in this Article.
This Indenture shall always have a Trustee who satisfies the requirements
of Section 310(a)(1) of the Trust Indenture Act. The Trustee is subject to the
provisions of Section 310(b) of the Trust Indenture Act regarding
disqualification of a trustee upon acquiring any conflicting interest.
SECTION 7.09. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 7.10.
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(b) The Trustee may resign at any time by giving written notice thereof to
the Company and by mailing notice of resignation by first-class mail, postage
prepaid, to Noteholders at their addresses appearing on the Note Register.
(c) The Trustee may be removed at any time by Act of the holders of not
less than a majority of the then Outstanding Principal Amount of the Notes,
delivered to the Trustee and the Company.
(d) If the Trustee shall resign, be removed, or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Company,
with the consent of the holders of 66-2/3% of the Outstanding Principal Amount
of the Notes, by an act of the Company, shall promptly appoint a successor
Trustee.
(e) If no successor Trustee shall have been so appointed by the Company or
the Noteholders as hereinbefore provided and accepted appointment in the manner
hereinafter provided within 30 days after any such resignation or removal,
existence of incapability, or occurrence of such vacancy, the Trustee or any
Noteholder may petition any court of competent jurisdiction for the appointment
of a successor Trustee.
(f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee by mailing written
notice of such event by first-class mail, postage prepaid, to all Noteholders,
as their names and addresses appear in the Note Register and each Rating Agency.
Each notice shall include the name of the successor Trustee and the address of
its Corporate Trust Office.
(g) The Company may remove the Trustee if the Trustee fails to comply with
Section 7.08 of this Indenture.
(h) If the Trustee after written request by any Noteholder who has been a
Noteholder for at least six months fails to comply with Section 3.10(b) of the
Trust Indenture Act, such Noteholder may petition any court of competent
jurisdiction, for the removal of the Trustee and the appointment of a successor
Trustee.
SECTION 7.10. Acceptance of Appointment by Successor.
(a) Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Company and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the
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retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges and expenses, execute and deliver an instrument transferring to such
successor Trustee all the rights, powers and trusts of the retiring Trustee and
shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder. Upon request of any such
successor Trustee, the Company shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor Trustee all such
rights, powers and trusts.
(b) No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be qualified and eligible under
this Article.
SECTION 7.11. Merger, Conversion, Consolidation or Succession to Business.
Any Person into which the Trustee may be merged or converted or with which
it may be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
all or substantially all the corporate trust business of the Trustee, shall be
the successor of the Trustee hereunder, provided such Person shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto. In case
any Notes shall have been authenticated, but not delivered, by the Trustee then
in office, any successor by merger, conversion, or consolidation to such
authenticating Trustee may adopt such authentication and deliver the Notes so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Notes. The Trustee shall provide prompt written notice to
each Rating Agency of any event referenced in this Section 7.11.
SECTION 7.12. Co-trustees and Separate Trustees.
(a) At any time or times, if the Company, the Trustee or any Noteholder
determines that it is necessary for the purpose of meeting the legal
requirements of any jurisdiction in which any of the Trust Estate may at the
time be located, the Company and the Trustee shall have power to appoint, and,
upon the written request of the Trustee or the holders of a majority of the then
Outstanding Principal Amount of the Notes, the Company shall for such purpose
join with the Trustee in the execution, delivery,
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and performance of all instruments and agreements necessary or proper to appoint
one or more Persons approved by the Trustee either to act as co-trustee, jointly
with the Trustee, of all or any part of such Trust Estate, or to act as separate
trustee of any such property, in either case with such powers as may be provided
in the instrument of appointment, and to vest in such Person or Persons in the
capacity aforesaid, any property, title, right or power deemed necessary or
desirable, subject to the other provisions of this Section. If the Company does
not join in such appointment within 15 days after the receipt by it of a request
so to do, or in case an Event of Default has occurred and is continuing, the
Trustee, or the holders of a majority of the then Outstanding Principal Amount
of the Notes, alone shall have power to make such appointment.
(b) Should any written instrument from the Company be required by any
co-trustee or separate trustee so appointed for more fully confirming to such
co-trustee or separate trustee such property, title, right, or power, any and
all such instruments shall, on request, be executed, acknowledged and delivered
by the Company.
(c) Every co-trustee or separate trustee shall, to the extent permitted by
law, but to such extent only, be appointed subject to the following terms:
(i) The Notes shall be authenticated and delivered and all rights,
powers, duties, and obligations hereunder in respect of the custody of
securities, cash and other personal property held by, or required to be
deposited or pledged with, the Trustee hereunder, shall be exercised,
solely by the Trustee.
(ii) The rights, powers, duties, and obligations hereby conferred or
imposed upon the Trustee in respect of any property covered by such
appointment shall be conferred or imposed upon and exercised or performed
by the Trustee or by the Trustee and such co-trustee or separate trustee
jointly, as shall be provided in the instrument appointing such co--trustee
or separate trustee, except to the extent that, under any law of any
jurisdiction in which any particular act is to be performed, the Trustee
shall be incompetent or unqualified to perform such act, in which event
such rights, powers, duties and obligations shall be exercised and
performed by such co-trustee or separate trustee.
(iii) The Trustee at any time, by an instrument in writing executed by
it, with the concurrence of the Company evidenced by a Company Order, may
accept the
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resignation of or remove any co-trustee or separate trustee appointed under
this Section, and, in case an Event of Default has occurred and is
continuing, the Trustee shall have power to accept the resignation of, or
remove, any such co-trustee or separate trustee without the concurrence of
the Company. Upon the written request of the Trustee, the Company shall
join with the Trustee in the execution, delivery and performance of all
instruments and agreements necessary or proper to effectuate such
resignation or removal. A successor to any co-trustee or separate trustee
so resigned or removed may be appointed in the manner provided in this
Section.
(iv) No co-trustee or separate trustee hereunder shall be personally
liable by reason of any act or omission of the Trustee or any other such
trustee hereunder and the Trustee shall not be personally liable by reason
of any act or omission of any co-trustee or other such separate trustee
hereunder selected by the Trustee with due care or appointed in accordance
with directions to the Trustee pursuant to Section 6.12.
(v) Any Act of Noteholders delivered to the Trustee shall be deemed to
have been delivered to each such co-trustee and separate trustee.
SECTION 7.13. Acceptance by Trustee.
The Trustee hereby acknowledges the conveyance of the Granted Assets and
the receipt of the Leases and the other Granted Assets granted by the Company
hereunder and declares that the Trustee, through a custodian, will hold such
Leases and other Granted Assets conveyed by the Company in trust, for the use
and benefit of all Noteholders subject to the terms and provisions hereof.
SECTION 7.14. Preferential Collection of Claims Against the Company.
The Trustee is subject to Trust Indenture Act Section 311(a), excluding
any creditor relationship listed in Trust Indenture Act Section 311(b). A
Trustee who has resigned or been removed shall be subject to Trust Indenture Act
Section 311(a) to the extent indicated therein.
SECTION 7.15. Reports by Trustee to Noteholders.
To the extent required by the Trust Indenture Act, within 60 days after
each May 15, following the date of this Indenture, the Trustee shall mail to
Noteholders a brief report dated as of such reporting date that complies with
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Trust Indenture Act Section 313(a), if such a report is required pursuant to
Trust Indenture Act Section 313(a). The Trustee also shall comply with Trust
Indenture Act Section 313(b). The Trustee shall also transmit by mail all
reports as required by Trust Indenture Act Section 313(c).
A copy of each such report required under Trust Indenture Act Section 3.13
shall, at the time of such transmission to Noteholders be filed with the
Commission and with each stock exchange or other market system on which the
Notes are listed. The Company or any other obligor upon the Notes shall notify
the Trustee if the Notes become listed on any stock exchange or market trading
system.
SECTION 7.16. No Proceedings. The Trustee hereby agrees that it will not,
with respect to its fees and expenses, directly or indirectly institute, or
cause to be instituted, against the Company any proceeding of the type referred
to in Section 6.01(e) or (f) so long as there shall not have elapsed one year
plus one day since the latest maturing Notes have been paid in full in cash.
ARTICLE 8.
COVENANTS
SECTION 8.01. Payment of Principal and Interest.
The Company will duly and punctually pay the principal of and interest on
the Notes in accordance with the terms of the Notes and this Indenture.
SECTION 8.02. Maintenance of Office or Agency; Chief Executive Office.
(a) The Company will maintain at the Corporate Trust Office an office or
agency where Notes may be surrendered for registration of transfer or exchange
and where notices and demands to or upon the Company in respect of the Notes and
this Indenture may be served. The Company hereby appoints the Trustee as its
agent to receive all such presentations, surrenders, notices and demands.
(b) The chief executive office of the Company, and the office at which the
Company maintains its records with respect to the Leases, the interests in the
Equipment, and the transactions contemplated hereby, is currently located in
Mahwah, New Jersey; records with respect to certain of the Leases are maintained
in Mt. Laurel, New Jersey. The Company will not change the location of such
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offices without giving the Trustee at least 30 days prior written notice
thereof.
SECTION 8.03. Money for Payments to Noteholders to be Held in Trust.
(a) All payments of amounts due and payable with respect to any Notes that
are to be made from amounts withdrawn from the Collection Account pursuant to
Section 3.03(b) or Section 6.06 shall be made on behalf of the Company by the
Trustee, and no amounts so withdrawn from the Collection Account for payments of
Notes shall be paid over to the Company under any circumstances except as
provided in this Section 8.03 or in Section 3.03(b) or Section 6.06.
(b) In making payments hereunder, the Trustee will:
(i) allocate all sums received for payment to the Noteholders on each
Payment Date among such Noteholders, first to the Class A Noteholders on a
pro rata basis, second to the Class B Noteholders on a pro rata basis and
then to the Class C Noteholders on a pro rata basis in accordance with the
information known to the Trustee;
(ii) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed
of as herein provided and pay such sums to such Persons as herein provided;
and
(iii) comply with all requirements of the Internal Revenue Code of
1986, as amended (or any successor statutes), and all regulations
thereunder, with respect to the withholding from any payments made by it on
any Notes of any applicable withholding taxes imposed thereon and with
respect to any applicable reporting requirements in connection therewith.
(c) If the Company shall at any time act as its own Paying Agent, it will,
on or before each due date of the principal of or interest on any of the Notes,
segregate and hold in trust for the benefit of the Noteholders entitled thereto
a sum sufficient to pay the principal or interest so becoming due until such
sums shall be paid to such Noteholders or otherwise disposed of as herein
provided and will promptly notify the Trustee of its action or failure so to
act.
Whenever the Company shall have one or more Paying Agents, it will, prior
to each due date of the principal of
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or interest on any Notes, deposit with a Paying Agent a sum sufficient to pay
the principal or interest so becoming due, such sum to be held in trust for the
benefit of the Noteholders entitled to such principal or interest, and (unless
such Paying Agent is the Trustee) the Company will promptly notify the Trustee
of its action or failure so to act.
The Company will cause each Paying Agent other than the Trustee to execute
and deliver to the Trustee an instrument in which such Paying Agent shall agree
with the Trustee, subject to the provisions of this Section, that such Paying
Agent will:
(1) hold all sums held by it for the payment of the principal of or
interest on Notes in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of as
herein provided, and
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities) in the making of any payment of
principal or interest.
(d) Except as required by applicable law, any money held by the Trustee in
trust for the payment of any amount due with respect to any Note and remaining
unclaimed for three years after such amount has become due and payable to the
Noteholder shall be discharged from such trust and, subject to applicable
escheat laws, paid to the Company upon request; and such Noteholder shall
thereafter, as an unsecured general creditor, look only to the Company for
payment thereof (but only to the extent of the amounts so paid to the Company),
and all liability of the Trustee with respect to such trust money shall
thereupon cease.
SECTION 8.04. Corporate Existence; Merger; Consolidation, etc.
(a) The Company will keep in full effect its existence, rights and
franchises as a corporation under the laws of the State of Delaware, and will
obtain and preserve its qualification to do business as a foreign corporation in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of the Indenture, the Notes or any of
the Leases.
(b) The Company shall at all times observe and comply in all material
respects with (i) all laws applicable to it, (ii) all requirements of law in the
declaration and payment of dividends on its capital stock, and (iii) all
requisite and appropriate corporate and other formalities (including without
limitation meetings of the Company's
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board of directors and, if required by law, its charter or otherwise, meetings
and votes of the shareholders of the Company to authorize corporate action) in
the management of its business and affairs and the conduct of the transactions
contemplated hereby and by the Underwriting Agreement and the Sales and
Servicing Agreement.
(c) The Company shall not issue or register the transfer of any of its
capital stock to any Person other than Copelco and will deliver any certificate
of such stock so issued to the Trustee in accordance with Section 7.02 of the
Sales and Servicing Agreement.
(d) The Company shall not (i) consolidate or merge with or into any other
Person or convey or transfer its properties and assets substantially as an
entirety to any other Person or (ii) commingle its assets with those of any
other Person.
(e) At least one director of the Company shall at all times be a person who
is not, and for five years prior to such individual's election as a director
shall not have been, a director, officer, employee or 10% beneficial owner of
the outstanding shares of common stock of its parent institution or any of its
Affiliates.
(f) The Company will, at all times, (i) maintain (A) corporate books and
records separate from those of any other Person and (B) minutes of the meetings
and other proceedings of its shareholders and board of directors; (ii)
continuously maintain the resolutions, agreements and other instruments
underlying the transactions contemplated hereby and by the Sales and Servicing
Agreement as official records of the Company; (iii) act solely in its corporate
name and through its duly authorized officers or agents to maintain an
arm's-length relationship with Copelco and its Affiliates and (iv) pay all of
its operating expenses and liabilities from its own funds.
(g) The Company shall conduct its business solely in its own name so as to
not mislead others as to the identity of the corporation with which those others
are concerned, and particularly will use its best efforts to avoid the
appearance of conducting business on behalf of Copelco or any of its Affiliates
or that the assets of the Company are available to pay the creditors of Copelco
or any of its Affiliates. Without limiting the generality of the foregoing, all
oral and written communications, including without limitation letters, invoices,
purchase orders, contracts, statements and loan applications, will be made
solely in the name of the Company.
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SECTION 8.05. Protection of Trust Estate; Further Assurances.
The Company will from time to time execute and deliver all such supplements
and amendments hereto and all such Financing Statements, continuation
statements, instruments of further assurance, and other instruments, and will
take such other action as may be necessary or advisable to:
(i) Grant more effectively all or any portion of the Trust Estate;
(ii) maintain or preserve the Lien of this Indenture or carry out more
effectively the purposes hereof;
(iii) publish notice of, or protect the validity of, any Grant made or
to be made by this Indenture and perfect the security interest contemplated
hereby in favor of the Trustee in each of the Leases, in the Equipment and
all other property included in the Trust Estate; provided, that the Company
shall not be required to file Financing Statements with respect to the
interests in the Equipment in addition to those contemplated by Section
3.01(c) of the Sales and Servicing Agreement;
(iv) enforce or cause the Servicer to enforce any of the Leases; or
(v) preserve and defend title to the Leases (including the right to
receive all payments due or to become due thereunder), the interests in the
Equipment, or other property included in the Trust Estate and preserve and
defend the rights of the Trustee and the Noteholders in such Leases
(including the right to receive all payments due or to become due
thereunder), interests in the Equipment and other property against the
claims of all Persons and parties.
The Company, upon the Company's failure to do so, hereby designates the Trustee
its agent and attorney-in-fact to execute any Financing Statement or
continuation statement required pursuant to this Section 8.05; provided,
however, that such designation shall not be deemed to create a duty in the
Trustee to monitor the compliance of the Company with the foregoing covenants,
and provided, further, that the duty of the Trustee to execute any instrument
required pursuant to this Section 8.05 shall arise only if a Responsible Officer
of the Trustee has actual knowledge of any failure of the Company to comply with
the provisions of this Section 8.05.
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SECTION 8.06. [Reserved].
SECTION 8.07. Performance of Obligations; Sales and Servicing Agreement.
(a) The Company will punctually perform and observe all of its obligations
and agreements contained in this Indenture, the Notes and the Underwriting
Agreement.
(b) The Company will not take any action or permit any action to be taken
by others which would release any Person from any of such Person's covenants or
obligations under any Lease or any other instrument included in the Trust
Estate, or which would result in the amendment, hypothecation, subordination,
termination, or discharge of, or impair the validity or effectiveness of, any
Lease or such other instrument, except as expressly provided in this Indenture
or the Sales and Servicing Agreement.
(c) If any Authorized Officer shall have knowledge of the occurrence of a
default under the Sales and Servicing Agreement, the Company shall promptly
notify the Trustee and the Noteholders thereof, and shall specify in such notice
the action, if any, the Company is taking in respect of such default. Unless
consented to by the holders of 66 2/3% of the then Outstanding Principal Amount
of the Notes, the Company may not waive any default under or amend the Sales and
Servicing Agreement.
SECTION 8.08. Negative Covenants.
The Company will not:
(a) sell, transfer, exchange or otherwise dispose of any portion of
the Trust Estate except as expressly permitted by this Indenture;
(b) claim any credit on, or make any deduction from, the principal of,
or interest on, any of the Notes by reason of the payment of any taxes
levied or assessed upon any portion of the Trust Estate;
(c) engage in any business or activity other than in connection with,
or relating to the ownership of, the Leases and the interests in the
Equipment, the issuance of the Notes, and the specific transactions
contemplated hereby;
(d) become liable for, issue, incur, assume, or allow to remain
outstanding any indebtedness, or guaranty any indebtedness of any Person,
other than the Notes, except as contemplated by this Indenture, the
registration statement filed with respect to the
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Class A Notes and Class B Notes (and any registration statement for similar
securities), and the Sales and Servicing Agreement;
(e) seek dissolution or liquidation in whole or in part or
reorganization of its business or affairs;
(f) (i) permit the validity or effectiveness of this Indenture or any
Grant hereby to be impaired, or permit the lien of this Indenture to be
amended, hypothecated, subordinated, terminated or discharged, or permit
any Person to be released from any covenants or obligations under this
Indenture, except as may be expressly permitted hereby, (ii) permit any
lien, charge, security interest, mortgage or other encumbrance to be
created on or to extend to or otherwise arise upon or burden the Trust
Estate or any part thereof or any interest therein or the proceeds thereof
other than the lien of this Indenture, or (iii) subject to Section 3.01(c)
of the Sales and Servicing Agreement, permit the lien of this Indenture not
to constitute a valid first priority security interest in the Trust Estate;
or
(g) make any loan or advance to any Affiliate of the Company or to any
other Person; provided that the Company may from time to time make
Inter-Company Loans on the terms and conditions set forth in Section 13 of
the Sales and Servicing Agreement.
SECTION 8.09. Information as to Company.
The Company shall deliver to the Trustee and, the Trustee shall deliver to
each Rating Agency and to each holder of outstanding Notes (and,
upon the request of any Noteholder, to any prospective transferee of any Notes):
(a) Quarterly Statements - within 45 days after the end of each of the
first three quarterly fiscal periods in each fiscal year of the Company, one
copy of:
(i) a balance sheet of the Company as at the end of such quarter, and
(ii) statements of income, retained earnings and cash flow of the
Company for that quarter and for the portion of the fiscal year ending with
such quarter, setting forth in each case in comparative form the figures
for the corresponding periods in the previous fiscal year,
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all in reasonable detail and accompanied by a certificate signed by a principal
financial officer of the Company stating that such financial statements present
fairly the financial condition of the Company and have been audited and prepared
in accordance with generally accepted accounting principles consistently
applied;
(b) Annual Statements - within 135 days after the end of each fiscal year
of the Company, one copy of:
(i) a balance sheet of the Company, as at the end of that year, and
(ii) statements of income, retained earnings and cash flow of the
Company for that year, setting forth in each case in comparative form the
figures for the previous fiscal year,
all in reasonable detail and accompanied by a certificate signed by a principal
financial officer of the Company stating that such financial statements present
fairly the financial condition of the Company and have been audited and
prepared in accordance with generally accepted accounting principles
consistently applied;
(c) Officer's Certificate - with each set of financial statements delivered
pursuant to Section 8.09(a) or 8.09(b), the Company will deliver an Officer's
Certificate stating that such officer has reviewed the relevant terms of this
Indenture (including without limitation Section 8.04 hereof) and the Sales and
Servicing Agreement and has made, or caused to be made, under such officer's
supervision, a review of the transactions and conditions of the Company during
the period covered by the income statements then being furnished and that the
review has not disclosed the existence of any Event of Default or, if an Event
of Default exists, describing its nature.
(d) Notice of Event of Default - immediately upon becoming aware of the
existence of any condition or event which constitutes a Default or an Event of
Default, a written notice describing its nature and period of existence and what
action the Company is taking or proposes to take with respect thereto; and
(e) Report on Proceedings - promptly upon the Company's becoming aware of
(i) any proposed or pending investigation of it by any governmental
authority or agency, or
(ii) any pending or proposed court or administrative proceeding which
involves or may involve
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the possibility of materially and adversely affecting the properties,
business, prospects, profits or condition (financial or otherwise) of the
Company
a written notice specifying the nature of such investigation or proceeding and
what action the Company is taking or proposes to take with respect thereto and
evaluating its merits.
SECTION 8.10. Taxes.
The Company shall pay all taxes when due and payable or levied against its
assets, properties or income, including any property that is part of the Trust
Estate.
SECTION 8.11. Indemnification.
The Company agrees to indemnify and hold harmless the Trustee and each
Noteholder (each an "Indemnified Party") against any and all liabilities,
losses, damages, penalties, costs and expenses (including costs of defense and
legal fees and expenses) which may be incurred or suffered by such Indemnified
Party without negligence or willful misconduct on its part as a result of
claims, actions, suits or judgments asserted or imposed against it and arising
out of the transactions contemplated hereby or by the Sales and Servicing
Agreement, including without limitation, any claims resulting from any use,
operation, maintenance, repair, storage or transportation of any item of
Equipment, whether or not in the Company's possession or under its control, and
any tort claims and any fines or penalties arising from any violation of the
laws or regulations of the United States or any state or local government or
governmental authority; provided that, all amounts payable pursuant to this
Section 8.11 shall be fully subordinated to amounts payable under the Notes,
shall be without recourse to the Company except to the extent that all amounts
otherwise due and payable under the terms of this Indenture have been fully paid
and shall not, to the extent that such amounts are unpaid, constitute a claim
against the Company except to the extent that all amounts otherwise due and
payable under the terms of this Indenture have been fully paid.
SECTION 8.12. Commission Reports; Reports to Trustee; Reports to
Noteholders.
To the extent it has not satisfied the following requirements by reporting
under Section 8.09 hereof, the Company shall:
(a) file with the Trustee, within 15 days after the Company is required to
file the same with the
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Commission, copies of the annual reports and of the information, documents and
other reports which the Company may be required to file with the Commission
pursuant to Section 13 or Section 15(d) of the Exchange Act (or copies of such
portions thereof as may be prescribed by rules and regulations of the
Commission); or, if the Company is not required to file with the Commission
information, documents or reports pursuant to either Section 13 or Section 15(d)
of the Exchange Act, then the Company will file with the Trustee and with the
Commission, in accordance with rules and regulations prescribed by the
Commission, such of the supplementary and periodic information, documents and
reports required pursuant to Section 13 of the Exchange Act in respect of a
security listed and registered on a national securities exchange as may be
prescribed in such rules and regulations;
(b) file with the Trustee and the Commission, in accordance with the rules
and regulations prescribed by the Commission, such additional information,
documents and reports with respect to compliance by the Company with the
conditions and covenants provided for in this Indenture as may be required by
such rules and regulations, including, in the case of annual reports, if
required by such rules and regulations, certificates or opinions of independent
public accountants, conforming to the requirements of Sections 12.03 and 12.04
hereof, as to compliance with conditions or covenants, compliance with which is
subject to verification by accountants; and
(c) furnish to the Trustee for distribution to the Noteholders, as the
names and addresses of such Noteholders appear in the Note Register, in the
manner and to the extent provided in Section 7.15 hereof, such summaries of any
information, documents and reports required to be filed with the Trustee
pursuant to the provisions of Subsections (a) and (b) of this Section 8.12 as
may be required to be provided to such Noteholders by the rules and regulations
of the Commission under the provisions of the Trust Indenture Act.
ARTICLE 9.
SUPPLEMENTAL INDENTURES
SECTION 9.01. Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of any Noteholders, the Company, by a Company
Order, and the Trustee, at any time and from time to time, may enter into one or
more indentures
81
supplemental hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(i) to add to the covenants of the Company for the benefit of the
Noteholders, or to surrender any right or power herein conferred upon the
Company;
(ii) to cure any ambiguity, to correct or supplement any provision
herein which may be inconsistent with any other provision herein; or
(iii) to correct or amplify the description of any property at any
time subject to the lien of this Indenture, or to better assure, convey and
confirm unto the Trustee any property subject or required to be subjected
to the lien of this Indenture;
provided such action pursuant to this Section 9.01(a) shall not adversely affect
the interests of the Noteholders in any respect.
(b) The Trustee shall promptly deliver to each Noteholder and each Rating
Agency a copy of any supplemental indenture entered into pursuant to Section
9.01(a).
SECTION 9.02. Supplemental Indentures with Consent of Noteholders.
(a) With the consent of the holders of not less than 66-2/3% of the then
Outstanding Principal Amount of the Notes and by Act of said Noteholders
delivered to the Company and the Trustee, the Company, by a Company Order, and
the Trustee may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or of modifying in any manner the rights
of the Noteholders under this Indenture; provided, that no supplemental
indenture shall, without the consent of the holder of each Outstanding Note
affected thereby,
(i) change the Stated Maturity of any Note or the Principal Payments
or Interest Payments due or to become due on any Payment Date with respect
to any Note, or change the priority of payment thereof as set forth herein,
or reduce the principal amount thereof or the Note Interest Rate thereon,
or change the place of payment where, or the coin or currency in which, any
Note or the interest thereon is payable, or impair the right to institute
suit for the enforcement of any such payment on or after the Maturity
thereof;
82
(ii) reduce the percentage of the Outstanding Principal Amount of the
Notes the consent of whose Noteholders is required for any such
supplemental indenture, for any waiver of compliance with provisions of
this Indenture or Events of Default and their consequences, or for any Act
of Noteholders;
(iii) modify any of the provisions of this Section or Section 6.13
except to increase any percentage or fraction set forth therein or to
provide that certain other provisions of this Indenture cannot be modified
or waived without the consent of the holder of each Outstanding Note
affected thereby;
(iv) modify or alter the provisions of the proviso to the definition
of the term "Outstanding"; or
(v) permit the creation of any lien ranking prior to or on a parity
with the lien of this Indenture with respect to any part of the Trust
Estate or, except as provided in Sections 4.01 or 4.02, terminate the lien
of this Indenture on any property at any time subject hereto or deprive any
Noteholder of the security afforded by the lien of this Indenture.
(b) The Trustee shall promptly deliver to each Noteholder and each Rating
Agency a copy of any supplemental indenture entered into pursuant to Section
9.02(a).
SECTION 9.03. Execution of Supplemental Indentures.
In executing any supplemental indenture (a) pursuant to Article 9.01 of
this Indenture or (b) pursuant to Section 9.02 of this Indenture without the
consent of each holder of the Notes to the execution of the same, the Trustee
shall be entitled to receive, and (subject to Section 7.01) shall be, fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such supplemental indenture is authorized or permitted by this Indenture. The
Trustee may, but shall not be obligated to, enter into any supplemental
indenture which affects the Trustee's own rights, duties, projections, or
immunities under this Indenture or otherwise.
SECTION 9.04. Effect of Supplemental Indentures.
Upon the execution of any supplemental indenture under this Article, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes, and every
Noteholder of Notes theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
83
SECTION 9.05. Reference in Notes to Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article may, and shall if required by the Trustee,
bear a notation in form approved by the Trustee as to any matter provided for in
such supplemental indenture. If the Company shall so determine, new Notes so
modified as to conform, in the opinion of the Trustee and the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding Notes.
SECTION 9.06. Compliance with Trust Indenture Act.
Every amendment, supplement or waiver to this Indenture or the Notes shall
comply with the Trust Indenture Act as then in effect.
ARTICLE 10.
SATISFACTION AND DISCHARGE
SECTION 10.01. Satisfaction and Discharge of Indenture.
(a) This Indenture shall cease to be of further effect (except as to any
surviving rights of registration of transfer or exchange of Notes herein
expressly provided for), and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(i) 100 days shall have elapsed since either
(A) all Notes theretofore authenticated and delivered (other than
(1) Notes which have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 2.04 and (2) Notes for
whose payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter repaid to
the Company or discharged from such trust, as provided in Section
8.03(c)) have been delivered to the Trustee for cancellation; or
(B) the final installments of principal on all such Notes not
theretofore delivered to the Trustee for cancellation
84
(1) have become due and payable, or
(2) will become due and payable at their Stated Maturity,
as applicable, within one year,
and the Company has irrevocably deposited or caused to be deposited
with the Trustee as trust funds in trust for the purpose an amount
sufficient to pay and discharge the entire indebtedness on such Notes
not theretofore delivered to the Trustee for cancellation, for
principal and interest to the date of such deposit (in the case of
Notes which have become due and payable) or to the Stated Maturity
thereof;
(ii) the Company has paid or caused to be paid all other sums payable
hereunder by the Company for the benefit of the Noteholders; and
(iii) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with.
At such time, the Trustee shall deliver to the Company or, upon Company Order,
its assignee, all cash, securities and other property held by it as part of the
Trust Estate other than funds deposited with the Trustee pursuant to Section
10.01(a)(i)(B), for the payment and discharge of the Notes.
(b) Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Sections 7.07 and 8.11, and, if
money shall have been deposited with the Trustee pursuant to Section
10.01(a)(i)(B), the obligations of the Trustee under Section 10.02 and Section
8.03(c) shall survive.
(c) The Trustee shall provide prompt written notice to each Rating Agency
of any satisfaction and discharge of this Indenture pursuant to this Article 10.
SECTION 10.02. Application of Trust Money.
Subject to the provisions of Section 8.03(c), all money deposited with the
Trustee pursuant to Sections 10.01 and 8.03 shall be held in trust and applied
by it, in accordance with the provisions of the Notes and this Indenture, to the
payment to the Persons entitled thereto, of the principal and interest for whose
payment such money has been deposited with the Trustee.
85
ARTICLE 11.
REPRESENTATIONS AND WARRANTIES
OF THE COMPANY
The Company hereby represents and warrants as follows:
SECTION 11.01. Corporate Organization and Authority.
The Company:
(a) is a corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation;
(b) has all requisite power and authority and all necessary licenses and
permits to own and operate its properties and to carry on its business as now
conducted (except where the failure to have such licenses and permits would not
have a material adverse effect on the business or condition (financial or
otherwise) of the Company or impair the enforceability of any Lease) and to
enter into and perform its obligations under this Indenture and the Sales and
Servicing Agreement, and the transactions contemplated hereby and thereby,
including the issuance and sale of the Notes and the performance of its
obligations thereunder; and
(c) has duly qualified and is authorized to do business and is in good
standing as a foreign corporation in each jurisdiction where the character of
its properties or the nature of its activities makes such qualification
necessary (except where the failure to be so qualified or in good standing would
not have a material adverse effect on the business or condition (financial or
otherwise) of the Company or impair the enforceability of any Lease).
SECTION 11.02. Pending Litigation.
There are no proceedings or investigations pending, or to the knowledge of
the Company (after due inquiry) threatened, against or affecting the Company in
or before any court, governmental authority or agency or arbitration board or
tribunal, including but not limited to any such proceeding or investigation with
respect to any environmental or other liability resulting from the ownership or
use of any of the Equipment, which, individually or in the aggregate, involve
the possibility of materially and adversely affecting the properties, business,
prospects, profits or condition (financial or otherwise) of the Company, or the
ability of the Company to perform its obligations hereunder or under the Sales
and Servicing
86
Agreement or the Notes. The Company is not in default with respect to any order
of any court, governmental authority or agency or arbitration board or tribunal.
SECTION 11.03. Transactions Legal and Authorized. The sale of the Notes by
the Company, the purchase of the Leases (including the right to receive all
payments due or to become due thereunder) and the acquisition of the interests
in the Equipment pursuant to the Sales and Servicing Agreement, the granting of
the Liens created by the Indenture, and compliance by the Company with all of
the provisions of this Indenture, the Sales and Servicing Agreement and the
Notes:
(a) have been duly authorized by all necessary corporate action on the part
of the Company, and do not require any stockholder approval, or approval or
consent of any trustee or holders of any indebtedness or obligations of the
Company except such as have been duly obtained;
(b) are within the corporate powers of the Company; and
(c) are legal and will not conflict with, result in any breach of any of
the provisions of, constitute a default under, or result in the creation of any
Lien upon any property of the Company (except as contemplated by this Indenture)
under the provisions of any agreement, charter instrument, by-law or other
instrument to which the Company is a party or by which it or its property may be
bound or result in the violation of any law, regulation, rule, order or judgment
applicable to the Company or its properties, or any order to which the Company
or its properties is subject, of or by any government or governmental agency or
authority.
SECTION 11.04. No Defaults.
No event has occurred and no condition exists which, upon the issue of the
Notes or with the lapse of time and/or the giving of notice, would constitute a
Default or an Event of Default. The Company is not in violation in any material
respect of any term of any agreement, charter instrument, by-law or other
instrument to which it is a party or by which it is or may be bound.
SECTION 11.05. Governmental Consent.
No consent, approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is required for the
issue and sale of the Notes or the consummation by the Company of the
transactions contemplated by this Indenture, except such
87
consents, approvals, authorizations, registrations or qualifications as may be
required under the Securities Act and under state securities or Blue Sky laws in
connection with the purchase and distribution of the Notes pursuant to the
Underwriting Agreement.
SECTION 11.06. Use of Proceeds.
The proceeds from the sale of the Notes will be used by the Company to
purchase the Leases from the Seller pursuant to the Sales and Servicing
Agreement.
SECTION 11.07. Compliance with Law.
The Company:
(a) is not in violation of any laws, ordinances, governmental rules or
regulations to which it is subject;
(b) has not failed to obtain any licenses, permits, franchises or other
governmental authorizations necessary to the ownership of its properties or to
the conduct of its business; and
(c) is not in violation in any material respect of any term of any
agreement, charter instrument, by-law or other instrument to which it is a party
or by which it may be bound, which violation or failure to obtain might
materially adversely affect the business or condition (financial or otherwise)
of the Company or the transactions contemplated by the Sales and Servicing
Agreement, the Notes, or this Indenture.
SECTION 11.08. Restrictions on Company.
The Company is not a party to any contract or agreement, or subject to any
charter or other corporate restriction, which materially and adversely affects
its business. The Company has not agreed or consented to cause or permit in the
future (upon the happening of a contingency or otherwise) any of its properties,
whether now owned or hereafter acquired, to be subject to a Lien not permitted
by the Indenture.
SECTION 11.09. Legal, Valid and Binding Obligations.
This Indenture, the Sales and Servicing Agreement and any other documents
executed by or on behalf of the Company in connection with the transactions
contemplated hereby or thereby each constitutes the legal, valid and binding
obligation of the Company, enforceable in accordance with the respective terms
hereof and thereof, except as the
88
same may be limited by bankruptcy, insolvency, reorganization or other similar
laws relating to or affecting the enforcement of creditors' rights generally and
by equitable principles. The Notes, when issued in accordance with the
provisions hereof, will represent the legal, valid and binding obligations of
the Company, enforceable in accordance with the terms thereof, except as the
same may be limited by bankruptcy, insolvency, reorganization or other similar
laws relating to or affecting the enforcement of creditors' rights generally and
by equitable principles.
SECTION 11.10. Perfected Security Interest.
Except for the execution and delivery of the Indenture, the delivery of the
Leases to the Trustee and the filing of required Financing Statements, no
further action, including any filing or recording of any document, is necessary
or advisable in order to establish, protect and perfect the security interest of
the Trustee as of the Closing Date in (a) the Leases (including the right to
receive all payments due or to become due thereunder) and (b) the Equipment and
any proceeds thereof subject to Leases having a Discounted Present Value of not
less than 75% of the Discounted Present Value of the Leases as of the Cut-Off
Date and such equipment relating to not less than 75% of the Booked Residual
Value of such equipment, in each case as against any third party in any
applicable jurisdiction in the United States. In the case of each Lease which
consists of a master lease and one or more exhibits or schedules thereto, the
Company has delivered the schedules relating to the Leases to the Trustee and
has neither assigned such schedules or such master lease in its entirety, nor
delivered physical possession of such schedules or such master lease, to any
Person other than the Trustee (including the trustee under another indenture in
a transaction substantially similar to the transaction contemplated hereby,
which other indenture provides for a lien insofar as it relates to the lease
schedules which are not part of the Trust Estate).
SECTION 11.11. Taxes.
The Company is not in default with respect to the payment of any taxes
levied or assessed against it or any of its assets and has not failed to file
any tax return required to be filed by it.
SECTION 11.12. Nonconsolidation.
The Company is operated in such a manner that it would not be substantively
consolidated in the bankruptcy estate of Copelco, such that the separate
existence of the Company and Copelco would be disregarded in the event of a
89
bankruptcy or insolvency of the Company or Copelco, and in such regard:
(a) the Company is not involved in the day-to-day management of Copelco;
(b) the Company maintains separate corporate records and books of account
from Copelco and otherwise observes corporate formalities and has a separate
business office from Copelco;
(c) the financial statements and books and records of the Copelco prepared
after the Issuance Date will reflect the separate existence of the Company;
(d) the Company maintains its assets separately from the assets of Copelco
(including through the maintenance of a separate bank account), the Company's
funds and assets, and records relating thereto, have not been and are not
commingled with those of Copelco and the separate creditors of the Company will
be entitled to be satisfied out of the Company's assets prior to any value in
the Company becoming available to the Company's equityholders or the Copelco's
creditors;
(e) all business correspondence of the Company and other communications are
conducted in the Company's own name and on its own stationery; and
(f) Copelco does not act as an agent of the Company in any capacity and the
Company does not act as agent for Copelco, but instead presents itself to the
public as a corporation separate from Copelco.
ARTICLE 12.
MISCELLANEOUS
SECTION 12.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by operation of Trust Indenture Act Section 318(a), the duties
imposed by Section 318(a) shall control.
SECTION 12.02. Communication by Noteholders with Other Noteholders.
Noteholders may communicate, pursuant to Trust Indenture Act Section
3.12(b), with other Noteholders with respect to their rights under this
Indenture or the Notes. The Company, the Trustee, the Note Registrar and all
other
90
parties shall have the protection of Trust Indenture Act Section 3.12(c).
SECTION 12.03. Officers' Certificate and Opinion of Counsel as to
Conditions Precedent.
Upon any request or application by the Company (or any other obligor upon
the Notes) to the Trustee to take any action under this Indenture, the Company
(or such other Obligor) shall furnish to the Trustee:
(a) an Officers' Certificate (which shall include the statements set forth
in Section 12.04) stating that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(b) an Opinion of Counsel (which shall include the statements set forth in
Section 12.04) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been complied with.
SECTION 12.04. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(a) a statement that the Person making such certificate or opinion has read
such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been complied with.
91
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
witnessed, all as of the day and year first above written.
COPELCO CAPITAL FUNDING CORP. X
_________________________________________
Name:
Title:
[SEAL]
MANUFACTURERS AND TRADERS TRUST COMPANY,
as Trustee
[SEAL] By_______________________________________
Name:
Title:
SCHEDULE 1
----------
LEASES
EXHIBIT A
---------
[FORM OF
CLASS A NOTE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
COPELCO CAPITAL FUNDING CORP. X
____% CLASS A LEASE-BACKED NOTE, SERIES 1997-A
CUSIP NO._______________
No. R- $_________________
Copelco Capital Funding Corp. X, a corporation duly organized and existing
under the laws of Delaware (herein called the "Company", which term includes any
successor Person under the Indenture referred to herein), for value received,
hereby promises to pay to ____ , or registered assigns, the principal sum of
____ Dollars ($___), payable in monthly installments beginning on __________,
1997, in accordance with the Indenture. Interest will accrue on the unpaid
principal hereof from the date of issuance, at the rate of _____% per annum,
until the full amount of principal hereof is otherwise paid or made available
for payment and shall be computed on the basis of twelve 30-day months and a
year of 360 days.
Principal and interest on this Class A Note shall be paid on the [__]th day
of each month (or, if such day is not a Business Day, the next succeeding
Business Day), commencing __________, 1997, either by check to the registered
address of the Holder of this Class A Note as of the relevant Record Date or by
wire transfer to an account
A-1
at a bank in the United States as the Holder shall specify, as provided more
fully in the Indenture; provided, that the final payment of principal and
interest in respect of the Notes shall be payable to the Holder of this Note
only upon presentation and surrender of this Note at the Corporate Trust Office
of the Trustee or at the principal office of any Paying Agent appointed pursuant
to the Indenture.
The Stated Maturity of the Class A Notes is __________, ____.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Class A Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
This Class A Note is one of a duly authorized issue of Class A Notes of the
Company designated as its "___% Class A Lease-Backed Notes, Series 1997-A"
(herein called the "Class A Notes") limited in aggregate principal amount of
$__________, issued under the Indenture, dated as of ___________, 1997 (herein
called the "Indenture"), between the Company and _____________________ as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders and of the terms upon which the Class A Notes are authenticated and
delivered. Unless otherwise defined herein, all capitalized terms used herein
shall have the meanings set forth in the Indenture.
This Class A Note will be secured by the pledge to the Trustee of the Trust
Estate.
If an Event of Default under the Indenture has been declared by the
Trustee, the principal of all the Class A Notes (but not less than all the Class
A Notes) may be declared due and payable in the manner and with the effect
provided in the Indenture. Notice of such declaration will be given by mail to
Holders, as their names and addresses appear in the Note Register, as provided
in the Indenture. Upon payment of such principal amount together with all
accrued interest, the obligations of the Company with respect to the payment of
principal and interest on this Class A Note shall terminate.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders under the Indenture at any time by the
A-2
Company and the Trustee with the consent of the Holders of 66 2/3% in aggregate
principal amount of the Class A Notes and the Company's _____% Class B
Lease-Backed Notes, Series 1997-A (the "Class B Notes") at the time Outstanding.
The Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Class A Notes and the Class B
Notes at the time Outstanding, on behalf of all the Holders, to waive compliance
by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or waiver
by the Holder of this Class A Note shall be conclusive and binding upon such
Holder and upon all future Holders of this Class A Note and of any Class A Note
issued upon the registration of transfer hereof or in exchange herefor or in
lieu hereof, whether or not notation of such consent or waiver is made upon this
Class A Note or any Class A Note.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Class A Note is registrable in the Note Register,
upon surrender of this Class A Note for registration of transfer at the office
or agency of the Trustee in The City of [__________], and at any other office or
agency maintained by the Company for that purpose, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Note Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class A Notes, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Class A Notes are issuable only in registered form without coupons in
minimum denominations of $1,000. As provided in the Indenture and subject to
certain limitations therein set forth, Class A Notes are exchangeable for a like
aggregate principal amount of Class A Notes of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name this Class A Note is registered as the owner
hereof for all purposes, whether or not this Class A Note may be overdue, and
neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary.
A-3
The Indenture and this Class A Note shall be deemed to be contracts made
under the laws of the State of New York and shall for all purposes be governed
by, and construed in accordance with, the laws of the State of New York.
A-4
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: ________________, 199_
COPELCO CAPITAL FUNDING CORP. X
[SEAL]
By:_______________________________________
Authorized Officer
Attest:
______________________________
Trustee's Certificate of Authentication
This is one of the Class A Notes referred to in the within mentioned
Indenture.
_____________________, as Trustee
By:_______________________________________
Authorized Signatory
A-5
ASSIGNMENT FORM
If you the holder want to assign this Class A Note, fill in the form below
and have your signature guaranteed:
I or we assign and transfer this Class A Note to:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint __________________, agent to transfer this Class A Note
on the books of the Company. The agent may substitute another to act for him.
Dated: __________________ Signed: _____________________________
_____________________________
(sign exactly as the name
appears on the other side
of this Class A Note)
Signature Guarantee ____________________________________________________________
Important Notice: When you sign your name to this Assignment Form without
filling in the name of your "Assignee" or "Attorney", this Note becomes fully
negotiable, similar to a check endorsed in blank. Therefore, to safeguard a
signed Class A Note, it is recommended that you fill in the name of the new
owner in the "Assignee" blank. Alternatively, instead of using this Assignment
Form, you may sign a separate "power of attorney" form and then mail the
unsigned Class A Note and the signed "power of attorney" in separate envelopes.
For added protection, use certified or registered mail for a Class A Note.
A-6
[FORM OF
CLASS B NOTE]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
TRUSTEE OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
COPELCO CAPITAL FUNDING CORP. X
_____% CLASS B LEASE-BACKED NOTE
CUSIP No. _________
No. R- $_______________
Copelco Capital Funding Corp. X, a corporation duly organized and existing
under the laws of Delaware (herein called the "Company", which term includes any
successor Person under the Indenture referred to herein), for value received,
hereby promises to pay to_____________, or registered assigns, the principal sum
of ________________ Dollars ($____________ ), payable in monthly installments
beginning on __________, 1997, in accordance with the Indenture. Interest will
accrue on the unpaid principal hereof from the date of issuance, at the rate of
_____% per annum, until the full amount of principal hereof is otherwise paid or
made available for payment and shall be computed on the basis of twelve 30-day
months and a year of 360 days.
Principal and interest on this Class B Note shall be paid on the [__]th day
of each month (or, if such day is not a Business Day, the next succeeding
Business Day), commencing __________, 1997, either by check to the registered
address of the Holder of this Class B Note or by wire transfer to an account at
a bank in the United States as the Holder shall specify, as provided more fully
in the Indenture; provided, that the final payment of principal and interest in
respect of the Class B Notes during the Principal Amortization Period shall be
payable to the Holder
A-7
of this Class B Note only upon presentation and surrender of this Class B Note
at the Corporate Trust Office of the Trustee or at the principal office of any
Paying Agent appointed pursuant to the Indenture.
The Stated Maturity of the Class B Notes is ___________, ____.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Class B Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
This Class B Note is one of a duly authorized issue of Class B Notes of the
Company designated as its "_____% Class B Lease-Backed Notes, Series 1997-A"
(herein called the "Class B Notes"), limited in aggregate principal amount of
$_____________, issued under the Indenture, dated as of ___________, 1997
(herein called the "Indenture"), between the Company and ____________________ as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders and of the terms upon which the Class B Notes are authenticated and
delivered. Unless otherwise defined herein, all capitalized terms used herein
shall have the meanings set forth in the Indenture.
If an Event of Default under the Indenture has been declared by the
Trustee, the principal of all the Class B Notes (but not less than all the Class
B Notes) may be declared due and payable in the manner and with the effect
provided in the Indenture. Notice of such declaration will be given by mail to
Holders, as their names and addresses appear in the Note Register, as provided
in the Indenture. Upon payment of such principal amount together with all
accrued interest, the obligations of the Company with respect to the payment of
principal and interest on this Class B Note shall terminate.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders under the Indenture at any time by the
Company and the Trustee with the consent of the Holders of 66 2/3% in aggregate
principal amount of the Company's _____% Class A Lease-Backed Notes, Series
1996-A (the "Class A Notes"), the Class B Notes and the Class C Notes at the
time Outstanding. The Indenture also contains provisions permitting the Holders
of specified percentages
A-8
in aggregate principal amount of the Class A Notes and the Class B Notes at the
time outstanding, on behalf of all the Holders, to waive compliance by the
Company with certain provisions of the Indenture and certain past defaults under
the Indenture and their consequences. Any such consent or waiver by the Holder
of this Class B Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Class B Note and of any Class B Note issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Class B Note
or any Class B Note.
No sale or transfer of this Class B Note may be made unless such sale or
transfer complies with or is exempt from registration requirements of the
Securities Act and applicable state securities laws. Prospective transferees of
this Class B Note will be required to deliver a certificate pursuant to the
terms of the Indenture relating to compliance with the Securities Act and
applicable state securities law.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Class B Note is registrable in the Note Register,
upon surrender of this Class B Note for registration of transfer at the office
or agency of the Trustee in The City of [__________], and at any other office or
agency maintained by the Company for that purpose, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Note Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class B Notes, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Class B Notes are issuable only in registered form without coupons in
minimum denominations of $1,000. As provided in the Indenture and subject to
certain limitations therein set forth, Class B Notes are exchangeable for a like
aggregate principal amount of Class B Notes of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name this Class B Note is registered as the owner
hereof for all purposes, whether or not this Class B Note may be overdue,
A-9
and neither the Company, the Trustee nor any such agent shall be affected by
notice to the contrary.
The Indenture and this Class B Note shall be deemed to be contracts made
under the laws of the State of New York and shall for all purposes be governed
by, and construed in accordance with, the laws of the State of New York.
A-10
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: ____________, 199_
COPELCO CAPITAL FUNDING CORP. X
[SEAL]
By:_______________________________________
Authorized Officer
Attest:
______________________
Trustee's Certificate of Authentication
This is one of the Class B Notes referred to in the within mentioned
Indenture.
_____________________, as Trustee
By:_______________________________________
Authorized Signatory
A-11
ASSIGNMENT FORM
If you the holder want to assign this Class B Note, fill in the form below
and have your signature guaranteed:
I or we assign and transfer this Class B Note to:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint _____________________________ , agent to transfer this
Class B Note on the books of the Company. The agent may substitute another to
act for him.
Dated: __________________ Signed: _____________________________
_____________________________
(sign exactly as the
name appears on the other
side of this Class B
Note)
Signature Guarantee_____________________________________________________________
Important Notice: When you sign your name to this Assignment Form without
filling in the name of your "Assignee" or "Attorney", this Note becomes fully
negotiable, similar to a check endorsed in blank. Therefore, to safeguard a
signed Class B Note, it is recommended that you fill in the name of the new
owner in the "Assignee" blank. Alternatively, instead of using this Assignment
Form, you may sign a separate "power of attorney" form and then mail the
unsigned Class B Note and the signed "power of attorney" in separate envelopes.
For added protection, use certified or registered mail for a Class B Note.
A-12
[FORM OF
CLASS C NOTE]
THIS CLASS C NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAW, AND MAY NOT BE DIRECTLY OR INDIRECTLY OFFERED OR SOLD OR
OTHERWISE DISPOSED OF BY THE OWNER HEREOF UNLESS SUCH TRANSACTION IS EXEMPT FROM
REGISTRATION UNDER THE SECURITIES ACT AND SUCH STATE LAWS, AND WILL NOT BE A
"PROHIBITED TRANSACTION" UNDER THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"). BY ACCEPTANCE OF THIS CLASS C NOTE, THE HOLDER
AGREES TO BE BOUND BY ALL THE TERMS OF THE INDENTURE.
COPELCO CAPITAL FUNDING CORP. X
_____% CLASS C LEASE-BACKED NOTE
PP No. _________
No. R- $_______________
Copelco Capital Funding Corp. X, a corporation duly organized and existing
under the laws of Delaware (herein called the "Company", which term includes any
successor Person under the Indenture referred to herein), for value received,
hereby promises to pay to __________, or registered assigns, the principal sum
of __________Dollars ($__________), payable in monthly installments beginning on
__________, 1997, in accordance with the Indenture. Interest will accrue on the
unpaid principal hereof from the date of issuance, at the rate of _____% per
annum, until the full amount of principal hereof is otherwise paid or made
available for payment and shall be computed on the basis of twelve 30-day months
and a year of 360 days.
Principal and interest on this Class C Note shall be paid on the [__]th day
of each month (or, if such day is not a Business Day, the next succeeding
Business Day), commencing __________, 1997, either by check to the registered
address of the Holder of this Class C Note or by wire transfer to an account at
a bank in the United States as the Holder shall specify, as provided more fully
in the Indenture; provided, that the final payment of principal and interest in
respect of the Class C Notes during the Principal Amortization Period shall be
payable to the Holder of this Class C Note only upon presentation and surrender
of this Class C Note at the Corporate Trust Office of the
A-13
Trustee or at the principal office of any Paying Agent appointed pursuant to the
Indenture.
The Stated Maturity of the Class C Notes is ___________, ____.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Class C Note
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
This Class C Note is one of a duly authorized issue of Class C Notes of the
Company designated as its "_____% Class C Lease-Backed Notes, Series 1997-A"
(herein called the "Class C Notes"), limited in aggregate principal amount of
$_____________, issued under the Indenture, dated as of ___________, 1997
(herein called the "Indenture"), between the Company and ____________________ as
Trustee (herein called the "Trustee", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders and of the terms upon which the Class C Notes are authenticated and
delivered. Unless otherwise defined herein, all capitalized terms used herein
shall have the meanings set forth in the Indenture.
If an Event of Default under the Indenture has been declared by the
Trustee, the principal of all the Class C Notes (but not less than all the Class
C Notes) may be declared due and payable in the manner and with the effect
provided in the Indenture. Notice of such declaration will be given by mail to
Holders, as their names and addresses appear in the Note Register, as provided
in the Indenture. Upon payment of such principal amount together with all
accrued interest, the obligations of the Company with respect to the payment of
principal and interest on this Class C Note shall terminate.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders under the Indenture at any time by the
Company and the Trustee with the consent of the Holders of 66 2/3% in aggregate
principal amount of the Company's _____% Class A Lease-Backed Notes, Series
1996-A (the "Class A Notes"), the Class B Notes and the Class C Notes at the
time Outstanding. The Indenture also contains provisions permitting the Holders
of specified percentages in aggregate principal amount of the Class A Notes and
the Class C Notes at the time outstanding, on behalf of all the
A-14
Holders, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Class C Note shall be
conclusive and binding upon such Holder and upon all future Holders of this
Class C Note and of any Class C Note issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Class C Note or any Class C Note.
No sale or transfer of this Class C Note may be made unless such sale or
transfer complies with or is exempt from registration requirements of the
Securities Act and applicable state securities laws. Prospective transferees of
this Class C Note will be required to deliver a certificate pursuant to the
terms of the Indenture relating to compliance with the Securities Act and
applicable state securities law.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Class C Note is registrable in the Note Register,
upon surrender of this Class C Note for registration of transfer at the office
or agency of the Trustee in The City of [__________], and at any other office or
agency maintained by the Company for that purpose, duly endorsed by, or
accompanied by a written instrument of transfer in the form satisfactory to the
Note Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Class C Notes, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.
The Class C Notes are issuable only in registered form without coupons in
minimum denominations of $250,000. As provided in the Indenture and subject to
certain limitations therein set forth, Class C Notes are exchangeable for a like
aggregate principal amount of Class C Notes of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name this Class C Note is registered as the owner
hereof for all purposes, whether or not this Class C Note may be overdue, and
neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary.
A-15
The Indenture and this Class C Note shall be deemed to be contracts made
under the laws of the State of New York and shall for all purposes be governed
by, and construed in accordance with, the laws of the State of New York.
A-16
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: ____________, 199_
COPELCO CAPITAL FUNDING CORP. X
[SEAL]
By:_______________________________________
Authorized Officer
Attest:
______________________
Trustee's Certificate of Authentication
This is one of the Class C Notes referred to in the within mentioned
Indenture.
_____________________, as Trustee
By:_______________________________________
Authorized Signatory
A-17
ASSIGNMENT FORM
If you the holder want to assign this Class C Note, fill in the form below
and have your signature guaranteed:
I or we assign and transfer this Class C Note to:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type name, address and zip code and
social security or tax ID number of assignee)
and irrevocably appoint _________________________ , agent to transfer this Class
C Note on the books of the Company. The agent may substitute another to act for
him.
Dated: __________________ Signed: _____________________________
_____________________________
(sign exactly as the
name appears on the other
side of this Class C
Note)
Signature Guarantee ____________________________________________________________
Important Notice: When you sign your name to this Assignment Form without
filling in the name of your "Assignee" or "Attorney", this Note becomes fully
negotiable, similar to a check endorsed in blank. Therefore, to safeguard a
signed Class C Note, it is recommended that you fill in the name of the new
owner in the "Assignee" blank. Alternatively, instead of using this Assignment
Form, you may sign a separate "power of attorney" form and then mail the
unsigned Class C Note and the signed "power of attorney" in separate envelopes.
For added protection, use certified or registered mail for a Class C Note.
A-18
EXHIBIT B
---------
[FORM OF
INVESTOR'S LETTER]
(Date)
Copelco Capital Funding Corp. X
000 Xxxx Xxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxxxx 00000
Ladies and Gentlemen:
We propose to purchase $__________ in original aggregate principal amount
of Copelco Capital Funding Corp. X _____% Class C Lease-Backed Notes, Series
1997-A, (the "Class C Notes"). The Class C Notes were issued pursuant to an
Indenture (the "Indenture"), dated as of [May] 1, 1997, among Copelco Capital
Funding Corp. X and [Manufacturers and Traders Trust Company]. Capitalized terms
used herein but not otherwise defined shall have the same meaning as in the
Indenture.
In connection with our proposed purchase of Class C Notes, we agree to the
following terms and conditions and make the representations and warranties
stated herein with the express understanding that they will be relied upon by
Copelco Capital Funding Corp. X and ____________________.
1. We understand that the Class C Notes have not been registered under the
Securities Act of 1933, as amended (the "Securities Act") or registered or
qualified under any state securities or "Blue Sky" laws and are being sold to us
in a transaction that is exempt from the registration requirements of the
Securities Act and the registration or qualification requirements of such state
laws.
2. We are (Check one):
___ (a) a "Qualified Institutional Buyer" (as defined in Rule 144A under
the Securities Act), in the case of a transfer of Certificates to
be made in reliance on Rule 144A.
___ (b) an institutional investor that has such knowledge and experience
in financial and business matters as to be capable of evaluating
the merits and risks of an investment in the Class C Notes and is
able to bear the economic risk of investment in the Class C
Notes.
B-1
___ (c) an "accredited investor" as defined in Rule 501 promulgated under
the Securities Act that has such knowledge and experience in
financial and business matters as to be capable of evaluating the
merits and risks of investment in the Class C Notes and is able
to bear the economic risk of investment in the Class C Notes.
3. We agree that, to the extent that Section 2(a) of this letter is
applicable, that the Class C Notes will not be transferred unless such transfer
is made in reliance on Rule 144A or unless some other exemption from the
registration requirements of the Securities Act, or any applicable state
securities law, is available.
4. To the extent that Section 2(b) or (c) of this letter is applicable,
that we are acquiring the Class C Notes (i) solely for investment purposes for
our own account or for accounts as to which we exercise sole investment
discretion and not with a view to any resale or distribution of the Class C
Notes in whole or in part, or (ii) otherwise for purposes which will not
constitute a distribution of securities under the Securities Act, or under any
state securities or "Blue Sky" laws subject, nevertheless, to the understanding
that disposition of our property shall at all times be and remain within our
control, and under no circumstances will we attempt to sell, pledge, hypothecate
or otherwise transfer all or any portion of our interest in the Class C Notes
except in accordance with the terms of the Class C Notes and the Indenture.
5. We agree not to sell the Class C Notes in whole or in part, unless the
subsequent purchaser agrees to be subject to the same representations and
warranties as were applicable to us in acquiring the Class C Notes.
6. We understand that each of the Class C Notes shall bear a legend to
substantially the following effect:
THIS CLASS C NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAW, AND MAY NOT BE DIRECTLY OR INDIRECTLY OFFERED OR SOLD OR
OTHERWISE DISPOSED OF BY THE OWNER HEREOF UNLESS SUCH TRANSACTION IS EXEMPT FROM
REGISTRATION UNDER THE SECURITIES ACT AND SUCH STATE LAWS, AND WILL NOT BE A
"PROHIBITED TRANSACTION" UNDER THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"). BY ACCEPTANCE OF THIS CLASS C NOTE, THE HOLDER
AGREES TO BE BOUND BY ALL THE TERMS OF THE INDENTURE.
B-2
7. We understand that there is no public market for the Class C Notes and
it is unlikely that such market will develop.
8. We are authorized to invest in the Class C Notes.
9. We certify that, in acquiring the Class C Notes, we have complied with
any applicable guidelines or regulations for or limitations on investments
established by each regulatory agency or body, if any, which has jurisdiction
over investments made by us and that our acquisition and retention of the Class
C Notes will not violate the limitations on possession contained in any such
guidelines, regulations or limitations.
10. We further agree to be bound by all of the terms and conditions of
ownership of the Class C Notes contained in the Indenture, as the same may be
amended from time to time.
Very truly yours,
[TRANSFEREE]
B-3
