UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Form 10-Q
(Mark One)*
[X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange
Act of 1934 for the quarterly period ended June 30, 1999 or [ ] Transition
report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
for the transition period from ________ to ________
Commission file number 333-71073
IKON Receivables, LLC
(Exact name of registrant as specified in its charter)
DELAWARE 23-2990188
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1738 Bass Road, P.O. Box 9115, Macon, GA 31208
(Address of principal executive offices)
(Zip Code)
(912) 471-2300
(Registrant's telephone number, including area code)
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No ___
* Applicable only to issuers involved in bankruptcy proceedings during the
preceding five years:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes ___ No ___
* Applicable only to corporate issuers:
Indicate the number of shares outstanding of each issuer's classes of common
stock, as of the latest practicable date. (Not applicable)
Registered Debt Outstanding as of July 31, 1999 $672,106,059.06
The registrant, an indirect wholly owned subsidiary of IKON Office Solutions,
Inc. ("IKON"), meets the conditions set forth in General Instruction H(1)(a) and
(b) of Form 10-Q and is, therefore, filing with the reduced disclosure format
contemplated thereby.
<PAGE>
INDEX
IKON RECEIVABLES, LLC
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Balance Sheet--June 30, 1999
Statement of Income--April 6, 1999 to
June 30, 1999
Statement of Cash Flows--April 6, 1999 to
June 30, 1999
Notes to Financial Statements--June 30, 1999
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
<PAGE>
PART I . FINANCIAL INFORMATION
Item 1: Financial Statements (unaudited)
IKON RECEIVABLES, LLC
BALANCE SHEET
(in thousands)
<TABLE>
<CAPTION>
June 30,
1999
---------------------
Assets
Investment in leases:
<S> <C>
Direct financing leases $920,304
Less: Unearned income (140,069)
---------------------
780,235
Cash 1
Restricted cash 33,433
Due from IKON 684,153
Accounts receivable 27,549
Prepaid expenses and other assets 3,340
---------------------
Total assets $1,528,711
=====================
Liabilities and member's equity
Liabilities:
Accounts payable and accrued expenses $89
Accrued interest 1,645
Lease-backed notes 696,537
---------------------
Total liabilities 698,271
Member's equity:
Contributed capital 822,505
Retained earnings 7,935
---------------------
Total member's equity 830,440
---------------------
Total liabilities and member's equity $1,528,711
=====================
</TABLE>
See notes to financial statements.
<PAGE>
IKON RECEIVABLES, LLC
STATEMENT OF INCOME
(in thousands)
<TABLE>
<CAPTION>
April 6, 1999
through
June 30, 1999
------------------
Revenues:
<S> <C>
Lease finance income $13,031
Other income 182
------------------
13,213
Expenses:
Interest expense 4,530
General and administrative expenses - IOS Capital 748
------------------
5,278
Net income $7,935
==================
</TABLE>
See notes to financial statements.
<PAGE>
IKON RECEIVABLES, LLC
STATEMENT OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
April 6, 1999
through
June 30, 1999
----------------------------
Operating activities:
<S> <C>
Net income $7,935
Adjustments to reconcile net income to net
cash used in operating activities:
Changes in operating assets and liabilities:
Accounts receivable (27,549)
Prepaid expenses and other assets (1,029)
Accounts payable and accrued expenses 89
Accrued interest 1,645
----------------------------
Net cash used (18,909)
----------------------------
Investing activities:
Collections on lease receivables 42,269
----------------------------
Net cash provided 42,269
----------------------------
Financing activities:
Proceeds from issuance of leased-back notes 749,331
Payments on lease-backed notes (55,105)
Capital contribution 1
Deposit to restricted cash (33,433)
----------------------------
Net cash provided 660,794
----------------------------
Increase in Cash and amounts Due from IKON $684,154
============================
</TABLE>
See notes to financial statements.
<PAGE>
IKON Receivables, LLC
Notes to Financial Statements
June 30, 1999
Note 1: Basis of Presentation
The accompanying unaudited condensed financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and the instructions to Form 10-Q and Rule 10-01 of
Regulation S-X. In the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair presentation have
been included.
Note 2: Organization
IKON Receivables, LLC (the "Company") is a special purpose Delaware
limited liability company, all of the membership interests in which are held by
IKON Receivables-1, LLC ("Sole Member"), also a special purpose Delaware limited
liability company. All of the membership interests in the Sole Member are owned
by IOS Capital, Inc. ("IOS Capital"), a wholly owned finance subsidiary of IKON
Office Solutions, Inc. ("IKON"), a publicly traded office technology company
with fiscal 1998 revenues of $5.6 billion. The Company was organized in the
State of Delaware on January 20, 1999 and is managed by IKON Receivables
Funding, Inc. (the "Manager").
The Company was organized to engage exclusively in the following
business and financial activities: to purchase or acquire from IKON, or any
subsidiary or affiliate of IKON, any right to payment, whether constituting an
account, chattel paper, instrument or general intangible, and certain related
property (other than equipment) and rights (collectively, "Lease Receivables"),
and hold, sell, transfer, pledge or otherwise dispose of Lease Receivables or
interests therein; to enter into any agreement related to any Lease Receivables
that provides for the administration, servicing and collection of amounts due on
such Lease Receivables and to enter into any interest rate hedging arrangements
in connection therewith; to distribute Lease Receivables or proceeds from Lease
Receivables and any other income to its Sole Member; and to engage in any lawful
act or activity and to exercise any power that is incidental and necessary or
convenient to the foregoing and permitted under Delaware law.
Neither the Sole Member nor the Manager is liable for the debts,
liabilities, contracts or other obligations of the Company solely by reason of
being the Sole Member or Manager of the Company.
The Company's organizational documents require it to operate in such
a manner that it should not be consolidated in the bankruptcy estate of the Sole
Member, IOS Capital, or IKON, should any of these entities become subject to
such a proceeding. The Company is legally separate from each of the foregoing
entities and the assets of the Company, including, without limitation, the Lease
Receivables, are not available to the creditors of the Sole Member, IOS Capital,
or IKON.
Note 3: Capital Contributions
The Sole Member made an initial cash capital contribution of $1,000
to the Company on April 6, 1999. Subsequently, the Sole Member contributed a
segregated pool of $819,572,000 of office equipment leases or contracts and
related assets (the "1999-1 Asset Pool") to the Company as an initial transfer
of leases to the Company. An additional $14,543,000 of leases were added to the
1999-1 Asset Pool after the initial transfer though June 30, 1999 as
substitutions for leases that were cancelled or defaulted.
<PAGE>
IKON Receivables, LLC
Notes to Financial Statements (cont.)
June 30, 1999
Note 4: Lease-backed Notes
On May 19, 1999, the Company issued $304,474,000 aggregate principal
amount of 5.11% Lease-Backed Notes, Class A-1 (the "Class A-1 Notes"),
$61,579,000 aggregate principal amount of 5.60% Lease-Backed Notes, Class A-2
(the "Class A-2 Notes"), $304,127,000 aggregate principal amount of 5.99%
Lease-Backed Notes, Class A-3 (the "Class A-3 Notes"), and $81,462,000 aggregate
principal amount of 6.23% Lease-Backed Notes, Class A-4 (the "Class A-4 Notes"
and, together with the Class A-1 Notes, the Class A-2 Notes, the Class A-3
Notes, the "1999-1 Notes"). The 1999-1 Notes were issued pursuant to an
Indenture dated as of April 1, 1999 between the Company and Harris Trust and
Savings Bank, as Indenture Trustee. The 1999-1 Notes are secured solely by the
1999-1 Asset Pool, which includes a portfolio of chattel paper composed of
leases, leases intended as security agreements and installment sales contracts
acquired or originated by IOS Capital (the "1999-1 Leases") (together with the
equipment financing portion of each periodic rental payment due under the 1999-1
Leases on or after the opening of business on April 1, 1999), and all related
casualty payments, retainable deposits, and termination payments. The 1999-1
Notes have certain credit enhancement features available to noteholders
including a reserve account, an overcollateralization account and a
noncancellable insurance policy from Ambac Assurance Corporation with respect to
the 1999-1 Notes.
Payments on the 1999-1 Notes are due on the fifteenth day of each month
(or if that is not a Business Day, the next succeeding Business Day), commencing
on June 15, 1999. The 1999-1 Notes bear interest from May 25, 1999 at the
respective fixed per annum interest rates specified above. The interest rate is
calculated on the basis of a year of 360 days comprised of twelve 30-day months
(except in the case of the Class A-1 Notes, for which interest will be
calculated on the basis of a year of 360 days and the actual number of days in
the interest period) payable on the payment date. On each payment date, to the
extent funds are available therefore from the collection of the lease
receivables, principal payments will be made to noteholders in the following
priority: (i) to the Class A-1 Noteholders only, until the outstanding principal
amount on the Class A-1 Notes has been reduced to zero, then (ii) to the Class
A-2 noteholders only, until the outstanding principal amount on the Class A-2
Notes has been reduced to zero, then (iii) to the Class A-3 noteholders only,
until the outstanding principal amount on the Class A-3 Notes has been reduced
to zero, and then (iv) to the Class A-4 noteholders, until the outstanding
principal amount on the Class A-4 Notes has been reduced to zero. Each class of
1999-1 Notes will be payable in full on the applicable stated maturity date,
which is as follows: Class A-1 Notes - June 2000, Class A-2 Notes, Class A-3
Notes and Class A-4 Notes - May 2005. However, if all payments are made on the
1999-1 Leases as scheduled, final payment on the 1999-1 Notes will be earlier
than the stated maturity dates. The Company may, on any payment date, redeem the
1999-1 Notes when the total discounted lease balance is less than or equal to
10% of the total discounted lease balance as of April 1, 1999.
IOS Capital services the 1999-1 Leases pursuant to an Assignment and
Servicing Agreement by and among IOS Capital, as Originator and Servicer, the
Sole Member, as Seller, and the Company, as Issuer. IOS Capital may delegate its
servicing responsibilities to one or more sub-servicers, but such delegation
does not relieve IOS Capital of its liabilities with respect thereto. IOS
Capital retains possession of the 1999-1 Leases and related files, and receives
a monthly service fee from the Company for servicing the 1999-1 Leases.
<PAGE>
IKON Receivables, LLC
Notes to Financial Statements (cont.)
June 30, 1999
Note 5: Restricted Cash
Cash related to the 1999-1 Leases is held in segregated accounts
pending distribution to the holders of the 1999-1 Notes and is restricted in its
use.
Note 6: Income Taxes
As a limited liability company, the Company will be treated as a
disregarded entity for tax purposes. The Company, the Sole Member and IOS
Capital will be treated as a single entity for tax purposes. The Company's
income and losses are passed through to the Sole Member and, accordingly, no
provision for income taxes has been recorded.
<PAGE>
Item 2: Management's Discussion and Analysis of Financial Condition and
Results of Operations
Pursuant to General Instruction H(2)(a) of Form 10-Q, the following analysis of
the results of operations is presented in lieu of Management's Discussion and
Analysis of Financial Condition and Results of Operations.
IKON Receivables, LLC (the "Company") is a special purpose Delaware limited
liability company, all of the membership interests in which are held by IKON
Receivables-1, LLC ("Sole Member"), also a special purpose Delaware limited
liability company. All of the membership interests in the Sole Member are owned
by IOS Capital, Inc. ("IOS Capital"), a wholly owned finance subsidiary of IKON
Office Solutions, Inc. ("IKON"), a publicly traded office technology company
with fiscal 1998 revenues of $5.6 billion. The Company was organized in the
State of Delaware on January 20, 1999 and is managed by IKON Receivables
Funding, Inc. (the "Manager").
On May 19, 1999, the Company issued $304,474,000 aggregate principal amount of
5.11% Lease-Backed Notes, Class A-1 (the "Class A-1 Notes"), $61,579,000
aggregate principal amount of 5.60% Lease-Backed Notes, Class A-2 (the "Class
A-2 Notes"), $304,127,000 aggregate principal amount of 5.99% Lease-Backed
Notes, Class A-3 (the "Class A-3 Notes"), and $81,462,000 aggregate principal
amount of 6.23% Lease-Backed Notes, Class A-4 (the "Class A-4 Notes" and,
together with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the
"1999-1 Notes"). The 1999-1 Notes were issued pursuant to an Indenture dated as
of April 1, 1999 between the Company and Harris Trust and Savings Bank, as
Indenture Trustee. The 1999-1 Notes are secured solely by the 1999-1 Asset Pool,
which includes a portfolio of chattel paper composed of leases, leases intended
as security agreements and installment sales contracts acquired or originated by
IOS Capital (the "1999-1 Leases") (together with the equipment financing portion
of each periodic rental payment due under the 1999-1 Leases on or after the
opening of business on April 1, 1999), and all related casualty payments,
retainable deposits, and termination payments. The 1999-1 Notes have certain
credit enhancement features available to noteholders including a reserve
account, an overcollateralization account and a noncancellable insurance policy
from Ambac Assurance Corporation with respect to the 1999-1 Notes.
Payments on the 1999-1 Notes are due on the fifteenth day of each month (or if
that is not a Business Day, the next succeeding Business Day), commencing on
June 15, 1999. The 1999-1 Notes bear interest from May 25, 1999 at the
respective fixed per annum interest rates specified above. The interest rate is
calculated on the basis of a year of 360 days comprised of twelve 30-day months
(except in the case of the Class A-1 Notes, for which interest will be
calculated on the basis of a year of 360 days and the actual number of days in
the interest period) payable on the payment date. On each payment date, to the
extent funds are available therefore from the collection of the lease
receivables, principal payments will be made to noteholders in the following
priority: (i) to the Class A-1 Noteholders only, until the outstanding principal
amount on the Class A-1 Notes has been reduced to zero, then (ii) to the Class
A-2 noteholders only, until the outstanding principal amount on the Class A-2
Notes has been reduced to zero, then (iii) to the Class A-3 noteholders only,
until the outstanding principal amount on the Class A-3 Notes has been reduced
to zero, and then (iv) to the Class A-4 noteholders, until the outstanding
principal amount on the Class A-4 Notes has been reduced to zero. Each class of
1999-1 Notes will be payable in full on the applicable stated maturity date,
<PAGE>
which is as follows: Class A-1 Notes - June 2000, Class A-2 Notes, Class A-3
Notes and Class A-4 Notes - May 2005. However, if all payments are made on the
1999-1 Leases as scheduled, final payment on the 1999-1 Notes will be earlier
than the stated maturity dates. The Company may, on any payment date, redeem the
1999-1 Notes when the total discounted lease balance is less than or equal to
10% of the total discounted lease balance as of April 1, 1999.
IOS Capital services the 1999-1 Leases pursuant to an Assignment and Servicing
Agreement by and among IOS Capital, as Originator and Servicer, the Sole Member,
as Seller, and the Company, as Issuer. IOS Capital may delegate its servicing
responsibilities to one or more sub-servicers, but such delegation does not
relieve IOS Capital of its liabilities with respect thereto. IOS Capital retains
possession of the 1999-1 Leases and related files, and receives a monthly
service fee from the Company for servicing the 1999-1 Leases.
Interest income earned on the Asset Pool is expected to offset interest expense
on the Notes, amortization of debt issuance costs and discount on the notes and
the fees charged by IOS Capital for servicing the Asset Pool and providing
administrative services to the Company. For the period April 6, 1999 (date the
Company commenced operations) to June 30, 1999, income generated from the Asset
Pool was approximately $13.0 million, other income earned was $.2 million, while
interest expense during this period was $4.5 million and administrative expenses
were $.7 million. Collections on the lease receivables since inception through
June 30, 1999 have been approximately $42.3 million. The Company repaid $55.1
million of principal on the Class A-1 Notes on the June 15, 1999 payment date.
The Company's portfolio of leases has an average interest rate of 10.5% at June
30, 1999, while the Company's weighted average interest rate on its debt
outstanding as of June 30, 1999 is 5.9%. This rate differential, in addition to
the overcollateralization of the lease portfolio balance, gives rise to the 60%
net income to revenue relationship for the period April 6, 1999 to June 30,
1999.
Impact of Year 2000
IOS Capital is responsible for servicing the 1999-1 Leases and, therefore, any
Year 2000 issues adversely affecting IOS Capital could adversely affect the
Company.
State of Readiness. The Year 2000 issue arises from computer programs being
written using two digits rather than four to define the applicable year. Any of
IOS Capital's computer programs or hardware that have date-sensitive software or
embedded technology (non-IT systems) may recognize a date using "00" as the year
1900 rather than the year 2000. This could result in a system failure or
miscalculations causing disruptions of operations, including, among other
things, a temporary inability to process transactions, send invoices, or engage
in similar normal business activities. The potential for a problem exists with
all computer hardware and software, as well as in products with embedded
technology: copiers and fax machines; security and HVAC systems; voice/telephony
systems; elevators, etc.
IKON has appointed a Year 2000 Corporate Compliance Team, which has prepared a
compliance program for IOS Capital, and is responsible for coordination and
inspecting compliance activities in all business units. The compliance program
requires all business units and locations in every country to inventory
potentially affected systems and products, assess risk, take any required
corrective actions, test and certify compliance. IKON's Year 2000 Testing and
Certification Guidelines delineate the Year 2000 compliance process, testing and
quality assurance guidelines, certification and reporting processes and
contingency planning. An independent consulting company has reviewed the
compliance program.
IOS Capital's Year 2000 compliance program has five phases: 1) inventory of
internal IT and non-IT systems; 2) risk assessment of the Year 2000 compliance
issues associated with such internal IT and non-IT systems; 3) remediation of
non-compliant systems; 4) testing and validation of remediated systems; and 5)
implementation of remediated systems throughout IOS Capital. The progress to
date of each of these phases is as follows: 1) internal IT and non-IT systems
have been inventoried; 2) appropriate risk assessments have been completed; 3)
<PAGE>
remediation of critical systems has been substantially completed and remediation
of non-critical systems is progressing; 4) testing and validation of critical
systems has been substantially completed; and 5) Year 2000 compliant versions of
critical systems are in the process of being implemented. IOS Capital
anticipates completing the Year 2000 project no later than October 31, 1999,
which is prior to any anticipated material impact on its operating systems.
Costs. The Company has no internal or external costs relating to the Year 2000
issue. IOS Capital will use both internal and external resources to reprogram or
replace, test and implement its IT and non-IT systems for Year 2000
modifications. IOS Capital does not separately track the internal costs incurred
on the Year 2000 project. Such costs are principally payroll and related costs
for its internal IT personnel. IOS Capital's total cost of the Year 2000
project, excluding its internal costs, is estimated at $1.4 million and is being
funded through operating cash flows, all of which will be expensed as incurred.
Through June 30, 1999, IOS Capital expensed approximately $833,000 related to
its Year 2000 project.
Risks. The Company is advised by IOS Capital that the most reasonably likely
worse case scenario that could be caused by technology failures relating to the
Year 2000 could pose a significant threat not only to IOS Capital, IKON, its
customers and suppliers, but to all businesses. Risks include, but are not
limited to:
o Legal risks, including customer, supplier, employee or shareholder lawsuits
over failure to deliver contracted services, product failure, or health and
safety issues.
o Loss of revenues due to failure to meet customer quality expectations.
o Increased operational costs due to manual processing, data corruption or
disaster recovery.
o Inability to bill or invoice.
The cost of the project and the date on which IKON and IOS Capital believe IOS
Capital will complete the Year 2000 modifications are based on management's best
estimates, which were derived using numerous assumptions of future events,
including the continued availability of certain resources and other factors.
However, there can be no guarantee that these estimates will be achieved and
actual results could differ materially from those anticipated. Specific factors
that might cause such material differences include, but are not limited to, the
availability and cost of personnel trained in this area, the ability to locate
and correct all relevant computer codes, and other uncertainties.
Contingency Plans. IKON's Guidelines require that contingency plans be developed
and validated in the event that any critical system cannot be corrected and
certified before the system's failure date. IOS Capital and IKON expect to have
contingency plans in place by October 31, 1999. In addition, IKON is forming a
rapid response team as part of its IT group that will respond to any operational
problems during the Year 2000 date change period.
<PAGE>
FORWARD-LOOKING STATEMENT DISCLOSURE
This Report includes or incorporates by reference information which may
constitute forward-looking statements within the meaning of the federal
securities laws. Although the Company believes the expectations contained in
such forward-looking statements are reasonable, it can give no assurances that
such expectations will prove correct. Such forward-looking information is based
upon management's current plans or expectations and is subject to a number of
risks and uncertainites that could significantly affect current plans,
anticipated actions and the Company's future financial condition and results.
These risks and uncertainties include, but are not limited to, factors which may
affect the Company's ability to recoup the full amount due on the 1999-1 Leases
(such as lessee defaults or factors impeding recovery efforts), and risks and
uncertainties affecting the business of IOS Capital and/or IKON as set forth in
IOS Capital's and IKON's periodic reports filed with the Securities & Exchange
Commission, including, but not limited to, risks and uncertainties relating to
conducting operations in a competitive environment; delays, difficulties,
management transitions and employment issues associated with consolidation of,
and/or changes in business operations; managing the integration of existing and
acquired companies; risks and uncertainties associated with existing or future
vendor relationships; and general economic conditions. As a consequence of these
and other risks and uncertainties, current plans, anticipated actions and future
financial condition and results may differ materially from those expressed in
any forward-looking statements made by or on behalf of the Company.
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) The following Exhibits are furnished pursuant to Item 601 of Regulation S-K:
1.1 Underwriting Agreement, dated May 19, 1999, among the Company, IKON
Receivables-1, LLC, IOS Capital, Inc., and Lehman Brothers as Representative of
the Underwriters, filed as Exhibit 1.1 to the Company's Form 8-K dated May 25,
1999, is incorporated herein by reference.
3.1 Certificate of Formation of IKON Receivables, LLC., filed as
Exhibit 3.1 to the Company's Registration Statement on Form S-3 (File No.
333-71073), is incorporated herein by reference.
3.2 Limited Liability Company Agreement of IKON Receivables, LLC.,
filed as Exhibit 3.2 to the Company's Registration Statement on Form S-3 (File
No. 333-71073), is incorporated herein by reference.
4.1 Indenture, dated as of April 1, 1999 among the Company, Harris
Trust Savings Bank, as Trustee, and IOS Capital, Inc., as Servicer, filed as
Exhibit 4.1 to the Company's Form 8-K dated May 25, 1999, is incorporated herein
by reference.
4.2 Certificate Guaranty Insurance Policy, dated May 25, 1999, issued
and delivered by Ambac Assurance Corporation, filed as Exhibit 4.2 to the
Company's Form 8-K dated May 25, 1999, is incorporated herein by reference.
10.1 Assignment and Servicing Agreement, dated as of April 1, 1999,
among the Company, IKON Receivables-1, LLC, and IOS Capital, Inc., as Originator
and Servicer, filed as Exhibit 10.1 to the Company's Form 8-K dated May 25,
1999, is incorporated herein by reference.
10.2 Indemnification Agreement, dated as of May 25, 1999, among Lehman
Brothers, Chase Securities Inc., Deutsche Bank Securities Inc., PNC Capital
Markets, Inc., as Underwriters, and Ambac Assurance Corporation, as Insurer,
filed as Exhibit 10.2 to the Company's Form 8-K dated May 25, 1999, is
incorporated herein by reference.
10.3 Insurance and Indemnity Agreement, dated as of May 25, 1999, among
IOS Capital, Inc., as Originator and Servicer, the Company, IKON Receivables-1,
LLC, and Ambac Assurance Corporation, as Insurer, filed as Exhibit 10.3 to the
Company's Form 8-K dated May 25, 1999, is incorporated herein by reference.
27 Financial Data Schedule
(b) Reports on Form 8-K
On May 13, 1999, the Company filed a Current Report on Form 8-K to
file, under Item 5 of the form, certain information regarding the
offering of the Company's 1999-1 Notes.
On June 4, 1999, the Company filed a Current Report on Form 8-K to
file, under Items 2 and 7 of the form, certain information
regarding the Registration of the 1999-1 Notes.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
IKON RECEIVABLES, LLC
By: IKON RECEIVABLES FUNDING, INC.
As Manager of IKON Receivables LLC
Date August 16, 1999 /s/ Robert K. McLain
--------------- -----------------------
Robert K. McLain
President
(Principal Financial Officer)
<PAGE>
Index to Exhibits
Exhibit Number
(27) Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of IKON Receivables LLC and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> Other
<FISCAL-YEAR-END> Sep-30-1999
<PERIOD-END> Jun-30-1999
<CASH> 1,000
<SECURITIES> 0
<RECEIVABLES> 807,784,000<F1>
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,528,711,000
<CURRENT-LIABILITIES> 0
<BONDS> 696,537,000
0
0
<COMMON> 0
<OTHER-SE> 830,440,000
<TOTAL-LIABILITY-AND-EQUITY> 1,528,711,000
<SALES> 0
<TOTAL-REVENUES> 13,213,000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 748,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 4,530,000
<INCOME-PRETAX> 7,935,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 7,935,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 7,935,000
<EPS-BASIC> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1> Includes net investments in leases of $780,235,000 and other
accounts receivable.
<F2> Not required as the registrant is a wholly-owned subsidiary.
</FN>
</TABLE>
