SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: May 11, 2000
(Date of earliest event reported)
DVI Receivables Corp., VIII
(Exact name of registrant as specified in its charter)
Delaware 333-94523 25-1824148
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(State or Other Juris- (Commission (I.R.S. Employer
diction of Incorporation) File Number) Identification No.)
500 Hyde Park, Doylestown, Pennsylvania 18901
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(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code:(215) 345-6600
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Item 5. Other Events.
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The registrant has entered into the material agreements
exhibited below.
Item 7. Financial Statements, PRO FORMA Financial Information and
Exhibits
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(a) Financial Statements.
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Not applicable.
(b) PRO FORMA Financial Information.
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Not applicable.
(c) Exhibits
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1.1 Underwriting Agreement, dated as of May 5, 2000, by and
among Prudential Securities Incorporated, Lehman Brothers Inc., Banc One Capital
Markets, Inc., DVI Receivables Corp. VIII, DVI Receivables XI, L.L.C., DVI
Receivables Corp. XI and DVI Financial Services Inc.
4.1 Amended and Restated Indenture, dated as of December 1,
1999 between DVI Receivables XI, L.L.C., as Issuer, and U.S. Bank Trust National
Association, as Indenture Trustee, and Appendix I thereto.
4.2 Amended and Restated Contribution and Servicing Agreement,
dated as of December 1, 1999, between DVI Financial Services Inc., as
Contributor, and DVI Receivables Corp. XI, as Transferor.
4.3 Amended and Restated Subsequent Contract Transfer
Agreement, dated as of December 1, 1999 between DVI Receivables Corp. XI and DVI
Receivables XI, L.L.C.
4.4 Amended and Restated Limited Liability Company Operating
Agreement, dated as of December 1, 1999, by and between DVI Receivables Corp.
VIII and DVI Receivables XI, L.L.C.
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Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on behalf of the
Registrant by the undersigned thereunto duly authorized.
DVI RECEIVABLES CORP. VIII
By:/s/ Lisa J. Cruikshank
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Name: Lisa J. Cruikshank
Title: Vice President
Dated: May 18, 2000
EXHIBIT 1.1
$39,800,000 6.72375% ASSET-BACKED NOTES, SERIES 2000-1, CLASS A-1
$39,000,000 7.265% ASSET-BACKED NOTES, SERIES 2000-1, CLASS A-2
$83,000,000 7.550% ASSET-BACKED NOTES, SERIES 2000-1, CLASS A-3
$95,625,000 7.780% ASSET-BACKED NOTES, SERIES 2000-1, CLASS A-4
$ 4,387,000 7.760% ASSET-BACKED NOTES, SERIES 2000-1, CLASS B
$ 8,775,000 7.860% ASSET-BACKED NOTES, SERIES 2000-1, CLASS C
$ 5,850,000 8.340% ASSET-BACKED NOTES, SERIES 2000-1, CLASS D
UNDERWRITING AGREEMENT
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May 5, 2000
PRUDENTIAL SECURITIES INCORPORATED
One New York Plaza
New York, New York 10292
LEHMAN BROTHERS INC.
Three World Financial Center
New York, New York 10285
BANC ONE CAPITAL MARKETS, INC.
One Bank One Plaza
Chicago, Illinois 60670
Ladies and Gentlemen:
DVI Receivables Corp. VIII (the "MANAGING MEMBER"), as sole owner of
all of the membership Units interest in DVI Receivables XI, L.L.C. (the
"ISSUER"), the Issuer, DVI Receivables Corp. XI (the "TRANSFEROR") and DVI
Financial Services Inc. (the "CONTRIBUTOR" or "SERVICER"), hereby agree with the
Underwriters (defined below) as follows:
Section 1. ISSUANCE AND SALE OF NOTES. The Issuer proposes to issue and
sell $39,800,000 (the "CLASS A-1 INITIAL PRINCIPAL AMOUNT") of 6.72375% Class
A-1 Asset-Backed Notes (the "CLASS A-1 NOTES"); $39,000,000 (the "CLASS A-2
INITIAL PRINCIPAL AMOUNT") of 7.265% Class A-2 Asset- Backed Notes (the "CLASS
A-2 NOTES"); $83,000,000 (the "CLASS A-3 INITIAL PRINCIPAL AMOUNT") of 7.550%
Class A-3 Asset-Backed Notes (the "CLASS A-3 NOTES"), $95,625,000 (the "CLASS
A-4 INITIAL PRINCIPAL AMOUNT") of 7.780% Class A-4 Asset-Backed Notes (the
"CLASS A-4 NOTES," together with the Class A-1 Notes, the Class A-2 Notes and
the Class A-3 Notes, the "CLASS A NOTES"); $4,387,000 (the "CLASS B INITIAL
PRINCIPAL AMOUNT") of 7.760% Class B Asset-Backed Notes (the "CLASS B NOTES");
$8,775,000 (the "CLASS C INITIAL PRINCIPAL AMOUNT") of 7.860% Class C
Asset-Backed Notes (the "CLASS C NOTES"); $5,850,000 (the "CLASS D INITIAL
PRINCIPAL AMOUNT") of 8.340% Class
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D Asset-Backed Notes (the "CLASS D NOTES"; together with the Class A-1 Notes,
the Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class B Notes
and the Class C Notes, the "NOTES"). The Notes will be issued pursuant to an
Amended and Restated Indenture, dated as of December 1, 1999 (the "INDENTURE"),
between the Issuer and U.S. Bank Trust National Association, a national banking
association (the "TRUSTEE"). The Notes are more fully described in the
Prospectus Supplement (as defined below), a copy of which the Managing Member is
furnishing to the Underwriters. The Notes will evidence secured obligations of
the Issuer. The assets of the Issuer will include a pool of leases, loans and
other contracts and security interests in the related underlying Equipment.
The Notes will be sold by the Issuer to the Underwriters listed on
Schedule A hereto (the "UNDERWRITERS") in accordance with the terms of this
agreement.
The terms which follow, when used in this Agreement, shall have the
meanings indicated:
"INITIAL PRINCIPAL AMOUNT" means the sum of the Class A-1 Initial
Principal Amount, the Class A-2 Initial Principal Amount, the Class A-3 Initial
Principal Amount, the Class A-4 Initial Principal Amount, the Class B Initial
Principal Amount, the Class C Initial Principal Amount and the Class D Initial
Principal Amount.
"UNDERWRITING INFORMATION" has the meaning given to such term in
SECTION 8(B).
Capitalized terms used and not otherwise defined herein shall have the
meanings ascribed to them in APPENDIX I to the Indenture.
Section 2. PURCHASE AND SALE OF NOTES.
(a) Subject to the terms and conditions and in reliance upon the
covenants, representations and warranties set forth herein, each of the
Underwriters agrees to purchase from the Issuer its respective Initial Principal
Amount of the Notes pursuant to the terms of this Agreement on the Closing Date
at a purchase price (the "PURCHASE PRICE") equal to the product of (x) the
aggregate of the Initial Principal Amount of each class of Notes purchased by
such Underwriter multiplied by (y) the applicable Underwriter's price set forth
on Schedule A attached hereto.
(b) The obligations of each of the Underwriters hereunder to purchase
the respective Notes of each Class shall be several and not joint. Each
Underwriter's obligation shall be to purchase the aggregate principal amount of
Notes of the related class as is indicated with respect to each Underwriter on
Schedule A attached hereto. The rights of the Issuer and any Non-Defaulting
Underwriter shall be as set forth in Section 13 hereof.
(c) It is understood that the Underwriters propose to offer the Notes
for sale to the public in the manner set forth in the Prospectus Supplement (as
defined below).
Section 3. DELIVERY AND PAYMENT. Delivery of and payment for the Notes
purchased by the Underwriters shall be made at the offices of Thacher Proffitt &
Wood, at Two World Trade Center, 39th Floor, New York, New York, on the Closing
Date, or such other place and time as the
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parties hereto agree. Delivery of the Notes shall be made against payment of the
purchase price in immediately available funds drawn to the order of the Issuer
or as it shall so direct. The Notes to be so delivered will be initially
represented by one or more Notes registered in the name of Cede & Co., as
nominee for The Depository Trust Company. The interests of beneficial owners of
the Notes will be represented by book entries on the records of the Note
Registrar and participating members thereof. Definitive Notes will be available
only under limited circumstances described in the Indenture.
Section 4. REPRESENTATIONS AND WARRANTIES OF THE MANAGING MEMBER AND
THE ISSUER.
(a) Each of the Managing Member or the Issuer, as the case may be,
hereby severally represents and warrants to, and agrees with, the Underwriters
as follows:
(i) The Managing Member has filed with the Securities and
Exchange Commission (the "COMMISSION") a registration statement (No.
333-94523) on Form S-3 for the registration under the Securities Act of
1933, as amended (the "ACT"), of Asset Backed Securities (issuable in
series), including the Notes, which registration statement has become
effective, and a copy of which, as amended to the date hereof, has
heretofore been delivered to you. The Managing Member proposes to file
with the Commission pursuant to Rule 424(b) under the rules and
regulations of the Commission under the Act (the "1933 ACT
REGULATIONS") a supplement dated May 8, 2000 (the "PROSPECTUS
SUPPLEMENT"), to the Prospectus dated January 12, 2000 (the "BASIC
PROSPECTUS"), relating to the Notes and the method of distribution
thereof. Such registration statement (No. 333-94523) including exhibits
thereto and any information incorporated therein by reference, as
amended at the date hereof, is hereinafter called the "REGISTRATION
STATEMENT"; and the Basic Prospectus and the Prospectus Supplement and
any information incorporated therein by reference, together with any
amendment thereof or supplement thereto authorized by the Managing
Member on or prior to the Closing Date for use in connection with the
offering of the Notes, are hereinafter called the "PROSPECTUS."
(ii) The Registration Statement has become effective, and the
Registration Statement as of the effective date (the "EFFECTIVE DATE"),
and the Prospectus, as of the date of the Prospectus Supplement,
complied in all material respects with the applicable requirements of
the Act and the 1933 Act Regulations; and the Registration Statement,
as of the Effective Date, did not contain any untrue statement of a
material fact and did not omit to state any material fact required to
be stated therein or necessary to make the statements therein not
misleading and the Prospectus, as of the date of the Prospectus
Supplement, did not, and as of the Closing Date will not, contain an
untrue statement of a material fact and did not and will not omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; PROVIDED, HOWEVER, that neither the Managing Member,
the Transferor, the Issuer, the Contributor nor the Servicer makes any
representations or warranties as to the Underwriting Information. The
conditions to the use by the Managing Member of a registration
statement on Form S-3 under the Act, as set forth in the General
Instructions to Form S-3, have been satisfied with respect to the
Registration Statement, as applicable, and the Prospectus, except that
the Managing Member makes no such representation regarding any
Computational
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Materials (as defined herein) incorporated by reference therein. There
are no contracts or documents (not including Computational Materials)
of the Managing Member which are required to be filed as exhibits to
the Registration Statement pursuant to the Act or the 1933 Act
Regulations which have not been so filed.
(iii) This Agreement has been duly authorized, executed and
delivered by the Managing Member and the Issuer and constitutes a
legal, valid and binding agreement of the Managing Member and the
Issuer enforceable in accordance with its terms, except that the
provisions hereof relating to indemnification of the Underwriters may
be subject to limitations of public policy.
(iv) Each of the Transaction Documents to which the Managing
Member or the Issuer is a party have been duly authorized by the
Managing Member or the Issuer, as the case may be and each of the
Managing Member and the Issuer has the power, authority and legal right
to execute, deliver and perform its respective obligations under each
of the Transaction Documents to which it is a party and to consummate
all transactions contemplated thereunder, and, when executed and
delivered by the Managing Member or the Issuer, each of the Transaction
Documents to which it is a party will constitute the legal, valid and
binding obligation of the Managing Member or the Issuer, as the case
may be, enforceable in accordance with its terms, except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general
principles of equity and the discretion of the court before which any
proceeding therefor may be brought.
(v) The direction by the Issuer to Trustee to authenticate the
Notes has been duly authorized by the Issuer and, when duly and validly
authenticated by Trustee and delivered in accordance with the Indenture
and this Agreement, the Notes will be the legal, valid and binding
obligations of the Issuer, enforceable in accordance with their terms,
and entitled to the benefits of the Indenture, except that the
enforcement thereof may be subject to (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general
principles of equity and the discretion of the court before which any
proceeding therefor may be brought.
(vi) The sale of the Notes and the performance by the Managing
Member or the Issuer, as the case may be, of this Agreement and the
Transaction Documents to which the Managing Member or the Issuer is a
party will (A) not conflict with or result in a breach of, and will not
constitute a default under any of the provisions of, its certificate of
incorporation or certificate of formation, as applicable, its by-laws
or limited liability company operating agreement, as applicable, any
law, governmental rule or regulation, or any judgment, decree or order
binding on the Managing Member or the Issuer or either of their
respective properties, or any of the provisions of any indenture,
mortgage, deed of trust, contract or other agreement or instrument to
which the Managing Member or the Issuer, as the case may be, is a party
or by which it is bound and (B) not result in the creation or
imposition of any adverse claim and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the sale of the
Notes or the consummation by the Managing Member or the Issuer, as the
case may be, of the
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transactions contemplated by this Agreement, except such consents,
approvals, authorizations, registrations or qualifications as may be
required under the Act and under state securities or Blue Sky laws in
connection with the purchase and distribution of the Notes by the
Underwriters.
(vii) Neither the Managing Member nor the Issuer is, or will
be, subject to registration as an "investment company" under the
Investment Company Act of 1940 (the "1940 ACT").
(viii) the Issuer is a Delaware limited liability company duly
organized, validly existing and in good standing under the laws of the
State of Delaware, with its chief executive office located at 500 Hyde
Park, Doylestown, Pennsylvania, and has the power and authority to own,
convey and otherwise deal with its assets and to engage in the
activities in which it is presently engaged and is duly qualified and
in good standing under the laws of each jurisdiction where its
ownership of property or the conduct of its activities requires such
qualification, if the failure to so qualify would have a material
adverse effect on the financial condition of the Issuer or on the
enforceability of the Contracts or the Notes or the ability of the
Issuer to perform its obligations under the Transaction Documents to
which it is a party; one hundred percent of the Units of the Issuer at
all times will be owned by the Managing Member; and the Issuer has no
subsidiaries.
(ix) Each of the Managing Member and the Issuer hereby makes
and repeats each of the respective representations and warranties
expressly made by it in the Transaction Documents. Such representations
and warranties are incorporated by reference in this Section 4(a) and
the Underwriters may rely thereon as if such representations and
warranties were fully set forth herein.
(b) The Contributor hereby represents and warrants to and agrees with
the Underwriters as follows:
(i) This Agreement has been duly authorized, executed and
delivered, each of the Transaction Documents to which the Contributor
is a party has been duly authorized, and this Agreement constitutes,
and when executed and delivered, each of such Transaction Documents
will constitute, the legal, valid and binding obligations of the
Contributor enforceable in accordance with their respective terms,
except that (A) the enforcement thereof may be subject to (1)
bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect relating to creditors' rights generally
and (2) general principles of equity and the discretion of the court
before which any proceeding therefor may be brought, and (B) the
provisions hereof relating to indemnification of the Underwriters may
be subject to limitations of public policy.
(ii) The performance by the Contributor of each of this
Agreement and the Transaction Documents to which the Contributor is a
party, and the consummation by the Contributor of the transactions
herein and therein contemplated, will (A) not conflict with or result
in a breach of, and will not constitute a default under any of the
provisions of its certificate of incorporation or by-laws or any law,
governmental rule or regulation, or any
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judgment, decree or order binding on the Contributor or its properties,
or any of the provisions of any indenture, mortgage, deed of trust,
contract or other agreement or instrument to which the Contributor is a
party or by which it is bound and (B) not result in the creation or
imposition of any lien, pledge or incumbrance upon any of the
Contributor's, Transferor's or Issuer's property and no consent,
approval, authorization, order, registration or qualification of or
with any court or governmental agency or body is required for the
consummation by the Contributor of the transactions contemplated by
this Agreement or the Transaction Documents, except such 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
by the Underwriters.
(iii) The Contributor hereby makes and repeats the
representations and warranties set forth in Articles II and III of the
Contribution Agreement. Such representations and warranties are
incorporated by reference in this Section 4(b), and the Underwriters
may rely thereon as if such representations and warranties were fully
set forth herein.
(iv) The Contributor represents and warrants it has delivered
to the Underwriters complete and correct copies of its balance sheet
and statements of income and retained earnings for the fiscal year
ended June 30, 1999. Except as set forth in or contemplated in the
Registration Statement and the Prospectus, there has been no material
adverse change in the condition (financial or otherwise) of the
Contributor or any other consolidated subsidiary of the Contributor
since December 31, 1999.
(v) Any taxes, fees and other governmental charges arising
from the execution and delivery of this Agreement and the Transaction
Documents and in connection with the execution, delivery and issuance
of the Notes and with the transfer of the Contracts and any interest in
the Equipment, have been paid or will be paid by the Contributor.
(c) The Transferor hereby represents and warrants to and agrees with
the Underwriters as follows:
(i) This Agreement has been duly authorized, executed and
delivered by the Transferor and constitutes a legal, valid and binding
agreement of the Transferor enforceable in accordance with its terms,
except that the provisions hereof relating to indemnification of the
Underwriters may be subject to limitations of public policy.
(ii) Each of the Transaction Documents to which the Transferor
is a party have been duly authorized by the Transferor and the
Transferor has the power, authority and legal right to execute, deliver
and perform its obligations under each of the Transaction Documents to
which it is a party and to consummate all transactions contemplated
thereunder, and, when executed and delivered by the Transferor, each of
the Transaction Documents to which it is a party will constitute the
legal, valid and binding obligation of the Transferor, enforceable in
accordance with its terms, except that the enforcement thereof may be
subject to (i) bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to creditors'
rights generally and (ii) general principles of equity and the
discretion of the court before which any proceeding therefor may be
brought.
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(iii) The sale of the Notes and the performance by the
Transferor, of this Agreement and the Transaction Documents to which
the Transferor is a party will (A) not conflict with or result in a
breach of, and will not constitute a default under any of the
provisions of, its respective certificate of incorporation or limited
liability company operating agreement any law, governmental rule or
regulation, or any judgment, decree or order binding on the Transferor
or its properties, or any of the provisions of any indenture, mortgage,
deed of trust, contract or other agreement or instrument to which the
Transferor is a party or by which it is bound and (B) not result in the
creation or imposition of any adverse claim and no consent, approval,
authorization, order, registration or qualification of or with any such
court or governmental agency or body is required for the sale of the
Notes or the consummation by the Transferor of the transactions
contemplated by this Agreement, except such consents, approvals,
authorizations, registrations or qualifications as may be required
under the Act and under state securities or Blue Sky laws in connection
with the purchase and distribution of the Notes by the Underwriters.
(iv) The Transferor is not, or will it be, subject to
registration as an "investment company" under the Investment Company
Act of 1940 (the "1940 ACT").
(v) The Transferor hereby makes and repeats each of the
respective representations and warranties expressly made by it in the
Transaction Documents. Such representations and warranties are
incorporated by reference in this Section 4(a) and the Underwriters may
rely thereon as if such representations and warranties were fully set
forth herein.
(d) Each of the Transferor, the Managing Member and the Contributor
severally represents and warrants to the Underwriters that:
(i) There is no pending or threatened action, suit or
proceeding against or affecting it in any court or tribunal or before
any arbitrator of any kind or before or by any governmental authority
(A) asserting the invalidity of this Agreement, any Transaction
Document or the Notes, (B) seeking to prevent the issuance of the Notes
or the consummation of any of the transactions contemplated by this
Agreement or the Transaction Documents or (C) seeking any determination
or ruling that might materially and adversely affect (x) its
performance or its obligations under this Agreement or the Transaction
Documents (as applicable), (y) the validity or enforceability of this
Agreement, any Transaction Documents or the Notes or (z) the federal
income tax attributes of such Notes described in the Prospectus.
(ii) Deloitte & Touche LLP is an independent public accountant
with respect to the Contributor and the Transferor within the meaning
of the Act and the rules and regulations promulgated thereunder.
Section 5. COVENANTS OF THE MANAGING MEMBER AND THE CONTRIBUTOR. The
Managing Member and the Contributor, jointly and severally, hereby covenant and
agree with the Underwriters as follows:
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(a) To use best efforts to cause the Registration Statement, and any
amendment thereto, if not effective as of the date hereof, to become effective.
If the Registration Statement has become or becomes effective pursuant to Rule
430A, or filing of the Prospectus is otherwise required under Rule 424(b), the
Managing Member will file the Prospectus, properly completed, pursuant to Rule
424(b) within the time period prescribed and will provide evidence satisfactory
to the Underwriters of such timely filing. The Managing Member will promptly
advise the Underwriters (i) when the Registration Statement shall have become
effective, (ii) when any amendment thereof shall have become effective, (iii) of
any request by the Commission for any amendment or supplement of the
Registration Statement or the Prospectus or for any additional information or of
the receipt of any comments from the Commission with respect to the Registration
Statement or the Prospectus, (iv) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
institution or threatening of any proceeding for that purpose, and (v) of the
receipt by the Managing Member of any notification with respect to the
suspension of the qualification of the Notes for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. Before amending or
supplementing the Registration Statement or the Prospectus with respect to the
Notes, the Managing Member will furnish each of the Underwriters with a copy of
each such proposed amendment or supplement within a reasonable time in advance
of filing and the Managing Member will not file any amendment of the
Registration Statement or supplement to the Prospectus to which the Underwriters
reasonably object. The Managing Member and the Contributor will use best efforts
to prevent the issuance of any such stop order and, if issued, to obtain as soon
as possible the withdrawal thereof.
(b) If, at any time when the Prospectus relating to the Notes is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading or, if it shall be necessary to supplement such Prospectus
to comply with the Act or the rules thereunder, the Managing Member promptly
will prepare and file with the Commission, subject to paragraph (a) of this
Section 5, a supplement which will correct such statement or omission or an
amendment which will effect such compliance.
(c) As soon as practicable, the Managing Member will make generally
available to Noteholders and to the Underwriters an earnings statement or
statements of the Issuer which will satisfy the provisions of Section 11(a) of
the Act and Rule 158 under the Act.
(d) The Issuer will furnish to the Underwriters and counsel for the
Underwriters, without charge, signed copies of the Registration Statement
(including exhibits thereto) and, so long as delivery of the prospectus by
either of the Underwriters or any dealer may be required by the Act, as many
copies of each Prospectus relating to the Notes and any supplement thereto as
the Underwriters may reasonably request.
(e) The Contributor, the Managing Member and the Transferor will take
all reasonable actions requested by the Underwriters to arrange for the
qualification of the Notes for sale under the laws of such jurisdictions within
the United States and as the Underwriters may reasonably designate, will
maintain such qualifications in effect so long as required for the completion of
the distribution of the Notes; PROVIDED, in connection therewith the
Contributor, the Managing Member
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and the Transferor shall not be required to qualify as a foreign corporation
doing business in any jurisdiction or to file a general consent to service of
process in any jurisdiction.
(f) For so long as the Notes are outstanding, the Managing Member shall
deliver to the Underwriters by first-class mail and as soon as practicable a
copy of all reports and notices delivered by the Issuer to the Trustee or the
Noteholders under the Indenture.
(g) For so long as the Notes are outstanding, the Managing Member and
the Contributor will furnish to the Underwriters as soon as practicable after
filing any other information concerning the Transferor or the Contributor filed
with any government or regulatory authority which is otherwise publicly
available.
(h) To the extent, if any, that any rating provided with respect to the
Notes set forth in Section 6(e) is conditional upon the furnishing of documents
reasonably available to the Managing Member or the Contributor, the Managing
Member or the Contributor, as necessary, shall furnish such documents.
(i) The Managing Member will file with the Commission within fifteen
days of the issuance of the Notes a current report on Form 8-K setting forth
specific information concerning the Notes and the Contracts to the extent that
such information is not set forth in the Prospectus. The Managing Member will
also file with the Commission a current report on Form 8-K setting forth all
Computational Materials, ABS Term Sheets and Collateral Term Sheets (as such
terms are defined herein) provided to the Managing Member by any Underwriter
within the applicable time periods allotted for such filing pursuant to the
No-Action Letters (as such term is defined herein).
(j) In connection with any Computational Materials, ABS Term Sheets or
Collateral Term Sheets provided by an Underwriter pursuant to Section 5A, the
Transferor must receive a letter from Deloitte & Touche LLP, certified public
accountants, satisfactory in form and substance to the Transferor, to the effect
that such accountants have performed certain specified procedures, all of which
have been agreed to by the Transferor, as a result of which they have determined
that the information included in the Computational Materials, ABS Term Sheets or
Collateral Term Sheets (if any), provided by the Underwriter(s) to the Managing
Member for filing on Form 8-K pursuant to Section 5A and subsection (i), is
accurate except as to such matters that are not deemed by the Managing Member to
be material. The foregoing letter shall be obtained at the expense of the
Managing Member.
(k) In the event that an Underwriter must prepare corrected
Computational Materials, ABS Term Sheets or Collateral Term Sheets pursuant to
Section 5A(d), the Managing Member shall file any corrected Computational
Materials, ABS Term Sheets or Collateral Term Sheets no later than two days
following receipt thereof (or, if such second day is not a Business Day, then
the next immediately succeeding Business Day).
Section 5A. INVESTOR INFORMATION. Each Underwriter may prepare and
provide to prospective investors certain Computational Materials, ABS Term
Sheets or Collateral Term Sheets in connection with its offering of the Notes,
subject to the following conditions:
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(a) Such Underwriter shall comply with the requirements of the
No-Action Letter of May 20, 1994 issued by the Commission to Kidder, Peabody
Acceptance Corporation I, Kidder, Peabody & Co. Incorporated and Kidder
Structured Asset Corporation, as made applicable to other issuers and
underwriters by the Commission in response to the request of the Public
Securities Association dated May 24, 1994 (collectively, the "KIDDER/PSA
LETTER"), and the requirements of the No-Action Letter of February 17, 1995
issued by the Commission to the Public Securities Association (the "PSA LETTER"
and, together with the Kidder/PSA Letter, the "NO-ACTION LETTERS").
(b) For purposes hereof, "COMPUTATIONAL MATERIALS" shall have the
meaning given such term in the No-Action Letters, but shall include only those
Computational Materials that have been prepared or delivered to prospective
investors by any Underwriter. For purposes hereof, "ABS TERM SHEETS" and
"COLLATERAL TERM SHEETS" shall have the meanings given such terms in the PSA
Letter but shall include only those ABS Term Sheets or Collateral Term Sheets
that have been prepared or delivered to prospective investors by any
Underwriter.
(c) Each Underwriter shall provide to the Managing Member any
Computational Materials, ABS Term Sheets or Collateral Term Sheets which are
provided to investors by it no later than the day preceding the date such
Computational Materials, ABS Term Sheets or Collateral Term Sheets are required
to be filed pursuant to the applicable No-Action Letters. Each Underwriter may
provide copies of the foregoing in a consolidated or aggregated form including
all information required to be filed.
(d) In the event that the Managing Member or any Underwriter discovers
an error in the Computational Materials, ABS Term Sheets or Collateral Term
Sheets, the Underwriter that prepared such material shall prepare corrected
Computational Materials, ABS Term Sheets or Collateral Term Sheets, as
applicable, and deliver them to the Managing Member for filing pursuant to
Section 5(k).
Section 6. CONDITIONS OF THE UNDERWRITERS' OBLIGATION. The obligation
of the Underwriters to purchase and pay for the Notes as provided herein shall
be subject to the accuracy as of the date hereof and the Closing Date (as if
made at the Closing Date) of the representations and warranties of the
Transferor, the Managing Member, the Contributor and the Issuer contained herein
(including those representations and warranties set forth in the Transaction
Documents and incorporated herein), to the accuracy of the statements of the
Transferor, the Managing Member, the Contributor and the Issuer made in any
certificate or other document delivered pursuant to the provisions hereof, to
the performance by the Transferor, the Managing Member, the Contributor and the
Issuer of its respective obligations hereunder, and to the following additional
conditions:
(a) (i) no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall have
been initiated or threatened by the Commission and the Prospectus Supplement
shall have been filed or transmitted for filing by means reasonably calculated
to result in filing with the Commission not later than the time required by Rule
424(b) under the Act and (ii) there shall not have come to any Underwriter's
attention any facts that would cause such Underwriter to believe that the
Prospectus at the time it was required to be delivered to a purchaser of the
Notes, contained an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in light of the
circumstances
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existing at such time, not misleading. No challenge by the Commission shall have
been made to the accuracy or adequacy of the Registration Statement and any
request of the Commission for inclusion of additional information in the
Registration Statement or the Prospectus shall have been complied with and the
Transferor shall not have filed with the Commission any amendment or supplement
to the Registration Statement or the Prospectus without prior written notice to
the Underwriters.
(b) The Underwriters shall have received the Transaction Documents,
including the Notes, in form and substance reasonably satisfactory to the
Underwriters, duly executed by all signatories required pursuant to the
respective terms thereof.
(c) (i) The Underwriters shall have received the favorable opinions of
Thacher Proffitt & Wood with respect to the following items, each dated the
Closing Date:
(A) Each of the agreements to which the Contributor,
the Transferor and the Issuer is a party (the "AGREEMENTS"),
assuming the necessary authorization, execution and delivery
thereof by the parties thereto, is a valid and legally binding
agreement under the laws of the State of New York, enforceable
thereunder in accordance with its terms.
(B) The Notes, assuming the necessary execution,
authentication and delivery thereof and payment therefor in
accordance with the applicable Agreements, are valid and
legally binding obligations under the laws of the State of New
York, enforceable thereunder against the Issuer in accordance
with their terms, and are entitled to the benefits of the
Indenture.
(C) With respect to each of the Contributor, the
Transferor and the Issuer, the performance of its obligations
under the Agreements to which it is a party and the
consummation of the transactions contemplated thereby do not
require any consent, approval, authorization or order of,
filing with or notice to any court, agency or other
governmental body, except such as may be required under the
securities laws of any state or such as have been obtained,
effected or given.
(D) With respect to each of the Contributor, the
Transferor and the Issuer, the performance of its obligations
under the Agreements to which it is a party and the
consummation of the transactions contemplated thereby will not
result in any breach or violation of any statute or regulation
thereunder or, to such counsel's knowledge, any order of any
court, agency or other governmental body.
(E) The Agreements create, for the benefit of the
Trustee, acting under the Indenture for the benefit of the
Holders of the Notes, a valid security interest under the New
York UCC in all right, title and interest of the Issuer in and
to the Contracts and the proceeds thereof, (i) which security
interest in the Initial Contracts and the proceeds thereof,
and, with respect to the Substitute Contracts, upon the
delivery of such Substitute Contracts to the Trustee pursuant
to and in accordance with the Agreements, will be perfected
and is prior to all other security interests and (ii) which
security interest, upon the filing of the Financing Statements
in the Filing Offices,
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will be perfected in any Contract constituting either an
Instrument or Chattel Paper, and the proceeds thereof, in
which a security interest can be perfected against the Issuer
by filing.
(F) The statements made in the Prospectus Supplement
under the heading "DESCRIPTION OF THE NOTES AND PRINCIPAL
TRANSACTION DOCUMENTS," insofar as such statements purport to
summarize certain provisions of the Notes, the Contribution
Agreement, the SCTA and the Indenture, provide a fair summary
of such provisions. The statements made in the Prospectus
Supplement under the headings "MATERIAL FEDERAL INCOME TAX
CONSEQUENCES" and "CONSIDERATIONS FOR BENEFIT PLAN INVESTORS,"
to the extent that they constitute statements of the law of
the State of New York or federal law or legal conclusions with
respect thereto, while not purporting to discuss all possible
consequences of investment in the Notes, are correct in all
material respects with respect to those consequences or
matters that are discussed therein.
(G) The Indenture has been qualified under the Trust
Indenture Act of 1939, as amended. Neither the Transferor nor
the Issuer is an "investment company" nor "controlled by" an
"investment company" within the meaning of the Investment
Company Act of 1940, as amended.
(H) The Registration Statement has become effective
under the 1933 Act. To such counsel's knowledge, no stop order
suspending the effectiveness of the Registration Statement has
been issued and not withdrawn, and no proceedings for that
purpose have been instituted or threatened under Section 8(d)
of the 1933 Act.
(I) The Registration Statement as of its effective
date, the date of the Prospectus Supplement and the date
hereof, and the Prospectus as of the date thereof and hereof,
other than with respect to any financial and statistical
information, Computational Materials and ABS Term Sheets
contained or incorporated by reference therein as to which we
express no opinion herein, complied as to form in all material
respects with the requirements of the 1933 Act and the
applicable rules and regulations thereunder.
(J) To such counsel's knowledge, there are no
material contracts, indentures or other documents of a
character required to be described or referred to in either
the Registration Statement or the Prospectus Supplement or to
be filed as exhibits to the Registration Statement, other than
any Computational Materials and ABS Term Sheets, as to which
such counsel expresses no opinion, and those described or
referred to therein or filed or incorporated by reference as
exhibits thereto.
(ii) The Underwriters shall have received the favorable
opinions of Melvin Breaux, Esq. general counsel to the Issuer, the
Transferor and the Contributor with respect to the following items,
each dated the Closing Date:
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(A) Each of the Issuer, the Transferor and the
Contributor has been duly organized and is validly existing as
a corporation or, in the case of the Issuer, a limited
liability company, in good standing under the laws of the
State of Delaware, and is qualified to do business in each
jurisdiction in which the character of the properties owned or
leased by it or the nature of the business conducted by it
makes such qualification necessary to conduct its business as
presently conducted (except where the failure to be so
qualified or in good standing could not individually or in the
aggregate have a material adverse effect upon (x) the
business, assets, property, condition (financial or otherwise)
or prospects of the Issuer, the Transferor or the Contributor,
respectively, taken as a whole or (y) the validity and
enforceability of the Agreements to which it is a party. Each
of the Issuer, the Transferor and the Contributor has the
power and authority to make, deliver and perform each of the
Agreements to which it is a party.
(B) The Agreements have been duly authorized,
executed and delivered by the Issuer, the Transferor and the
Contributor, as to those Agreements as to which each
respectively is a party, and each constitutes the valid and
binding obligation of the Issuer, the Transferor or the
Contributor, respectively, enforceable against the Issuer, the
Transferor and the Contributor, as applicable, in accordance
with their respective terms, except as enforcement thereof may
be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers),
reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a
proceeding in equity or at law).
(C) Neither the consummation of transactions
contemplated by, nor the execution, delivery and performance
of the terms of the Agreements, (x) will result in any
violation of the limited liability company operating
agreement, certificate of incorporation or bylaws of the
Issuer, the Transferor or the Contributor, as applicable; or
(y) to the best of such counsel's knowledge, any order,
judgment or decree of any court or arbitrator to which any of
the Issuer, the Transferor or the Contributor is a party or is
subject; and (z) to the best of such counsel's knowledge, will
not conflict with, result in a breach, violation or
acceleration of any of the terms of, constitute a default
under or result in the creation or imposition of any lien,
pledge or encumbrance upon either the Issuer's, the
Transferor's or the Contributor's property pursuant to the
terms of any indenture, loan agreement, any other agreement,
instrument or other undertaking to which either the Issuer,
the Transferor or the Contributor or any of their subsidiaries
is a party or by which any of them is bound or to which any of
their property or assets of any of them is subject, or upon
the Notes, except as otherwise contemplated by the Indenture.
(D) Except for the filing of the related UCC
financing statements described in the Agreements and the
registration under the Securities Act of the Publicly Offered
Notes, and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the purchase
and distribution by the Underwriters, no consent,
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<PAGE>
approval, authorization, order or withholding of objection on
the part of, or registration or qualification with, any court,
governmental agency or body or tribunal is required for the
execution and delivery by either the Issuer, the Transferor or
the Contributor of, or the consummation by each of them of the
Agreements, except such consents, approvals, authorizations,
registrations or qualifications which have been obtained and
such as have been made and are in full force and effect.
(E) Other than as may be set forth or contemplated in
the related Prospectus Supplement, there are no actions,
proceedings or investigations pending or, to the best of such
counsel's knowledge, threatened before any court,
administrative agency or other tribunal to which either the
Issuer, the Transferor or the Contributor is a party or
threatened to be made a party (i) asserting the invalidity of
the Agreements, (ii) seeking to prevent the consummation of
any of the transactions contemplated by the Agreements or
(iii) which could reasonably be expected to have a material
adverse effect upon (x) the business, assets, property,
condition (financial or otherwise) or prospects of any of the
Issuer, the Transferor or the Contributor or any of their
subsidiaries, taken as a whole or (y) the validity and
enforceability of the Indenture or the rights of the Trustee
therein.
(F) The Notes, assuming due authentication by the
Trustee, and delivery and payment therefor pursuant to the
Agreements, are validly issued and outstanding and are
entitled to the benefits of the Indenture.
(iii) The Underwriters shall have received the favorable
opinion(s), dated the Closing Date, of Thacher Proffitt & Wood, with
respect to such other related matters as the Underwriters shall
reasonably require.
In rendering their opinions, the counsel described in this Paragraph
(c) may rely, as to matters of fact, on certificates of responsible officers of
the Issuer, the Managing Member, the Transferor, the Contributor, the Trustee
and public officials. Such opinions may also assume the due authorization,
execution and delivery of the instruments and documents referred to therein by
the parties thereto; PROVIDED, HOWEVER, that counsel to the Transferor, the
Managing Member, the Contributor and the Issuer may not make such assumptions
with respect to such Transferor, Managing Member, Contributor and Issuer.
(d) The Underwriters shall have received a letter from a nationally
recognized independent accounting firm, dated on or before the Closing Date, in
form and substance satisfactory to the Underwriters and counsel for the
Underwriters, to the effect that they have performed certain specified
procedures requested by the Underwriters with respect to the information set
forth in the Prospectus and certain matters relating to the Managing Member.
(e) The Class A-1 Notes shall have been rated "F1+" and "P-1" by Fitch
IBCA, Inc. ("FITCH") and Moody's Investors Service, Inc. ("MOODY'S"; together
with Fitch IBCA, the "RATING AGENCIES"), respectively; the Class A-2 Notes, the
Class A-3 Notes, the Class A-4 Notes, shall have been rated "AAA" or "Aaa", as
applicable, by the Rating Agencies; the Class B Notes shall have been rated at
least "AA" or "Aa3", as applicable, by the Rating Agencies; the Class C Notes
shall
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<PAGE>
have been rated at least "A" or "A2", as applicable, by the Rating Agencies; the
Class D Notes shall have been rated at least "BBB" or "Baa2", as applicable by
the Rating Agencies; and such ratings shall not have been rescinded. The
Underwriters and counsel for the Underwriters shall have received copies of any
opinions of counsel supplied to the rating organizations relating to any matters
with respect to the Class A Notes, the Class B Notes, the Class C Notes and the
Class D Notes. Any such opinions shall be dated the Closing Date and addressed
to the Underwriters or accompanied by reliance letters to the Underwriters or
shall state that the Underwriters may rely upon them.
(f) The Underwriters shall have received from the Managing Member a
certificate, signed by the president, a senior vice president or a vice
president of the Managing Member, dated the Closing Date, to the effect that the
signer of such certificate has carefully examined the Registration Statement,
the Prospectus, the Indenture and this Agreement and that, to his or her
knowledge:
(i) the representations and warranties of the Managing Member
and the Issuer, as applicable, in this Agreement and in the
Contribution and Servicing Agreement, as of the Closing Date, and in
the Indenture, the Subsequent Contract Transfer Agreement and in all
related agreements, as of the date specified in such agreements, are
true and correct, and the Managing Member and the Issuer, as
applicable, has complied with all the agreements, and satisfied all the
conditions on its part to be performed or satisfied, thereunder at or
prior to the Closing Date;
(ii) there are no actions, suits or proceedings pending, or,
to such officer's knowledge, threatened, against or affecting the
Managing Member or the Issuer which, if adversely determined,
individually or in the aggregate, would be reasonably likely to
materially and adversely affect the ability of the Managing Member or
the Issuer to perform the Managing Member's or the Issuer's,
respectively, obligations under the Transaction Documents or the Notes;
and no merger, liquidation, dissolution or bankruptcy of the Managing
Member or the Issuer is pending or contemplated;
(iii) the information contained in the Registration Statement
and the Prospectus relating to the Managing Member, the Issuer, the
Contracts or the servicing procedures of its affiliates is true and
accurate in all material respects, and nothing has come to his or her
attention that would lead such officer to believe that the Registration
Statement or the Prospectus includes any untrue statement of a material
fact or omits to state a material fact necessary to make the statements
therein not misleading;
(iv) the information set forth in the List of Contracts
required to be furnished pursuant to the Indenture is true and correct
in all material respects;
(v) there has been no amendment or other document filed
affecting the certificate of incorporation or bylaws of the Managing
Member since the amendment filed July 22, 1999, and no such amendment
has been authorized. Other than with regard to the amendments that the
Issuer intends to enter into on the Closing Date, there has been no
amendment or other document filed affecting the amended and restated
limited liability company operating agreement of the Issuer since April
1, 2000 and no such amendment has
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been authorized. No event has occurred since May 4, 2000 which has
affected the good standing of the Managing Member or the Issuer under
the laws of the State of Delaware;
(vi) there has not occurred any material adverse change, or,
to such officer's knowledge, any development involving a prospective
material adverse change, in the condition, financial or otherwise,
results of operations, business or operations of the Issuer, the
Managing Member and its parent, taken as a whole, since December 31,
1999;
(vii) on or prior to the Closing Date, there has been no
downgrading nor has any notice been given of (A) any intended or
potential downgrading or (B) any review or possible change in rating,
the direction of which has not been indicted in, the rating, if any,
accorded the Notes by any "nationally recognized statistical rating
organization," as such term is defined for purposes of the Act;
(viii) each person who, as an officer or representative of the
Managing Member or the Issuer, signed or signs the Registration
Statement, the Transaction Documents or any other document delivered
pursuant hereto, on the date of such execution or on the Closing Date,
as the case may be, in connection with the transactions described in
the Transaction Documents, was, at the respective times of such signing
and delivery, and is now, duly elected or appointed, qualified and
acting as such officer or representative, and the signatures of such
persons appearing on such documents are their genuine signatures; and
(ix) the Notes have been duly executed by the Issuer.
The Managing Member shall attach to such certificate a true and correct
copy of its certificate of incorporation and bylaws, which are in full force and
effect on the date of such certificate, and a certified true copy of the
resolutions of its Board of Directors with respect to the transactions
contemplated herein and the Issuer shall attach a true and correct copy of its
limited liability company operating agreement, which will be in full force and
effect on the date of such certificate.
(g) The Underwriters shall have received a certificate, signed by the
president, a senior vice president or a vice president of each of the
Contributor and the Servicer, dated the Closing Date, to the effect that the
signer of such certificate has carefully examined the Registration Statement,
the Prospectus, the Indenture, and the Contribution and Servicing Agreement and
that, to his or her knowledge:
(i) the representations and warranties of each of the
Contributor and the Servicer in the Contributor Documents, as of the
Closing Date, and in all related agreements, as of the date specified
in such agreements, are true and correct, and each of the Contributor
and the Servicer has complied with all the respective agreements, and
satisfied all the conditions on its part to be performed or satisfied
thereunder at or prior to the Closing Date;
(ii) there are no actions, suits or proceedings pending, or,
to such officer's knowledge, threatened, against or affecting the
Contributor or the Servicer which, if adversely determined,
individually or in the aggregate, would be reasonably likely to
materially and adversely affect the Contributor's or the Servicer's
respective obligations
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under the Contributor Documents; and no merger, liquidation,
dissolution or bankruptcy of the Contributor or the Servicer is pending
or contemplated;
(iii) the information contained in the Registration Statement
and the Prospectus relating to the Contributor and the Servicer, the
Contracts, the origination procedures of the Contributor and the
servicing procedures of the Servicer is true and accurate in all
material respects, and nothing has come to his or her attention that
would lead such officer to believe that the Registration Statement or
the Prospectus, includes any untrue statement of a material fact or
omits to state a material fact necessary to make the statements therein
not misleading;
(iv) the information set forth in the List of Contracts
required to be furnished pursuant to the Contribution and Servicing
Agreement is true and correct in all material respects;
(v) there has been no amendment or other document filed
affecting the certificate of incorporation or bylaws of the
Contributor/Servicer since April 17, 1996 and no such amendment has
been authorized. No event has occurred since April 12, 2000, which has
affected the good standing of the Contributor/Servicer under the laws
of the State of Delaware;
(vi) there has not occurred any material adverse change, or,
any development involving a prospective material adverse change, in the
condition, financial or otherwise, results of operations, business or
operations of the Contributor or the Servicer and its respective
subsidiaries, taken as a whole, since December 31, 1999; and
(vii) each person who, as an officer or representative of the
Contributor or the Servicer, signed or signs the Contributor Documents
or any other document delivered pursuant hereto, on the date of such
execution, or on the Closing Date, as the case may be, in connection
with the transactions described in the Contributor Documents, was, at
the respective times of such signing and delivery, and is now, duly
elected or appointed, qualified and acting as such officer or
representative, and the signatures of such persons appearing on such
documents are their genuine signatures.
The Contributor/Servicer shall attach to such certificate a true and
correct copy of its certificate of incorporation and bylaws, which are in full
force and effect on the date of such certificate, and a certified true copy of
the resolutions of its Board of Directors with respect to the transactions
contemplated herein.
(j) The Underwriters shall have received a favorable opinion of counsel
to the Trustee, dated the Closing Date and in form and substance reasonably
satisfactory to the Underwriters, to the effect that:
(i) the Trustee is a banking corporation duly organized,
validly existing and in good standing under the laws of the United
States of America, and has the power and authority to enter into and to
take all actions required of it under the Indenture;
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(ii) the Indenture has been duly authorized, executed and
delivered by the Trustee, and the Indenture constitutes the legal,
valid and binding obligation of the Trustee, enforceable against the
Trustee in accordance with its terms, except as enforceability thereof
may be limited by (A) bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally,
as such laws would apply in the event of a bankruptcy, insolvency or
reorganization or similar occurrence affecting the Trustee, and (B)
general principles of equity, regardless of whether such enforcement is
sought in a proceeding at law or in equity;
(iii) no consent, approval, authorization or other action by
any state or federal court or any governmental agency or body or other
tribunal is required on the part of the Trustee in connection with its
execution and delivery of the Indenture or the performance of its
obligations thereunder;
(iv) the Notes have been duly authenticated and delivered by
the Trustee; and
(v) the execution and delivery of, and performance by the
Trustee of its obligations under, the Indenture do not conflict with or
result in a violation of any statute or regulation applicable to the
Trustee, or the charter or bylaws of the Trustee, or any order,
judgment, writ, injunction or decree of any governmental authority
having jurisdiction over the Trustee, or, to the best knowledge of such
counsel, the terms of any material indenture or other agreement or
instrument to which the Trustee is a party or by which it is bound.
In rendering such opinion, such counsel may rely, as to matters of
fact, on certificates of responsible officers of the Transferor, the Managing
Member, the Trustee and public officials. Such opinion may also assume the due
authorization, execution and delivery of the instruments and documents referred
to therein by the parties thereto other than the Trustee.
(i) The Underwriters shall have received from the Trustee a
certificate, signed by the president, a senior vice president or a vice
president of the Trustee, dated the Closing Date, to the effect that each person
who, as an officer or representative of the Trustee, signed or signs the Notes,
the Indenture or any other document delivered pursuant hereto, on the date
hereof or on the Closing Date, in connection with the transactions described in
the Indenture, was, at the respective times of such signing and delivery, and is
now, duly elected or appointed, qualified and acting as such officer and
representation, and the signatures of such persons appearing on such documents
are their genuine signatures.
(j) On or prior to the Closing Date, there has been no downgrading, nor
has any notice been given of (A) any intended or potential downgrading or (B)
any review or possible changes in rating, the direction of which has not been
indicated in the rating, if any, in any rating accorded the Notes by any
"nationally recognized statistical rating organization," as such term is defined
for purposes of the Act.
(k) Since December 31, 1999, there has not occurred any change, or any
development involving a prospective change, in the condition, financial or
otherwise, or in the business or operations, of (A) the Managing Member, (B) the
Transferor, (C) the Servicer or (D) the Contributor,
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that, in either Underwriter's judgment, is material and adverse and that makes
it, in either Underwriter's reasonable judgment, impracticable to market the
Notes on the terms and in the manner contemplated in the Prospectus.
(l) Reserved.
(m) The Underwriters and counsel for the Underwriters shall have
received copies of any opinions of counsel to the Contributor, the Managing
Member, the Transferor or the Issuer supplied to the Trustee relating to matters
with respect to the Notes. Any such opinions shall be dated the Closing Date and
addressed to the Underwriters or accompanied by reliance letters to the
Underwriters or shall state the Underwriters may rely thereon.
(n) The Underwriters shall have received such further information,
certificates and documents as the Underwriters may reasonably have requested not
fewer than three (3) full Business Days prior to the Closing Date.
(o) The Contributor shall have transferred to the Trustee, for deposit
in the Collection Account to be maintained by the Trustee in accordance with the
Indenture, all Contract Payments actually received by the Contributor which were
due subsequent to the Cut-Off Date and received on or prior to the Closing Date.
(p) The Financing Statements shall have been prepared and filed as set
forth in Article One of the Contribution and Servicing Agreement.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all respects when and as provided in this Agreement, if the
Managing Member, the Transferor, the Issuer or the Contributor is in breach of
any covenants or agreements contained herein or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not be in all
material respects reasonably satisfactory in form and substance to the
Underwriters and counsel to the Underwriters, this Agreement and all obligations
of the Underwriters hereunder may be canceled on, or at any time prior to, the
Closing Date by the Underwriters. Notice of such cancellation shall be given to
the Managing Member in writing, or by telephone or telegraph confirmed in
writing.
Section 7. REIMBURSEMENT OF EXPENSES. If (x) no closing of the sale of
the Notes occurs by the Closing Date through no fault of the Managing Member,
the Transferor, the Issuer or the Contributor or because the conditions set
forth in Section 6 have not been met, or (y) the Underwriters terminate the
engagement pursuant to Section 10 or because any conditions precedent in Section
6 have not been fulfilled, then the Managing Member's or the Contributor's
liability to the Underwriters shall be limited to the reimbursement of the
Underwriters' expenses incurred through the date of termination for their
reasonable out-of-pocket and incidental expenses. In addition, whether or not
the Notes are issued or sold:
(a) The Transferor or the Contributor shall pay the reasonable fees and
expenses associated with the transactions contemplated hereby not paid by the
Underwriters in accordance with the provisions of Section 7(b) including,
without limitation, the following fees and expenses:
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(i) rating agency fees payable with respect to their ratings
of the Notes;
(ii) any fees charged by the firm of independent public
accountants referred to in Section 6(d);
(iii) filing fees in connection with the transactions
contemplated hereby including, but not limited to, the Commission;
(iv) reasonable fees and expenses of counsel to the
Underwriters;
(v) the Trustee's fees and expenses and reasonable fees and
expenses of counsel to the Trustee;
(vi) the costs and expenses of printing the Prospectus;
(vii) the costs of printing or reproducing this Agreement,
the Blue Sky Survey, if applicable, and any other documents in
connection with the offer, sale and delivery of the Notes;
(viii) all expenses in connection with the qualification of
the Notes under state securities laws as provided in Section 4(a)(vi),
including the fees and disbursements of counsel in connection with the
Blue Sky Survey, if applicable;
(ix) the cost of preparing the Notes;
(x) the cost or expenses of any transfer agent or registrar;
and
(xi) all other costs and expenses incident to the performance
of their obligations hereunder which are not otherwise specifically
provided for in this Section 7; PROVIDED, that neither the Contributor
nor the Managing Member waives any rights to reimbursement from the
Underwriters in the event of any Underwriter's failure to perform in
accordance with this Agreement.
(b) It is understood and agreed that, except as provided in Sections 8
and 9, the Underwriters will pay securities transfer taxes on resale of any of
the Notes by them, and any advertising expenses connected with any offers they
may make.
Section 8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Transferor and the Contributor, jointly and severally, will
indemnify and hold harmless each Underwriter as follows: (i) against any losses,
claims, damages or liabilities, joint or several, to which such Underwriter may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or acts in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or the Prospectus, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein
-20-
<PAGE>
or necessary to make the statements therein not misleading, and will promptly
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating, preparing to defend or
defending, or appearing as a third-party witness in connection with, any such
action or claim; PROVIDED, that the Transferor and the Contributor shall not be
liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in the Registration Statement or
the Prospectus or any such amendment or supplement, in reliance upon and in
conformity with the Underwriting Information (defined below); and (ii) against
any losses, claims, damages, liabilities, joint or several, and expenses
whatsoever, as incurred, arising out of any untrue statement or alleged untrue
statement of a material fact contained in the Computational Materials, ABS Term
Sheets or Collateral Term Sheets distributed by any Underwriter; unless such
untrue statement or alleged untrue statement of a material fact was made in
reliance upon and in conformity with Derived Information provided by such
Underwriter expressly for use in the Computational Materials, the ABS Term
Sheets or the Collateral Term Sheets and the untrue statement or alleged untrue
statement did not derive from an inaccuracy in the Transferor- Provided
Information used in the preparation of such Computational Materials, ABS Term
Sheets or Collateral Term Sheets.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Transferor and the Contributor as follows: (i) against any
losses, claims, damages or liabilities to which the Transferor or the
Contributor may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or acts in respect thereof) arise out of
or are based upon an untrue statement or alleged untrue statement of a material
fact contained in the Underwriting Information or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in the Underwriting Information or any such
amendment or supplement, in reliance upon and in conformity with written
information furnished to the Transferor or the Contributor by or on behalf of
such Underwriter expressly for use therein; and will reimburse the Transferor or
the Contributor for any legal or other expenses reasonably incurred by the
Transferor or the Contributor in connection with the investigating, preparing to
defend or defending, or appearing as a third-party witness in connection with
any such action or claim; and (ii) against any losses, claims, damages and
expenses described in the indemnity contained in subsection (a) of this Section
8, as incurred, but only with respect to untrue statements or alleged untrue
statements made in the Computational Materials, Collateral Term Sheets or ABS
Term Sheets furnished by such Underwriter to the extent that such untrue
statement or alleged untrue statement of a material fact was made in reliance
upon and in conformity with Derived Information provided by it expressly for use
in the Computational Materials, the ABS Term Sheets or the Collateral Term
Sheets and the untrue statements or alleged untrue statements were not derived
from any inaccuracy in the Transferor-Provided Information used in the
preparation of such Computational Materials, ABS Term Sheets or Collateral Term
Sheets.
The Transferor and the Contributor acknowledge that the
statements set forth under the headings "THE UNDERWRITING OF THE SECURITIES" and
"PLAN OF DISTRIBUTION" in the Basic Prospectus and "PLAN OF DISTRIBUTION" in the
Prospectus Supplement constitute the only information furnished in writing by or
on behalf of the Underwriters for inclusion in the Registration Statement
-21-
<PAGE>
or the Prospectus (the "UNDERWRITING INFORMATION"), and the Underwriters confirm
that such statements are correct; PROVIDED, HOWEVER, that if but only if, all
Transferor-Provided Information (as defined below) is accurate and complete in
all material respects, the references to "Underwriting Information" in this
Agreement shall be deemed to include any Derived Information contained in a Form
8-K relating to the Notes filed by the Transferor with the Commission. For
purposes of this Section, the term "Derived Information" means such portion, if
any, of the information contained in Computational Materials, Collateral Term
Sheets or ABS Term Sheets in any Form 8-K relating to the Notes filed by the
Transferor with the Commission as:
(1) is not also contained in the Prospectus or
the Prospectus Supplement without taking
into account information incorporated
therein by reference; and
(2) does not constitute Transferor-Provided
Information.
"TRANSFEROR-PROVIDED INFORMATION" means the information set forth under the
heading "The Contracts" in the Prospectus Supplement and any computer tape or
other information furnished to any Underwriter by or on behalf of the Transferor
concerning the assets of the Issuer.
(c) Promptly after receipt by an indemnified party under subsection (a)
or (b) of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof, but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party; PROVIDED, that if the defendants
in any such action include both the indemnified party and the indemnifying
party, and the indemnified party shall have been advised by counsel that
representation of such indemnified party and the indemnifying party may be
inappropriate under applicable standards of professional conduct due to actual
or potential differing interests between them, the indemnified party or parties
shall have the right to select separate counsel to defend such action on behalf
of such indemnified party or parties. It is understood that the indemnifying
party shall, in connection with any such action or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of only one separate firm of attorneys together with appropriate local
counsel at any time from all indemnified parties not having actual or potential
differing interest with any other indemnified party. Upon receipt of notice from
the indemnifying party to such indemnified party of such counsel, the
indemnifying party will not be liable for any settlement entered into without
its consent and will not be liable to such indemnified party under this Section
8 for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof unless (i) the indemnified party
shall have employed separate counsel in accordance with the proviso to the
second preceding sentence, (ii) the indemnifying party shall have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action or (iii) the indemnifying party has authorized the employment
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<PAGE>
of counsel for the indemnified party at the expense of the indemnifying party;
and except that, if clause (i) or (iii) is applicable, such liability shall be
only in respect of the counsel referred to in such clause (i) or (iii).
Notwithstanding the immediately preceding sentence and the first sentence of
this paragraph, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such indemnifying
party of the aforesaid request and (ii) such indemnifying party shall not have
reimbursed the indemnifying party in accordance with such request prior to the
date of such settlement.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (B) in respect of any losses, claims, damages or liabilities
(or actions or proceeding in respect thereon) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) in such proportion as is appropriate
to reflect the relative benefits received by the Transferor and the Contributor
on the one hand and the Underwriters on the other from the offering of the
Notes. If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law or if the indemnified party failed
to give the notice required under subsection (c), then each indemnifying party
shall contribute to such amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Transferor or the Contributor on the one hand and
the Underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Transferor or the
Contributor on the one hand and the Underwriters on the other shall be deemed to
be in the same proportion that the total net proceeds from the offering (before
deducting expenses) received by the Transferor and the Contributor bear to the
total underwriting discounts and commissions received by the Underwriters, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Transferor or the Contributor on the one hand or the Underwriters on the other
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Transferor,
the Contributor and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were determined by
pro rata allocation or by any other method of allocation which does not take
into account the equitable considerations referred to above in this subjection
(d). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to above in this subsection (d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating, preparing to defend or defending, or appearing as
a third-party witness in connection with, any such action or claim.
Notwithstanding the provision for this subsection (d), the Underwriters shall
not be required to contribute any amount in excess of the total underwriting
discount as set forth on the cover page of the Prospectus. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The
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<PAGE>
obligations of the Underwriters to contribute pursuant to this subsection (d)
are several in proportion to their respective underwriting obligations with
respect to such Notes and not joint.
(e) The obligations of the Transferor and the Contributor under this
Section 8 shall be in addition to any liability which the Transferor or the
Contributor may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls either of the Underwriters
within the meaning of the Act, and the obligations of the Underwriters under
this Section 8 shall be in addition to any liability which the Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Transferor and the Contributor and to each person,
if any, who controls the Transferor or the Contributor within the meaning of the
Act.
Section 9. SURVIVAL. The respective representations, warranties and
agreements of the Transferor, the Managing Member, the Issuer, the Contributor
and the Underwriters set forth in or made pursuant to this Agreement will remain
in full force and effect, notwithstanding any investigation heretofore or
hereafter made by or on behalf of the Transferor, the Managing Member, the
Issuer, the Contributor or the Underwriters or any director, officer or
controlling person thereof, and such representations, warranties and agreements
made by the Transferor, the Managing Member, the Issuer and the Contributor
shall survive the delivery and payment for the Notes. The provisions of Sections
7 and 8 shall survive the termination or cancellation of this Agreement.
Section 10. TERMINATION.
(a) This Agreement may be terminated by the Underwriters at any time
upon the giving of notice at any time prior to the Closing Date: (i) if there
has been, since December 31, 1999, any material adverse change in the condition,
financial or otherwise, of the Contributor, the Managing Member, the Issuer or
the Transferor, or in the earnings, business affairs or business prospects of
the Contributor, the Issuer or the Transferor, whether or not arising in the
ordinary course of business, (ii) if there has occurred any outbreak or
escalation of hostilities or other calamity or crises the effect of which on the
financial markets of the United States is such as to make it, in the reasonable
judgment of the underwriters, impracticable to market the Notes or enforce
contracts for the sale of the Notes, (iii) if trading generally on either the
American Stock Exchange or the New York Stock Exchange has been suspended, or
minimum or maximum prices for trading have been fixed, or maximum ranges for
prices for securities have been required, by either of said exchanges or by
order of the Commission or any other governmental authority or (iv) if a banking
moratorium has been declared by either federal or New York authorities. In the
event of any such termination, no party will have any liability to any other
party hereto, except as otherwise provided in Sections 7 or 8.
(b) This agreement may not be terminated by the Transferor, the
Managing Member, the Issuer or the Contributor, except in accordance with law,
without the written consent of the Underwriters.
(c) Notwithstanding anything herein to the contrary, if the Transferor,
the Managing Member, the Issuer or the Contributor does not perform any
obligation under this agreement or any representation and warranty hereunder is
incomplete or inaccurate in any material respect, this Agreement and all of the
Underwriters' obligations hereunder may be immediately canceled by the
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<PAGE>
Underwriters by notice thereof to the Managing Member or the Contributor. Any
such cancellation shall be without liability of any party to any other party
except that the provisions of Sections 8 and 9 shall survive any such
cancellation.
Section 11. NOTICES. All communications provided for or permitted
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered to or mailed by certified or registered mail, postage
prepaid, or transmitted by telex or telegraph and confirmed by a similar mailed
writing, if to the Underwriters, addressed to Prudential Securities
Incorporated, addressed c/o Mr. Robert Schwartz, facsimile no.: (212) 778-7401,
at the address set forth in the beginning of this Agreement, to Lehman Brothers
Inc., c/o Mr. Henry Domenici, facsimile no.: (212) 526-8579, at the address set
forth in the beginning of this Agreement, and to Banc One Capital Markets, Inc.,
c/o Mr. Vimal Shah, facsimile no.: (312) 732-4487, at the address set forth in
the beginning of this Agreement or to such other address as any of the
Underwriters may designate with respect to itself in writing to the Transferor
or the Contributor; if to the Contributor, addressed to the Securitization
Manager at 500 Hyde Park, Doylestown, Pennsylvania 18901, facsimile no.: (215)
230-5382; if to the Transferor, addressed to the Transferor at 500 Hyde Park,
Doylestown, Pennsylvania 18901, facsimile no.: (215) 230-5382, or such other
address as the Transferor or the Contributor may have designated in writing to
you; if to the Managing Member, addressed to the Managing Member at 500 Hyde
Park, Doylestown, Pennsylvania 18901, facsimile no.: (215) 230- 5382, or such
other address as the Managing Member may have designated in writing to you; or,
if to the Issuer, addressed to the Issuer at 500 Hyde Park, Doylestown,
Pennsylvania 18901, facsimile no.: (215) 230-5382, or such other address as the
Issuer may have designated in writing to you.
Section 12. SUCCESSORS; ACTIONS BY THE UNDERWRITERS. This Agreement
will inure to the benefit of and be binding upon the Transferor, the Managing
Member, the Issuer and the Contributor and their respective successors and
assigns and the Underwriters and their respective successors and assigns. Any
action by the Underwriters hereunder may be taken by the Underwriters jointly or
by Lehman Brothers Inc. alone or on behalf of the Underwriters, and any such
action taken by Lehman Brothers Inc. alone shall be binding upon the
Underwriters.
Section 13. DEFAULT BY EITHER UNDERWRITER. If any Underwriter shall
fail on the Closing Date to purchase the Notes which it is obligated to purchase
hereunder (the "DEFAULTED NOTES"), the remaining Underwriters (the
"NON-DEFAULTING UNDERWRITERS") shall have the right, but not the obligation,
within one (1) Business Day thereafter, to make arrangements to purchase all,
but not less than all, of the Defaulted Notes upon the terms herein set forth;
if, however, the Non-Defaulting Underwriters shall not have completed such
arrangements within such one (1) Business Day period, then this Agreement shall
terminate without liability on the part of the Non-Defaulting Underwriters.
No action taken pursuant to this Section 13 shall relieve the
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, any of the Non-Defaulting Underwriters, the Transferor, the
Managing Member or the Contributor shall have the right to postpone the Closing
Date for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents or
arrangements.
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<PAGE>
Section 14. ENTIRE AGREEMENT. This Agreement and the documents referred
to herein and to be delivered pursuant hereto constitute the entire agreement
between the parties pertaining to the subject matter hereof and supersede all
prior agreements, understandings, negotiations and discussions, whether oral or
written, of the parties.
Section 15. GOVERNING LAW.
(a) THIS AGREEMENT IS TO BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE INTERNAL LAWS (AS OPPOSED TO CONFLICT OF LAWS PROVISIONS) OF THE STATE
OF NEW YORK.
(b) EACH UNDERWRITER, THE TRANSFEROR, THE MANAGING MEMBER, THE ISSUER
AND THE CONTRIBUTOR HEREBY SUBMIT TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS
OF THE STATE OF NEW YORK AND THE UNITED STATES DISTRICT COURT LOCATED IN THE
BOROUGH OF MANHATTAN IN NEW YORK CITY, AND EACH WAIVES PERSONAL SERVICE OF ANY
AND ALL PROCESS UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY
REGISTERED MAIL DIRECTED TO THE ADDRESS SET FORTH IN SECTION 11 AND SERVICE SO
MADE SHALL BE DEEMED TO BE COMPLETED FIVE DAYS AFTER THE SAME SHALL HAVE BEEN
DEPOSITED IN THE U.S. MAILS, POSTAGE PREPAID. THE TRANSFEROR, THE MANAGING
MEMBER, THE ISSUER AND THE CONTRIBUTOR HEREBY WAIVE ANY OBJECTION BASED ON FORUM
NON CONVENIENS, AND ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER.
NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF THE TRANSFEROR, THE MANAGING
MEMBER, THE ISSUER OR THE CONTRIBUTOR TO SERVE LEGAL PROCESS IN ANY OTHER MANNER
PERMITTED BY LAW OR AFFECT EITHER'S RIGHT TO BRING ANY ACTION OR PROCEEDING IN
THE COURTS OF ANY OTHER JURISDICTION.
(c) EACH UNDERWRITER, THE TRANSFEROR, THE MANAGING MEMBER, THE ISSUER
AND THE CONTRIBUTOR HEREBY WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE ARISING
OUT OF, CONNECTED WITH, RELATED TO, OR IN CONNECTION WITH THIS AGREEMENT.
INSTEAD, ANY DISPUTE RESOLVED IN COURT WILL BE RESOLVED IN A BENCH TRIAL WITHOUT
A JURY.
Section 16. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which when so executed and delivered shall be an original,
but all of which together shall constitute one and the same instrument.
Section 17. MISCELLANEOUS. Neither this Agreement nor any term hereof
may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. The headings in this
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.
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<PAGE>
UNDERWRITING AGREEMENT
If you are in agreement with the foregoing, please sign a counterpart
hereof and return the same to the Transferor, the Managing Member, the Issuer
and the Contributor, whereupon this Agreement shall become a binding agreement
among the Underwriters, the Transferor, the Managing Member, the Issuer and the
Contributor.
Very truly yours,
DVI RECEIVABLES CORP. XI
By: /s/ Lisa J. Cruikshank
------------------------
Name: Lisa J. Cruikshank
Title: Vice President
DVI FINANCIAL SERVICES INC.
By: /s/ Lisa J. Cruikshank
------------------------
Name: Lisa J. Cruikshank
Title: Vice President
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII, its Managing
Member
By: /s/ Lisa J. Cruikshank
------------------------
Name: Lisa J. Cruikshank
Title: Vice President
DVI RECEIVABLES CORP. VIII
By: /s/ Lisa J. Cruikshank
------------------------
Name: Lisa J. Cruikshank
Title: Vice President
<PAGE>
UNDERWRITING AGREEMENT
The foregoing Underwriting Agreement is hereby confirmed and accepted as of the
date first above written.
PRUDENTIAL SECURITIES INCORPORATED
By: /s/ Robert Schwartz
------------------------------
Name: Robert Schwartz
Title: Managing Director
LEHMAN BROTHERS INC.
By: /s/ Paul E. Sveen
------------------------------
Name: Paul E. Sveen
Title: Managing Director
BANC ONE CAPITAL MARKETS, INC.
By: /s/ Vimal Shah
------------------------------
Name: Vimal Shah
Title: Director
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE A
PURCHASING PRICE
Principal Amount
to be Purchased by Principal Amount Principal Amount
Prudential to be Purchased by to be Purchased by
Securities Lehman Brothers Banc One Capital
Class of Note Price Incorporated Inc. Markets, Inc.
------------- ----- ------------ ---- -------------
<S> <C> <C> <C> <C>
The Class A-1 Notes 100.0% $ 13,266,668 $ 13,266,666 $ 13,266,666
The Class A-2 Notes 100.0% $ 13,000,000 $ 13,000,000 $ 13,000,000
The Class A-3 Notes 100.0% $ 27,666,668 $ 27,666,666 $ 27,666,666
The Class A-4 Notes 100.0% $ 31,875,000 $ 31,875,000 $ 31,875,000
The Class B Notes 100.0% $ 4,387,000 $ 0 $ 0
The Class C Notes 100.0% $ 8,775,000 $ 0 $ 0
The Class D Notes 100.0% $ 5,850,000 $ 0 $ 0
</TABLE>
A-1
EXHIBIT 4.1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DVI RECEIVABLES XI, L.L.C.
ISSUER
AND
U.S. BANK TRUST NATIONAL ASSOCIATION,
TRUSTEE
AMENDED AND RESTATED INDENTURE
Dated as of December 1, 1999
$283,750,000 in aggregate principal amount of Asset-Backed Notes consisting of:
$39,800,000 6.72375% ASSET BACKED NOTES, SERIES 2000-1, CLASS A-1
$39,000,000 7.265% ASSET BACKED NOTES, SERIES 2000-1, CLASS A-2
$83,000,000 7.550% ASSET BACKED NOTES, SERIES 2000-1, CLASS A-3
$95,625,000 7.780% ASSET BACKED NOTES, SERIES 2000-1, CLASS A-4
$4,387,000 7.760% ASSET BACKED NOTES, SERIES 2000-1, CLASS B
$8,775,000 7.860% ASSET BACKED NOTES, SERIES 2000-1, CLASS C
$5,850,000 8.340% ASSET BACKED NOTES, SERIES 2000-1, CLASS D
$7,313,000 10.680% ASSET BACKED NOTES, SERIES 2000-1, CLASS E
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page
<S> <C>
RECITALS OF THE ISSUER ....................................................................................1
GRANTING CLAUSE ....................................................................................2
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01 Definitions.........................................................................3
SECTION 1.02 Compliance Certificates.............................................................3
SECTION 1.03 Form of Documents Delivered to Trustee..............................................3
SECTION 1.04 Acts of Noteholders, etc............................................................4
SECTION 1.05 Notices.............................................................................5
SECTION 1.06 Notice to Noteholders; Waiver.......................................................6
SECTION 1.07 Table of Contents, Headings, etc....................................................6
SECTION 1.08 Successors and Assigns..............................................................6
SECTION 1.09 Severability Clause.................................................................6
SECTION 1.10 Benefits of Amended and Restated Indenture..........................................7
SECTION 1.11 Governing Law.......................................................................7
SECTION 1.12 Legal Holidays......................................................................7
SECTION 1.13 Execution in Counterparts...........................................................7
SECTION 1.14 Inspection..........................................................................7
SECTION 1.15 Survival of Representations and Warranties..........................................8
SECTION 1.16 Incorporation by Reference to Trust Indenture Act...................................8
SECTION 1.17 Communications by Noteholders with Other Noteholders................................8
SECTION 1.18 Statements Required in Officer's Certificate........................................8
SECTION 1.19 When Treasury Securities are Disregarded............................................8
SECTION 1.20 Rules by Trustee....................................................................9
SECTION 1.21 No Adverse Interpretation of Other Agreements.......................................9
SECTION 1.22 No Recourse Against Others..........................................................9
SECTION 1.23 Independence of Covenants...........................................................9
SECTION 1.24 Consent to Jurisdiction.............................................................9
SECTION 1.25 No Bankruptcy Petition.............................................................10
SECTION 1.26 Voting Rights of Class F Instruments...............................................10
SECTION 1.27 Indebtedness Treatment.............................................................10
ARTICLE II
THE NOTES
ii
<PAGE>
Page
SECTION 2.01 General Provisions.................................................................11
SECTION 2.02 Global Notes.......................................................................12
SECTION 2.03 Execution, Authentication, Delivery and Dating.....................................15
SECTION 2.04 Registration, Transfer and Exchange................................................16
SECTION 2.05 Mutilated, Destroyed, Lost and Stolen Notes........................................18
SECTION 2.06 Delivery of Class F Instruments....................................................18
SECTION 2.07 Payment of Interest and Principal; Rights Preserved................................20
SECTION 2.08 Persons Deemed Owners..............................................................20
SECTION 2.09 Cancellation.......................................................................20
SECTION 2.10. Noteholder Lists; Communications to Noteholders....................................20
SECTION 2.11. ERISA Deemed Representations.......................................................21
ARTICLE III
ACCOUNTS; INVESTMENT OF MONEYS; COLLECTION
AND APPLICATION OF MONEYS; REPORTS
SECTION 3.01 Accounts; Investments by Trustee...................................................22
SECTION 3.02 Reserved...........................................................................24
SECTION 3.03 Collection of Moneys...............................................................24
SECTION 3.04 Collection Account.................................................................25
SECTION 3.05 Class A Distribution Sub-Account; Class B Distribution Sub-
Account; Class C Distribution Sub-Account; Class D Distribution
Sub-Account; Class E Distribution Sub-Account; Class F
Distribution Sub-Account...........................................................29
SECTION 3.06 Reserved...........................................................................31
SECTION 3.07 Reserved...........................................................................31
SECTION 3.08 Reserve Account....................................................................31
SECTION 3.09 Reports; Notices of Certain Payments...............................................32
SECTION 3.10. Trustee May Rely on Certain Information from Contributor and
Servicer...........................................................................32
ARTICLE IV
CONTRACTS AND EQUIPMENT
SECTION 4.01 Representations and Warranties of the Issuer.......................................34
SECTION 4.02 Purchase upon Breach; Amended and Restated Contribution and
Servicing Agreement................................................................34
SECTION 4.03 Release of Contracts and Equipment Following Substitution or
Purchase...........................................................................35
SECTION 4.04 Release of Contracts and Equipment Upon Final Contract Payment.....................35
SECTION 4.05 Execution of Documents.............................................................36
iii
<PAGE>
Page
ARTICLE V
SERVICER EVENTS OF DEFAULT; SUBSTITUTE SERVICER
SECTION 5.01 Servicer Events of Default.........................................................37
SECTION 5.02 Substitute Servicer................................................................37
SECTION 5.03 Notification to Noteholders and Rating Agencies....................................37
ARTICLE VI
EVENTS OF DEFAULT; REMEDIES
SECTION 6.01 Events of Default..................................................................38
SECTION 6.02 Acceleration of Maturity; Rescission and Annulment.................................39
SECTION 6.03 Other Remedies.....................................................................40
SECTION 6.04 Trustee May File Proofs of Claim...................................................40
SECTION 6.05 Trustee May Enforce Claims Without Possession of Notes.............................41
SECTION 6.06 Application of Money Collected.....................................................42
SECTION 6.07 Limitation on Suits................................................................43
SECTION 6.08 Unconditional Right of Noteholders to Receive Payment..............................44
SECTION 6.09 Restoration of Rights and Remedies.................................................44
SECTION 6.10. Rights and Remedies Cumulative.....................................................45
SECTION 6.11 Delay or Omission Not Waiver.......................................................45
SECTION 6.12 Control by Noteholders.............................................................45
SECTION 6.13 Waiver of Defaults and Events of Default...........................................45
SECTION 6.14 Waiver of Stay or Extension Laws...................................................46
SECTION 6.15 Sale of Trust Property.............................................................46
SECTION 6.16 Undertaking for Costs..............................................................47
ARTICLE VII
THE TRUSTEE
SECTION 7.01 Certain Duties and Responsibilities................................................47
SECTION 7.02 Notice of Defaults or Events of Default............................................48
SECTION 7.03 Certain Rights of Trustee..........................................................49
SECTION 7.04 Trustee's Disclaimer...............................................................50
SECTION 7.05 Money Held in Trust................................................................50
SECTION 7.06 Compensation, Reimbursement, etc...................................................50
SECTION 7.07 Eligibility; Disqualification......................................................51
SECTION 7.08 Resignation and Removal; Appointment of Successor..................................51
SECTION 7.09 Acceptance of Appointment by Successor.............................................52
SECTION 7.10. Merger, Conversion, Consolidation or Succession to Business........................53
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Page
SECTION 7.11 Co-trustees and Separate Trustees..................................................53
SECTION 7.12 Trustee to Hold Contracts..........................................................54
SECTION 7.13 Financing Statements...............................................................55
SECTION 7.14 Trustee to Act; Appointment of Successor...........................................55
SECTION 7.15 Reports by Trustee to Holders......................................................55
SECTION 7.16 Preferential Collection of Claims Against Issuer...................................56
ARTICLE VIII
COVENANTS
SECTION 8.01 Payment of Principal and Interest..................................................57
SECTION 8.02 Maintenance of Office or Agency; Chief Executive Office............................57
SECTION 8.03 Money for Payments to Noteholders to Be Held in Trust..............................57
SECTION 8.04 Issuer Existence; etc..............................................................58
SECTION 8.05 Protection of Trust Property; Further Assurances...................................59
SECTION 8.06 Compliance Certificates............................................................60
SECTION 8.07 Performance of Obligations; Amended and Restated Contribution
and Servicing Agreement............................................................60
SECTION 8.08 Negative Covenants.................................................................61
SECTION 8.09 Information as to the Issuer.......................................................62
SECTION 8.10. Payment of Taxes and Other Claims..................................................63
SECTION 8.11 Indemnification....................................................................63
SECTION 8.12 Contract Files to Trustee..........................................................64
SECTION 8.13 Payment Advices....................................................................64
ARTICLE IX
AMENDMENTS AND SUPPLEMENTAL AMENDED AND RESTATED INDENTURES
SECTION 9.01 Amendments and Supplemental Indentures.............................................65
SECTION 9.02 Execution of Amendments and Supplemental Indentures................................65
SECTION 9.03 Effect of Amendments and Supplemental Indentures...................................66
SECTION 9.04 Reference in Notes to Amendments and Supplemental Indentures.......................66
SECTION 9.05 Compliance with Trust Indenture Act................................................66
SECTION 9.06 Revocation and Effect of Consents..................................................66
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.01 Optional Redemption; Election to Redeem............................................67
SECTION 10.02 Notice to Trustee..................................................................67
SECTION 10.03 Notice of Redemption or Partial Redemption by the Issuer...........................67
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Page
SECTION 10.04 Deposit of the Redemption Price or Partial Redemption Price........................68
SECTION 10.05 Notes Payable on Redemption Date...................................................68
ARTICLE XI
SATISFACTION AND DISCHARGE
SECTION 11.01 Satisfaction and Discharge of Amended and Restated Indenture.......................70
SECTION 11.02 Application of Trust Money.........................................................71
SECTION 11.03 Reinstatement......................................................................71
</TABLE>
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SCHEDULES
Schedule 1 - Contract Schedule
EXHIBITS
Exhibit A-1 - Form of Class A-1 Note
Exhibit A-2 - Form of Class A-2 Note
Exhibit A-3 - Form of Class A-3 Note
Exhibit A-4 - Form of Class A-4 Note
Exhibit B - Form of Class B Note
Exhibit C - Form of Class C Note
Exhibit D - Form of Class D Note
Exhibit E - Form of Class E Note
Exhibit F - Form of Class F Instrument
Exhibit G - Investment Letter
Exhibit H - Reserved
Exhibit I - Tax Certificate
APPENDICES
Appendix I - Defined Terms
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AMENDED AND RESTATED INDENTURE
This AMENDED AND RESTATED INDENTURE ("AMENDED AND RESTATED
INDENTURE") dated as of December 1, 1999, is between DVI RECEIVABLES XI, L.L.C.,
a Delaware limited liability company (herein called the "ISSUER"), and U.S. BANK
TRUST NATIONAL ASSOCIATION, a national banking association, as trustee (herein
called the "TRUSTEE").
RECITALS OF THE ISSUER
The Issuer has duly authorized the issuance of $39,800,000 in
aggregate principal amount of its 6.72375% Asset Backed Notes, Series 2000-1,
Class A-1 (the "CLASS A-1 NOTES"), $39,000,000 in aggregate principal amount of
its 7.265% Asset Backed Notes, Series 2000-1, Class A-2 (the "CLASS A-2 NOTES"),
$83,000,000 in aggregate principal amount of its 7.550% Asset Backed Notes,
Series 2000-1, Class A-3 (the "CLASS A-3 NOTES"), $95,625,000 in aggregate
principal amount of its 7.780% Asset Backed Notes, Series 2000-1, Class A-4 (the
"CLASS A-4 NOTES"), together with the Class A-1 Notes, the Class A-2 Notes and
the Class A-3 Notes, the "CLASS A NOTES"), $4,387,000 in aggregate principal
amount of its 7.760% Asset Backed Notes, Series 2000-1, Class B (the "CLASS B
NOTES") $8,775,000 in aggregate principal amount of its 7.860% Asset Backed
Notes, Series 2000-1, Class C (the "CLASS C NOTES"), $5,850,000 in aggregate
principal amount of its 8.340% Asset Backed Notes, Series 2000-1, Class D (the
"CLASS D NOTES") and $7,313,000 in aggregate principal amount of its 10.680%
Asset Backed Notes, Series 2000-1, Class E (the "CLASS E NOTES" and together
with the Class A Notes, the Class B Notes, the Class C Notes and the Class D
Notes, the "OFFERED NOTES"), of substantially the tenor hereinafter set forth,
and to provide therefor the Issuer has duly authorized the execution and
delivery of this Amended and Restated Indenture.
Subsequent to the execution and delivery of this Amended and
Restated Indenture, the Issuer may, subject to the restrictions described
herein, enter into a Supplement directing the issuance of a sixth class of
securities (the "CLASS F INSTRUMENTS", and together with the Offered Notes, the
"NOTES") which will be subordinate to the Class A Notes, the Class B Notes, the
Class C Notes, the Class D Notes and the Class E Notes.
All things necessary to make the Notes, when executed by the
Issuer and authenticated and delivered hereunder, the valid obligations of the
Issuer, and to make this Amended and Restated Indenture a valid agreement of the
Issuer, in accordance with its terms, have been done.
NOW, THEREFORE, THIS AMENDED AND RESTATED 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:
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GRANTING CLAUSE
The Issuer hereby Grants to the Trustee, for the benefit and
security of the Noteholders and the Trustee as their interests appear herein,
all of the Issuer's right, title and interest in and to the Trust Property. The
Issuer also hereby assigns to the Trustee, for the benefit of the Noteholders
and the Trustee, its security interest in the Equipment (which shall be a first
priority perfected security interest in Equipment other than with respect to
Equipment relating to a Secured Equipment Note or Finance Lease and for which
the Original Equipment Cost is less than $25,000) subject to the underlying
equipment lease related to the Contracts and all of the Issuer's rights in all
income, payments and proceeds related thereto. The Grants of the Trust Property
effected by this Amended and Restated Indenture shall include all rights,
powers, and options (but none of the obligations) of the Issuer with respect
thereto, including, without limitation, the immediate and continuing right to
claim for, collect, receive, and give receipts for Contract Payments in respect
of the Contracts and all other moneys payable thereunder, to give and receive
notices and other communications, to recover on the Equipment pursuant thereto,
to make waivers, amendments or other agreements, to exercise all rights and
options, to bring judicial proceedings in the name of the Issuer or otherwise,
to terminate a Contract pursuant to the terms thereof, enforce all rights and
remedies of the Issuer with respect to the duties, covenants, obligations,
indemnities, representations and warranties of the Contributor and the Servicer
under the Amended and Restated Contribution and Servicing Agreement, and
generally to do and receive anything that the Issuer is or may be entitled to do
or receive thereunder or with respect thereto. Such Grants are made in trust to
secure (i) the payment of all amounts due on the Notes in accordance with their
terms, equally and ratably without prejudice, priority, or distinction between
any Note of the same class and any other Note of the same class by reason of
differences in time of issuance or otherwise, except as otherwise may be
provided in this Amended and Restated Indenture or any Supplement, (ii) the
payment of all other sums payable under this Amended and Restated Indenture and
(iii) compliance with the provisions of this Amended and Restated Indenture and
any Supplement with respect to the Notes.
The Trustee acknowledges such Grants, 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.
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01 DEFINITIONS.
For purposes of this Amended and Restated Indenture,
capitalized terms used herein but not otherwise defined shall have the
respective meaning assigned to such terms in Appendix I hereto.
SECTION 1.02 COMPLIANCE CERTIFICATES.
Upon any application or request by the Issuer to the Trustee
to take any action under any provision of this Amended and Restated Indenture or
any Supplement, other than any request that (i) the Trustee authenticate the
Notes specified in such request, (ii) the Trustee invest moneys in the
Collection Account or the Reserve Account pursuant to the written directions
specified in such request, or (iii) the Trustee pay moneys due and payable to
the Issuer hereunder to the Issuer's beneficial owner or other assignee
specified in such request, the Trustee may require the Issuer to furnish to the
Trustee an Officer's Certificate stating that all conditions precedent, if any,
provided for in this Amended and Restated Indenture or any Supplement relating
to the proposed action 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
Amended and Restated Indenture or any Supplement, no additional certificate need
be furnished.
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 Officer's Certificate 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 Authorized Officer or Authorized Officers
of the Managing Member as to such factual matters unless such Authorized Officer
or counsel of the Managing Member 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.
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Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Amended and Restated Indenture or any Supplement,
they may, but need not, be consolidated and form one instrument.
Wherever in this Amended and Restated Indenture or any
Supplement, in connection with any application or certificate or report to the
Trustee, it is provided that the Issuer 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 Issuer to have
such application granted or to the sufficiency of such 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).
SECTION 1.04 ACTS OF NOTEHOLDERS, ETC.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Amended and Restated Indenture
or any Supplement 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, with a copy (or if
expressly required an original) to the Issuer and the Servicer. 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
Amended and Restated Indenture or any Supplement and (subject to Section 7.01)
conclusive in favor of the Trustee and the Issuer, 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 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 therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee or the
Issuer in reliance thereon, whether or not notation of such action is made upon
such Note.
(d) By accepting the Notes issued pursuant to this Amended and
Restated Indenture and any Supplement, each Noteholder irrevocably appoints the
Trustee hereunder as the special attorney-
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in-fact for such Noteholder vested with full power on behalf of such Noteholder
to effect and enforce the rights of such Noteholder pursuant hereto and the
provisions hereof for the benefit of such Noteholder.
(e) Each holder of a Note, by acceptance of such Note, agrees
to treat such Note as indebtedness for federal, state and local income or
franchise tax purposes.
SECTION 1.05 NOTICES.
Any request, demand, authorization, direction, notice,
consent, waiver, Act of Noteholders, or other document provided or permitted by
this Amended and Restated Indenture or any Supplement to be made upon, given or
furnished to, or filed with, the Trustee, the Issuer or the Servicer shall be
sufficient for every purpose hereunder if in writing and telexed, telecopied
(with the original of the telexed or telecopied material sent to the recipient
by overnight courier on the day of the telex or telecopy), mailed, first-class
postage prepaid, or hand delivered. 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:
(i) if to the Trustee, at the Corporate Trust Office,
Attention: Structured Finance, 180 Fifth Street, St. Paul, Minnesota,
55101 (Number for telecopy: (651) 244-0089; Number for telephonic
confirmation: (651) 244-0727;
(ii) if to the Issuer, Attention: Securitization
Manager, at 500 Hyde Park, Doylestown, Pennsylvania 18901 (Number for
telecopy: (215) 489-8015; Number for telephonic confirmation: (215)
230-6375) or at any other address previously furnished in writing to
the Trustee, the Servicer or the Contributor by the Issuer;
(iii) if to the Contributor, Attention: Securitization
Manager, at 500 Hyde Park, Doylestown, Pennsylvania 18901 (Number for
telecopy: (215) 230-5328; Number for telephonic confirmation: (215)
489-8015) or at any other address previously furnished in writing to
the Trustee, the Issuer and the Servicer by the Contributor;
(iv) if to the Servicer, Attention: Servicing Manager,
at 500 Hyde Park, Doylestown, Pennsylvania 18901 (Number for telecopy:
(215) 230-5328; Number for telephonic confirmation: (215) 489-8015) or
at any other address previously furnished in writing to the Trustee,
the Issuer and the Contributor by the Servicer;
(v) if to Moody's, at 99 Church Street, New York, New
York 10007, Attention: ABS Monitoring Department (Number for telecopy:
(212) 553-3856), or at any other address or telecopy number previously
furnished in writing to the Trustee, the Issuer and the Servicer by
Moody's; or
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(vi) if to Fitch IBCA, at One State Street Plaza, New
York, New York 10004, Attention: ABS Group (Number for telecopy: (212)
635-0476), or at any other address or telecopy number previously
furnished in writing to the Trustee, the Issuer and the Servicer by
Fitch IBCA.
SECTION 1.06 NOTICE TO NOTEHOLDERS; WAIVER.
(a) Where this Amended and Restated Indenture or any
Supplement 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 sent by private courier or confirmed telecopy (with a
copy of the telecopied material sent to the recipient by overnight courier on
the day of the telecopy) to each Noteholder affected by such event or to whom
such report is required to be mailed, at such Noteholder's 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 Amended and
Restated Indenture or any Supplement 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 of this Amended and Restated Indenture or any
Supplement, 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 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents and the Article and Section headings are
for convenience only and shall in no way modify or restrict any of the terms or
provisions hereof.
SECTION 1.08 SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Amended and Restated
Indenture by the Issuer or the Trustee shall bind its respective successors and
permitted assigns, whether so expressed or not.
SECTION 1.09 SEVERABILITY CLAUSE.
In case any provision in this Amended and Restated Indenture,
any Supplement or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
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SECTION 1.10 BENEFITS OF AMENDED AND RESTATED INDENTURE.
Nothing in this Amended and Restated Indenture, any Supplement
or in the Notes, express or implied, shall give to any Person, other than the
parties hereto and their successors hereunder, any separate trustee or
co-trustee appointed under Section 7.11 and the holders of Notes, any benefit or
any legal or equitable right, remedy or claim under this Amended and Restated
Indenture.
SECTION 1.11 GOVERNING LAW.
THIS AMENDED AND RESTATED INDENTURE, ANY SUPPLEMENT AND THE
NOTES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES THEREOF.
THIS AMENDED AND RESTATED INDENTURE IS SUBJECT TO THE TRUST INDENTURE ACT OF
1939, AS AMENDED FROM TIME TO TIME, AS IN EFFECT ON ANY RELEVANT DATE (THE
"TIA") AND SHALL BE GOVERNED THEREBY OR CONSTRUED IN ACCORDANCE THEREWITH.
SECTION 1.12 LEGAL HOLIDAYS.
In any case where any Payment Date or the Stated Maturity Date
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 Amended and Restated Indenture or of the Notes) such payment shall be
made on the next succeeding Business Day, and no interest shall accrue for the
intervening period.
SECTION 1.13 EXECUTION IN COUNTERPARTS.
This Amended and Restated 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.
SECTION 1.14 INSPECTION.
The Issuer agrees that, on reasonable prior notice, it will
permit the representatives of the Trustee or any Noteholder, during the Issuer's
normal business hours, to examine all of the books of account, records, reports
and other papers of the Issuer, to make copies thereof and extracts therefrom,
to cause such books to be audited by independent accountants selected by the
Issuer 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 with an Authorized Officer of the
Transferor (as sole beneficiary of the Issuer) present (and by this provision
the Issuer 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 Issuer or the
performance of and compliance with the covenants and undertakings of the Issuer
in this Amended and Restated Indenture, the Amended and Restated Contribution
and Servicing Agreement, the other Transaction Documents, or any of the other
documents referred to herein or therein. Any expense incident to the exercise by
the Trustee or any Noteholder during the continuance of any Default or Indenture
Event of Default of any right under this Section 1.14 shall be borne by the
Issuer, but any expense due to the exercise of a right
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by any such Person prior to the occurrence of a Default or Indenture Event of
Default shall be borne by such Person.
SECTION 1.15 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
The representations, warranties and certifications of the
Issuer made in this Amended and Restated Indenture or in any certificate or
other writing delivered by the Issuer pursuant hereto shall survive the
authentication and delivery of the Notes hereunder, but unless explicitly
provided to the contrary, they are made only as of the Closing Date.
SECTION 1.16 INCORPORATION BY REFERENCE TO TRUST
INDENTURE ACT.
The provisions of TIA Sections 310 through 317 inclusive that
impose duties on any Person (including the provisions automatically deemed
included herein unless expressly excluded by the provisions of this Amended and
Restated Indenture) are a part of and govern this Amended and Restated
Indenture, whether or not physically contained herein.
If any provision of this Amended and Restated Indenture
limits, qualifies or conflicts with another provision which is required to be
included in this Amended and Restated Indenture by the TIA, the required
provision of the TIA shall control.
SECTION 1.17 COMMUNICATIONS BY NOTEHOLDERS WITH OTHER
NOTEHOLDERS.
A Noteholder may communicate with other Noteholders pursuant
to TIA Section 312(b) with respect to their rights under this Amended and
Restated Indenture or the Notes. The Issuer, the Trustee and anyone else shall
have the protection of Section 312(c) of the TIA.
SECTION 1.18 STATEMENTS REQUIRED IN OFFICER'S
CERTIFICATE.
Each Officer's Certificate with respect to compliance with a
condition or covenant provided for in this Amended and Restated Indenture shall
include:
(i) a statement that the Person making such
certification has read such covenant or condition;
(ii) a brief statement as to the nature and scope of
the examination or investigation upon which the statements contained in
such certificate are based;
(iii) a statement that, in the opinion of such Person, he
or she 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
(iv) a statement as to whether or not, in the opinion of
such Person, such covenant or condition has been complied with.
SECTION 1.19 WHEN TREASURY SECURITIES ARE DISREGARDED.
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In determining whether the Noteholders of the required
principal amount of Notes have concurred in any direction, waiver or consent
hereunder, Notes owned by the Issuer or any other obligor on the Notes or by any
Affiliate of the Issuer or such obligor related thereto shall be disregarded,
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 of the Trustee actually knows are so owned shall be so
disregarded. Notes so owned which have been pledged in good faith shall not be
disregarded if the pledgee establishes to the reasonable satisfaction of the
Trustee the pledgee's right so to act with respect to such Notes and that the
pledgee is not the Issuer or any other obligor upon the Notes or any Affiliate
of the Issuer or such obligor.
SECTION 1.20 RULES BY TRUSTEE.
The Trustee may make reasonable rules for action by or at a
meeting of Noteholders.
SECTION 1.21 NO ADVERSE INTERPRETATION OF OTHER
AGREEMENTS.
This Amended and Restated Indenture may not be used to
interpret another indenture, loan or debt agreement of the Issuer or an
Affiliate of the Issuer. Any such indenture, loan or debt agreement may not be
used to interpret this Amended and Restated Indenture.
SECTION 1.22 NO RECOURSE AGAINST OTHERS.
All liability described in the Notes of any director, officer,
employee or member, as such, of the Issuer is waived and released.
SECTION 1.23 INDEPENDENCE OF COVENANTS.
All covenants and agreements in this Amended and Restated
Indenture shall be given independent effect so that if any particular action or
condition is not permitted by any of such covenants, the fact that it would be
permitted by an exception to, or otherwise be within the limitations of, another
covenant shall not avoid the occurrence of a Default or an Indenture Event of
Default if such action is taken or condition exists.
SECTION 1.24 CONSENT TO JURISDICTION.
Each of the Issuer and the Trustee irrevocably submits to the
jurisdiction of any New York State or Federal court sitting in the Borough of
Manhattan in the City of New York over any suit, action or proceeding arising
out of or relating to this Amended and Restated Indenture or any Note. Each of
the Issuer and the Trustee irrevocably waives, to the fullest extent permitted
by laws, any objection which it may have to the laying of the venue of any such
suit, action or proceeding brought in such a court and any claim that any such
suit, action or proceeding brought in such a court has been brought in any
inconvenient forum. Each of the Issuer and the Trustee agrees that final
judgment in any such suit, action or proceeding brought in such a court shall be
conclusive and binding upon the Issuer or the Trustee, as the case may be, and
may be enforced in the courts of New York (or any other courts to the
jurisdiction of which the Issuer or the Trustee, as the case may be, is subject)
by a suit upon such judgment, provided that service of process is effected upon
the Issuer as permitted
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by law; PROVIDED, HOWEVER, that each of the Issuer and the Trustee does not
waive, and the foregoing provisions of this sentence shall not constitute or be
deemed to constitute a waiver of, (i) any right to appeal any such judgment, to
seek any stay or otherwise to seek reconsideration or review of any such
judgment or (ii) any stay of execution or levy pending an appeal from, or a
suit, action or proceeding for reconsideration or review of, any such judgment.
SECTION 1.25 NO BANKRUPTCY PETITION.
Notwithstanding any provision contained herein, each of the
Noteholders and the Trustee covenants and agrees that prior to the date which is
one year and one day after the payment in full of all Notes issued by the
Issuer, it will not institute against, or join any other Person in instituting
against, the Issuer or its Managing Member any bankruptcy, reorganization,
receivership, arrangement, insolvency or liquidation proceedings, or other
similar proceedings under any federal or state bankruptcy or similar law. The
Issuer represents, warrants, and covenants that it and has obtained, and will in
the future obtain, a no-petition agreement from each and every Person that
enters into any agreement of any kind with the Issuer or its Managing Member.
This Section 1.25 shall survive the termination of this Amended and Restated
Indenture.
SECTION 1.26 VOTING RIGHTS OF CLASS F INSTRUMENTS.
Upon the irrevocable payment in full of all of the Class A
Notes, the Class B Notes the Class C Notes, the Class D Notes and the Class E
Notes, all voting and consent rights otherwise granted to the Class A
Noteholders, the Class B Noteholders, the Class C Noteholders, the Class D
Noteholders and the Class E Noteholders shall be exercised by the requisite
percentage of holders of the Class F Instruments, if any.
SECTION 1.27 INDEBTEDNESS TREATMENT.
This Amended and Restated Indenture and the Notes have been
structured with the intention that the Notes will qualify under applicable tax
law as indebtedness. Each Noteholder agrees to treat the Notes for purposes of
federal, state and local income or franchise taxes (and any other tax imposed on
or measured by income) as indebtedness and to cause any Person acquiring an
interest in a Note by, through or under it to acknowledge the characterization
of the Notes as indebtedness and to agree to treat the Notes as indebtedness for
such tax purposes.
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ARTICLE II
THE NOTES
SECTION 2.01 GENERAL PROVISIONS.
(a) The Notes issuable hereunder shall be issued as registered
Notes without coupons in no more than five classes as from time to time shall be
authorized by the Issuer. The Notes of all classes shall be known and entitled
generally as the "DVI Receivables XI, L.L.C. Asset-Backed Notes, Series 2000-1"
The Notes of each class shall have further particular designation as the Issuer
may adopt for each class, and each Note issued hereunder shall bear upon the
face thereof the designation so adopted for the class to which it belongs. The
Trustee is hereby authorized and directed upon the written order of the Issuer
to authenticate and deliver Notes to be issued hereunder in five classes, and,
with respect to the Class A Notes only, in four tranches, entitled "6.72375%
Asset-Backed Notes, Series 2000-1, Class A-1", "7.2650% Asset-Backed Notes,
Series 2000-1, Class A-2", "7.550% Asset- Backed Notes, Series 2000-1 Class
A-3", "7.780% Asset-Backed Notes, Series 2000-1 Class A-4", "7.760% Asset-Backed
Notes, Series 2000-1, Class B", "7.860% Asset-Backed Notes, Series 2000-1, Class
C", "8.340% Asset-Backed Notes, Series 2000-1, Class D" and "10.680%
Asset-Backed Notes, Series 2000-1, Class E", respectively. The Issuer may issue
in accordance with Section 2.06 hereof, the Class F Instruments which will be
subordinate to the Class A Notes, the Class B Notes, the Class C Notes, the
Class D Notes and the Class E Notes by entering into a Supplement. The form of
each class of Offered Notes and of the Trustee's certificate of authentication
shall be in substantially the forms set forth in Exhibits A-1, A-2, A-3, A-4, B,
C, D and E hereto, with such appropriate insertions, omissions, substitutions,
and other variations as are required or permitted by this Amended and Restated
Indenture. The aggregate principal amount of Notes which may be authenticated
and delivered under this Amended and Restated Indenture is limited to
$283,750,000 except for Notes authenticated and delivered upon registration of,
transfer of, or in exchange for, or in lieu of, other Notes pursuant to Section
2.04, 2.05, or 9.04. The Notes shall be issuable only in registered form and
only in denominations of at least $500,000 and integral multiples of $1,000
thereof; PROVIDED that the foregoing shall not restrict or prevent the transfer
or issuance in accordance with Section 2.04 or 2.05 of any Note having a
remaining outstanding principal amount of less than $500,000; PROVIDED, FURTHER,
that a single Note of each Class may be issued in a different amount as may be
necessary so that the Notes of such Class evidence the full initial principal
balance thereof. The Class F Instruments, if any, shall be issued in the minimum
denominations indicated in the related Supplement.
(b) The aggregate amount of principal due and payable on each
class of Notes on each Payment Date shall be equal to the sum of (i) Monthly
Principal for such class and (ii) any other due and unpaid principal for such
class. Except (i) for optional redemption pursuant to Section 10.01, (ii) for
Prepayment Amounts or Partial Prepayment Amounts or (iii) 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).
(c) Interest and principal on the Notes shall be payable on
each Payment Date commencing with the Initial Payment Date to Noteholders of
record on the Record Date. Interest on the Notes is required to be paid to
Noteholders in an amount equal to the Monthly Interest plus Overdue Interest.
Interest on the Notes shall be computed on the basis of a 360-day year
consisting
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of twelve 30-day months PROVIDED that for Class A-1, interest shall be computed
using the actual number of days elapsed over a 360-day year.
(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 and then to the
principal thereof.
(e) All Notes of the same class issued under this Amended and
Restated Indenture or any Supplement shall be in all respects equally and
ratably entitled to the benefits hereof and thereof 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 Amended and
Restated Indenture or any Supplement. Payments of principal and interest on
Notes of the same class shall be made pro rata among all outstanding Notes of
such class, without preference or priority of any kind.
(f) The Issuer, the Trustee and each Class A, Class B, Class
C, Class D and Class E Noteholder by acceptance of its Class A, Class B, Class
C, Class D or Class E Note, respectively, (and any Person that is a beneficial
owner of any interest in a Class A, Class B, Class C, Class D or Class E Note,
respectively, by virtue of such Person's acquisition of a beneficial interest
therein) agrees to treat such Note(s) for purposes of federal, state and local
income or franchise taxes (and any other tax imposed on or measured by income)
as indebtedness. Each Class A, Class B, Class C, Class D and Class E Noteholder
agrees that it will cause any Person acquiring an interest in a Class A, Class
B, Class C, Class D or Class E Note through it to acknowledge the Class A, Class
B, Class C, Class D or Class E Notes', respectively, characterization as
indebtedness and to agree to comply with this Amended and Restated Indenture as
to treatment of such Notes as indebtedness for such tax purposes.
SECTION 2.02 GLOBAL NOTES.
(a) Initially, the Class A Notes, the Class B Notes, the Class
C Notes and the Class D Notes shall be issued in the form of one or more Public
Global Notes and the Class E Notes shall be issued in the form of one or more
Rule 144A Global Note(s) which (i) shall represent, and shall be denominated in
an aggregate amount equal to, the aggregate principal amount of all Class A
Notes, the Class B Notes, the Class C Notes, the Class D Notes and the Class E
Notes to be issued hereunder, (ii) shall be delivered as one or more Notes held
by the Book Entry Custodian, or, if appointed to hold such Notes as provided
below, the Depositary shall be registered in the name of the Depositary or its
nominee, (iii) shall be substantially in the form of the Note specified pursuant
to Section 2.01, with such changes therein as may be necessary to reflect that
each such Note is a global security, and (iv) shall each bear a legend
substantially to the effect included in the form of the face of the Notes as set
forth in Exhibits A-1, A-2, A-3, A-4, B, C, D and E hereto. Notwithstanding
anything in any Transaction Document to the contrary, no Class E Note shall be
purchased by a Person who is not a U.S. Person, as defined herein and no Class E
Note shall be purchased by a Person who is not a "qualified institutional buyer"
as defined in Rule 144A of the Securities Act.
(b) Notwithstanding any other provisions of this Section 2.02
or of Section 2.04, unless and until a Global Note is exchanged in whole for
Notes in definitive form, a Global Note may be transferred, in whole, but not in
part, and in the manner provided in this Section 2.02, only by the
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Depositary to a nominee of such Depositary or by a nominee of such Depositary to
such Depositary or another nominee of such Depositary or by such Depositary or
any such nominee to a successor Depositary selected or approved by the Issuer or
to a nominee of such successor Depositary or in the manner specified in Section
2.02(c). The Depositary shall order the Note Registrar to authenticate and
deliver the following Book-Entry Notes: with respect to the E Notes only, a Rule
144A Global Note having an aggregate initial Outstanding principal balance equal
to the Initial Class Note Balance of such Class, and, with respect to the Class
A Notes, the Class B Notes, the Class C Notes and the Class D Notes only, a
Public Global Note, having an initial Outstanding principal balance equal to
zero. Note Owners shall hold their respective Ownership Interests in and to such
Notes through the book-entry facilities of the Depositary. Without limiting the
foregoing, Class A, Class B, Class C and Class D Note Owners shall hold their
respective Ownership Interests, if any, in Public Global Notes only through
Depositary Participants, Euroclear or Clearstream Banking, Luxembourg.
(c) If (i) the Depositary for the Notes represented by one or
more Global Notes at any time notifies the Issuer that it is unwilling or unable
to continue as Depositary of the Notes or if at any time the Depositary shall no
longer be a clearing agency registered under the Exchange Act and any other
applicable statute or regulation, and a successor Depositary is not appointed or
approved by the Issuer within 90 days after the Issuer receives such notice or
becomes aware of such condition, as the case may be, (ii) the Trustee, at the
direction of Noteholders evidencing not less than 66 2/3% of the Voting Rights,
elects to terminate the book-entry system through the Depositary or (iii) after
an Indenture Event of Default or a Servicer Event of Default, Noteholders
representing more than 50% of the Voting Rights advise the Depositary, or
Book-Entry Custodian, as the case may be, in writing that the continuation of a
book-entry system through the Depositary, or the Book-Entry Custodian, as the
case may be, is no longer in such Noteholder's best interest upon the request of
such Noteholder, but only with respect to the interests of such Noteholder, the
Issuer will promptly execute, and the Trustee, upon receipt of an Officer's
Certificate evidencing such determination by the Issuer, will promptly
authenticate and make available for delivery, Notes in definitive form without
coupons, in authorized denominations and in an aggregate principal amount equal
to the principal amount of the Global Note or Notes then outstanding in exchange
for such Global Note or Notes and this Section 2.02 shall no longer be
applicable to the Notes. Upon the exchange of the Global Notes for such Notes in
definitive form without coupons, in authorized denominations, such Global Notes
shall be canceled by the Trustee. Such Notes in definitive form issued in
exchange of the Global Notes pursuant to this Section 2.02(c) shall be
registered in such names and in such authorized denominations as the Depositary,
pursuant to instructions from its direct or indirect participants or otherwise,
shall instruct the Trustee. The Trustee may conclusively rely on any such
instructions furnished by the Depositary and shall not be liable for any delay
in delivery of such instructions. The Trustee shall make such Notes available
for delivery to the Persons in whose names such Notes are so registered.
(d) As long as the Notes outstanding are represented by one or
more Global Notes:
(i) the Note Registrar and the Trustee may deal with
the Depositary for all purposes (including the payment of principal of
and interest on the Notes) as the authorized representative of the Note
Owners;
(ii) the rights of Note Owners shall be exercised only
through the Depositary and shall be limited to those established by law
and agreements between such Note Owners
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and the Depositary and/or the Depositary Participants. Unless and until
Definitive Notes are issued, the Depositary will make book-entry
transfers among the Depositary Participants and receive and transmit
payments of principal of and interest on the Notes to such Depositary
Participants; and
(iii) whenever this Amended and Restated Indenture
requires or permits actions to be taken based upon instructions or
directions of Holders of Notes evidencing a specified percentage of the
Voting Rights, the Depositary shall be deemed to represent such
percentage only to the extent that it has received instructions to such
effect from Note Owners and/or Depositary Participants owning or
representing, respectively, such required percentage of the beneficial
interest in the Notes (or Class of Notes) and has delivered such
instruction to the Trustee.
(e) If Notes are to be issued in global form other than as
Global Notes, the provisions governing such Notes shall be specified pursuant to
an Officer's Certificate with respect thereto and by an indenture supplemental
hereto.
(f) Whenever a notice or other communication to the
Noteholders is required under this Amended and Restated Indenture, unless and
until Notes have been issued in definitive form to Note Owners, the Trustee
shall give all such notices and communications to the Depositary.
(g) The Trustee is hereby initially appointed as the
Book-Entry Custodian and hereby agrees to act as such in accordance with the
agreement that it has with the Depositary authorizing it to act as such. The
Book-Entry Custodian may, and, if it is no longer qualified to act as such, the
Book-Entry Custodian shall, appoint, by written instrument delivered to the
Issuer and the Depositary, any other transfer agent (including the Depositary or
any successor Depositary) to act as Book-Entry Custodian under such conditions
as the predecessor Book-Entry Custodian and the Depositary or any successor
Depositary may prescribe, PROVIDED that the predecessor Book-Entry Custodian
shall not be relieved of any of its duties or responsibilities by reason of any
such appointment of other than the Depositary. If the Trustee resigns or is
removed in accordance with the terms hereof, the successor Trustee or, if it so
elects, the Depositary shall immediately succeed to its predecessor's duties as
Book- Entry Custodian. The Issuer shall have the right to inspect, and to obtain
copies of, any Notes held as Book-Entry Notes by the Book-Entry Custodian.
(h) The provisions of this Section 2.02(h) shall apply to all
transfers of Definitive Notes, if any, issued in respect of Ownership Interests
in the Rule 144A Global Notes.
(1) No transfer of any Class of Note or interest therein shall
be made unless that transfer is made pursuant to an effective
registration statement under the Securities Act, and effective
registration or qualification under applicable state securities laws,
or is made in a transaction that does not require such registration or
qualification. If a transfer of any Definitive Note is to be made
without registration under the Securities Act (other than in connection
with the initial issuance thereof or a transfer thereof by the
Depositary or one of its Affiliates), then the Note Registrar shall
refuse to register such transfer unless it receives (and upon receipt,
may conclusively rely upon) either: (i) a certificate from such
Noteholder substantially in the form attached as Exhibit G hereto or
such other certification reasonably acceptable to the
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Trustee and a certificate from such Noteholder's prospective transferee
substantially in the form attached as Exhibit G hereto or such other
certification reasonably acceptable to the Trustee; or (ii) an Opinion
of Counsel satisfactory to the Trustee to the effect that such transfer
may be made without registration under the Securities Act (which
Opinion of Counsel shall not be an expense of the Issuer or any
Affiliate thereof that is a trust or of the Depositary, the Servicer,
the Trustee or the Note Registrar in their respective capacities as
such), together with the written certification(s) as to the facts
surrounding such transfer from the Noteholder desiring to effect such
transfer and/or such Noteholder's prospective transferee on which such
Opinion of Counsel is based. If such a transfer of any interest in a
Book-Entry Note is to be made without registration under the Securities
Act, the transferor will be deemed to have made each of the
representations and warranties set forth on Exhibit G hereto in respect
of such interest as if it was evidenced by a Definitive Note and the
transferee will be deemed to have made each of the representations and
warranties set forth in either Exhibit G hereto in respect of such
interest as if it was evidenced by a Definitive Note. None of the
Depositary, the Trustee or the Note Registrar is obligated to register
or qualify any Class of Notes under the Securities Act or any other
securities law or to take any action not otherwise required under this
Amended and Restated Indenture to permit the transfer of any Note or
interest therein without registration or qualification. Any Noteholder
or Note Owner desiring to effect such a transfer shall, and does hereby
agree to, indemnify the Depositary, the Trustee and the Note Registrar
against any liability that may result if the transfer is not so exempt
or is not made in accordance with such federal and state laws.
SECTION 2.03 EXECUTION, AUTHENTICATION, DELIVERY AND
DATING.
(a) The Notes shall be executed manually or by facsimile
signature on behalf of the Issuer by an Authorized Officer of the Issuer.
(b) Any Note bearing the signature of an individual who was at
the time of execution thereof a proper authorized signatory of the Issuer shall
bind the Issuer, notwithstanding that such individual did not hold such office
at the date of such Note.
(c) No Note shall be entitled to any benefit under this
Amended and Restated Indenture or any Supplement 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 Issuer
and delivered to the Trustee for authentication together with an Issuer 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 Issuer Request.
All Notes and the interest thereon shall be nonrecourse
obligations of the Issuer and shall be payable from and secured by the Trust
Property. The Notes shall never constitute obligations of the Trustee, the
Contributor, the Servicer, the Transferor, the Managing Member or of any
shareholder
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or any Affiliate of such parties (other than any Affiliate that guarantees any
Notes) or any officers, directors, employees or agents of any thereof, and no
recourse may be had under or upon any obligation, covenant or agreement of this
Amended and Restated Indenture, any Supplement or of any Notes, or for any claim
based thereon or otherwise in respect thereof, against any incorporator or
against any past, present, or future owner, partner of an owner or any officer,
employee or director thereof or of any successor entity, or any other Person,
either directly or through the Issuer, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise; it being expressly agreed that this Amended and Restated Indenture
and the obligations issued hereunder are solely obligations of the Issuer, and
that no such personal liability whatever shall attach to, or is or shall be
incurred by, any other Person under or by reason of this Amended and Restated
Indenture, any Supplement or any Notes or implied therefrom, or for any claim
based thereon or in respect thereof, all such liability and any and all such
claims being hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Amended and Restated Indenture and the
issue of such Notes. Except as provided in any Supplement, no Person other than
the Issuer shall be liable for any obligation of the Issuer under this Amended
and Restated Indenture or any Note or any losses incurred by any Noteholder.
SECTION 2.04 REGISTRATION, TRANSFER AND EXCHANGE.
(a) The Issuer 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 Issuer 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.
(b) Upon surrender for registration of transfer of any Note at
the Corporate Trust Office, the Issuer 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 the same class, of any authorized
denominations and of a like aggregate original principal amount.
(c) All Notes issued upon any registration of transfer or
exchange of Notes shall be the valid obligations of the Issuer, evidencing the
same debt, and entitled to the same benefits under this Amended and Restated
Indenture and any Supplement, 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 Issuer or the Trustee) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Issuer 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 Issuer or the Trustee may require payment
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,
but this provision shall not apply to any exchange pursuant to Section 9.04 not
involving any transfer.
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(f) If Notes are issued or exchanged in definitive form under
Section 2.02, such Notes will not be registered by the Trustee unless each
prospective initial Noteholder acquiring a Note, each prospective transferee
acquiring a Note and each prospective owner (or transferee thereof) of a
beneficial interest in Notes acquiring such beneficial interest provides the
Servicer, the Issuer, the Trustee and any successor Servicer with a
representation that the statements in either subsections (1) or (2) of Section
2.11 is an accurate representation as to all sources of funds to be used to pay
the purchase price of the Notes.
(g) No transfer of a Note shall be deemed effective unless the
registration and prospectus delivery requirements of Section 5 of the Securities
Act of 1933, as amended, and any applicable state securities laws are complied
with, or such transfer is exempt from the registration and prospectus delivery
requirements under said Securities Act and laws. In the event that a transfer is
to be made without registration or qualification, such Noteholder's prospective
transferee shall deliver to the Trustee an investment letter substantially in
the form of Exhibit G hereto (the "INVESTMENT LETTER"). The Trustee is not under
any obligation to register the Notes under said Act or any other securities law
or to bear any expense with respect to such registration by any other Person or
monitor compliance of any transfer with the securities laws of the United States
regulations promulgated in connection thereto or ERISA unless the Notes are
issued or exchanged in definitive form under Section 2.02.
(h) No Class E Noteholder shall transfer, sell, assign, pledge
or otherwise grant a security interest in ("TRANSFER"), a Class E Note to any
Person that is not a United States person within the meaning of section
7701(a)(30) of the Code. In the event of any Transfer with respect to a Class E
Note, the Trustee shall require, in addition to any other applicable
requirements set forth in this Amended and Restated Indenture, including without
limitation, the delivery of the Investment Letter, (A) the purchaser to execute
a Tax Certificate in substantially the form attached as Exhibit I hereto
certifying to the transferor and the Trustee as to the matters set forth therein
and (B) the transferee to certify, in form and substance reasonably acceptable
to the Trustee, that (1) the transferee is acquiring the Class E Note for its
own behalf and is not acting as agent or custodian for any other person or
entity in connection with such acquisition and (2) the transferee is a United
States person within the meaning of section 7701(a)(30) of the Code.
In addition, no Class E Noteholder shall Transfer a Class E
Note to any Person that is a grantor trust, partnership or S corporation (each a
"PASS-THROUGH ENTITY") if substantially all of the value of the assets of the
Pass-Through Entity is attributable to the Pass-Through Entity's ownership
interest in securities of the Issuer other than the Class A, Class B, Class C
and Class D Notes, nor may the Class E Notes be Transferred or sold to any
Person if, for the purposes of Section 7704 of the Code and the Treasury
regulations promulgated thereunder, after giving effect to such Transfer the
Issuer would be treated under the Code (by virtue of calculating the aggregate
number, Class E Noteholders and holders of the Class F Instrument (if issued))
as being owned by more than 100 persons. In the event of any Transfer with
respect to a Class E Note, the Trustee shall require, in addition to any other
applicable requirements set forth in this Agreement, including without
limitation, the delivery of the Investment Letter, (A) the purchaser to execute
a Tax Certificate substantially in the form attached as Exhibit I hereto in form
and substance reasonably acceptable to the Trustee certifying to the transferor
and the Trustee as to the matters set forth therein and (B) the transferee to
certify, in form and substance reasonably acceptable to the Trustee, that (1)
the transferee is acquiring the Class E Note for its own
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behalf and is not acting as agent or custodian for any other person or entity in
connection with such acquisition and (2) the transferee is (x) not a
Pass-through Entity or (y) is a Pass-through Entity but after giving effect to
such purchase of such Class E Note by such person, substantially all of the
value of the assets of the Pass-Through Entity is not attributable to the
Pass-Through Entity's ownership interest in the Class E Notes.
SECTION 2.05 MUTILATED, DESTROYED, LOST AND STOLEN NOTES.
(a) If any mutilated Note is surrendered to the Trustee, the
Issuer shall execute and the Trustee shall authenticate and deliver in exchange
therefor a replacement Note of the same class, of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
(b) If there shall be delivered to the Issuer 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 Issuer or the Trustee that such Note has been acquired by a bona
fide purchaser, the Issuer 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 the same class, 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 Issuer 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 Issuer or the Trustee may require the payment 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 in
lieu of any destroyed, lost or stolen Note shall constitute an original
additional contractual obligation of the Issuer, 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 Amended and Restated Indenture and any
Supplement equally and proportionately with any and all other Notes of the same
class, duly issued hereunder.
(f) The provisions of this Section 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 2.06 DELIVERY OF CLASS F INSTRUMENTS.
(a) The Issuer may issue the Class F Instruments upon delivery
to the Trustee of the following: (i) a Supplement in form reasonably
satisfactory to the Trustee executed by the Issuer, the Trustee and any other
applicable party and specifying the items provided in Section 2.06(c) and any
other terms (the "PRINCIPAL TERMS"), (ii) any related credit enhancement
agreements as contemplated by such Supplement, (iii) written confirmation from
each Rating Agency that the issuance of such Class F Instruments will not result
in a Ratings Effect with respect to any class of Notes; PROVIDED,
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HOWEVER, that no such written confirmation shall be required if the Class F
Instruments are issued on the Closing Date, (iv) such other closing documents,
certificates and Opinions of Counsel as may be required by this Amended and
Restated Indenture or the applicable Supplement and (v) an Officer's Certificate
from the Issuer stating that each of the conditions to the issuance of the Class
F Instruments set forth in this Section 2.06 have been satisfied. In no event
shall the Issuer issue a Class F Instrument to the order of the Issuer or an
Affiliate.
(b) Any such Class F Instrument shall be substantially in the
form of Exhibit F hereto and shall bear, upon its face, the designation for such
class to which it belongs so selected by the Issuer and set forth in the related
Supplement. All Class F Instruments shall be identical in all respects except
for the denominations thereof and shall be equally and ratably entitled among
themselves to the benefits of this Amended and Restated Indenture and any
Supplement thereof without preference, priority or distinction on account of the
actual title or times of authentication and delivery, all in accordance with the
terms and provisions of this Amended and Restated Indenture and such Supplement.
Notwithstanding anything contained in any Supplement, such Class F Instruments,
if any, shall be subordinate to the Class A Notes, the Class B Notes, the Class
C Notes, the Class D Notes and the Class E Notes, and no Class F Instruments
shall adversely affect the method of allocating Available Funds to Class A
Notes, the Class B Notes, the Class C Notes, the Class D Notes or the Class E
Notes for any period or alter or affect the manner or timing of distributions to
the Class A, Class B, Class C, Class D or Class E Noteholders or the rights or
priority of such holders in and to the Trust Property.
(c) Any Supplement relating to Class F Instruments shall
define or provide for, but shall not be limited to, the following Principal
Terms: (i) the name or designation of the Class F Instruments, (ii) the initial
balance of the Class F Instrument (or method for calculating such amount), (iii)
the rate of interest applicable to such Class F Instrument (or formula for the
determination thereof, which may provide that such rate is a floating rate),
(iv) the Class F Percentage, (v) the Stated Maturity Date, (vi) the Redemption
Price, if any, (vii) the Payment Dates and the date or dates from which interest
shall accrue and (viii) if the Class F Instruments are entitled to receive less
than the entire amount distributable to the Issuer or its designee pursuant to
Section 3.04(b)(xiii), the amount that the Class F Instruments are entitled to
receive; PROVIDED that no such Supplement shall conflict with the terms of this
Amended and Restated Indenture in any respect.
(d) The Issuer will not issue, sell, assign, pledge or
otherwise grant a security interest in, the Class F Instruments without an
Opinion of Counsel acceptable in form and substance to the Trustee and addressed
to the Trustee delivered by outside counsel to the Issuer to the effect that for
federal income tax purposes (i) such issuance, sale, assignment, pledge or grant
of a security interest in the Class F Instruments will not affect the tax
characterization of any of the Class A Notes, Class B Notes, Class C Notes or
Class D Notes as indebtedness or Class E Notes as indebtedness or partnership
interests, (ii) such issuance, sale, assignment, pledge or grant of a security
interest in the Class F Instruments will not constitute a deemed reissuance of
the Class A Notes, the Class B Notes, the Class C Notes, the Class D Notes or
the Class E Notes under Treasury Regulations ss.1.1001-3 and (iii) such
issuance, sale, assignment, pledge or grant of a security interest in the Class
F Instruments will not prevent the income from the Trust Property from being
properly included in the consolidated federal income tax return of the DVI
Group.
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SECTION 2.07 PAYMENT OF INTEREST AND PRINCIPAL; RIGHTS
PRESERVED.
(a) Any installment of interest or principal payable on any
Note that is paid or duly provided for by the Issuer 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
immediately available funds to the account and number specified in the Note
Register on such Record Date for such Person 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 therefor 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 for the payment of the final installment of
principal on such Note.
SECTION 2.08 PERSONS DEEMED OWNERS.
Prior to due presentment of a Note for registration or
transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the 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 Issuer, the
Trustee nor any agent of the Issuer or the Trustee shall be affected by notice
to the contrary.
SECTION 2.09 CANCELLATION.
All Notes surrendered for registration of transfer or exchange
or 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 Issuer may
at any time deliver to the Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer 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
Amended and Restated Indenture. All cancelled Notes held by the Trustee may be
disposed of in the normal course of its business or as directed by an Issuer
Order.
SECTION 2.10. NOTEHOLDER LISTS; COMMUNICATIONS TO
NOTEHOLDERS.
(a) 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. If the Trustee is not the Note Registrar, the Issuer
or other obligor, if any, shall furnish to the Trustee at least three Business
Days prior to each Record Date 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.
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(b) If any Noteholder (herein referred to as an "APPLICANT")
applies in writing to the Trustee, and such application states that the
applicant desires to communicate with other Noteholders with respect to their
rights under this Amended and Restated Indenture or under the Notes, then the
Trustee shall, within three Business Days after the receipt of such application,
afford such applicant(s) access to the information preserved at the time by the
Trustee in accordance with Section 2.10(a).
(c) Every Noteholder, by receiving and holding the same,
agrees with the Issuer and the Trustee that neither the Issuer nor the Trustee
nor any agent of either of them shall be held accountable by reason of the
disclosure of any such information as to the names and addresses of the
Noteholders in accordance with Section 2.10(b), regardless of the source from
which such information was derived, and that the Trustee shall not be held
accountable by reason of mailing any material pursuant to a request made under
Section 2.10(b).
SECTION 2.11. ERISA DEEMED REPRESENTATIONS
Each prospective initial Noteholder acquiring Notes, each
prospective transferee acquiring the Notes, and each prospective owner (or
transferee thereof) of a beneficial interest in Notes (each a "PROSPECTIVE
OWNER") will be deemed to have represented by such purchase to the Issuer, the
Trustee, the Servicer and any successor Servicer that either (1) it is not a
plan within the meaning of Section 3(3) of ERISA or Section 4975 of the Code
("PLAN") and is not directly or indirectly acquiring the Notes on behalf of, as
investment manager of, as named fiduciary of, as trustee of, or with the assets
of a Plan; or (2) the acquisition and holding of the Notes will not give rise to
a prohibited transaction under Section 406(a) of ERISA or Section 4975 of the
Code for which a statutory or administrative exemption is unavailable.
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ARTICLE III
ACCOUNTS; INVESTMENT OF MONEYS; COLLECTION
AND APPLICATION OF MONEYS; REPORTS
SECTION 3.01 ACCOUNTS; INVESTMENTS BY TRUSTEE.
(a) The Servicer, pursuant to a Lock-Box Agreement, shall
establish a Lock-Box Account, which account shall be an Eligible Deposit
Account, in the name of the Trustee for the benefit of the Noteholders. Each
Lock-Box Account shall be a segregated account initially established and
maintained with First Union National Bank, First National Bank of Chicago or
such other Lock-Box Bank as the Servicer may select; PROVIDED, HOWEVER, that the
Servicer (i) shall give the Trustee and the Rating Agencies written notice of
any change in the location of a Lock-Box Account and (ii) shall give at least 10
days' prior written notice of the new location to each Obligor.
In addition, on or before the Closing Date, the
Trustee shall establish in the name of the Trustee for the benefit of the
Noteholders and the Issuer to the extent of their interests therein as provided
in this Amended and Restated Indenture and in the Amended and Restated
Contribution and Servicing Agreement, the following accounts, which accounts
shall be trust accounts maintained at the Corporate Trust Office:
(i) Collection Account;
(ii) Distribution Account; and
(iii) Reserve Account.
Each of such accounts shall be established and maintained as an Eligible Deposit
Account. In addition, the Trustee shall establish a sub-account to the
Distribution Account for each Class of Notes (such sub-accounts the "CLASS A
DISTRIBUTION SUB-ACCOUNT," the "CLASS B DISTRIBUTION SUB-ACCOUNT," the "CLASS C
DISTRIBUTION SUB-ACCOUNT" the "CLASS D DISTRIBUTION SUB-ACCOUNT," the "CLASS E
DISTRIBUTION SUB-ACCOUNT" and, if necessary, the "CLASS F DISTRIBUTION
SUB-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 written direction of the Servicer
and the provisions of this Amended and Restated Indenture. All such amounts and
all investments made with such amounts, including all income and other gain from
such investments, shall be held by the Trustee in such accounts as part of the
Trust Property as herein provided, subject to withdrawal by the Trustee in
accordance with, and for the purposes specified in the written direction of the
Servicer pursuant to the provisions of, this Amended and Restated Indenture.
The Collection Account shall be comprised of more than one
such Eligible Deposit Account, but shall, for the purposes of the Transaction
Documents, be deemed to be one account. Funds shall be withdrawn equally from
each such Eligible Account that constitutes the Collection Account to make all
payments from the Collection Account in accordance with the terms and conditions
of this Amended and Restated Indenture.
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(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 written instructions of the
Servicer. Unless otherwise advised in writing by the Servicer, the Trustee shall
assume that any amount remitted to it is to be deposited into the Collection
Account pursuant to Section 3.03(b). 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 Property 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) The Trustee shall have no right of set-off with respect to
any Lock-Box Account, the Collection Account, the Reserve Account, the
Distribution Account, the Class A Distribution Sub- Account, the Class B
Distribution Sub-Account, the Class C Distribution Sub-Account, the Class D
Distribution Sub-Account, the Class E Distribution Sub-Account, the Class F
Distribution Sub- Account or any investment therein, or any Trust Property,
including collections or proceeds with respect thereto regardless of when or how
held by the Trustee and whether or not commingled.
(d) So long as no Default or Indenture Event of Default shall
have occurred and be continuing, the amounts in the Collection Account and the
Reserve Account shall be invested and reinvested by the Trustee pursuant to a
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 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 Servicer identified
therein, in each case in such amounts as such Servicer Order shall specify. The
Issuer, and any Class F Instrumentholder, agrees to report as income for
financial reporting and tax purposes (to the extent reportable) all investment
earnings on amounts in the Collection Account and the Reserve Account.
(e) In the event that either (i) the Servicer shall have
failed to give investment directions to the Trustee by 12:00 P.M. New York time
on any Business Day on which there may be uninvested cash or (ii) a Default or
Indenture Event of Default shall have occurred and be continuing, then the
Trustee shall invest and reinvest the funds then in the Collection Account, the
Reserve Account, as the case may be, to the fullest extent practicable in one or
more Eligible Investments as specified in paragraph (vii) of the definition of
Eligible Investments. All investments made by the Trustee shall mature no later
than the maturity date therefor permitted by Section 3.01(f).
(f) No investment of any amount held in the Collection Account
or the Reserve Account shall mature later than the second Business Day
immediately preceding the Payment Date which is scheduled to occur immediately
following the date of investment; all such investments shall be held to
maturity. All income or other gains from the investment of moneys deposited in
the Collection Account or the Reserve Account shall be deposited by the Trustee
in such account immediately upon receipt. Any net loss of principal (determined
on a month by month basis) resulting
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from such investment of amounts in the Collection Account or the Reserve Account
shall be charged to the Issuer, and the Issuer shall reimburse such account for
such loss within three Business Days.
(g) Any investment of any funds in the Collection Account or
the Reserve 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 (in its capacity as such) for the benefit of the
Noteholders or in the name of a nominee of the Trustee;
(ii) the investment earnings of any investment shall be
credited to the account for which such investment was made;
(iii) any certificate or other instrument evidencing
such investment shall be delivered directly to the Trustee or its agent
and the Trustee shall have sole possession of such instrument, and all
income on such investment; and
(iv) 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) The Trustee shall not in any way be held liable by reason
of any insufficiency in the Collection Account or the Reserve 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 losses or any
liquidation prior to its maturity or any investment made by it in accordance
with this Section 3.01 on the grounds that it could have made a more favorable
investment.
SECTION 3.02 RESERVED.
SECTION 3.03 COLLECTION OF MONEYS.
(a) Except as otherwise expressly provided herein, the Trustee
may demand payment or delivery of, and shall receive and collect, directly and
without intervention or assistance of any fiscal agent or other intermediary,
all money and other property payable to or receivable by the Trustee pursuant to
this Amended and Restated Indenture. The Trustee shall apply all such money
received by it as provided in this Amended and Restated Indenture. Except as
otherwise expressly provided in this Amended and Restated Indenture, if any
default occurs in the making of any payment or performance under any agreement
or instrument that is part of the Trust Property, the Trustee may take such
action as may be appropriate to enforce such payment or performance, including
the institution and prosecution of appropriate proceedings. Notwithstanding the
foregoing, the Trustee shall not be obligated to act as Servicer prior to its
being appointed Successor Servicer. Any such action shall be without prejudice
to any right to claim a Default or Event of Default under this Amended and
Restated Indenture and any right to proceed thereafter as provided in Article
VI. If at any time the Issuer shall receive any payment on or in respect of any
Contract or Equipment (including any Residual
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Payment), it shall hold such payment in trust for the benefit of the Trustee and
the Noteholders, shall segregate such payment from the other property of the
Issuer, and shall, within two Business Days of receipt, deliver such payment in
immediately available funds to the Trustee.
(b) If at any time the Trustee shall receive any payment on or
in respect of any Contract or Equipment (including any Residual Payment), it
shall, within two Business Days of receipt, deposit such payment by it into the
Collection Account in accordance with the written direction of the Servicer.
(c) If at any time the Trustee shall receive any Residual
Payment in respect of any Contract, it shall hold such Residual Payment in trust
for the benefit of the Contributor and deposit such Residual Payment as
instructed in writing by the Servicer, including, without limitation, as the
Servicer may so instruct as contemplated in Section 3.04(a)(v) hereof or to such
other designee or account as the Servicer instructs.
SECTION 3.04 COLLECTION ACCOUNT.
(a) The Trustee shall deposit the following into the
Collection Account in accordance with the written instructions delivered to the
Trustee by the Servicer:
(i) promptly upon receipt, each Contract Payment or
Servicer Advance received by the Trustee, including all Contract
Payments deposited with the Trustee by the Contributor on the Closing
Date;
(ii) promptly upon receipt, the proceeds of any purchase
of Contracts and Equipment pursuant to Section 4.02 of this Amended and
Restated Indenture;
(iii) promptly upon receipt, each Prepayment Amount or
Partial Prepayment Amount received by the Trustee and any amounts
remitted by the Contributor in connection with any substitution of
Contracts;
(iv) promptly upon receipt, any amount required to be
deposited in the Collection Account pursuant to this Amended and
Restated Indenture;
(v) promptly upon receipt, each Residual Payment
received by the Trustee;
(vi) promptly upon receipt, any proceeds received by the
Trustee pursuant to any insurance policy covering Equipment or any
other amounts received by the Trustee relating to a Contract or
Equipment; and
(vii) promptly upon receipt, any amounts the Trustee
receives pursuant to Section 3.03 of this Amended and Restated
Indenture.
(b) Unless the Notes have been declared due and payable
pursuant to Section 6.02 hereof and moneys collected by the Trustee are being
applied in accordance with Section 6.06 hereof, the Trustee shall by 3:00 P.M.,
New York City time, on each Payment Date disburse all Available
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Funds deposited in the Collection Account (including any investment income with
respect to monies on deposit in the Collection Account) in the amounts required,
and in the following order of priority in accordance with the Monthly Servicer
Report:
(i) to the Servicer, the Servicing Fee due to the
Servicer on such Payment Date and if the Servicer is no longer DVI, and
the Servicer has, in its good faith and reasonable business judgment,
deemed the Servicing Fee to be commercially unreasonable, then, to the
Servicer, the amount agreed upon between the then Servicer and the
Trustee, each in their good faith and commercially reasonable judgment,
as necessary to make the Servicing Fee commercially reasonable and to
cover the reasonable costs in transferring the servicing obligations;
(ii) to the Servicer, any unreimbursed Nonrecoverable
Advances or Servicer Advances previously made with respect to
Delinquent Contracts in accordance with Section 5.01 of the Amended and
Restated Contribution and Servicing Agreement;
(iii) first, to the Class A Distribution Sub-Account, in
the following order of priority, the sum of: (A) the Class A-1 Monthly
Interest; and (B) the Class A-1 Overdue Interest, if any; second, to
the Class A Distribution Sub-Account, in the following order of
priority, the sum of: (A) the Class A-2 Monthly Interest; and (B) the
Class A-2 Overdue Interest, if any; third, to the Class A Distribution
Sub-Account, in the following order of priority, the sum of: (A) the
Class A-3 Monthly Interest; and (B) the Class A-3 Overdue Interest, if
any; and fourth, to the Class A Distribution Sub-Account, in the
following order of priority, the sum of: (A) the Class A-4 Monthly
Interest; and (B) the Class A-4 Overdue Interest, if any;
(iv) to the Class B Distribution Sub-Account, in the
following order of priority, in the sum of:
(A) the Class B Monthly Interest; and
(B) the Class B Overdue Interest, if
any;
(v) to the Class C Distribution Sub-Account, in
the following order of priority, the sum of:
(A) the Class C Monthly Interest; and
(B) the Class C Overdue Interest, if
any;
(vi) to the Class D Distribution Sub-Account, in
the following order of priority, in the sum of:
(A) the Class D Monthly Interest; and
(B) the Class D Overdue Interest, if
any;
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(vii) to the Class E Distribution Sub-Account, in
the following order of priority, the sum of:
(A) the Class E Monthly Interest; and
(B) the Class E Overdue Interest, if
any;
(viii) PROVIDED that no Amortization Event shall have
occurred and be continuing, to the Class A Distribution Sub-Account, in
the following order of priority, the sum of:
(A) the Class A-1 Overdue Principal, if
any;
(B) the Class A-1 Monthly Principal;
(C) the Class A-2 Overdue Principal, if
any;
(D) the Class A-2 Monthly Principal;
(E) the Class A-3 Overdue Principal, if
any;
(F) the Class A-3 Monthly Principal;
(G) the Class A-4 Overdue Principal, if
any; and
(H) the Class A-4 Monthly Principal;
(ix) PROVIDED that no Amortization Event shall have
occurred and be continuing, to the Class B Distribution Sub-Account, in
the following order of priority, the sum of:
(A) the Class B Overdue Principal, if
any; and
(B) the Class B Monthly Principal;
(x) PROVIDED that no Amortization Event shall have
occurred and be continuing, to the Class C Distribution Sub-Account, in
the following order of priority, the sum of:
(A) the Class C Overdue Principal, if
any; and
(B) the Class C Monthly Principal;
(xi) PROVIDED that no Amortization Event shall have
occurred and be continuing, to the Class D Distribution Sub-Account, in
the following order of priority, the sum of:
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(A) the Class D Overdue Principal, if
any; and
(B) the Class D Monthly Principal;
(xii) PROVIDED that no Amortization Event shall have
occurred and be continuing, to the Class E Distribution Sub-Account, in
the following order of priority, the sum of:
(A) the Class E Overdue Principal, if
any; and
(B) the Class E Monthly Principal;
(xiii) PROVIDED that no Amortization Event shall
have occurred and be continuing, to the Reserve Account, the Reserve
Account Deposit Amount;
(xiv) if an Amortization Event shall have occurred
and is continuing and is not subject to a continuing waiver from
Noteholders evidencing not less than 662/3% of the Voting Rights, in
the following order of priority:
FIRST, to the Class A Distribution
Sub-Account the amount necessary to reduce the Class
A-1 Note Balance to zero; then, to the Class A
Distribution Sub- Account, the amount necessary to
reduce the Class A-2 Note Balance to zero; then, to
the Class A Distribution Sub-Account, the amount
necessary to reduce the Class A-3 Note Balance to
zero; and then, to the Class A Distribution Sub-
Account, the amount necessary to reduce the Class A-4
Note Balance to zero; PROVIDED, HOWEVER, that upon
the occurrence of a Subordination Deficiency Event,
after the Class A-1 Note Balance has been reduced to
zero and the Class A-2 Note Balance has been reduced
to zero, then the Class A-3 Note Balance and the
Class A-4 Note Balance will be paid on a PRO RATA,
PARI PASSU basis; and
SECOND, to the Class B Distribution
Sub-Account the amount necessary to reduce the Class
B Note Balance to zero; and
THIRD, to the Class C Distribution
Sub-Account the amount necessary to reduce the Class
C Note Balance to zero;
FOURTH, to the Class D Distribution
Sub-Account the amount necessary to reduce the Class
D Note Balance to zero; and
FIFTH, to the Class E Distribution
Sub-Account the amount necessary to reduce the Class
E Note Balance to zero;
(xv) any remaining Available Funds on deposit in the
Collection Account shall be paid to DVI Receivables Corp. VIII, as sole
member of the Issuer, or, if the Class F Instrument has been issued, to
the Class F Distribution Sub-Account.
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Noteholders evidencing not less than 662/3% of the Voting Rights shall have the
ability to waive or defer any Amortization Event by written notice delivered to
the Trustee. If at any time any amount or portion thereof previously distributed
pursuant to this Section 3.04(b) shall have been recovered, or shall be subject
to recovery, in any proceeding with respect to the Issuer or otherwise, then for
purposes of determining future distributions pursuant to this Section 3.04(b)
such amount or portion thereof shall be deemed not to have been previously so
distributed. The Trustee shall make the disbursements in accordance with the
Monthly Servicer Report on each Payment Date to the extent of Available Funds
for such Payment Date.
(c) If on any Payment Date, the Available Funds on deposit in
the Collection Account (the "DEPOSITED AVAILABLE FUNDS") are less than the sum
necessary to make the payments required pursuant to Section 3.04(b), clauses
(iii) through (xii) inclusive and clause (xiv), each as applicable (the sum of
such payments, the "PRIORITY PAYMENTS"), then the Trustee shall withdraw from
the Reserve Account, to the extent that such funds are on deposit in the Reserve
Account and after taking into account payments to be made pursuant to clauses
(i) and (ii) of Section 3.04(b), and either (A) if an automatic stay under
Section 362(a) of the Bankruptcy Code has not been applied to the Trust
Property, deposit into the Distribution Account for payment on such Payment Date
funds equal to the amount of the Priority Payments less any Deposited Available
Funds for payment in accordance with Section 3.04(b)(iii) through and including
(xii) and (xiv) hereof, as applicable or (B) if an automatic stay under Section
362(a) of the Bankruptcy Code has been applied to the Trust Property, deposit
into the Distribution Account for payment on such Payment Date funds equal to
the amount of payments required pursuant to Section 3.04(b), clauses (iii)
through (vii) less any Deposited Available Funds for payment in accordance with
Section 3.04(b)(iii) through and including (vii) hereof, as applicable (the
amount calculated pursuant to Clause (A) or (B), as applicable, the "AVAILABLE
RESERVE ACCOUNT FUNDS").
SECTION 3.05 CLASS A DISTRIBUTION SUB-ACCOUNT; CLASS B
DISTRIBUTION SUB-ACCOUNT; CLASS C DISTRIBUTION SUB-ACCOUNT; CLASS D DISTRIBUTION
SUB-ACCOUNT; CLASS E DISTRIBUTION SUB-ACCOUNT; CLASS F DISTRIBUTION SUB-ACCOUNT.
(a) On each Payment Date in accordance with the Monthly
Servicer Report the Trustee shall pay to the Class A Noteholders, from the
amounts then on deposit in the Class A Distribution Sub- Account and allocated
pursuant to Section 3.04 hereof, first to the Class A-1 Noteholders, the Class
A-2 Noteholders, the Class A-3 Noteholders and the Class A-4 Noteholders, PRO
RATA among the Noteholders of each such Class, in the following order of
priority:
(i) the Class A-1 Monthly Interest;
(ii) the Class A-1 Overdue Interest, if
any;
(iii) the Class A-2 Monthly Interest;
(iv) the Class A-2 Overdue Interest, if
any;
(v) the Class A-3 Monthly Interest;
(vi) the Class A-3 Overdue Interest, if
any;
(vii) the Class A-4 Monthly Interest; and
(viii) the Class A-4 Overdue Interest, if
any;
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second, to the Class A-1 Noteholders, Class A-2 Noteholders,
the Class A-3 Noteholders and the Class A-4 Noteholders, PRO RATA among the
Noteholders of each such Class, in the following order of priority:
(i) the Class A-1 Overdue Principal, if
any;
(ii) the Class A-1 Monthly Principal;
(iii) any additional Class A-1 principal
payable pursuant to the Amended and
Restated Indenture;
(iv) the Class A-2 Overdue Principal, if
any;
(v) the Class A-2 Monthly Principal;
(vi) any additional Class A-2 principal
payable pursuant to the Amended and
Restated Indenture;
(vii) the Class A-3 Overdue Principal, if
any;
(viii) the Class A-3 Monthly Principal;
(ix) any additional Class A-3 principal
payable pursuant to the Amended and
Restated Indenture;
(x) the Class A-4 Overdue Principal, if
any;
(xi) the Class A-4 Monthly Principal; and
(xii) any additional Class A-4 principal
payable under the Amended and
Restated Indenture;
PROVIDED, HOWEVER, that in the event that a Subordination Deficiency Event has
occurred and is continuing, after the Class A-1 Note Balance has been reduced to
zero, and the Class A-2 Note Balance has been reduced to zero, the Class A-3
Note Balance and the Class A-4 Note Balance will be paid on a PRO RATA, PARI
PASSU basis.
(b) On each Payment Date in accordance with the Monthly
Servicer Report the Trustee shall pay to the Class B Noteholders, PRO RATA among
the Noteholders of such Class, the amount then on deposit in the Class B
Distribution Sub-Account and allocated pursuant to Section 3.04 hereof. Such
payments to the Class B Noteholders shall be made in the following order of
priority:
(i) the Class B Monthly Interest;
(ii) the Class B Overdue Interest, if
any;
(iii) the Class B Overdue Principal, if
any;
(iv) the Class B Monthly Principal; and
(v) any additional principal payable to
the Class B Noteholders pursuant to
the Amended and Restated Indenture.
(c) On each Payment Date in accordance with the Monthly
Servicer Report the Trustee shall pay to the Class C Noteholders, PRO RATA among
the Noteholders of such Class, the amount then on deposit in the Class C
Distribution Sub-Account and allocated pursuant to Section 3.04 hereof. Such
payments to the Class C Noteholders shall be made in the following order of
priority:
(i) the Class C Monthly Interest;
(ii) the Class C Overdue Interest, if
any;
(iii) the Class C Overdue Principal, if
any;
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(iv) the Class C Monthly Principal; and
(v) any additional principal payable to
the Class C Noteholders pursuant to
the Amended and Restated Indenture.
(d) On each Payment Date in accordance with the Monthly
Servicer Report the Trustee shall pay to the Class D Noteholders, PRO RATA among
the Noteholders of such Class, the amount then on deposit in the Class D
Distribution Sub-Account and allocated pursuant to Section 3.04 hereof. Such
payments to the Class D Noteholders shall be made in the following order of
priority:
(i) the Class D Monthly Interest;
(ii) the Class D Overdue Interest, if
any;
(iii) the Class D Overdue Principal, if
any;
(iv) the Class D Monthly Principal; and
(v) any additional principal payable to
the Class D Noteholders pursuant to
the Amended and Restated Indenture.
(e) On each Payment Date in accordance with the Monthly
Servicer Report the Trustee shall pay to the Class E Noteholders, PRO RATA among
the Noteholders of such Class, the amount then on deposit in the Class E
Distribution Sub-Account and allocated pursuant to Section 3.04 hereof. Such
payments to the Class E Noteholders shall be made in the following order of
priority:
(i) the Class E Monthly Interest;
(ii) the Class E Overdue Interest, if
any;
(iii) the Class E Overdue Principal, if
any;
(iv) the Class E Monthly Principal; and
(v) any additional principal payable to
the Class E Noteholders pursuant to
the Amended and Restated Indenture.
(f) If the Class F Instruments have been issued, on each
Payment Date in accordance with the Monthly Servicer Report the Trustee shall
distribute to the Class F Instrumentholders, PRO RATA among all holders of Class
F Instruments, the amount then on deposit in the Class F Distribution Sub-
Account in the priority set forth in the Supplement.
SECTION 3.06 RESERVED.
SECTION 3.07 RESERVED.
SECTION 3.08 RESERVE ACCOUNT.
(a) On each Payment Date the Trustee shall promptly deposit
into the Reserve Account all amounts required to be deposited into the Reserve
Account and actually received by the Trustee pursuant to this Amended and
Restated Indenture. The obligation of the Trustee to deposit amounts into the
Reserve Account in accordance with the terms of this Amended and Restated
Indenture shall be limited to the deposit of amounts in the Collection Account
pursuant to Section 3.04(b) hereof. The Trustee shall not have any
responsibility to determine the amount or adequacy of funds on deposit in the
Reserve Account, or the amount of any deposits to or withdrawals from the
Reserve Account. The
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Issuer, or Class F Instrumentholder, if any, by its acceptance of the Class F
Instrument, agrees to treat such assets (and all earnings thereon) (the "RESERVE
ACCOUNT PROPERTY") as its assets (and earnings) for federal, state and local tax
purposes and not to sell, transfer or otherwise dispose of its interest therein.
(b) On each Payment Date, the Trustee shall, on the basis of
the Monthly Servicer Report, deposit in the Reserve Account, pursuant to Section
3.04(b), an amount equal to the Reserve Account Deposit Amount. If on any
Payment Date, Deposited Available Funds are less than the Priority Payments, the
Trustee shall withdraw from the Reserve Account the excess of the Priority
Payments over the Available Funds in accordance with Section 3.04(c) hereof. On
each Payment Date, if, after giving effect to all deposits and withdrawals
therefrom on such Payment Date, the balance in the Reserve Account is greater
than the Reserve Account Requirement, the Trustee shall release and, at the
instruction of the Servicer, shall pay the amount (such amount, a "RESERVE
ACCOUNT WITHDRAWAL") of the excess to the Issuer or its designee, or Class F
Instrumentholder, if any. Amounts properly paid to the Issuer or its designee,
or Class F Instrumentholder, if any, pursuant to this Section 3.08, either
directly from the Distribution Account without deposit in the Reserve Account or
from the Reserve Account, shall be deemed released from the Trust Property, and
the Issuer or its designee, or Class F Instrumentholder, if any, shall not in
any event thereafter be required to refund any such paid amounts.
(c) With respect to the Reserve Account Property, the Issuer
and the Trustee agree that any Reserve Account Property that is held in deposit
accounts shall be held solely in the name of the Trustee, on behalf of the
Noteholders. Each such deposit account shall be subject to the exclusive custody
and control of the Trustee, and the Trustee shall have sole signature authority
with respect thereto.
(d) Upon termination of this Amended and Restated Indenture,
any amounts on deposit in the Reserve Account, after payment of amounts due to
the Class A Noteholders, the Class B Noteholders, the Class C Noteholders, the
Class D Noteholders, the Class E Noteholders upon the Managing Member's written
request to the Trustee, shall be paid to the Managing Member (as sole beneficial
owner of the Issuer), or Class F Instrumentholders, if any.
SECTION 3.09 REPORTS; NOTICES OF CERTAIN PAYMENTS.
(a) Following each payment to the Noteholders, the Trustee
shall mail to the Issuer, Cede & Co. and the Rating Agencies, and make available
to each Noteholder, the Monthly Servicer Report furnished to the Trustee by the
Servicer on the Determination Date prior to such Payment Date (or if such report
has not been received, a written statement to such effect).
(b) The Trustee shall deliver to the Servicer, and within two
Business Days after the request of the Issuer, deliver to the Issuer a written
statement setting forth the amounts on deposit in the Collection Account and the
Reserve Account, and identifying the investments included therein.
SECTION 3.10. TRUSTEE MAY RELY ON CERTAIN INFORMATION FROM
CONTRIBUTOR AND SERVICER.
Pursuant to the Amended and Restated Contribution and
Servicing Agreement, the Contributor and the Servicer are 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
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III and in Article IV of this Amended and Restated Indenture. The Trustee shall
be entitled to rely conclusively in good faith on any such information and
calculations in the performance of its duties hereunder, (i) unless and until a
Responsible Officer of the Trustee has actual knowledge that such information or
calculations is or are incorrect, or (ii) unless there is a manifest error in
any such information; PROVIDED that the Trustee shall verify the mathematical
accuracy of the Class A-1 Monthly Principal, the Class A-2 Monthly Principal,
the Class A-3 Monthly Principal, the Class A-4 Monthly Principal, the Class B
Monthly Principal, the Class C Monthly Principal, the Class D Monthly Principal,
the Class E Monthly Principal, the Class A-1 Monthly Interest, the Class A-2
Monthly Interest, the Class A-3 Monthly Interest, the Class A-4 Monthly
Interest, the Class B Monthly Interest, the Class C Monthly Interest, the Class
D Monthly Interest and the Class E Monthly Interest to be paid on each Payment
Date.
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ARTICLE IV
CONTRACTS AND EQUIPMENT
SECTION 4.01 REPRESENTATIONS AND WARRANTIES OF THE
ISSUER.
The Issuer hereby restates and incorporates herein each of the
representations and warranties, IN MUTATIS MUTANDIS, set forth in Section 2.03
and Section 2.04 of the Amended and Restated Contribution and Servicing
Agreement. The Trustee shall rely on such representations and warranties in
accepting the Contracts and the other Trust Property in trust and authenticating
the Notes. Such representations and warranties shall speak as of the Closing
Date.
SECTION 4.02 PURCHASE UPON BREACH; AMENDED AND RESTATED
CONTRIBUTION AND SERVICING AGREEMENT.
The Issuer shall inform the Trustee promptly, in writing, upon
the discovery of a breach of any of the Contributor's representations and
warranties set forth in Section 2 of the Amended and Restated Contribution and
Servicing Agreement. With respect to any breach of the Contributor's
representations and warranties set forth in Section 2 of the Amended and
Restated Contribution and Servicing Agreement, which materially and adversely
affects the interest of the Noteholders in such Contract or Contracts, the
Issuer shall cause the Contributor to either (a) replace such Contract and the
related Equipment with a Substitute Contract in accordance with the provisions
of Section 5.03 of the Amended and Restated Contribution and Servicing Agreement
(and for the Transferor to receive from the Contributor and transfer to the
Issuer such Substitute Contract) or (b) purchase from the Transferor (which
Transferor shall purchase from the Issuer and resell to the Contributor) the
Contract and the security interest in the related Equipment that are affected by
such breach, unless, in each such instance such breach has been cured, or waived
in all respects by Noteholders evidencing more than 50% of the Voting Rights,
within 90 days following the Issuer's discovery or receipt of notice of such
breach. In the event of a repurchase of a Contract, the Issuer and the Managing
Member (as sole beneficial owner of the Issuer) shall cause the Contributor to
remit to the Trustee (upon written notice to the Trustee thereof) the Repurchase
Amount of such Contract (or, if such Contract is then a Defaulted Contract, an
amount equal to the Repurchase Amount as of the date such Contract first became
a Defaulted Contract, together with interest thereon at the Discount Rate from
the date such Contract first became a Defaulted Contract to the end of the month
in which the repurchase is to be made). The Trustee shall, to the extent
received, deposit such Repurchase Amounts and any cash received in connection
with a substitution in the Collection Account on or prior to 11:00 a.m. New York
City time on the second Business Day after receipt thereof. The sole remedy of
the Trustee or the Noteholders against the Contributor with respect to a breach
of a representation or a warranty set forth in Section 2 of the Amended and
Restated Contribution and Servicing Agreement, and against the Issuer or the
Transferor with respect to a breach under this agreement or the Amended and
Restated Subsequent Contract Transfer Agreement (the "SCTA") by reason of such
breach by the Contributor, shall be to require the Contributor to purchase or
substitute Contracts pursuant to the Amended and Restated Contribution and
Servicing Agreement, PROVIDED that the limitation contained in this sentence
shall not otherwise limit the rights of any such Person under Section 5.02 of
the Amended and Restated Contribution and Servicing Agreement. In the event that
the Contributor fails to purchase or substitute for any Contract that it is
required to substitute or repurchase pursuant to the Amended and Restated
Contribution and Servicing Agreement, the Trustee,
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upon the written direction of the Noteholders, shall enforce the Issuer's and
the Transferor's rights against the Contributor under and in accordance with the
terms of the Amended and Restated Contribution and Servicing Agreement, and the
SCTA, as assigned to the Trustee, to require the purchase or replacement of the
Contract.
SECTION 4.03 RELEASE OF CONTRACTS AND EQUIPMENT FOLLOWING
SUBSTITUTION OR PURCHASE.
In the event that (i) the Contributor shall have substituted a
Substitute Contract and a security interest in the Equipment subject thereto for
a Predecessor Contract and a security interest in the Equipment subject thereto
in accordance with Section 7 of the Amended and Restated Contribution and
Servicing Agreement, or (ii) the Contributor shall have purchased a Contract and
a security interest in the related Equipment in accordance with Section 5.03 of
the Amended and Restated Contribution and Servicing Agreement, the Predecessor
Contract or the repurchased Contract, as applicable, and the security interest
in the Equipment subject thereto, shall be released from the lien of this
Amended and Restated Indenture when the Trustee shall have (i) in the case of
the purchase of a Contract, deposited in the Collection Account all amounts
received pursuant to Section 5.03 of the Amended and Restated Contribution and
Servicing Agreement, (ii) in the case of a Substitute Contract, received a fully
executed original of the Substitute Contract Transfer Form and the Contract File
with respect to such Substitute Contract plus any cash amount delivered as
provided in Section 7.01(d) of the Amended and Restated Contribution and
Servicing Agreement, (iii) received written certification from an Authorized
Officer of the Servicer that there are no unreimbursed Servicer Advances with
respect to such Contract and (iv) delivered to the Contributor acknowledgment of
its receipt of the related Contract Files. If there are such unreimbursed
amounts, any proceeds received with respect to such Predecessor Contract or
repurchased Contract, as applicable, and the security interest in the related
Equipment shall be applied hereunder only to the extent necessary to repay such
Servicer Advances (and clause (iii) of the foregoing sentence shall be deemed
satisfied) and to reimburse the Collection Account for any other amounts drawn
thereon and the balance of such proceeds, if any, shall be paid to, or as
directed by, the Contributor.
In connection with the substitution of a Contract, if the
Discounted Contract Balance of such Substitute Contract is less than the
Discounted Contract Balance of the Predecessor Contract, the Contributor shall,
on the date of substitution, deposit an amount equal to such difference into the
Collection Account.
SECTION 4.04 RELEASE OF CONTRACTS AND EQUIPMENT UPON
FINAL CONTRACT PAYMENT.
(a) In the event that the Trustee shall have received written
certification from an Authorized Officer of the Servicer that the Trustee has
received from amounts paid by the Obligor or from the proceeds of the Equipment
subject to any Contract (i) the final Contract Payment due and payable under any
Contract (including, if applicable, any Purchase Option Payment paid by the
Obligor) or (ii) a Prepayment Amount in respect of any Contract and, following
such final Contract Payment or Prepayment Amount, no further payments on, or in
respect of, such Contract are or will be due and payable, such Contract and the
Equipment subject thereto shall be released from the lien of this Amended and
Restated Indenture except if a Restricting Event or an Amortization Event shall
have occurred and then be continuing.
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(b) If a Restricting Event or Amortization Event shall have
occurred and then be continuing, then each Contract and the security interest in
all Equipment (except for security interests relating to Equipment subject to a
conditional sales agreement or an equipment note) which would otherwise be
released from the lien of this Amended and Restated Indenture pursuant to this
Section 4.04 shall instead remain subject to such lien and all of the provisions
of this Amended and Restated Indenture, including, without limitation, Article
VI hereof.
SECTION 4.05 EXECUTION OF DOCUMENTS.
The Trustee shall promptly execute and deliver such documents
(which shall be furnished to the Trustee by the Issuer) and take such other
actions as the Issuer, by Issuer Request, may reasonably request to fully
effectuate the release from this Amended and Restated Indenture of any Contract
and the security interest relating to Equipment required to be so released
pursuant to Sections 4.03 and 4.04 hereof.
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ARTICLE V
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 under Section 10.01 of the Amended and Restated Contribution and
Servicing Agreement, the Trustee shall, upon the written request of Noteholders
evidencing not less than 66 2/3% of the Voting Rights give written notice to the
Servicer of the termination of all of the rights and obligations of the Servicer
(but none of the Contributor's obligations thereunder, which shall survive any
such termination) under the Amended and Restated Contribution and Servicing
Agreement and the Trustee shall act as successor Servicer in accordance with
Section 10 of the Amended and Restated Contribution and Servicing Agreement.
SECTION 5.02 SUBSTITUTE SERVICER.
Notwithstanding the provisions of Section 5.01, the Trustee
may, if it shall be unwilling or unable to act as the Successor Servicer in
accordance with Section 5.01, appoint a Successor Servicer in accordance with
the provisions of Section 10.03 of the Amended and Restated Contribution and
Servicing Agreement.
SECTION 5.03 NOTIFICATION TO NOTEHOLDERS AND RATING
AGENCIES.
Upon any termination of the Servicer or appointment of a
Successor Servicer, the Trustee shall give prompt notice of such termination,
resignation, discharge, removal or appointment, together with the conditions of
default, if applicable, to the Rating Agencies and each Noteholder in the manner
provided herein.
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ARTICLE VI
EVENTS OF DEFAULT; REMEDIES
SECTION 6.01 EVENTS OF DEFAULT.
"INDENTURE EVENT OF DEFAULT," wherever used herein, means any
one of the following (whatever the reason for such Indenture 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):
(i) default in the payment of (A) any interest payment
on any outstanding Class A Note, Class B Note, Class C Note, Class D
Note or Class E Note when it becomes due and payable, or (B) the then
outstanding principal balance of the Class A-1 Notes on the Class A-1
Stated Maturity Date, of the Class A-2 Note on the Class A-2 Stated
Maturity Date, of the Class A-3 Note on the Class A-3 Stated Maturity
Date, of the Class A-4 Note on the Class A-4 Stated Maturity Date, of
the Class B Notes on the Class B Stated Maturity Date, of the Class C
Notes on the Class C Stated Maturity Date, of the Class D Notes on the
Class D Stated Maturity Date or of the Class E Notes on the Class E
Stated Maturity Date or (C) any payment of principal of or interest on
any outstanding Note when it becomes due and payable to the extent that
sufficient Available Funds were on deposit in the Collection Account
and to the extent that sufficient Available Reserve Account Funds are
on deposit in the Reserve Account with respect to such Payment Date;
(ii) default in the performance, or breach, of any
covenant set forth in Section 8.04, 8.07(c) or 8.08;
(iii) default in the performance, or breach, of any
covenant of the Issuer in the Notes or this Amended and Restated
Indenture (other than a covenant described in (ii) above), or of any
party to the Amended and Restated Contribution and Servicing Agreement,
or the other Transaction Documents and continuance of such default or
breach for a period of 30 days after the earliest of (A) any officer of
the Transferor or the Issuer first acquiring knowledge thereof, (B) the
Trustee's giving written notice thereof to the Issuer or (C) the holder
of any Note giving written notice thereof to the Issuer;
(iv) if any representation or warranty of the Issuer,
the Transferor or the Contributor made in this Amended and Restated
Indenture, the SCTA or the Amended and Restated Contribution and
Servicing Agreement, respectively, or any other writing provided to the
Noteholders in connection with the foregoing documents 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 the Contributor in Section 2.03 or
2.04 of the Amended and Restated Contribution and Servicing Agreement,
with respect to any of the Contracts or the security interest in the
Equipment subject thereto shall not constitute an Indenture Event of
Default if the Contributor substitutes one or more Substitute Contracts
and the security interest in the Equipment subject thereto for such
Contract and a security interest in the related Equipment in accordance
with Section 7.01 of the Amended and Restated
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Contribution and Servicing Agreement, or repurchases a Contract and the
security interest in the related Equipment in accordance with Section
5.03 of the Amended and Restated Contribution and Servicing Agreement;
(v) the entry by a court having jurisdiction in the
premises of (A) a decree or order for relief in respect of the Issuer
in an involuntary case or proceeding under any applicable federal or
state bankruptcy, insolvency, reorganization, or other similar law or
(B) a decree or order adjudging the Issuer a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization,
arrangement, adjustment, or composition of or in respect of the Issuer
under any applicable federal or state law, or appointing a custodian,
receiver, liquidator, assignee, trustee, sequestrator, or other similar
official of the Issuer 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 90 consecutive
days; or
(vi) the commencement by the Issuer 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
Issuer 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 Issuer or of any substantial part of its property, or
the making by it of an assignment for the benefit of creditors, or the
Issuer's failure to pay its debts generally as they become due, or the
taking of company action by the Issuer in furtherance of any such
action.
SECTION 6.02 ACCELERATION OF MATURITY; RESCISSION AND
ANNULMENT.
(a) If an Indenture Event of Default occurs and is continuing,
of which a Responsible Officer of the Issuer written notice (PROVIDED that such
written notice need not have been received by the Trustee in connection with a
payment default as described in Section 6.01(i)), then and in every such case
the Trustee with the consent of Noteholders evidencing not less than 662/3% of
the Voting Rights may declare the unpaid principal amount of all the Notes to be
due and payable immediately, by a notice in writing to the Issuer, 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 Issuer.
(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, Noteholders
evidencing not less than 662/3% of the Voting Rights, by written notice to the
Issuer and the Trustee, may rescind and annul such declaration and its
consequences if:
(i) the Issuer has paid or deposited with the Trustee a
sum sufficient to pay:
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(A) all sums paid or advanced, together with
interest thereon, by the Trustee hereunder and the reasonable
compensation, expenses, disbursements, and advances, if any,
of the Trustee, its agents and counsel;
(B) all principal of any Notes which have
become due otherwise than by such declaration of acceleration,
and interest thereon from the date when the same first became
due at the applicable Note Rate; and
(C) all interest which has become due with
respect to the Notes;
(ii) all Indenture Events of Default, other than the
non-payment of the aggregate 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; and
(iii) the rescission would not conflict with any judgment
or decree of a court of competent jurisdiction.
No such rescission shall affect any subsequent Indenture Event of Default or
impair any right consequent thereon.
SECTION 6.03 OTHER REMEDIES.
(a) If an Indenture Event of Default occurs and is continuing
of which a Responsible Officer of the Trustee has received written notice
(PROVIDED that such written notice need not have been received by the Trustee in
the case of a payment default as described in Section 6.01(i)), the Trustee
shall give notice to each Noteholder as set forth in Section 7.02. The Trustee
shall then take such action, if any, as may be directed by Noteholders
evidencing not less than 662/3% of the Voting Rights.
(b) Following any acceleration of the Notes, the Trustee shall
have all of the rights, powers and remedies with respect to the Trust Property
as are available to secured parties under the Uniform Commercial Code or other
applicable law or as are otherwise available to it under applicable law to
protect and enforce the rights and remedies of the Trustee and the Noteholders
hereunder and under the other Transaction Documents; PROVIDED that, so long as
the Offered Notes are outstanding, the Trustee, in acting during the pendency of
an Indenture Event of Default shall act solely on behalf of the holders of the
Offered Notes and shall not take into account any Class F Instruments that may
have been issued in so acting. Such rights, powers and remedies may be exercised
by the Trustee in its own name as trustee of an express trust.
SECTION 6.04 TRUSTEE MAY 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 Issuer, the Transferor, the
Contributor, the Servicer or any other obligor upon the Notes or the other
obligations secured hereby or relating to the property of the Issuer, the
Transferor, the Contributor, 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
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whether the Trustee shall have made any demand on the Issuer, the Transferor,
the Contributor or the Servicer for the payment of overdue principal or overdue
interest or any such other obligation) shall be entitled and empowered, by
intervention in such proceeding or otherwise:
(i) to 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,
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
(iii) unless prohibited by applicable law and
regulations, to vote on behalf of the Noteholders in any election of a
trustee, a standby trustee or Person performing similar functions in
any such proceedings; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Trustee or the Noteholders allowed in any proceedings relative
to the Issuer, its creditors and its property;
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 7.06.
(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, except as aforesaid to vote for the election of a trustee in
bankruptcy or similar Person.
SECTION 6.05 TRUSTEE MAY ENFORCE CLAIMS WITHOUT
POSSESSION OF NOTES.
All rights of action and claims under this Amended and
Restated 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.
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SECTION 6.06 APPLICATION OF MONEY COLLECTED.
Any money, securities or property collected by the Trustee
pursuant to this Article, and any moneys, securities or property 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 (including the reasonable fees and
expenses of any counsel to the Trustee) and all other amounts
due the Trustee under Section 7.06 (the parties hereto agree
that when the Trustee renders services following an Indenture
Event of Default under Section 6.01 (v) or (vi), compensation
for such services and expenses in connection therewith are
intended to constitute administrative expenses under
applicable bankruptcy law);
SECOND, to the payment of all unreimbursed Servicer Advances
due to the Servicer;
THIRD, only in the event that DVI is no longer the Servicer,
and the Servicer has, in its good faith and reasonable
business judgment, deemed the Servicing Fee to be commercially
unreasonable, then, to the Servicer, the amount agreed upon
between the then Servicer and the Trustee, each in their good
faith and commercially reasonable judgment, as necessary to
make the Servicing Fee commercially reasonable and to cover
the reasonable costs in transferring the servicing
obligations;
FOURTH, to the payment of all accrued and unpaid interest on
the outstanding Class A Note Balance to the date of payment
thereof, ratably to each Class A Noteholder, without
preference or priority of any kind;
FIFTH, to the payment of all accrued and unpaid interest on
the outstanding Class B Note Balance to the date of payment
thereof, ratably to each Class B Noteholder, without
preference or priority of any kind;
SIXTH, to the payment of all accrued and unpaid interest on
the outstanding Class C Note Balance to the date of payment
thereof, ratably to each Class C Noteholder, without
preference or priority of any kind;
SEVENTH, to the payment of all accrued and unpaid interest on
the outstanding Class D Note Balance to the date of payment
thereof, ratably to each Class D Noteholder, without
preference or priority of any kind;
EIGHTH, to the payment of all accrued and unpaid interest on
the outstanding Class E Note Balance to the date of payment
thereof, ratably to each Class E Noteholder, without
preference or priority of any kind;
NINTH, to the payment of the outstanding Class A-1 Note
Balance, and any other amounts due to the Class A-1
Noteholders, ratably, without preference or priority of any
kind,
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until the Class A-1 Note Balance has been reduced to zero,
then to the payment of the outstanding Class A-2 Note Balance,
and any other amounts due to the Class A-2 Noteholders,
ratably, without preference or priority of any kind, until the
Class A-2 Note Balance has been reduced to zero, then to the
payment of the outstanding Class A-3 Note Balance, and any
other amounts due to the Class A-3 Noteholders, ratably,
without preference or priority of any kind, until the Class
A-3 Note Balance has been reduced to zero, then to the payment
of the outstanding Class A-4 Note Balance, and any other
amounts due to the Class A-4 Noteholders, ratably, without
preference or priority of any kind, until the Class A-4 Note
Balance has been reduced to zero (PROVIDED that a
Subordination Deficiency Event has not occurred and is
continuing, in which case the outstanding Class A-3 Note
Balance and the Class A-4 Note Balance shall be paid PRO RATA
in accordance with their respective outstanding Note
Balances);
TENTH, to the payment of the outstanding Class B Note Balance,
and any other amounts due to the Class B Noteholders ratably,
without preference or priority of any kind;
ELEVENTH, to the payment of the outstanding Class C Note
Balance, and any other amounts due to the Class C Noteholders
ratably, without preference or priority of any kind;
TWELFTH, to the payment of the outstanding Class D Note
Balance, and any other amounts due to the Class D Noteholders
ratably, without preference or priority of any kind;
THIRTEENTH, to the payment of the outstanding Class E Note
Balance, and any other amounts due to the Class E Noteholders
ratably, without preference or priority of any kind;
FOURTEENTH, to the payment of all accrued and unpaid interest
on outstanding Class F Instruments, if any, to the date of
payment thereof, ratably to each Holder of the Class F
Instruments without preference or priority of any kind;
FIFTEENTH, to the payment of the outstanding principal balance
of the Class F Instruments, if any, and any other amounts due
to the Holders of any Class F Instruments ratably, without
preference or priority of any kind;
SIXTEENTH, in the event that DVI is the Servicer, to the
payment of all unreimbursed Servicing Fees due to the
Servicer; and
SEVENTEENTH, to the payment of the remainder, if any, to, or
at the order of, the Issuer.
SECTION 6.07 LIMITATION ON SUITS.
The holder of any Note shall not have any right to institute
any proceeding, judicial or otherwise, with respect to this Indenture or the
Notes, 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 Indenture Event of Default;
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(ii) the Noteholders evidencing not less than 25% of the
Voting Rights shall have made written request to the Trustee to
institute proceedings in respect of such Indenture Event of Default in
its own name as Trustee hereunder;
(iii) such Noteholder or Noteholders have offered to the
Trustee adequate indemnity 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 Noteholders evidencing not less
than 662/3% of the Voting Rights;
it being understood and intended that no one or more Noteholder shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Amended and Restated Indenture to affect, disturb, or prejudice the rights
of any other Noteholder, or to obtain or to seek to obtain priority or
preference over any other Noteholder or to enforce any right under this Amended
and Restated Indenture, except in the manner herein provided. It is further
understood and intended that so long as any portion of the Notes remains
outstanding, the Servicer shall not have any right to institute any proceeding,
judicial or otherwise, with respect to this Amended and Restated Indenture
(other than for the enforcement of Sections 3.04(b) and 4.04) or for the
appointment of a receiver or trustee, or for any other remedy hereunder.
SECTION 6.08 UNCONDITIONAL RIGHT OF NOTEHOLDERS TO
RECEIVE PAYMENT.
Notwithstanding any other provision in this Amended and
Restated Indenture, other than the provisions hereof establishing priorities of
payment or limiting the right to recover amounts due on the Notes to recoveries
from the Trust Property, the holder of any Note shall have the absolute and
unconditional right to receive payment of the principal of and interest on such
Note as such principal and interest becomes due on the Payment Dates for such
payments, including the Stated Maturity Date for the applicable Class, 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 Amended and Restated 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 Issuer, 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 shall continue as though no such proceeding had been
instituted.
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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 2.05, 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 Indenture Event of
Default shall impair any such right or remedy or constitute a waiver of any such
Indenture Event of Default or an acquiescence therein. Every right and remedy
given by 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 Amended and
Restated Indenture, until such time as the conditions specified in Section 11.01
have been satisfied in full, Noteholders evidencing not less than 662/3% of the
Voting Rights 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 Amended and Restated Indenture;
(ii) the Trustee shall not be required to follow any
such direction which the Trustee believes may be unduly prejudicial to
the rights of another Noteholder not joining in such direction or which
the Trustee believes might result in any personal liability on the part
of the Trustee for which the Trustee is not indemnified to its
reasonable satisfaction; 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 DEFAULTS AND EVENTS OF DEFAULT.
(a) Subject to the provisions of Sections 6.08 and 9.01,
Noteholders evidencing more than 50% of the Voting Rights, may, by one or more
instruments in writing, waive an existing Default or Indenture Event of Default
hereunder and its consequences, except a continuing Indenture Event of Default:
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(i) in respect of the payment of the principal of or
interest on any outstanding 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 IX 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 Issuer to the Trustee. Upon any such waiver, such Indenture
Event of Default shall cease to exist and shall be deemed to have been cured,
for every purpose of this Amended and Restated Indenture; but no such waiver
shall extend to any subsequent or other Indenture Event of Default or impair any
right consequent thereon.
SECTION 6.14 WAIVER OF STAY OR EXTENSION LAWS.
The Issuer 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 Amended and Restated Indenture; and the
Issuer (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 6.15 SALE OF TRUST PROPERTY.
(a) The power to effect any sale of any portion of the Trust
Property pursuant to Section 6.03 shall not be exhausted by any one or more
sales as to any portion of the Trust Property remaining unsold, but shall
continue unimpaired until the entire Trust Property 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 with Section 6.12, postpone any public sale
by public announcement made at the time and place of such sale.
(b) To the extent permitted by applicable law, the Trustee
shall not in any private sale sell the Trust Property, or any portion thereof,
unless either (i) until such time as the conditions specified in Section
11.01(a) have been satisfied in full, Noteholders evidencing not less than
662/3% of the Voting Rights consent to or direct the Trustee 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 all Class
A Notes, Class B Notes, Class C Notes, Class D Notes and Class E Notes then
outstanding 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.
(c) In connection with a sale of all or any portion of the
Trust Property:
(i) any one or more Noteholders or the Trustee 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,
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in paying the purchase money therefor, 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 such 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 Property in connection with a sale thereof;
(iii) the Trustee is hereby irrevocably appointed the
agent and attorney-in-fact of the Issuer to transfer and convey its
interest in any portion of the Trust Property in connection with a sale
thereof, and to take all action necessary to effect such sale; and
(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 Property shall be commercially reasonable.
(e) The provisions of this Section 6.15 shall not be construed
to restrict the ability of the Trustee to exercise any rights and powers against
the Issuer or the Trust Property that are vested in the Trustee by this Amended
and Restated Indenture, including, without limitation, the power of the Trustee
to proceed against the collateral subject to the lien of this Amended and
Restated Indenture and to institute judicial proceedings for the collection of
any deficiency remaining thereafter.
SECTION 6.16 UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under
this Amended and Restated Indenture or in any suit against the Trustee for any
action taken or omitted by it as Trustee, a court may in its discretion require
the filing by any party litigant in the suit of an undertaking to pay the costs
of the suit, and the court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in the suit,
having due regard to the merits and good faith of the claims or defenses made by
the party litigant. This Section 6.16 does not apply to a suit by the Trustee, a
suit by a Noteholder pursuant to Sections 6.07 and 6.08, or a suit by any
Noteholder or group of Noteholders of more than 10% in principal amount of all
Class A Notes, Class B Notes, Class C Notes, Class D Notes and Class E Notes
then outstanding.
ARTICLE VII
THE TRUSTEE
SECTION 7.01 CERTAIN DUTIES AND RESPONSIBILITIES.
(a) Except during the continuance of an Indenture Event of
Default:
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(i) the Trustee undertakes to perform only those duties
that are specifically set forth in this Amended and Restated Indenture
and no others and no covenants or duties shall be implied herein in
connection with 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,
statements, opinions, reports or documents furnished to the Trustee and
conforming to the requirements of this Amended and Restated Indenture.
The Trustee, however, shall examine the same to determine whether or
not they conform to the requirements of this Amended and Restated
Indenture.
(b) If an Indenture Event of Default has occurred and is
continuing, the Trustee shall exercise its rights and powers vested in it by
this Amended and Restated Indenture and use the same degree of care and skill in
their exercise as a prudent person would exercise or use under the circumstances
in the conduct of his own affairs.
(c) No provision of this Amended and Restated 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 7.01;
(ii) the Trustee shall not be liable for any error in
judgment made in good faith by a Responsible Officer, unless it is
proved 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 directions received by it pursuant to Section 6.12 or 6.13;
and
(iv) no provision of this Amended and Restated Indenture
shall require the Trustee to expend or risk its own funds or otherwise
incur any personal 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 indemnity reasonably satisfactory to it against such risk or
liability is not assured to it.
(d) Whether or not therein expressly so provided, every
provision of this Amended and Restated 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 five Business Days after a Responsible Officer receives
written notice or is otherwise notified of the occurrence of any Default or
Indenture Event of Default hereunder or Servicer Event of Default under the
Amended and Restated Contribution and Servicing Agreement, the Trustee
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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, the Issuer, the Servicer, the Rating Agencies and the
Contributor notice of such Default, Indenture Event of Default or Servicer Event
of Default hereunder known to the Trustee, unless such Default, Indenture Event
of Default or Servicer Event of Default shall have been cured or waived.
SECTION 7.03 CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of Section 7.01:
(i) the Trustee may rely conclusively 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;
(ii) any request or direction of the Issuer mentioned
herein shall be sufficiently evidenced by an Issuer Request or Issuer
Order and any action of the Issuer may be sufficiently evidenced by an
Issuer Order;
(iii) whenever in the administration of this Amended and
Restated 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
Officer's Certificate;
(iv) the Trustee may consult with counsel as to legal
matters and the advice or opinion 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;
(v) the Trustee shall be under no obligation to
exercise any of the rights or powers vested in it by this Amended and
Restated Indenture at the request or direction of any of the
Noteholders pursuant to this Amended and Restated Indenture, unless
such Noteholders shall have offered to the Trustee security or
indemnity reasonably satisfactory to it against the costs, expenses and
liabilities which might be incurred by it in compliance with such
request or direction;
(vi) prior to the occurrence of an Indenture Event of
Default and after the curing or waiving of all Indenture Events of
Default, 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, other than to examine such documents to determine whether
they conform as to form to the requirements of this Amended and
Restated Indenture, unless requested in writing to do so by the
Noteholders evidencing more than 50% of the Voting Rights; PROVIDED
that, if the payment within a reasonable time to the Trustee of the
costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of
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the Trustee, not reasonably assured to the Trustee by the security
afforded to it by the terms of this Amended and Restated Indenture, the
Trustee may require indemnity reasonably satisfactory to it against
such expenses or liabilities as a condition to proceeding; the
reasonable expenses of every such examination shall be paid by the
Issuer or, if paid by the Trustee or any predecessor trustee, shall be
promptly repaid by the Issuer upon demand; and
(vii) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents, custodians, nominees or attorneys and the Trustee shall
not be responsible for any misconduct or negligence on the part of any
agent, custodian, nominee or attorney appointed with due care by it
hereunder.
SECTION 7.04 TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or
adequacy of this Amended and Restated Indenture (except as against itself), the
SCTA, the Amended and Restated Contribution and Servicing Agreement, or the
Notes and it shall not be responsible for any statement in the Notes other than
its certificate of authentication or in any document used in the sale of the
Notes. The Trustee shall have no responsibility for, or duty, or liability in
connection with performance by the Servicer, and shall have no obligation to
monitor the performance of the Servicer. The Trustee shall not be accountable
for the use or application by the Issuer of the Notes or the proceeds thereof.
SECTION 7.05 MONEY HELD IN TRUST.
Money and investments held by the Trustee or other paying
agent shall be held in trust in one or more Eligible Deposit Accounts as
required hereunder. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed with Issuer.
SECTION 7.06 COMPENSATION, REIMBURSEMENT, ETC.
(a) Pursuant to the Amended and Restated Contribution and
Servicing Agreement, the Servicer has agreed:
(i) to pay to the Trustee from time to time such
compensation for all services rendered by it hereunder as the Servicer
and the Trustee have agreed in writing prior to the Closing Date (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust), such payment to be
made independent of the other payment obligations of the Servicer
hereunder;
(ii) except as otherwise expressly provided herein,
to reimburse the Trustee upon its request for all reasonable expenses,
disbursements, and advances incurred or made by the Trustee in
accordance with any provision of this Amended and Restated 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;
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(iii) to pay the Trustee its annual administrative
fee on the Closing Date;
(iv) to pay the reasonable fees and expenses of
Trustee's counsel on the Closing Date; and
(v) to pay the reasonable annual administrative fee
of each Lock-Box Bank.
(b) The Trustee hereby acknowledges and agrees that if the
Servicer fails to pay the amounts set forth in Section 7.06(a) of this Amended
and Restated Indenture, the Trustee will continue to perform its obligations
under this Amended and Restated Indenture, regardless of the Servicer's failure
to pay such amounts, until the appointment of a successor Trustee reasonably
satisfactory to the Noteholders in accordance with Section 7.08 of this Amended
and Restated Indenture; PROVIDED, HOWEVER, that in such event, the Trustee shall
withhold amounts otherwise payable to it pursuant to Section 7.06(a) hereof from
amounts payable to the Servicer pursuant to Section 3.04(b)(i).
SECTION 7.07 ELIGIBILITY; DISQUALIFICATION.
The Trustee hereunder (a) shall at all times be a national
banking association organized and doing business under the laws of the United
States of America or any state thereof authorized under such laws to exercise
corporate trust powers, having a combined capital and surplus of at least
$100,000,000 or shall be a member of a bank holding system, the aggregate
combined capital and surplus of which is at least $100,000,000, PROVIDED that
unless the Trustee is U.S. Bank Trust National Association, the Trustee, or the
bank holding company system of which the Trustee is a member must have a
long-term unsecured debt rating of at least " A " from the Rating Agencies;
PROVIDED, FURTHER, that if the Trustee is U.S. Bank Trust National Association,
the Trustee, or the bank holding company system of which the Trustee is a
member, shall have a long-term unsecured debt rating of at least "Baa3" from
Moody's, "BBB-" from Duff & Phelps or "BBB" from Fitch IBCA or a short-term
unsecured rating of "Prime-3" from "Moody's" or "F1" from Fitch IBCA, and (b)
shall be subject to supervision or examination by Federal or state authority
and, in the case of any successor Trustee subject to regulations regarding
fiduciary funds on deposit substantially similar to 12 CFR ss. 9.10(b). If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then
for the purpose of this Section 7.07, 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. In case at any time the
Trustee shall cease to be eligible in accordance with the provisions of this
Section 7.07, the Trustee shall resign immediately in the manner and with the
effect specified in Section 7.08.
SECTION 7.08 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 a successor Trustee reasonably
satisfactory to Noteholders evidencing more than 50% of the Voting Rights under
Section 7.09.
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(b) Subject to Section 7.08(a) the Trustee may resign at any
time by giving written notice thereof to the Issuer and by mailing notice of
resignation by first-class mail, postage prepaid, to the Rating Agencies and the
Noteholders at their addresses appearing on the Note Register.
(c) The Trustee may be removed at any time by written notice
from Noteholders evidencing more than 50% of the Voting Rights delivered to the
Trustee and the Issuer. The Issuer, with the consent of Noteholders evidencing
more than 50% of the Voting Rights, may remove the Trustee if:
(i) the Trustee fails to comply with Section
7.07;
(ii) the Trustee is adjudged bankrupt or
insolvent;
(iii) a receiver or other public officer takes
charge of the Trustee or its property; or
(iv) the Trustee becomes incapable of acting.
(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 Issuer, with the consent of Noteholders evidencing more than 50%
of the Voting Rights by an act of the Issuer, shall promptly appoint a successor
Trustee.
(e) If no successor Trustee shall have been so appointed by
the Issuer as hereinabove 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 Issuer 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 to the
Rating Agencies. Each notice shall include the name of the successor Trustee and
the address of its Corporate Trust Office.
(g) A Trustee who has resigned or been removed shall be
subject to TIA Section 311(a) to the extent indicated therein.
SECTION 7.09 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Issuer and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
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; PROVIDED that on request of
the Issuer or the successor Trustee, such retiring Trustee shall, upon payment
of its charges, 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
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and deliver to such successor Trustee all property and money held by such
retiring Trustee hereunder. Upon request of any such successor Trustee, the
Issuer 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 and no reduction in the then current ratings, if
any, on the Notes has occurred as a result of such appointment.
SECTION 7.10. 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.
SECTION 7.11 CO-TRUSTEES AND SEPARATE TRUSTEES.
(a) At any time or times, for the purpose of meeting the legal
requirements of any jurisdiction in which any of the Trust Property may at the
time be located, the Issuer and the Trustee shall have power to appoint, and,
upon the written request of the Trustee or the Noteholders evidencing more than
50% of the Voting Rights, the Issuer shall for such purpose join with the
Trustee in the execution, delivery, 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 Property, 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 7.11. If the Issuer does not join in such
appointment within fifteen days after the receipt by it of a request so to do,
or in case an Indenture Event of Default has occurred and is continuing, the
Trustee alone shall have power to make such appointment.
(b) Should any written instrument from the Issuer 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 Issuer.
(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
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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 Issuer evidenced by
an Issuer Order, may accept the resignation of or remove any co-trustee
or separate trustee appointed under this Section 7.11, and, in case an
Indenture 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 Issuer.
Upon the written request of the Trustee, the Issuer 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
7.11.
(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 and supervised 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 7.12 TRUSTEE TO HOLD CONTRACTS.
On or prior to the Closing Date, the Contributor, on behalf of
the Issuer, shall deliver to the Trustee (or its designee) the sole original,
manually executed counterpart of each Contract (or, if the original Contract is
in the form of a schedule or supplement to a master lease, all original
counterparts of such schedule or supplement previously in the possession of the
Contributor or the Issuer together with a true and correct copy of such master
lease) that constitutes "chattel paper" or an "instrument," as such terms are
defined in the UCC. The Trustee (or its designee) shall hold such documents
until such time as such Contract is released from the lien of this Amended and
Restated Indenture pursuant to the provisions hereof.
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SECTION 7.13 FINANCING STATEMENTS.
The Trustee shall execute such UCC financing statements and
continuation statements as shall have been prepared by the Servicer and as shall
be necessary and shall furnish the Servicer with such limited powers of attorney
or other documents necessary or appropriate to enable the Servicer to fulfill
its obligations under Section 4 of the Amended and Restated Contribution and
Servicing Agreement and to carry out its servicing and administration duties
under the Amended and Restated Contribution and Servicing Agreement.
SECTION 7.14 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.
(a) On and after the time the Servicer receives a notice of
termination pursuant to Section 10.02 of the Amended and Restated Contribution
and Servicing Agreement, the Trustee (subject to subsection (b) hereof) shall be
the successor in all respects to the Servicer in its capacity as servicer under
the Amended and Restated Contribution and Servicing Agreement of the Contracts
and, to such extent, shall be subject to all the responsibilities, duties and
liabilities (other than the duty to advance funds and indemnify) relating
thereto placed on the Servicer by the terms and provisions thereof (but not the
obligations of the Contributor contained therein which shall survive any such
termination as provided in Section 10.02 thereof) and shall be entitled to
receive from the Issuer the Servicing Fee and other servicing compensation
provided for in Section 4.04 of the Amended and Restated Contribution and
Servicing Agreement; PROVIDED that the Trustee shall in no way be responsible or
liable for any action or actions of the Servicer before the time the Servicer
receives such a notice of termination.
(b) The Trustee may, if it is unwilling or unable to act as
the successor Servicer, give notice of such fact to each Noteholder and (i)
appoint a successor Servicer with a net worth of at least $15,000,000 and
reasonably acceptable to Noteholders evidencing more than 50% of the Voting
Rights and whose regular business includes the servicing of a similar type of
contracts and the financing of medical diagnostic imaging equipment, as the
successor Servicer under the Amended and Restated Contribution and Servicing
Agreement, to assume all of the rights and obligations of the Servicer
thereunder, including, without limitation, the Servicer's right thereunder to
receive the Servicing Fee (but not the obligations of the Contributor contained
therein) or, (ii) if no such institution is so appointed, petition a court of
competent jurisdiction to appoint an institution meeting such criteria as the
Servicer thereunder. Pending appointment of a successor Servicer under the
Amended and Restated Contribution and Servicing Agreement, the Trustee shall act
in such capacity as hereinabove provided. In connection with such appointment
and assumption, the Trustee shall cause such successor Servicer to enter into a
servicing agreement substantially in the form of the Amended and Restated
Contribution and Servicing Agreement, except that such agreement shall not
include any of the Contributor's representations, warranties or obligations and
the Trustee may make arrangements for the compensation of such successor
Servicer out of payments on Contracts and the related Contracts as it and such
successor Servicer shall agree; PROVIDED, HOWEVER, that no such compensation
shall be in excess of that provided in Section 4.04 of the Amended and Restated
Contribution and Servicing Agreement.
SECTION 7.15 REPORTS BY TRUSTEE TO HOLDERS.
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If required by the TIA, within 60 days after each Payment Date
beginning with June 14, 2000, the Trustee shall mail to each Noteholder a brief
report dated as of such Payment Date that complies with TIA Section 313(a).
SECTION 7.16 PREFERENTIAL COLLECTION OF CLAIMS AGAINST
ISSUER.
The Trustee is subject to and shall comply with TIA Section
311(a), excluding any creditor relationship listed in TIA Section 311(b).
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ARTICLE VIII
COVENANTS
SECTION 8.01 PAYMENT OF PRINCIPAL AND INTEREST.
The Issuer will duly and punctually pay the principal of and
interest on the Notes in accordance with the terms of the Notes and this Amended
and Restated Indenture. An installment of interest shall be considered paid on
the date it is due if the Trustee holds on that date money designated for and
sufficient to pay the installment.
SECTION 8.02 MAINTENANCE OF OFFICE OR AGENCY; CHIEF
EXECUTIVE OFFICE.
(a) The Issuer will maintain in the Commonwealth of
Pennsylvania an office or agency where notices and demands to or upon the Issuer
in respect of the Notes and this Amended and Restated Indenture may be served.
(b) The chief executive office of the Issuer, and the office
at which the Issuer maintains its records with respect to the Contracts, the
Equipment, and the transactions contemplated hereby, is located in Doylestown,
Pennsylvania. The Issuer will not change the location of such office without
giving the Trustee and each Noteholder at least 60 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 3.04(b) or Section 6.06 shall be made on behalf of the
Issuer by the Trustee, and no amounts so withdrawn from the Collection Account
for payments of Notes shall be paid over to the Issuer under any circumstances
except as provided in this Section 8.03.
(b) In making payments hereunder, the Trustee will:
(i) allocate all sums received for payment to the
Noteholders on each Payment Date in accordance with the terms of this
Amended and Restated Indenture;
(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, in each case, consistent with the
treatment of the Notes as indebtedness.
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(c) 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 two 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 Issuer upon request; and such Noteholder
shall thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof, and all liability of the Trustee with respect to such trust
money shall thereupon cease.
SECTION 8.04 ISSUER EXISTENCE; ETC.
(a) The Issuer will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence as a
Delaware limited liability company and the rights, licenses and franchises of
the Issuer, and will obtain and preserve its qualification to do business in
each jurisdiction in which such qualification is or shall be necessary to
protect the validity and enforceability of the Amended and Restated Indenture,
the Notes, or any of the Contracts.
(b) The Issuer shall at all times observe and comply in all
material respects with (i) its limited liability company operating agreement as
in effect on the date hereof, (ii) all laws, regulations and court orders
applicable to it, (iii) all requirements of law in the declaration and payment
of any distributions on its Units, and (iv) all requisite and appropriate
formalities (including, without limitation, obtaining the consent of the
Managing Member as its sole beneficial owner to authorize Issuer action as
required, and as otherwise required by law) in the management of its business
and affairs and the conduct of the transactions contemplated hereby, by the SCTA
and by the Amended and Restated Contribution and Servicing Agreement. The SCTA
limits the Issuer's activities to the purchases of assets, issuance of
securities, and activities incidental thereto. No Affiliate of the Issuer pays
the expenses of the Issuer except as contemplated in the Transaction Documents,
and no Affiliate of the Issuer guarantees any obligation of the Issuer. Other
than the purchase, contribution, substitution or sale of assets, the Issuer has
no intercorporate transactions with DVI.
(c) The Issuer will, at all times: (i) maintain (A) financial
books and records separate from those of any other Person and (B) minutes of its
meetings and other proceedings of its member(s); (ii) continuously maintain the
resolutions, agreements and other instruments underlying the transactions
contemplated hereby, by the SCTA and by the Amended and Restated Contribution
and Servicing Agreement, as official records of the Issuer; (iii) act solely in
its name to maintain an arm's-length relationship with the Contributor and its
Affiliates; (iv) pay all of its operating expenses and liabilities from its own
funds; (v) maintain an office and telephone number separate from that of the
Contributor, the Managing Member and the Transferor, (vi) maintain its assets
separately from the assets of the Contributor and (vii) characterize the
Contributor, the Managing Member and the Transferor as separate entities in any
report, tax return, financial statement, other accounting or business
transaction.
(d) The Issuer shall conduct its business solely in its own
name so as to not mislead others as to the identity of the trust with which
those others are concerned, and particularly will avoid the appearance of
conducting business on behalf of the Contributor or any of its Affiliates or
that the assets of the Issuer are available to pay the creditors of the
Contributor 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 Issuer.
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(e) The Issuer will be operated so as not to be substantively
consolidated for bankruptcy purposes with the Contributor.
(f) Reserved.
(g) The Issuer will not amend its limited liability company
operating agreement without the prior consent of Noteholders evidencing more
than 50% of the Voting Rights.
(h) The Issuer shall also comply with the other applicable
provisions of TIA Section 314.
SECTION 8.05 PROTECTION OF TRUST PROPERTY; FURTHER
ASSURANCES.
The Issuer will from time to time execute and deliver all such
supplements and amendments hereto and all such UCC 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 Property;
(ii) maintain or preserve the lien of this Amended and
Restated Indenture or carry out more effectively the purposes hereof;
(iii) publish notice of, or protect the validity of, any
Grant or assignment made or to be made by this Amended and Restated
Indenture and perfect the security interest contemplated hereby in
favor of the Trustee in the Contracts and any security interest in the
related Equipment;
(iv) enforce or cause the Servicer to enforce any of
the Contracts; or
(v) preserve and defend title to any Contract
(including the right to receive all payments due or to become due
thereunder subsequent to the applicable Cut-Off Date), the security
interest of the Trustee in the Equipment, or other property included in
the Trust Property and preserve and defend the rights of the Trustee
and the Noteholders in such Contract (including the right to receive
all payments due or to become due thereunder subsequent to the
applicable Cut-Off Date), Equipment and other property against the
claims of all persons and parties.
The Issuer, upon the Issuer's failure to do so, hereby designates the Trustee
its agent and attorney-in-fact to execute any UCC financing statement,
continuation statement or other document or instrument 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 Issuer 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 Issuer to comply with the provisions of this Section 8.05.
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SECTION 8.06 COMPLIANCE CERTIFICATES.
The Issuer will deliver to the Trustee and the Rating
Agencies, within 90 days after the end of each fiscal year, an Officer's
Certificate of the Managing Member, as sole owner of the beneficial interests of
the Issuer, stating, in addition to the statements required by Section 1.18, as
to each signer thereof, that
(i) a review of the activities of the Issuer during
such year and of performance under this Amended and Restated Indenture
has been made under such officers' supervision,
(ii) to the best of such officers' knowledge, based on
such review, (a) the Issuer has fulfilled all of its obligations under
this Amended and Restated Indenture throughout such year and (b) the
Servicer has fulfilled all of the Servicer's obligations under the
Amended and Restated Contribution and Servicing Agreement, and
(iii) whether the officer knows of any Defaults by the
Issuer under this Amended and Restated Indenture throughout such year
or, if there has been a Default in the fulfillment of any such
obligation, specifying each such Default known to him and the nature
and status thereof and the nature of the action taken with respect
thereto.
SECTION 8.07 PERFORMANCE OF OBLIGATIONS; AMENDED AND
RESTATED CONTRIBUTION AND SERVICING AGREEMENT.
(a) The Issuer will punctually perform and observe all of its
obligations and agreements contained in this Amended and Restated Indenture, any
Supplement, the Notes, its limited liability company operating agreement, the
Note Purchase Agreement, the Underwriting Agreements and any other applicable
Transaction Documents.
(b) The Issuer will clearly mark its books and records to
reflect each assignment and transfer of a Contract and the security interest in
the Equipment subject thereto from the Transferor.
(c) If the Managing Member, as sole member of the Issuer,
shall have actual knowledge of the occurrence of a default under either the
Amended and Restated Contribution and Servicing Agreement or the SCTA, the
Issuer shall promptly notify the Trustee and the Noteholders thereof, and shall
specify in such notice the action, if any, the Issuer is taking in respect of
such default. Unless consented to by Noteholders evidencing more than 50% of the
Voting Rights, the Issuer may not waive any default under or amend the Amended
and Restated Contribution and Servicing Agreement.
(d) The Issuer shall, and shall cause the Contributor to,
update any information required to be provided pursuant to Rule 144A(d) (4) of
the Securities Act to subsequent purchasers of the Class E Notes to prevent such
information from becoming materially false and materially misleading in a manner
adverse to any Noteholder.
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SECTION 8.08 NEGATIVE COVENANTS.
The Issuer will not:
(i) sell, transfer, exchange or otherwise dispose of
any portion of the Trust Property except as expressly permitted by this
Amended and Restated Indenture or any Supplement; PROVIDED THAT nothing
contained herein shall prohibit the transfer by the Issuer of amounts
payable to the Issuer pursuant to Section 3.04(b);
(ii) 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
Property;
(iii) seek dissolution or liquidation in whole or in part
or reorganization of its business or affairs;
(iv) (A) permit the validity or effectiveness of this
Amended and Restated Indenture or any Grant hereby to be impaired, or
permit the lien of this Amended and Restated Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any
Person to be released from any covenants or obligations under this
Amended and Restated Indenture, except as may be expressly permitted
hereby, (B) 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 Property or any part thereof or any interest
therein or the proceeds thereof other than the lien of this Amended and
Restated Indenture and the rights of Obligors, or (C) permit the lien
of this Amended and Restated Indenture not to constitute a valid first
priority perfected security interest in the Contracts and a valid
security interest in the Equipment;
(v) engage in any business or activity in violation of
the provisions contained in its limited liability company operating
agreement;
(vi) at any time insist upon, plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or
extension law or other law that would prohibit or forgive the Issuer
from paying all or any portion of the principal of or interest on the
Notes as contemplated herein or in the Notes, wherever enacted, now or
at any time hereafter in force, or that may affect the covenants or the
performance of this Amended and Restated Indenture; and (to the extent
that it may lawfully do so) the Issuer 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;
(vii) merge or consolidate with any other Person unless
(i) the entity surviving such merger or consolidation is a Person
organized under the laws of the United States or any jurisdiction
thereof, (ii) the surviving entity, if not the Issuer, shall execute
and deliver to the Servicer and the Trustee, in form and substance
satisfactory to each of them, (x) an instrument expressly assuming all
of the obligations of the Issuer hereunder, and (y) an opinion of
counsel to the effect that such Person is a Person of the type
described in the preceding clause (i), has
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effectively assumed the obligations of the Issuer hereunder, that all
conditions precedent provided for in this Amended and Restated
Indenture relating to such transaction have been complied with, that in
the opinion of such counsel, all UCC financing statements and
continuation statements and amendments thereto have been executed and
filed that are necessary fully to preserve and protect the interest of
the Trustee in the Trust Property, and reciting the details of such
filings, or stating that no such action shall be necessary to preserve
and protect such interest, (iii) the Issuer shall deliver to the
Trustee a letter from each Rating Agency to the effect that such
transaction will not, in and of itself, result in a downgrading of the
rating for the Notes and (iv) immediately after giving effect to such
transaction, no event of default under any Transaction Document, and no
event which, after notice or lapse of time, or both, would become an
event of default, shall have occurred and be continuing. The Issuer and
any surviving entity, if not the Issuer, will keep all of its material
assets within the United States at all times. The Issuer will not make
any material change in its business;
(viii) 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 Contract or any other instrument
included in the Trust Property other than any such release occasioned
by the early termination of a Contract after receipt of the Prepayment
Amount, or which would result in the amendment, hypothecation,
subordination, termination, or discharge of, or impair the validity or
effectiveness of, any Contract or such other instrument, except as
expressly provided in this Amended and Restated Indenture or the
Amended and Restated Contribution and Servicing Agreement; or
(ix) issue any other securities (other than the Notes
and the Class F Instruments) unless it shall have received from the
Rating Agencies a written confirmation that the issuance of such
securities will not result in a Ratings Effect with respect to any
class of Notes.
SECTION 8.09 INFORMATION AS TO THE ISSUER.
The Issuer shall file with the Trustee and the Rating
Agencies:
(a) within 15 days after filing with the Commission, copies of
the annual reports and of the information, documents and other reports (or
copies of such portions of any of the foregoing as the Commission may by rules
and regulations prescribe) which the Managing Member (as settlor of the Issuer)
is required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act.
(b) immediately upon becoming aware of the existence of any
condition or event which constitutes a Default or an Indenture Event of Default,
a written notice describing its nature and period of existence and what action
the Issuer is taking or proposes to take with respect thereto;
(c) promptly upon the Issuer's becoming aware of:
(i) any proposed or pending investigation of it by any
governmental authority or agency, or
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(ii) any pending or proposed court or administrative
proceeding
which involves or may involve the possibility, individually or in the aggregate,
of materially and adversely affecting the properties, business, profits or
condition (financial or otherwise) of the Issuer, a written notice specifying
the nature of such investigation or proceeding and what action the Issuer is
taking or proposes to take with respect thereto and evaluating its merits; and
(d) with reasonable promptness, any other data and information
which may be reasonably requested from time to time.
SECTION 8.10. PAYMENT OF TAXES AND OTHER CLAIMS.
The Issuer will pay or discharge or cause to be paid or
discharged, before any penalty accrues from the failure to so pay or discharge,
(1) all taxes, assessments and governmental charges levied or imposed upon the
Issuer or upon the income, profits or property (including any property that is
part of the Trust Property) of the Issuer and (2) all lawful claims for labor,
materials and supplies which, if unpaid, might by law become a lien upon the
property of the Issuer; PROVIDED, HOWEVER, that the Issuer shall not be required
to pay or discharge or cause to be paid or discharged any such tax, assessment,
charge or claim the amount, applicability or validity of which is being
contested in good faith by appropriate proceedings and for which adequate
provision has been made or where the failure to effect such payment or discharge
is not adverse in any material respect to the Noteholders.
SECTION 8.11 INDEMNIFICATION.
The Issuer agrees to indemnify and hold harmless the Trustee
(which shall include its directors, officers, employees and agents) and each
Noteholder (each an "INDEMNIFIED PARTY") against any and all liabilities,
losses, damages, penalties, costs and expenses (including the fees and expenses
of counsel and the costs of defense and legal fees and expenses) which may be
incurred or suffered by such Indemnified Party without negligence, bad faith 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, by the SCTA or by the Amended and Restated Contribution 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 Issuer'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, except to the extent otherwise provided
in Section 6.06, all amounts payable pursuant to this Section 8.11 shall be
fully subordinated to amounts payable under the Class A Notes, the Class B
Notes, the Class C Notes, the Class D Notes and the Class E Notes to the extent
that any amounts otherwise due and payable under the terms of this Amended and
Restated Indenture have not been fully paid. In every circumstance where the
Issuer has agreed to indemnify or hold harmless the Noteholders for legal fees,
counsel fees and related costs and expenses, it is understood and agreed, and
the Noteholders by their acceptance of their respective Notes agree, that such
indemnification and holding harmless is limited to the reasonable fees, related
costs and expenses of the Noteholders Counsel only. The provisions of this
Section 8.11 shall survive the termination of this Amended and Restated
Indenture.
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SECTION 8.12 CONTRACT FILES TO TRUSTEE.
On or prior to the Closing Date or each Substitute Date, as
applicable, the Contributor, on behalf of the Issuer, shall deliver to the
Trustee the original counterpart of each Contract that constitutes "chattel
paper" or an "instrument," as such terms are defined in the UCC.
SECTION 8.13 PAYMENT ADVICES.
Each payment by the Issuer or the Servicer to the Trustee
pursuant to any of the provisions of the Transaction Documents shall be
accompanied by written advice containing sufficient information to identify the
Contract and/or Equipment to which such payment relates, the Section of the
Transaction Documents pursuant to which such payment is made, and the proper
application pursuant to the provisions of the applicable Transaction Document of
the amounts being paid.
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ARTICLE IX
AMENDMENTS AND SUPPLEMENTAL AMENDED AND RESTATED INDENTURES
SECTION 9.01 AMENDMENTS AND SUPPLEMENTAL INDENTURES.
This Amended and Restated Indenture or the Notes may be
amended from time to time by the parties hereto, without the consent of any of
the Noteholders, (i) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision herein or to
make any other provisions with respect to matters or questions arising under
this Amended and Restated Indenture or the Notes which shall not be materially
inconsistent with the provisions of this Amended and Restated Indenture or the
Notes, PROVIDED THAT such action shall not adversely affect in any respect the
interests of any Noteholder or (ii) to make any change to comply with the TIA or
any amendment thereto, or to comply with any requirement of the Commission in
connection with the qualification of the Amended and Restated Indenture under
the TIA.
This Amended and Restated Indenture or the Notes may also be
amended from time to time by the parties hereto with the consent of the Holders
of Notes evidencing more than 662/3% of the Voting Rights (and with prior
written notice to the Rating Agency) for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this Amended
and Restated Indenture or the Notes or of modifying in any manner the rights of
the Holders of Notes; PROVIDED, HOWEVER, that no amendment to this Amended and
Restated Indenture or any supplemental indenture may (i) cause a reduction in
the then current ratings, if any, of the Notes, (ii) increase or reduce in any
manner the amount of, or accelerate or delay the timing of collections of
payments on the related Contracts or distributions that are required to be made
for the benefit of such Noteholders, (iii) reduce the aforesaid percentage of
the Notes of such series which is required to consent to any such amendment or
waiver, or (iv) release any of the Trust Property from the lien hereof (except
as otherwise permitted herein) or modify Section 2.06, 3.04, 6.06, 6.08, 6.13 or
9.01, without the consent of each affected Noteholder. The Issuer shall furnish
to the Rating Agencies copies of all amendments to and supplements to this
Amended and Restated Indenture.
It shall not be necessary for the consent of the Noteholders
under this Section 9.01 to approve the particular form of any proposed amendment
or supplement, but it shall be sufficient if such consent approves the substance
thereof.
SECTION 9.02 EXECUTION OF AMENDMENTS AND SUPPLEMENTAL
INDENTURES.
In executing any amendment to this Amended and Restated
Indenture, the Notes or any supplemental indenture pursuant to Section 9.01 of
this Amended and Restated Indenture, the Trustee shall be entitled to receive,
and (subject to Section 7.01) shall be fully protected in relying upon (i) an
Officer's Certificate stating that all conditions precedent for entering into
such amendment or supplemental indenture as set forth in the Amended and
Restated Indenture have been met and (ii) an Opinion of Counsel stating that the
execution of such amendment to this Amended and Restated Indenture, the Note, or
any supplemental indenture is authorized or permitted by this Amended and
Restated Indenture. The Trustee may, but shall not be obligated to, enter into
any supplemental indenture which affects
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the Trustee's own rights, duties, protections, or immunities under this Amended
and Restated Indenture or otherwise.
SECTION 9.03 EFFECT OF AMENDMENTS AND SUPPLEMENTAL
INDENTURES.
Upon the execution of any amendment to this Amended and
Restated Indenture, the Notes or any supplemental indenture under this Article,
this Amended and Restated Indenture, the Notes or any supplemental indenture
shall be modified in accordance therewith, and such amendment or supplemental
indenture shall form a part of this Amended and Restated Indenture, the Notes or
any supplemental indenture for all purposes, and every Noteholder of Notes
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.
SECTION 9.04 REFERENCE IN NOTES TO AMENDMENTS AND
SUPPLEMENTAL INDENTURES.
Notes authenticated and delivered after the execution of any
amendment to this Amended and Restated Indenture or 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
amendment or supplemental indenture. If the Issuer shall so determine, new Notes
so modified as to conform, in the opinion of the Trustee and the Issuer, to any
such amendment or supplemental indenture may be prepared and executed by the
Issuer and authenticated and delivered by the Trustee in exchange for
outstanding Notes.
SECTION 9.05 COMPLIANCE WITH TRUST INDENTURE ACT.
The Issuer hereby covenants and agrees that every amendment or
supplement to this Amended and Restated Indenture or the Notes shall comply with
the TIA as then in effect.
SECTION 9.06 REVOCATION AND EFFECT OF CONSENTS.
Subject to this Amended and Restated Indenture, each
amendment, waiver or instrument evidencing other action shall become effective
in accordance with its terms. Until an amendment, waiver or other action becomes
effective, a consent to it by a Noteholder is a continuing consent by the
Noteholder even if notation of the consent is not made on any Note.
The Issuer may, but shall not be obligated to, fix a record
date for the purpose of determining the Noteholders entitled to consent to any
amendment, supplement or waiver. If a record date is fixed, then those Persons
who were Noteholders at such record date (or their duly designated proxies), and
only those Persons, shall be entitled to consent to such amendment, supplement
or waiver or to revoke any consent previously given, whether or not such Persons
continue to be Noteholders after such record date. No such consent shall be
valid or effective for more than 90 days after such record date.
66
<PAGE>
ARTICLE X
REDEMPTION OF NOTES
SECTION 10.01 OPTIONAL REDEMPTION; ELECTION TO REDEEM.
(a) The Notes may be redeemed in part by the Issuer at the
Partial Redemption Price on any Payment Date on which the outstanding Pool B
Aggregate Discounted Contract Balance is less than 20% of the outstanding Pool B
Aggregate Discounted Contract Balance as of the Closing Date. The Notes may be
redeemed by the Issuer, in whole but not in part, at the Redemption Price on any
Payment Date on which the Pool A Aggregate Discounted Contract Balance is less
than 10% of the Pool A Aggregate Discounted Contract Balance as of the Closing
Date and the Pool B Aggregate Discounted Contract Balance is less than 20% of
the Pool B Aggregate Discounted Contract Balance as of the Closing Date. The
Issuer, by an Authorized Officer of the Managing Member, shall set the
Redemption Date and the Redemption Record Date and give notice thereof to the
Trustee. Notice of redemption or partial redemption having been given as
provided in the Amended and Restated Indenture, the Notes shall, on the
applicable Redemption Date, become due and payable at the Redemption Price or
Partial Redemption Price, as applicable. The respective Noteholders shall be
paid the Redemption Price or Partial Redemption Price, as applicable, by the
Trustee to the extent of Available Funds on deposit in the Collection Account,
and upon presentation and surrender of the Notes on behalf of the Issuer;
PROVIDED, HOWEVER, that installments of principal and interest which are due on
or prior to the Redemption Date shall be payable to the respective Noteholders
registered as such on the relevant Record Dates or Redemption Record Dates, as
applicable, according to their terms.
(b) The Issuer, by order of an Authorized Officer of the
Managing Member, shall set the Redemption Date and the Redemption Record Date
and give notice thereof to the Trustee pursuant to Section 10.02.
SECTION 10.02 NOTICE TO TRUSTEE.
In the case of any redemption or partial redemption pursuant
to Section 10.01, the Issuer shall, at least 20 days prior to the Redemption,
notify the Trustee and the Rating Agencies of such Redemption Date and the
principal amount of Notes to be redeemed in part. The notice shall be
accompanied by an Officer's Certificate stating that the redemption or partial
redemption complies with the provisions of this Amended and Restated Indenture.
SECTION 10.03 NOTICE OF REDEMPTION OR PARTIAL REDEMPTION
BY THE ISSUER.
Notice of redemption or partial redemption pursuant to Section
10.01 shall be given by first class mail, postage prepaid, mailed at least 15
days but not more than 60 days prior to the applicable Redemption Date, to each
holder of a Note, at its address in the Note Register.
67
<PAGE>
All notices of redemption or partial redemption shall state:
(1) the Redemption Date;
(2) the Redemption Price or Partial Redemption
Price, as applicable;
(3) that on the Redemption Date, the Redemption
Price or Partial Redemption Price, as
applicable, will become due and payable upon
each such Note, and that interest on the
redeemed portion of such Note shall cease to
accrue if payment is made on such date;
(4) the private placement number or CUSIP
number, if any, of the Notes;
(5) Corporate Trust Office where Notes are to be
surrendered for payment of the Redemption
Price; and
(6) the Redemption Record Date.
Notice of redemption or partial redemption, as applicable, of
Notes shall be given by the Issuer, by order of an Authorized Officer of the
Transferor, or, at the request of such Authorized Officer of the Managing
Member, by the Trustee in the name and at the expense of the Issuer. Failure to
give notice of redemption or partial redemption, as applicable, or any defect
therein, to any holder of a Note shall not impair or affect the validity of the
redemption or partial redemption, as applicable, of any other Note. If a private
placement number or CUSIP number is listed in such notice or printed on the
Note, the notice may state that no representation is made as to the correctness
or accuracy of such private placement number or CUSIP number.
SECTION 10.04 DEPOSIT OF THE REDEMPTION PRICE OR PARTIAL
REDEMPTION PRICE.
On or before the Business Day immediately preceding any
Redemption Date, the Issuer shall deposit with the Trustee an amount of monies
sufficient to pay the Redemption Price or Partial Redemption Price, as
applicable, of all Notes outstanding on such Redemption Date (less any portion
of such payment to be made from monies in the Collection Account).
SECTION 10.05 NOTES PAYABLE ON REDEMPTION DATE.
(a) Notice of redemption in full having been given as provided
in Section 10.03, the Notes shall, on the applicable Redemption Date, become due
and payable at the Redemption Price and on such Redemption Date (unless the
Issuer shall default in the payment of the Redemption Price) such Notes shall
cease to bear interest. The Noteholders shall be paid the Redemption Price by
the Trustee on behalf of the Issuer; PROVIDED, HOWEVER, that installments of
principal and interest which are due on or prior to the Redemption Date shall be
payable to the Noteholders registered as such on the relevant Record Dates
according to their terms and the provisions of Section 2.07. If the Holders of
any Note called for redemption in full shall not be so paid upon surrender, the
principal and interest shall, until paid, bear interest from the Redemption Date
at the related Note Rate.
68
<PAGE>
(b) Notice of partial redemption having been given as provided
in Section 10.03, that portion of the Notes shall, on the applicable Redemption
Date, become due and payable at the Partial Redemption Price and on such
Redemption Date (unless the Issuer shall default in the payment of the
Redemption Price) such Notes shall continue to bear interest only on the
principal balances remaining outstanding. The Noteholders shall be paid the
Partial Redemption Price by the Trustee on behalf of the Issuer; PROVIDED,
HOWEVER, that installments of principal and interest which are due on or prior
to the Redemption Date shall be payable to the Noteholders registered as such on
the relevant Record Dates according to their terms and the provisions of Section
2.07. If the holders of any Note called for partial redemption shall not be so
paid, the principal and interest shall, until paid, bear interest from the
Redemption Date at the related Note Rate.
69
<PAGE>
ARTICLE XI
SATISFACTION AND DISCHARGE
SECTION 11.01 SATISFACTION AND DISCHARGE OF AMENDED AND
RESTATED INDENTURE.
(a) This Amended and Restated Indenture shall cease to be of
further effect (except as to any surviving rights herein expressly provided
for), and the Trustee, on demand of and at the expense of the Issuer, shall
execute proper instruments and certifications acknowledging satisfaction and
discharge of this Amended and Restated Indenture, when:
(i) either:
(A) all Notes theretofore authenticated and
delivered (other than (x) Notes which have been destroyed,
lost, or stolen and which have been replaced or paid as
provided in Section 2.05 and (y) Notes for whose payment money
has theretofore been deposited in trust or segregated and held
in trust by the Issuer and thereafter repaid to the Issuer or
discharged from such trust, as provided in Section 8.03(c))
have been irrevocably paid and 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:
(1) have become due and payable, or
(2) will become due and payable at
their Stated Maturity Date within one year,
and the Issuer has 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 Date thereof;
(ii) the Issuer has paid or caused to be paid all other
sums payable hereunder by the Issuer for the benefit of the
Noteholders; and
(iii) the Issuer has delivered to the Trustee an
Officer's Certificate of the Managing Member stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Amended and Restated Indenture have been complied
with.
At such time, the Trustee shall deliver to the Issuer or, upon Issuer Order, its
assignee, all cash, securities and other property held by it as part of the
Trust Property other than funds deposited with the Trustee pursuant to Section
11.01(a)(i)(B) for the payment and discharge of the Notes and a certificate from
a Responsible Officer certifying the satisfaction and discharge of this Amended
and Restated Indenture.
70
<PAGE>
(b) Notwithstanding the satisfaction and discharge of this
Amended and Restated Indenture, the obligations of the Issuer under Sections
7.06 and 8.11, and, if money shall have been deposited with the Trustee pursuant
to Section 11.01(a)(i)(B), the obligations of the Trustee under Section 11.02
and Section 8.03(c) shall survive.
SECTION 11.02 APPLICATION OF TRUST MONEY.
Subject to the provisions of Section 8.03(c), all money
deposited with the Trustee pursuant to Sections 11.01 and 8.03 shall be held in
trust and applied by it, in accordance with the provisions of the Notes and this
Amended and Restated 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.
SECTION 11.03 REINSTATEMENT.
If the Trustee is unable to apply any money in accordance with
Section 11.01 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Issuer's obligations under this
Amended and Restated Indenture and the Notes shall be revived and reinstated as
though no deposit had occurred pursuant to Section 11.01 until such time as the
Trustee is permitted to apply all such money in accordance with Section 11.01.
71
<PAGE>
AMENDED AND RESTATED INDENTURE
DATED AS OF DECEMBER 1, 1999
IN WITNESS WHEREOF, the parties hereto have caused this
Amended and Restated Indenture to be duly executed, all as of the day and year
first above written.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By: /s/ Lisa J. Cruikshank
--------------------------
Name: Lisa J. Cruikshank
Title: Vice President
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By: /s/ EVE KAPLAN
--------------------------
Name: Eve D. Kaplan
Title: Vice President
<PAGE>
SCHEDULE 1
CONTRACT SCHEDULE
[See Tab 4]
<PAGE>
EXHIBIT A-1
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS A-1 NOTES]
NO BENEFICIAL OWNERS OF THIS NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT
OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED NOTES HAVE BEEN DELIVERED
PURSUANT TO THE TERMS OF THE AMENDED AND RESTATED INDENTURE.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, OR
DELIVERED, EXCEPT AS PERMITTED UNDER THE AMENDED AND RESTATED INDENTURE REFERRED
TO BELOW.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS A-1 NOTES ON BEHALF OF, AS INVESTMENT MANAGER OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN; OR (2) THE
ACQUISITION AND HOLDING OF THE CLASS A-1 NOTES WILL NOT GIVE RISE TO A
PROHIBITED TRANSACTION UNDER SECTION 406(a) OF ERISA OR SECTION 4975 OF THE CODE
FOR WHICH A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
No. 1 Principal Amount $__________
Due: _____________ CUSIP No. ___________
_______% ASSET-BACKED NOTE, SERIES 2000-1, CLASS A-1
A-1-1
<PAGE>
DVI RECEIVABLES XI, L.L.C., a Delaware limited liability
company (the "ISSUER"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum of ___________ _______ and 00/100
Dollars ($__________) in monthly installments equal to the sum of (i) the Class
A-1 Monthly Principal, (ii) the Class A-1 Overdue Principal and (iii) any other
principal that may be due hereon pursuant to the Amended and Restated Indenture
during an Amortization Event together with (i) the Class A-1 Monthly Interest
and (ii) the Class A-1 Overdue Interest due thereon on the fourteenth day of
each month (or if such date is not a Business Day, the next succeeding Business
Day, commencing _________, ____ (each, a "PAYMENT DATE"), and not later than
_____________, all remaining principal and interest (computed on the basis of a
360-day year of actual number of days elapsed) are due and payable in their
entirety as set forth in the Amended and Restated Indenture.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date, or Redemption Record Date, as
applicable, for such Payment Date, which shall be the last Business Day of the
month preceding the month in which the Payment Date occurs (or in the case of
the initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class A-1 Notes
of the Issuer designated as its _______% Asset-Backed Notes, Series 2000-1,
Class A-1 with aggregate principal amount of $__________ and to be issued under
an Amended and Restated Indenture, dated as of December 1, 1999 (herein called
the "AMENDED AND RESTATED INDENTURE"), between the Issuer and U.S. Bank Trust
National Association, as trustee (herein called the "TRUSTEE", which term
includes any successor trustee under the Amended and Restated Indenture), to
which Amended and Restated 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 Issuer, the Trustee, and the
holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The Trust Property secures the Notes equally and
ratably without prejudice, priority, or distinction between any Note of the same
tranche and any other Note of the same tranche by reason of difference in time
of issuance or otherwise, and also secures the payment of certain other amounts
and certain other obligations as set forth in the Amended and Restated
Indenture. This Note is issued under and is subject to the terms, provisions and
conditions of the Amended and Restated Indenture, to which Amended and Restated
Indenture the Holder of this Note by virtue of the acceptance hereof assents and
by which such Holder is bound.
Each Class A-1 Noteholder by acceptance of its Class A-1 Note
(and any Person which is a beneficial owner of any interest in a Class A-1 Note,
by virtue of such Persons' acquisition of a beneficial interest therein) agrees
to treat the Class A-1 Notes (or beneficial interest therein) for purposes of
federal, state and local income or franchise taxes and any other tax imposed on
or measured by income, as indebtedness. Each Class A-1 Noteholder agrees that it
will cause any Person acquiring an interest
A-1-2
<PAGE>
in a Class A-1 Note through it to acknowledge the Class A-1 Notes'
characterization as indebtedness and to treat the Class A-1 Notes as
indebtedness for such tax purposes.
Each prospective initial Noteholder acquiring Class A-1 Notes,
each prospective transferee acquiring a Class A-1 Note, and each prospective
owner (or transferee thereof) of a beneficial interest in a Class A-1 Note (each
a "Prospective Owner") will be deemed to have represented by such purchase to
the Issuer, the Trustee, the Servicer and any successor Servicer that either (1)
it is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of
the Code ("Plan") and is not directly or indirectly acquiring the Class A-1 Note
on behalf of, as investment manager of, as named fiduciary of, as trustee of, or
with the assets of a Plan; or (2) the acquisition and holding of the Class A-1
Note will not give rise to a prohibited transaction under Section 406(a) of
ERISA or Section 4975 of the Code for which a statutory or administrative
exemption is unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Class A-1
Note is registrable in the Note Register, upon surrender of this Class A-1 Note
for registration of transfer at the office or agency designated by the Issuer
pursuant to the Amended and Restated Indenture, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Issuer and the
Trustee duly executed by, the holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-1 Notes, of authorized
denominations and for the same original aggregate principal amount, will be
issued to the designated transferee or transferees.
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Class A-1 Note for
registration of transfer, the Issuer, the Trustee and any agent of the Issuer or
the Trustee may treat the Person in whose name this Note is registered as the
owner hereof for all purposes, whether or not this Class A-1 Note be overdue,
and neither the Issuer, the Trustee nor any such agent shall be affected by
notice to the contrary.
A-1-3
<PAGE>
This Class A-1 Note and the Amended and Restated Indenture may
be amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Class A-1 Note, the holder hereof
irrevocably appoints the Trustee under the Amended and Restated Indenture as the
special attorney-in-fact for the holder vested with full power on behalf of the
holder to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Class A-1 Note which are
defined in the Amended and Restated Indenture and not otherwise defined herein
shall have the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Class
A-1 Note and the Amended and Restated Indenture shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to the conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Class A-1 Note shall not be
entitled to any benefit under the Amended and Restated Indenture or be valid or
obligatory for any purpose.
This Class A-1 Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be provided to any Noteholder, at its expense, upon a
written request to the Trustee, U.S. Bank Trust National Association, 180 Fifth
Street, St. Paul, Minnesota 55101, Attention: Structured Finance.
A-1-4
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:
-----------------------------
Name:
Title:
Dated:____________________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee
By:
---------------------------------
Authorized Signatory
A-1-5
<PAGE>
EXHIBIT A-2
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS A-2 NOTES]
NO BENEFICIAL OWNERS OF THIS NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT
OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED NOTES HAVE BEEN DELIVERED
PURSUANT TO THE TERMS OF THE AMENDED AND RESTATED INDENTURE.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, OR
DELIVERED, EXCEPT AS PERMITTED UNDER THE AMENDED AND RESTATED INDENTURE REFERRED
TO BELOW.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS A-2 NOTES ON BEHALF OF, AS INVESTMENT MANAGER OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN; OR (2) THE
ACQUISITION AND HOLDING OF THE CLASS A-2 NOTES WILL NOT GIVE RISE TO A
PROHIBITED TRANSACTION UNDER SECTION 406(a) OF ERISA OR SECTION 4975 OF THE CODE
FOR WHICH A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
No. 1 Principal Amount $__________
Due: _____________ CUSIP No. ___________
_____% ASSET-BACKED NOTE, SERIES 2000-1, CLASS A-2
A-2-1
<PAGE>
DVI RECEIVABLES XI, L.L.C., a limited liability company (the
"ISSUER"), for value received, hereby promises to pay to CEDE & CO. or
registered assigns, the principal sum of _____________ and 00/100 Dollars
($__________) in monthly installments equal to the sum of (i) the Class A-2
Monthly Principal, (ii) the Class A-2 Overdue Principal and (iii) any other
principal that may be due hereon pursuant to the Amended and Restated Indenture
during an Amortization Event together with (i) the Class A-2 Monthly Interest
and (ii) the Class A-2 Overdue Interest due thereon on the fourteenth day of
each month (or if such date is not a Business Day, the next succeeding Business
Day, commencing _____ ________ (each, a "PAYMENT DATE"), and not later than
_____________, all remaining principal and interest (computed on the basis of a
360-day year of twelve 30-day months) are due and payable in their entirety as
set forth in the Amended and Restated Indenture.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date, or Redemption Record Date, as
applicable, for such Payment Date, which shall be the last Business Day of the
month preceding the month in which the Payment Date occurs (or in the case of
the initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class A-2 Notes
of the Issuer designated as its _____% Asset-Backed Notes, Series 2000-1, Class
A-2 with aggregate principal amount of $__________ and to be issued under an
Amended and Restated Indenture, dated as of December 1, 1999 (herein called the
"AMENDED AND RESTATED INDENTURE"), between the Issuer and U.S. Bank Trust
National Association, as trustee (herein called the "TRUSTEE", which term
includes any successor trustee under the Amended and Restated Indenture), to
which Amended and Restated 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 Issuer, the Trustee, and the
holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The Trust Property secures the Notes equally and
ratably without prejudice, priority, or distinction between any Note of the same
tranche and any other Note of the same tranche by reason of difference in time
of issuance or otherwise, and also secures the payment of certain other amounts
and certain other obligations as set forth in the Amended and Restated
Indenture. This Note is issued under and is subject to the terms, provisions and
conditions of the Amended and Restated Indenture, to which Amended and Restated
Indenture the Holder of this Note by virtue of the acceptance hereof assents and
by which such Holder is bound.
Each Class A-2 Noteholder by acceptance of its Class A-2 Note
(and any Person which is a beneficial owner of any interest in a Class A-2 Note,
by virtue of such Persons' acquisition of a beneficial interest therein) agrees
to treat the Class A-2 Notes (or beneficial interest therein) for purposes of
federal, state and local income or franchise taxes and any other tax imposed on
or measured by income, as indebtedness. Each Class A-2 Noteholder agrees that it
will cause any Person acquiring an interest
A-2-2
<PAGE>
in a Class A-2 Note through it to acknowledge the Class A-2 Notes'
characterization as indebtedness and to treat the Class A-2 Notes as
indebtedness for such tax purposes.
Each prospective initial Noteholder acquiring Class A-2 Notes,
each prospective transferee acquiring a Class A-2 Note, and each prospective
owner (or transferee thereof) of a beneficial interest in a Class A-2 Note (each
a "Prospective Owner") will be deemed to have represented by such purchase to
the Issuer, the Trustee, the Servicer and any successor Servicer that either (1)
it is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of
the Code ("Plan") and is not directly or indirectly acquiring the Class A-2
Notes on behalf of, as investment manager of, as named fiduciary of or with the
assets of a Plan; or (2) the acquisition and holding of the Class A-2 Notes will
not give rise to a nonexempt prohibited transaction under Section 406(a) of
ERISA or Section 4975 of the Code for which a statutory or administrative
exemption is unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Class A-2
Note is registrable in the Note Register, upon surrender of this Class A-2 Note
for registration of transfer at the office or agency designated by the Issuer
pursuant to the Amended and Restated Indenture, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Issuer and the
Trustee duly executed by, the holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-2 Notes, of authorized
denominations and for the same original aggregate principal amount, will be
issued to the designated transferee or transferees.
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Class A-2 Note for
registration of transfer, the Issuer, the Trustee and any agent of the Issuer or
the Trustee may treat the Person in whose name this Note is registered as the
owner hereof for all purposes, whether or not this Class A-2 Note be overdue,
and neither the Issuer, the Trustee nor any such agent shall be affected by
notice to the contrary.
A-2-3
<PAGE>
This Class A-2 Note and the Amended and Restated Indenture may
be amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Class A-2 Note, the holder hereof
irrevocably appoints the Trustee under the Amended and Restated Indenture as the
special attorney-in-fact for the holder vested with full power on behalf of the
holder to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Class A-2 Note which are
defined in the Amended and Restated Indenture and not otherwise defined herein
shall have the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Class
A-2 Note and the Amended and Restated Indenture shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to the conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Class A-2 Note shall not be
entitled to any benefit under the Amended and Restated Indenture or be valid or
obligatory for any purpose.
This Class A-2 Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be provided to any Noteholder, at its expense, upon a
written request to the Trustee, U.S. Bank Trust National Association, 180 Fifth
Street, St. Paul, Minnesota 55101, Attention: Structured Finance.
A-2-4
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:_______________________________
Name:
Title:
Dated:____________________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
By:
--------------------------------
Authorized Signatory
A-2-5
<PAGE>
EXHIBIT A-3
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS A-3 NOTES]
NO BENEFICIAL OWNERS OF THIS NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT
OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED NOTES HAVE BEEN DELIVERED
PURSUANT TO THE TERMS OF THE AMENDED AND RESTATED INDENTURE.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, OR
DELIVERED, EXCEPT AS PERMITTED UNDER THE AMENDED AND RESTATED INDENTURE REFERRED
TO BELOW.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS A-3 NOTES ON BEHALF OF, AS INVESTMENT MANAGER OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN; OR (2) THE
ACQUISITION AND HOLDING OF THE CLASS A-3 NOTES WILL NOT GIVE RISE TO A
PROHIBITED TRANSACTION UNDER SECTION 406(a) OF ERISA OR SECTION 4975 OF THE CODE
FOR WHICH A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
No. 1 Principal Amount $__________
Due: ____________ CUSIP No. ___________
A-3-1
<PAGE>
_____% ASSET-BACKED NOTE, SERIES 2000-1, CLASS A-3
DVI RECEIVABLES XI, L.L.C., a Delaware limited liability
company (the "ISSUER"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum of _________
_____________________________ and 00/100 Dollars ($__________) in monthly
installments equal to the sum of (i) the Class A-3 Monthly Principal, (ii) the
Class A-3 Overdue Principal and (iii) any other principal that may be due hereon
pursuant to the Amended and Restated Indenture during an Amortization Event
together with (i) the Class A-3 Monthly Interest and (ii) the Class A-3 Overdue
Interest due thereon on the fourteenth day of each month or if such date is not
a Business Day, the next succeeding Business Day, commencing _________________
(each, a "PAYMENT DATE"), and not later than ____________, all remaining
principal and interest (computed on the basis of a 360-day year of twelve 30-day
months) are due and payable in their entirety as set forth in the Amended and
Restated Indenture.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date, or Redemption Record Date, as
applicable, for such Payment Date, which shall be the last Business Day of the
month preceding the month in which the Payment Date occurs (or in the case of
the initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class A-3 Notes
of the Issuer designated as its _____% Asset-Backed Notes, Series 2000-1, Class
A-3 with aggregate principal amount of $__________ and to be issued under an
Amended and Restated Indenture, dated as of December 1, 1999 (herein called the
"AMENDED AND RESTATED INDENTURE"), between the Issuer and U.S. Bank Trust
National Association, as trustee (herein called the "TRUSTEE", which term
includes any successor trustee under the Amended and Restated Indenture), to
which Amended and Restated 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 Issuer, the Trustee, and the
holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The Trust Property secures the Notes equally and
ratably without prejudice, priority, or distinction between any Note of the same
tranche and any other Note of the same tranche by reason of difference in time
of issuance or otherwise, and also secures the payment of certain other amounts
and certain other obligations as set forth in the Amended and Restated
Indenture. This Note is issued under and is subject to the terms, provisions and
conditions of the Amended and Restated Indenture, to which Amended and Restated
Indenture the Holder of this Note by virtue of the acceptance hereof assents and
by which such Holder is bound.
Each Class A-3 Noteholder by acceptance of its Class A-3 Note
(and any Person which is a beneficial owner of any interest in a Class A-3 Note,
by virtue of such Persons' acquisition of a beneficial interest therein) agrees
to treat the Class A-3 Notes (or beneficial interest therein) for purposes
A-3-2
<PAGE>
of federal, state and local income or franchise taxes and any other tax imposed
on or measured by income, as indebtedness. Each Class A-3 Noteholder agrees that
it will cause any Person acquiring an interest in a Class A-3 Note through it to
acknowledge the Class A-3 Notes' characterization as indebtedness and to treat
the Class A-3 Notes as indebtedness for such tax purposes.
Each prospective initial Noteholder acquiring Class A-3 Notes,
each prospective transferee acquiring a Class A-3 Note, and each prospective
owner (or transferee thereof) of a beneficial interest in a Class A-3 Note (each
a "Prospective Owner") will be deemed to have represented by such purchase to
the Issuer, the Trustee, the Servicer and any successor Servicer that either (1)
it is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of
the Code ("Plan") and is not directly or indirectly acquiring the Class A-3 Note
on behalf of, as investment manager of, as named fiduciary of, as trustee of, or
with the assets of a Plan; or (2) the acquisition and holding of the Class A-3
Note will not give rise to a prohibited transaction under Section 406(a) of
ERISA or Section 4975 of the Code for which a statutory or administrative
exemption is unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Class A-3
Note is registrable in the Note Register, upon surrender of this Class A-3 Note
for registration of transfer at the office or agency designated by the Issuer
pursuant to the Amended and Restated Indenture, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Issuer and the
Trustee duly executed by, the holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-3 Notes, of authorized
denominations and for the same original aggregate principal amount, will be
issued to the designated transferee or transferees.
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Class A-3 Note for
registration of transfer, the Issuer, the Trustee and any agent of the Issuer or
the Trustee may treat the Person in whose name this Note
A-3-3
<PAGE>
is registered as the owner hereof for all purposes, whether or not this Class
A-3 Note be overdue, and neither the Issuer, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Class A-3 Note and the Amended and Restated Indenture may
be amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Class A-3 Note, the holder hereof
irrevocably appoints the Trustee under the Amended and Restated Indenture as the
special attorney-in-fact for the holder vested with full power on behalf of the
holder to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Class A-3 Note which are
defined in the Amended and Restated Indenture and not otherwise defined herein
shall have the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Class
A-3 Note and the Amended and Restated Indenture shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to the conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Class A-3 Note shall not be
entitled to any benefit under the Amended and Restated Indenture or be valid or
obligatory for any purpose.
This Class A-3 Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be provided to any Noteholder, at its expense, upon a
written request to the Trustee, U.S. Bank Trust National Association, 180 Fifth
Street, St. Paul, Minnesota 55101, Attention: Structured Finance.
A-3-4
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:_______________________________
Name:
Title:
Dated:______________________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
By:
--------------------------------
Authorized Signatory
A-3-5
<PAGE>
EXHIBIT A-4
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS A-4 NOTES]
NO BENEFICIAL OWNERS OF THIS NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT
OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED NOTES HAVE BEEN DELIVERED
PURSUANT TO THE TERMS OF THE AMENDED AND RESTATED INDENTURE.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, OR
DELIVERED, EXCEPT AS PERMITTED UNDER THE AMENDED AND RESTATED INDENTURE REFERRED
TO BELOW.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS A-4 NOTES ON BEHALF OF, AS INVESTMENT MANAGER OR, AS NAMED
FIDUCIARY OF OR WITH THE ASSETS OF A PLAN; OR (2) THE ACQUISITION AND HOLDING OF
THE CLASS A-4 NOTES WILL NOT GIVE RISE TO A PROHIBITED TRANSACTION UNDER SECTION
406(a) OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH A STATUTORY OR
ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
No. 1 Principal Amount $__________
Due: ____________ CUSIP No. ___________
A-4-1
<PAGE>
_____% ASSET-BACKED NOTE, SERIES 2000-1, CLASS A-4
DVI RECEIVABLES XI, L.L.C., a Delaware limited liability
company (the "ISSUER"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum of _________ _______ and 00/100 Dollars
($__________) in monthly installments equal to the sum of (i) the Class A-4
Monthly Principal, (ii) the Class A-4 Overdue Principal and (iii) any other
principal that may be due hereon pursuant to the Amended and Restated Indenture
during an Amortization Event together with (i) the Class A-4 Monthly Interest
and (ii) the Class A-4 Overdue Interest due thereon on the fourteenth day of
each month or if such date is not a Business Day, the next succeeding Business
Day, commencing ______________ (each, a "PAYMENT DATE"), and not later than
____________, all remaining principal and interest (computed on the basis of a
360-day year of twelve 30-day months) are due and payable in their entirety as
set forth in the Amended and Restated Indenture.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date, or Redemption Record Date, as
applicable, for such Payment Date, which shall be the last Business Day of the
month preceding the month in which the Payment Date occurs (or in the case of
the initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class A-4 Notes
of the Issuer designated as its _____% Asset-Backed Notes, Series 2000-1, Class
A-4 with aggregate principal amount of $__________ and to be issued under an
Amended and Restated Indenture, dated as of December 1, 1999 (herein called the
"AMENDED AND RESTATED INDENTURE"), between the Issuer and U.S. Bank Trust
National Association, as trustee (herein called the "TRUSTEE", which term
includes any successor trustee under the Amended and Restated Indenture), to
which Amended and Restated 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 Issuer, the Trustee, and the
holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The Trust Property secures the Notes equally and
ratably without prejudice, priority, or distinction between any Note of the same
tranche and any other Note of the same tranche by reason of difference in time
of issuance or otherwise, and also secures the payment of certain other amounts
and certain other obligations as set forth in the Amended and Restated
Indenture. This Note is issued under and is subject to the terms, provisions and
conditions of the Amended and Restated Indenture, to which Amended and Restated
Indenture the Holder of this Note by virtue of the acceptance hereof assents and
by which such Holder is bound.
Each Class A-4 Noteholder by acceptance of its Class A-4 Note
(and any Person which is a beneficial owner of any interest in a Class A-4 Note,
by virtue of such Persons' acquisition of a beneficial interest therein) agrees
to treat the Class A-4 Notes (or beneficial interest therein) for purposes of
federal, state and local income or franchise taxes and any other tax imposed on
or measured by income,
A-4-2
<PAGE>
as indebtedness. Each Class A-4 Noteholder agrees that it will cause any Person
acquiring an interest in a Class A-4 Note through it to acknowledge the Class
A-4 Notes' characterization as indebtedness and to treat the Class A-4 Notes as
indebtedness for such tax purposes.
Each prospective initial Noteholder acquiring Class A-4 Notes,
each prospective transferee acquiring a Class A-4 Note, and each prospective
owner (or transferee thereof) of a beneficial interest in a Class A-4 Note (each
a "Prospective Owner") will be deemed to have represented by such purchase to
the Issuer, the Trustee, the Servicer and any successor Servicer that either (1)
it is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of
the Code ("Plan") and is not directly or indirectly acquiring the Class A-4
Notes on behalf of, as investment manager of, as named fiduciary of or with the
assets of a Plan; or (2) the acquisition and holding of the Class A-4 Notes will
not give rise to a prohibited transaction under Section 406(a) of ERISA or
Section 4975 of the Code for which a statutory or administrative exemption is
unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Class A-4
Note is registrable in the Note Register, upon surrender of this Class A-4 Note
for registration of transfer at the office or agency designated by the Issuer
pursuant to the Amended and Restated Indenture, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Issuer and the
Trustee duly executed by, the holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Class A-4 Notes, of authorized
denominations and for the same original aggregate principal amount, will be
issued to the designated transferee or transferees.
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Class A-4 Note for
registration of transfer, the Issuer, the Trustee and any agent of the Issuer or
the Trustee may treat the Person in whose name this Note
A-4-3
<PAGE>
is registered as the owner hereof for all purposes, whether or not this Class
A-4 Note be overdue, and neither the Issuer, the Trustee nor any such agent
shall be affected by notice to the contrary.
This Class A-4 Note and the Amended and Restated Indenture may
be amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Class A-4 Note, the holder hereof
irrevocably appoints the Trustee under the Amended and Restated Indenture as the
special attorney-in-fact for the holder vested with full power on behalf of the
holder to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Class A-4 Note which are
defined in the Amended and Restated Indenture and not otherwise defined herein
shall have the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Class
A-4 Note and the Amended and Restated Indenture shall be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to the conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Class A-4 Note shall not be
entitled to any benefit under the Amended and Restated Indenture or be valid or
obligatory for any purpose.
This Class A-4 Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be provided to any Noteholder, at its expense, upon a
written request to the Trustee, U.S. Bank Trust National Association, 180 Fifth
Street, St. Paul, Minnesota 55101, Attention: Structured Finance.
A-4-4
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:_______________________________
Name:
Title:
Dated:___________________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
By:
----------------------------------
Authorized Signatory
Name:
Title:
A-4-5
<PAGE>
EXHIBIT B
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS B NOTES]
NO BENEFICIAL OWNERS OF THIS NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT
OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED NOTES HAVE BEEN DELIVERED
PURSUANT TO THE TERMS OF THE AMENDED AND RESTATED INDENTURE.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, OR
DELIVERED, EXCEPT AS PERMITTED UNDER THE AMENDED AND RESTATED INDENTURE REFERRED
TO BELOW.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS B NOTES ON BEHALF OF, AS INVESTMENT MANAGER OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN; OR (2) THE
ACQUISITION AND HOLDING OF THE CLASS B NOTES WILL NOT GIVE RISE TO A PROHIBITED
TRANSACTION UNDER SECTION 406(a) OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH
A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
No. 1 Principal Amount $_________
Due: ____________ CUSIP No. ___________
B-1
<PAGE>
_____% ASSET-BACKED NOTE, SERIES 2000-1, CLASS B
DVI RECEIVABLES XI, L.L.C., a Delaware limited liability
company (the "ISSUER"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum of ____________________________________
and 00/100 Dollars ($_________) in monthly installments equal to the sum of (i)
the Class B Monthly Principal, (ii) the Class B Overdue Principal and (iii) any
other principal that may be due hereon pursuant to the Amended and Restated
Indenture during an Amortization Event together with (i) the Class B Monthly
Interest and (ii) the Class B Overdue Interest due thereon on the fourteenth day
of each month (or if such date is not a Business Day, the next succeeding
Business Day, commencing _______________ (each, a "PAYMENT DATE"), and not later
than ______, ____, all remaining principal and interest (computed on the basis
of a 360-day year of twelve 30-day months) are due and payable in their entirety
as set forth in the Amended and Restated Indenture.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date, or Redemption Record Date, as
applicable, for such Payment Date, which shall be the last Business Day of the
month preceding the month in which the Payment Date occurs (or in the case of
the initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class B Notes
of the Issuer designated as its _____% Asset-Backed Notes, Series 2000-1, Class
B with aggregate principal amount of $_________ and to be issued under an
Amended and Restated Indenture, dated as of December 1, 1999 (herein called the
"AMENDED AND RESTATED INDENTURE"), between the Issuer and U.S. Bank Trust
National Association, as trustee (herein called the "TRUSTEE", which term
includes any successor trustee under the Amended and Restated Indenture), to
which Amended and Restated 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 Issuer, the Trustee, and the
holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The Trust Property secures the Notes equally and
ratably without prejudice, priority, or distinction between any Note of the same
class and any other Note of the same class by reason of difference in time of
issuance or otherwise, and also secures the payment of certain other amounts and
certain other obligations as set forth in the Amended and Restated Indenture.
This Note is issued under and is subject to the terms, provisions and conditions
of the Amended and Restated Indenture, to which Amended and Restated Indenture
the Holder of this Note by virtue of the acceptance hereof assents and by which
such Holder is bound.
Each Class B Noteholder by acceptance of its Class B Note (and
any Person which is a beneficial owner of any interest in a Class B Note, by
virtue of such Persons' acquisition of a beneficial interest therein) agrees to
treat the Class B Notes (or beneficial interest therein) for purposes of
federal,
B-2
<PAGE>
state and local income or franchise taxes and any other tax imposed on or
measured by income, as indebtedness. Each Class B Noteholder agrees that it will
cause any Person acquiring an interest in a Class B Note through it to
acknowledge the Class B Notes' characterization as indebtedness and to agree to
comply with the Amended and Restated Indenture as to treatment of the Class B
Notes as indebtedness for such tax purpose.
Each prospective initial Noteholder acquiring Class B Notes,
each prospective transferee acquiring the Class B Notes, and each prospective
owner (or transferee thereof) of a beneficial interest in Class B Notes (each a
"Prospective Owner") will be deemed to have represented by such purchase to the
Issuer, the Trustee, the Servicer and any successor Servicer that either (1) it
is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of the
Code ("Plan") and is not directly or indirectly acquiring the Class B Notes on
behalf of, as investment manager of, as named fiduciary of, as trustee of, or
with the assets of a Plan; or (2) the acquisition and holding of the Class B
Notes will not give rise to a prohibited transaction under Section 406(a) of
ERISA or Section 4975 of the Code for which a statutory or administrative
exemption is unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Note is
registrable in the Note Register, upon surrender of this Note for registration
of transfer at the office or agency designated by the Issuer pursuant to the
Amended and Restated Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Issuer and the Trustee duly
executed by, the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes, of authorized denominations and for the same
original aggregate principal amount, will be issued to the designated transferee
or transferees.
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Note for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name this Note is registered
B-3
<PAGE>
as the owner hereof for all purposes, whether or not this Note be overdue, and
neither the Issuer, the Trustee nor any such agent shall be affected by notice
to the contrary.
This Note and the Amended and Restated Indenture may be
amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Note, the holder hereof irrevocably appoints
the Trustee under the Amended and Restated Indenture as the special
attorney-in-fact for the holder vested with full power on behalf of the holder
to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Note which are defined in
the Amended and Restated Indenture and not otherwise defined herein shall have
the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Note
and the Amended and Restated Indenture shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to the
conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Note shall not be entitled to
any benefit under the Amended and Restated Indenture or be valid or obligatory
for any purpose.
This Class B Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be provided to any Noteholder, at its expense, upon a
written request to the Trustee, U.S. Bank Trust National Association, 180 Fifth
Street, St. Paul, Minnesota 55101, Attention: Structured Finance.
B-4
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:_______________________________
Name:
Title:
Dated:_____________________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
By:
--------------------------------
Authorized Signatory
B-5
<PAGE>
EXHIBIT C
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS C NOTES]
NO BENEFICIAL OWNERS OF THIS NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT
OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED NOTES HAVE BEEN DELIVERED
PURSUANT TO THE TERMS OF THE AMENDED AND RESTATED INDENTURE.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, OR
DELIVERED, EXCEPT AS PERMITTED UNDER THE AMENDED AND RESTATED INDENTURE REFERRED
TO BELOW.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS C NOTES ON BEHALF OF, AS INVESTMENT MANAGER OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN; OR (2) THE
ACQUISITION AND HOLDING OF THE CLASS C NOTES WILL NOT GIVE RISE TO A PROHIBITED
TRANSACTION UNDER SECTION 406(a) OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH
A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
No. 1 Principal Amount $_________
Due ____________ CUSIP No. ___________
C-1
<PAGE>
_____% ASSET-BACKED NOTE, SERIES 2000-1, CLASS C
DVI RECEIVABLES XI, L.L.C., a Delaware limited liability
company (the "ISSUER"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum of ___________________________________
and 00/100 Dollars ($_________) in monthly installments equal to the sum of (i)
the Class C Monthly Principal, (ii) the Class C Overdue Principal and (iii) any
other principal that may be due hereon pursuant to the Amended and Restated
Indenture during an Amortization Event together with (i) the Class C Monthly
Interest and (ii) the Class C Overdue Interest due thereon on the fourteenth day
of each month (or if such date is not a Business Day, the next succeeding
Business Day, commencing _______________ (each, a "PAYMENT DATE"), and not later
than ______, ____, all remaining principal and interest (computed on the basis
of a 360-day year of twelve 30-day months) are due and payable in their entirety
as set forth in the Amended and Restated Indenture.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date, or Redemption Record Date, as
applicable, for such Payment Date, which shall be the last Business Day of the
month preceding the month in which the Payment Date occurs (or in the case of
the initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class C Notes
of the Issuer designated as its _____% Asset-Backed Notes, Series 2000-1, Class
C with aggregate principal amount of $_________ and to be issued under an
Amended and Restated Indenture, dated as of December 1, 1999 (herein called the
"AMENDED AND RESTATED INDENTURE"), between the Issuer and U.S. Bank Trust
National Association, as trustee (herein called the "TRUSTEE", which term
includes any successor trustee under the Amended and Restated Indenture), to
which Amended and Restated 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 Issuer, the Trustee, and the
holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The Trust Property secures the Notes equally and
ratably without prejudice, priority, or distinction between any Note of the same
class and any other Note of the same class by reason of difference in time of
issuance or otherwise, and also secures the payment of certain other amounts and
certain other obligations as set forth in the Amended and Restated Indenture.
This Note is issued under and is subject to the terms, provisions and conditions
of the Amended and Restated Indenture, to which Amended and Restated Indenture
the Holder of this Note by virtue of the acceptance hereof assents and by which
such Holder is bound.
Each Class C Noteholder by acceptance of its Class C Note (and
any Person which is a beneficial owner of any interest in a Class C Note, by
virtue of such Persons' acquisition of a beneficial interest therein) agrees to
treat the Class C Notes (or beneficial interest therein) for purposes of
federal,
C-2
<PAGE>
state and local income or franchise taxes and any other tax imposed on or
measured by income, as indebtedness. Each Class C Noteholder agrees that it will
cause any Person acquiring an interest in a Class C Note through it to
acknowledge the Class C Notes' characterization as indebtedness and to agree to
comply with the Amended and Restated Indenture as to treatment of the Class C
Notes as indebtedness for such tax purpose.
Each prospective initial Noteholder acquiring Class C Notes,
each prospective transferee acquiring the Class C Notes, and each prospective
owner (or transferee thereof) of a beneficial interest in Class C Notes (each a
"Prospective Owner") will be deemed to have represented by such purchase to the
Issuer, the Trustee, the Servicer and any successor Servicer that either (1) it
is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of the
Code ("Plan") and is not directly or indirectly acquiring the Class C Notes on
behalf of, as investment manager of, as named fiduciary of, as trustee of, or
with the assets of a Plan; or (2) the acquisition and holding of the Class C
Notes will not give rise to a prohibited transaction under Section 406(a) of
ERISA or Section 4975 of the Code for which a statutory or administrative
exemption is unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Note is
registrable in the Note Register, upon surrender of this Note for registration
of transfer at the office or agency designated by the Issuer pursuant to the
Amended and Restated Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Issuer and the Trustee duly
executed by, the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes, of authorized denominations and for the same
original aggregate principal amount, will be issued to the designated transferee
or transferees.
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Note for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name this Note is registered
C-3
<PAGE>
as the owner hereof for all purposes, whether or not this Note be overdue, and
neither the Issuer, the Trustee nor any such agent shall be affected by notice
to the contrary.
This Note and the Amended and Restated Indenture may be
amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Note, the holder hereof irrevocably appoints
the Trustee under the Amended and Restated Indenture as the special
attorney-in-fact for the holder vested with full power on behalf of the holder
to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Note which are defined in
the Amended and Restated Indenture and not otherwise defined herein shall have
the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Note
and the Amended and Restated Indenture shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to the
conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Note shall not be entitled to
any benefit under the Amended and Restated Indenture or be valid or obligatory
for any purpose.
This Class C Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be provided to any Noteholder, at its expense, upon a
written request to the Trustee, U.S. Bank Trust National Association, 180 Fifth
Street, St. Paul, Minnesota 55101, Attention: Structured Finance.
C-4
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:_______________________________
Name:
Title:
Dated:_________________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
By:
--------------------------------
Authorized Signatory
C-5
<PAGE>
EXHIBIT D
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS D NOTES]
NO BENEFICIAL OWNERS OF THIS NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT
OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED NOTES HAVE BEEN DELIVERED
PURSUANT TO THE TERMS OF THE AMENDED AND RESTATED INDENTURE.
NEITHER THIS NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD, OR
DELIVERED, EXCEPT AS PERMITTED UNDER THE AMENDED AND RESTATED INDENTURE REFERRED
TO BELOW.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS D NOTES ON BEHALF OF, AS INVESTMENT MANAGER OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN; OR (2) THE
ACQUISITION AND HOLDING OF THE CLASS D NOTES WILL NOT GIVE RISE TO A PROHIBITED
TRANSACTION UNDER SECTION 406(a) OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH
A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
No. 1 Principal Amount $_________
Due: ____________ CUSIP No. ___________
D-1
<PAGE>
_____% ASSET-BACKED NOTE, SERIES 2000-1, CLASS D
DVI RECEIVABLES XI, L.L.C., a Delaware limited liability
company (the "ISSUER"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum of _________________________________
and 00/100 Dollars ($_________) in monthly installments equal to the sum of (i)
the Class D Monthly Principal, (ii) the Class D Overdue Principal and (iii) any
other principal that may be due hereon pursuant to the Amended and Restated
Indenture during an Amortization Event together with (i) the Class D Monthly
Interest and (ii) the Class D Overdue Interest due thereon on the fourteenth day
of each month (or if such date is not a Business Day, the next succeeding
Business Day, commencing _______________ (each, a "PAYMENT DATE"), and not later
than ____________, all remaining principal and interest (computed on the basis
of a 360-day year of twelve 30-day months) are due and payable in their entirety
as set forth in the Amended and Restated Indenture.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date, or Redemption Record Date, as
applicable, for such Payment Date, which shall be the last Business Day of the
month preceding the month in which the Payment Date occurs (or in the case of
the initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class D Notes
of the Issuer designated as its _____% Asset-Backed Notes, Series 2000-1, Class
D with aggregate principal amount of $_________ and to be issued under an
Amended and Restated Indenture dated as of December 1, 1999 (herein called the
"AMENDED AND RESTATED INDENTURE"), between the Issuer and U.S. Bank Trust
National Association, as trustee (herein called the "TRUSTEE", which term
includes any successor trustee under the Amended and Restated Indenture), to
which Amended and Restated 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 Issuer, the Trustee, and the
holders of the Notes and of the terms upon which the Notes are, and are to be,
authenticated and delivered. The Trust Property secures the Notes equally and
ratably without prejudice, priority, or distinction between any Note of the same
class and any other Note of the same class by reason of difference in time of
issuance or otherwise, and also secures the payment of certain other amounts and
certain other obligations as set forth in the Amended and Restated Indenture.
This Note is issued under and is subject to the terms, provisions and conditions
of the Amended and Restated Indenture, to which Amended and Restated Indenture
the Holder of this Note by virtue of the acceptance hereof assents and by which
such Holder is bound.
Each Class D Noteholder by acceptance of its Class D Note (and
any Person which is a beneficial owner of any interest in a Class D Note, by
virtue of such Persons' acquisition of a beneficial interest therein) agrees to
treat the Class D Notes (or beneficial interest therein) for purposes of
federal, state and local income or franchise taxes and any other tax imposed on
or measured by income, as
D-2
<PAGE>
indebtedness. Each Class D Noteholder agrees that it will cause any Person
acquiring an interest in a Class D Note through it to acknowledge the Class D
Notes' characterization as indebtedness and to agree to comply with the Amended
and Restated Indenture as to treatment of the Class D Notes as indebtedness for
such tax purpose.
Each prospective initial Noteholder acquiring Class D Notes,
each prospective transferee acquiring the Notes, and each prospective owner (or
transferee thereof) of a beneficial interest in Class D Notes (each a
"Prospective Owner") will be deemed to have represented by such purchase to the
Issuer, the Trustee, the Servicer and any successor Servicer that either (1) it
is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of the
Code ("Plan") and is not directly or indirectly acquiring the Notes on behalf
of, as investment manager of, as named fiduciary of, as trustee of, or with the
assets of a Plan; or (2) the acquisition and holding of the Class D Notes will
not give rise to a prohibited transaction under Section 406(a) of ERISA or
Section 4975 of the Code for which a statutory or administrative exemption is
unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Note is
registrable in the Note Register, upon surrender of this Note for registration
of transfer at the office or agency designated by the Issuer pursuant to the
Amended and Restated Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Issuer and the Trustee duly
executed by, the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes, of authorized denominations and for the same
original aggregate principal amount, will be issued to the designated transferee
or transferees.
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Note for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name this Note is registered
D-3
<PAGE>
as the owner hereof for all purposes, whether or not this Note be overdue, and
neither the Issuer, the Trustee nor any such agent shall be affected by notice
to the contrary.
This Note and the Amended and Restated Indenture may be
amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Note, the holder hereof irrevocably appoints
the Trustee under the Amended and Restated Indenture as the special
attorney-in-fact for the holder vested with full power on behalf of the holder
to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Note which are defined in
the Amended and Restated Indenture and not otherwise defined herein shall have
the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Note
and the Amended and Restated Indenture shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to the
conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Note shall not be entitled to
any benefit under the Amended and Restated Indenture or be valid or obligatory
for any purpose.
This Class D Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be provided to any Noteholder, at its expense, upon a
written request to the Trustee, U.S. Bank Trust National Association, 180 Fifth
Street, St. Paul, Minnesota 55101, Attention: Structured Finance.
D-4
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:_______________________________
Name:
Title:
Dated:_______________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
By:
--------------------------------
Authorized Signatory
D-5
<PAGE>
EXHIBIT E
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS E NOTES]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO TRUSTEE OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN 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 REQUESTED 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.
BY ACCEPTANCE OF THIS NOTE, THE HOLDER AND ANY BENEFICIAL OWNER AGREES
TO TREAT THIS NOTE AS INDEBTEDNESS FOR FEDERAL INCOME TAX PURPOSES.
THIS NOTE HAS NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "ACT") OR THE SECURITIES LAW OF ANY STATE. ANY RESALE,
TRANSFER OR OTHER DISPOSITION OF THIS NOTE WITHOUT SUCH REGISTRATION OR
QUALIFICATION MAY BE MADE ONLY IN A TRANSACTION WHICH DOES NOT REQUIRE SUCH
REGISTRATION OR QUALIFICATION AND IN ACCORDANCE WITH THE PROVISIONS OF SECTION
2.04 OF THE AMENDED AND RESTATED INDENTURE REFERRED TO HEREIN.
BY ITS ACCEPTANCE HEREOF, THE HOLDER AND ANY BENEFICIAL OWNER IS DEEMED
TO HAVE REPRESENTED TO THE ISSUER, THE TRUSTEE, THE SERVICER AND ANY SUCCESSOR
SERVICER THAT EITHER (1) IT IS NOT A PLAN WITHIN THE MEANING OF SECTION 3(3) OF
ERISA OR SECTION 4975 OF THE CODE ("PLAN") AND IT IS NOT DIRECTLY OR INDIRECTLY
ACQUIRING THE CLASS E NOTES ON BEHALF OF, AS INVESTMENT MANAGER OF, AS NAMED
FIDUCIARY OF, AS TRUSTEE OF, OR WITH THE ASSETS OF A PLAN; OR (2) THE
ACQUISITION AND HOLDING OF THE CLASS E NOTES WILL NOT GIVE RISE TO A PROHIBITED
TRANSACTION UNDER SECTION 406(a) OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH
A STATUTORY OR ADMINISTRATIVE EXEMPTION IS UNAVAILABLE.
THIS CLASS E NOTE MAY NOT BE SOLD, ASSIGNED, PLEDGED OR OTHERWISE TRANSFERRED
UNLESS (i) SUCH TRANSFEREE IS A "UNITED STATES PERSON" AS DEFINED IN SECTION
7701(a)(30) OF THE CODE; (ii) (A) SUCH TRANSFEREE IS NOT A GRANTOR TRUST,
PARTNERSHIP OR S CORPORATION FOR UNITED STATES FEDERAL INCOME TAX PURPOSES OR
(B) SUCH TRANSFEREE IS A GRANTOR TRUST, PARTNERSHIP OR S CORPORATION FOR UNITED
STATES FEDERAL INCOME TAX PURPOSES, BUT AFTER GIVING EFFECT TO SUCH TRANSFER OF
CLASS E NOTES TO SUCH TRANSFEREE,
E-1
<PAGE>
SUBSTANTIALLY ALL OF THE VALUE OF THE INTEREST OF AN OWNER OF THE TRANSFEREE IN
THE TRANSFEREE WILL NOT BE ATTRIBUTABLE TO THE PASS-THROUGH ENTITY'S OWNERSHIP
INTEREST IN SECURITIES ISSUED BY THE ISSUER OTHER THAN THE CLASS A, CLASS B AND
CLASS C NOTES AND (ii) FOR THE PURPOSES OF SECTION 7704 OF THE CODE AND THE
TREASURY REGULATIONS PROMULGATED THEREUNDER, AFTER SUCH TRANSFER THE ISSUER
WOULD NOT BE TREATED AS HAVING MORE THAN 100 PARTNERS.
No. 1 Principal Amount $_________
Due: ____________ CUSIP No. ___________
_____% ASSET-BACKED NOTE, SERIES 2000-1, CLASS E
DVI RECEIVABLES XI, L.L.C., a Delaware limited liability
company (the "ISSUER"), for value received, hereby promises to pay to CEDE & CO.
or registered assigns, the principal sum of
___________________________________________ and 00/100 Dollars ($_________) in
monthly installments equal to the sum of (i) the Class E Monthly Principal, (ii)
the Class E Overdue Principal and (iii) any other principal that may be due
hereon pursuant to the Amended and Restated Indenture during an Amortization
Event together with (i) the Class E Monthly Interest and (ii) the Class E
Overdue Interest due thereon on the fourteenth day of each month (or if such
date is not a Business Day, the next succeeding Business Day, commencing
_______________ (each, a "PAYMENT DATE"), and not later than ____________, all
remaining principal and interest (computed on the basis of a 360-day year of
twelve 30-day months) are due and payable in their entirety as set forth in the
Amended and Restated Indenture.
THE RIGHTS TO RECEIVE PAYMENTS WITH RESPECT TO THIS CLASS E
NOTE ARE SUBORDINATE TO THE PRIOR PAYMENT IN FULL ON EACH PAYMENT DATE OF
CERTAIN AMOUNTS DUE AND PAYABLE ON THE CLASS A NOTES, THE CLASS B NOTES, THE
CLASS C NOTES AND THE CLASS D NOTES AS PROVIDED IN THE AMENDED AND RESTATED
INDENTURE.
Payments of principal and interest on this Note shall be made
on each Payment Date in such coin or currency of the United States of America as
at such time is legal tender for payment of public and private debts to the
Person in whose name this Note (or one or more Predecessor Notes) is registered
at the close of business on the Record Date or Redemption Date, as applicable,
for such Payment Date, which shall be the last Business Day of the month
preceding the month in which the Payment Date occurs (or in the case of the
initial Payment Date, the Closing Date), by wire transfer of immediately
available funds to the account and number specified in the Note Register on such
Record Date for such Person 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. The holder hereof shall surrender this Note at the
principal Corporate Trust Office of the Trustee for the final installment of
principal of this Note.
This Note is one of a duly authorized issue of Class E Notes
of the Issuer designated as its _____% Asset-Backed Notes, Series 2000-1, Class
E with aggregate principal amount of $_________ and to be issued under an
Amended and Restated Indenture dated as of December 1, 1999
E-2
<PAGE>
(herein called the "AMENDED AND RESTATED INDENTURE"), between the Issuer and
U.S. Bank Trust National Association, as trustee (herein called the "TRUSTEE",
which term includes any successor trustee under the Amended and Restated
Indenture), to which Amended and Restated 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 Issuer,
the Trustee, and the holders of the Notes and of the terms upon which the Notes
are, and are to be, authenticated and delivered. The Trust Property secures the
Notes equally and ratably without prejudice, priority, or distinction between
any Note of the same class and any other Note of the same class by reason of
difference in time of issuance or otherwise, and also secures the payment of
certain other amounts and certain other obligations as set forth in the Amended
and Restated Indenture. This Note is issued under and is subject to the terms,
provisions and conditions of the Amended and Restated Indenture, to which
Amended and Restated Indenture the Holder of this Note by virtue of the
acceptance hereof assents and by which such Holder is bound.
The Issuer, the Trustee and each Class E Noteholder by
acceptance of its Class E Note (and any Person that is a beneficial owner of any
interest in a Class E Note, by virtue of such Person's acquisition of a
beneficial interest therein) agrees to treat the Class E Notes for purposes of
federal, state and local income or franchise taxes (and any other tax imposed on
or measured by income) as indebtedness. Each Class E Noteholder agrees that it
will cause any Person acquiring an interest in a Class E Note through it to
acknowledge the Class E Notes' characterization as indebtedness and to agree to
comply with this Amended and Restated Indenture as to treatment of the Class E
Notes as indebtedness for such tax purposes.
Each prospective initial Noteholder acquiring Notes, each
prospective transferee acquiring the Class E Notes, and each prospective owner
(or transferee thereof) of a beneficial interest in Class E Notes (each a
"Prospective Owner") will be deemed to have represented by such purchase to the
Issuer, the Trustee, the Servicer and any successor Servicer that either (1) it
is not a plan within the meaning of Section 3(3) of ERISA or Section 4975 of the
Code ("Plan") and is not directly or indirectly acquiring the Class E Notes on
behalf of, as investment manager of, as named fiduciary of, as trustee of, or
with the assets of a Plan; or (2) the acquisition and holding of the Class E
Notes will not give rise to a prohibited transaction under Section 406(a) of
ERISA or Section 4975 of the Code for which a statutory or administrative
exemption is unavailable.
If an Indenture Event of Default or Amortization Event shall
occur and be continuing, the Notes may be declared due and payable in the manner
and with the effect provided in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture and subject
to the limitations set forth therein and above, the transfer of this Note is
registrable in the Note Register, upon surrender of this Note for registration
of transfer at the office or agency designated by the Issuer pursuant to the
Amended and Restated Indenture, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Issuer and the Trustee duly
executed by, the holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Notes, of authorized denominations and for the same
original aggregate principal amount, will be issued to the designated transferee
or transferees.
E-3
<PAGE>
The Notes may be redeemed in part by the Issuer at the partial
redemption price set forth in the Amended and Restated Indenture on any Payment
Date on which the outstanding Pool B Aggregate Discounted Contract Balance is
less than 20% of the Pool B Aggregate Discounted Contract Balance on the Closing
Date in the manner provided in the Amended and Restated Indenture. The Notes may
be redeemed by the Issuer, in whole but not in part, at the redemption price set
forth in the Amended and Restated Indenture on any Payment Date on which the
Pool A Aggregate Discounted Contract Balance is less than 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date and the Pool B
Aggregate Discounted Contract Balance is less than 20% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date in the manner provided in the
Amended and Restated Indenture.
The Notes are issuable only in registered form without coupons
in denominations as provided in the Amended and Restated Indenture and subject
to certain limitations therein set forth. No service charge shall be made for
any such registration of transfer or exchange, but the Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Prior to due presentment of this Note for registration of
transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may
treat the Person in whose name this Note is registered as the owner hereof for
all purposes, whether or not this Note be overdue, and neither the Issuer, the
Trustee nor any such agent shall be affected by notice to the contrary.
This Note and the Amended and Restated Indenture may be
amended or supplemented as set forth in the Amended and Restated Indenture.
By accepting this Note, the holder hereof irrevocably appoints
the Trustee under the Amended and Restated Indenture as the special
attorney-in-fact for the holder vested with full power on behalf of the holder
to effect and enforce the rights of such holder and the provisions of the
Amended and Restated Indenture for the benefit of the holder. The preceding
provision in no way shall limit the right of the holder hereof to demand payment
hereunder or bring an action to enforce payment hereof.
All capitalized terms used in this Note which are defined in
the Amended and Restated Indenture and not otherwise defined herein shall have
the meanings assigned to them in the Amended and Restated Indenture.
As provided in the Amended and Restated Indenture, this Note
and the Amended and Restated Indenture shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to the
conflict of laws principles thereof.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Note shall not be entitled to
any benefit under the Amended and Restated Indenture or be valid or obligatory
for any purpose.
This Class E Note does not purport to summarize the Amended
and Restated Indenture and reference is made to the Amended and Restated
Indenture for information with respect to interests, rights, benefits,
obligations, proceeds and duties evidenced hereby and the rights, duties and
immunities of the Trustee. Copies of the Amended and Restated Indenture and all
amendments thereto will be
E-4
<PAGE>
provided to any Noteholder, at its expense, upon a written request to the
Trustee, U.S. Bank Trust National Association, 180 Fifth Street, St. Paul,
Minnesota 55101, Attention: Structured Finance.
E-5
<PAGE>
IN WITNESS WHEREOF, DVI RECEIVABLES XI, L.L.C. has caused this
instrument to be duly executed.
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII,
its Managing Member
By:_______________________________
Name:
Title:
Dated:__________________
This is one of the Notes
referred to in the within
mentioned Amended and Restated Indenture.
U.S. BANK TRUST NATIONAL ASSOCIATION, as Trustee
By:
------------------------------------
Authorized Signatory
E-6
<PAGE>
EXHIBIT F
TO AMENDED AND RESTATED INDENTURE
---------------------------------
[FORM OF CLASS F INSTRUMENT TO BE PROVIDED WITH ANY
SUPPLEMENT PURSUANT TO WHICH CLASS F INSTRUMENTS ARE ISSUED]
F-1
<PAGE>
EXHIBIT G
TO AMENDED AND RESTATED INDENTURE
---------------------------------
INVESTMENT LETTER
-----------------
_______________, 200_
DVI Receivables XI, L.L.C.
500 Hyde Park
Doylestown, Pennsylvania 18901
U.S. Bank Trust National Association
180 Fifth Street
St. Paul, Minnesota 55101
Re: $ % Asset-Backed Notes, Series 2000-1, Class
CUSIP Number
--------------------------------------------------------
Ladies and Gentlemen:
___________________________ (the "SELLER") intends to transfer
$_____________ in aggregate principal amount of the captioned Notes to
_____________________ (the "PURCHASER").
1. In connection with such transfer, and in accordance with
Section 2.04 of the Amended and Restated Indenture, dated as of December 1, 1999
(the "AMENDED AND RESTATED INDENTURE"; all capitalized terms used herein without
definition shall have the meanings ascribed to such terms in the Amended and
Restated Indenture), between DVI Receivables XI, L.L.C. (the "ISSUER") and U.S.
Bank Trust National Association, not in its individual capacity but solely as
Trustee (the "TRUSTEE"), pursuant to which the Notes were issued, the Seller
hereby certifies to you the following facts: Neither the Seller nor anyone
acting on its behalf has offered, transferred, pledged, sold or otherwise
disposed of the Notes, any interest in the Notes or any other similar security
to, or solicited any offer to buy or accept a transfer, pledge or other
disposition of the Notes, any interest in the Notes or any other similar
security with, any person in any manner, or made any general solicitation by
means of general advertising or in any other manner, or taken any other action
which would constitute a distribution of the Notes under the Securities Act of
1933, as amended (the "1933 ACT"), or under state securities laws, or which
would render the disposition of the Notes a violation of Section 5 of the 1933
Act or applicable state securities laws or require registration pursuant
thereto.
2. The Purchaser warrants and represents to, and covenants
with, the Trustee pursuant to Section 2.04 of the Amended and Restated Indenture
that:
G-1
<PAGE>
(a) The Purchaser agrees to be bound, as Noteholder, by all of
the terms, covenants and conditions of the Amended and Restated
Indenture and the Notes, and from and after the date hereof, the
Purchaser assumes for the benefit of each of the Trustee and the Seller
all of the Seller's obligations as Noteholder thereunder;
(b) The Purchaser understands that the Notes have not been and
may never be registered under the 1933 Act or the securities laws of
any state;
(c) The Purchaser is acquiring the Notes for investment for
its own account or the account of another qualified institutional buyer
(within the meaning of Rule 144A under the 1933 Act) only and not for
any other person or with a view to the distribution thereof in
violation of applicable securities laws;
(d) The Purchaser considers itself a substantial,
sophisticated institutional investor having such knowledge and
experience in financial and business matters that it is capable of
evaluating the merits and risks of investment in the Notes;
(e) The Purchaser has been furnished with all information
regarding the Notes that it has requested from the Seller or the
Trustee and has been afforded the opportunity to ask all questions it
reasonably desires to ask of the Seller (and all such questions have
been answered to the Purchaser's satisfaction);
(f) Neither the Purchaser nor anyone acting on its behalf has
offered, transferred, pledged, sold or otherwise disposed of the Notes,
any interest in the Notes or any other similar security to, or
solicited any offer to buy or accept a transfer, pledge or other
disposition of the Notes, any interest in the Notes or any other
similar security from, or otherwise approached or negotiated with
respect to the Notes, any interest in the Notes or any other similar
security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or
taken any other action which would constitute a distribution of the
Notes under the 1933 Act or applicable state securities laws or which
would render the disposition of the Notes a violation of Section 5 of
the 1933 Act or applicable state securities laws or require
registration pursuant thereto, nor will it act, nor has it authorized
or will it authorize any person to act, in such manner with respect to
the Notes; and
(g) The Purchaser will strictly comply with the Amended and
Restated Indenture as to treatment of the Class ___ Notes as
indebtedness of the Seller for purposes of federal, state and local
income or franchise taxes and any other tax imposed on or measured by
income.
3. The Purchaser represents and warrants to the Issuer, the
Trustee, the Servicer and any successor Servicer that either (1) it is not a
plan within the meaning of Section 3(3) of ERISA or Section 4975 of the Code
("Plan") and is not directly or indirectly acquiring this Note on behalf of, as
investment manager of, as named fiduciary of, as trustee of, or with the assets
of a Plan; or (2) the acquisition and holding of this Note will not give rise to
a prohibited transaction under Section 406(a) of ERISA or section 4975 of the
Code for which a statutory or administrative exemption is unavailable.
G-2
<PAGE>
4. The Purchaser understands and agrees with the Seller that
the Seller is transferring the Notes pursuant to the exemption from registration
under the 1933 Act provided by Rule 144A thereunder ("RULE 144A") and the
Purchaser hereby represents and warrants to the Seller and the Trustee that the
Purchaser is a "qualified institutional buyer" as defined in Rule 144A.
The Purchaser acknowledges that it is familiar with Rule 144A
and understand that you are and will continue to rely on the statements made
herein.
5. This Certification may be executed in one or more
counterparts and by the different parties hereto on separate counterparts, each
of which, when so executed, shall be deemed to be an original; such
counterparts, together, shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have caused this Investment
Letter to be executed by their duly authorized officers as of the date first
above written.
__________________________ __________________________________
Seller Purchaser
By:______________________________ By:_______________________________
Its:_____________________________ Its:______________________________
Taxpayer Identification Taxpayer Identification
No.______________________________ No._______________________________
G-3
<PAGE>
EXHIBIT H
[Reserved.]
H-1
<PAGE>
EXHIBIT I
TAX CERTIFICATE
[With respect to Class E Notes]
The undersigned hereby certifies and represents as follows to the
parties listed in the Amended and Restated Indenture to which this certification
relates with respect to the Class E Notes described therein:
This Tax Certificate ("CERTIFICATE") is delivered in
connection with the acquisition of, transfer to or possession by the
undersigned, whether as beneficial owner (the "BENEFICIAL OWNER"), or nominee on
behalf of the beneficial owner of the above-described Class E Notes.
Each Holder must complete Part I, Part II (if the holder is a
nominee), Part III, Part IV and in all cases sign and otherwise complete this
certificate. Each Holder shall submit with this certificate an IRS Form W-9 (or
any such successor form) to such Holder.
Part I
1. _______________ (Name of beneficial owner) is not a
foreign corporation, foreign partnership, foreign
trust or foreign estate (as those terms are defined
in the Code and Treasury Regulations);
2. The beneficial owner's office address and place of
incorporation (if applicable) is _______________; and
3. The beneficial owner's U.S. employer identification
number is _______________.
Part II - Nominees
If the undersigned is the nominee for the Beneficial Owner,
the undersigned certifies that this certificate has been made in reliance upon
information contained in:
____ an IRS Form W-9
____ a form such as this or substantially similar
provided to the undersigned by an appropriate person and (i) the undersigned
agrees to notify the Trustee at least thirty (30) days prior to the date that
the form relied upon becomes obsolete, and (ii) in connection with a change in
beneficial owners, the undersigned agrees to submit a new Tax Certificate to the
Trustee promptly after such change.
I-1
<PAGE>
Part III - Declaration
The undersigned, as the Beneficial Owner or a nominee thereof,
agrees to notify the Trustee within sixty (60) days of the date that the
Beneficial Owner becomes a foreign person. The undersigned understands that this
certificate may be disclosed to the Internal Revenue Service by the Trustee and
any false statement contained therein could be punishable by fines, imprisonment
or both.
Part IV - Representation
The undersigned hereby represents, warrants and agrees that
it:
(1) (a) is purchasing the Class E Note for its own
account and is the sole beneficial owner of such Note;
(b) either (i) is not, for federal income tax
purposes, a partnership, trust, estate or "S Corporation" (as defined in the
Code) (each a "PASS-THROUGH ENTITY") or (ii) is for federal income tax purposes,
a Pass-through Entity, but after giving effect to our purchase of such Note less
than 50 percent of the aggregate value of our assets would consist of Class E
Notes; and
(c) such Note has not been transferred through an
"established securities market" within the meaning of Section 7704(b) of the
Code;
(2) if it is a Pass-through Entity, it covenants that the
portion of its assets consisting of Class E Notes will remain below 50 percent
at all times; and
(3) if it resells or transfers any of the Class E Notes, it
will obtain from each subsequent purchaser or transferee a letter containing the
same representations and agreements as set forth herein.
The undersigned understands and agrees that no initial or subsequent
sale or other transfer of a Class E Note may be made unless such sale or
transfer (i) is accompanied by delivery of a tax statement in the form of this
letter, (ii) is made to a "United States Person" as defined in Section
7701(a)(30) of the code, as certified in such tax statement, and (iii) will not
cause the Issuer to be treated as a publicly traded partnership for United
States federal income tax purposes. Any attempted transfer, assignment,
conveyance, participation or subdivision in contravention of the preceding
restrictions, as reasonably determined by the Trustee, shall be void AB INITIO
and the purported transferor, seller or subdivider of such Class E Note shall
continue to be treated as the Holder of such Note for all purposes of the
Amended and Restated Indenture.
IN WITNESS WHEREOF, the undersigned has caused this
certificate to be executed by its duly authorized officer as of the date first
above written.
________________________________
Purchaser
By:_____________________________
Its:____________________________
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APPENDIX I
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The following definition of terms used in the Amended and
Restated Contribution and Servicing Agreement, the Amended and Restated
Indenture, the Amended and Restated Subsequent Contract Transfer Agreement, any
Note Purchase Agreement and the Underwriting Agreement (each such agreement as
defined herein), unless the context otherwise requires, shall have the following
meanings and such meanings shall be equally applicable to both the singular and
plural forms of such terms:
ACT: means, with respect to any Noteholder, as defined in
Section 1.04(a) of the Amended and Restated Indenture.
AFFILIATE: means, of any specified Person, any other Person
(i) which directly or indirectly controls, or whose directors or officers
directly or indirectly control, or is controlled by, or is under common control
with, such specified Person, (ii) which beneficially owns or holds, or whose
directors or officers beneficially own or hold, 5% or more of any class of the
voting stock (or, in the case of an entity that is not a corporation, 5% of the
equity interest) of such specified Person, or (iii) 5% or more of the voting
stock (or, in the case of an entity that is not a corporation, 5% of the equity
interest) of which is owned or held by such specified Person. The term "control"
as used in the preceding sentence 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.
AGGREGATE DISCOUNTED CONTRACT BALANCE: means, with respect to
any date of determination, the sum of the Discounted Contract Balances of all
Contracts.
AGGREGATE NOTE BALANCE: means the sum of (i) the Note Balance
for the Class A Notes, (ii) the Note Balance for the Class B Notes, (iii) the
Note Balance for the Class C Notes, (iv) the Note Balance for the Class D Notes,
(v) the Note Balance for the Class E Notes and (iv) the Note Balance for the
Class F Instrument, if any.
AMENDED AND RESTATED CONTRIBUTION AND SERVICING AGREEMENT:
means the Amended and Restated Contribution and Servicing Agreement dated as of
December 1, 1999 between the Transferor and the Contributor, as the same may be
amended or modified from time to time in accordance with the provisions hereof
and thereof.
AMENDED AND RESTATED INDENTURE: means the Amended and Restated
Indenture between the Issuer and the Trustee dated as of December 1, 1999 and as
from time to time supplemented or amended pursuant to the applicable provisions
thereof.
AMENDED AND RESTATED SUBSEQUENT CONTRACT TRANSFER AGREEMENT:
means the Subsequent Contract Agreement, dated as of December 1, 1999, by and
between the Issuer and the Transferor.
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AMORTIZATION EVENT: means the occurrence of any one of the
following events:
(i) The entry by a court having jurisdiction
in the premises of (A) a decree or order for relief in respect
of DVI, Inc. in an involuntary case or proceeding under any
applicable federal or state bankruptcy, insolvency,
reorganization, or other similar law or (B) a decree or order
adjudging DVI, Inc. a bankrupt or insolvent, or approving as
properly filed a petition servicing reorganization,
arrangement, adjustment, or composition of or in respect of
DVI, Inc. under any applicable federal or state law, or
appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator, or other similar official of DVI, Inc.
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 90
consecutive days; or
(ii) The commencement by DVI, Inc. 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 DVI, Inc. 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 DVI,
Inc. or of any substantial part of its property, or the making
by it of an assignment for the benefit of creditors, or DVI,
Inc.'s failure to pay its debts generally as they become due,
or the taking of corporate action by DVI, Inc. in furtherance
of any such action; or
(iii) On and as of any Determination Date,
(x) the quotient of (1) the sum of the Discounted Contract
Balances of all Contracts listed as more than 90 days
delinquent as of the last day of the three immediately
preceding calendar months, divided by (2) three exceeds (y)
the product of (1) 0.08 and (2) the quotient of (A) the sum of
the Aggregate Discounted Contract Balance as of the last day
of the three immediately preceding Collection Periods, divided
by (B) three; or
(iv) As of any Determination Date, the sum
of Discounted Contract Balances of all Contracts that have
been classified as Defaulted Contracts since the Closing Date
(such Discounted Contract Balances to be determined
immediately prior to the classification as a Defaulted
Contract) exceeds the product of (1) 0.06 and (2) the
Aggregate Discounted Contract Balance on the Closing Date.
AUTHORIZED OFFICER: means, with respect to any matter, any
officer of or other Person representing the Issuer, the Transferor, the
Contributor, the Servicer, the Trustee, any Noteholder or any Instrumentholder,
as the case may be, who is authorized to act for that party.
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<PAGE>
AVAILABLE FUNDS: means, with respect to each Payment Date, the
excess of (i) all amounts on deposit in the Collection Account on the second
Business Day preceding such Payment Date over (ii) any portion thereof
representing Contract Payments due, or voluntary prepayments deposited therein,
subsequent to the end of the related Collection Period.
AVAILABLE RESERVE ACCOUNT FUNDS: has the meaning set forth in
Section 3.04(c) of the Amended and Restated Indenture.
BALLOON PAYMENT: means, with respect to any Contract, a final
Contract Payment that is at least equal to six times any other Contract Payment
related to such Contract.
BOOK-ENTRY CUSTODIAN: means, the Person appointed pursuant to
the terms of the Amended and Restated Indenture to act in accordance with a
certain Letter of Representations agreement such Person has with DTC, in which
DTC delegates its duties to maintain the Book-Entry Notes to such Person and
authorizes such Person to perform such duties.
BOOK-ENTRY NOTE(S): means each Note for so long as such Note
is registered in the name of its depository or its nominee in accordance with
the terms and conditions of the Amended and Restated Indenture.
BUSINESS DAY: means any day other than a Saturday, a Sunday or
a day on which banking institutions in New York City or in the city in which the
Corporate Trust Office is located are authorized or required by law or executive
order to close.
CAPITAL STOCK: means the Transferor's common stock, $1.00 par
value.
CLASS A DISTRIBUTION SUB-ACCOUNT: means the sub-account or
sub-accounts by that name established and maintained by the Trustee pursuant to
Section 3.01 of the Amended and Restated Indenture.
CLASS A MONTHLY INTEREST: means, for any Payment Date, the sum
of the Class A-1 Monthly Interest, the Class A-2 Monthly Interest, the Class A-3
Monthly Interest and the Class A-4 Monthly Interest.
CLASS A MONTHLY PRINCIPAL: means for any Payment Date the sum
of the Class A-1 Monthly Principal, the Class A-2 Monthly Principal, the Class
A-3 Monthly Principal and the Class A-4 Monthly Principal due or payable on that
Payment Date.
CLASS A NOTE BALANCE: means, as of the Closing
Date,$257,425,000 and thereafter shall equal the Class A Note Balance as of the
Closing Date reduced by all principal payments on all of the Class A Notes.
CLASS A NOTEHOLDER: means, at any time, any Person in whose
name a Class A Note is registered in the Note Register.
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<PAGE>
CLASS A NOTES: means any Class A-1 Note, Class A-2 Note, Class
A-3 Note or Class A-4 Note described in Article II of, and authorized by, and
authenticated and delivered under, the Amended and Restated Indenture.
CLASS A OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class A Monthly Interest payable
on all prior Payment Dates over (b) the aggregate amount of interest actually
paid to the Class A Noteholders on all prior Payment Dates.
CLASS A OVERDUE PRINCIPAL: means, as of any Payment Date, the
excess, if any, of (a) the aggregate amount of Class A Monthly Principal due on
the Class A Notes on all prior Payment Dates over (b) the aggregate amount of
principal actually paid to the Class A Noteholders on all prior Payment Dates.
CLASS A PERCENTAGE: means 88.0%.
CLASS A-1 MONTHLY INTEREST: means, for any Payment Date
(except the Initial Payment Date), the product of (i) the fraction of which the
numerator is the actual number of days elapsed during the related month and the
denominator of which is 360 days and (ii) the Class A-1 Note Rate and (iii) the
Class A-1 Note Balance on the immediately preceding Payment Date (or, with
respect to the Initial Payment Date, the Closing Date) after giving effect to
all principal payments on the Class A-1 Notes on such Payment Date. The Class
A-1 Monthly Interest, with respect to each Payment Date, shall accrue from and
including the prior Payment Date to but excluding such Payment Date, and with
respect to the Initial Payment Date, shall accrue from and including the Closing
Date to but excluding such Initial Payment Date.
CLASS A-1 MONTHLY PRINCIPAL: means (A) with respect to each
Payment Date other than the Class A-1 Stated Maturity Date, until the Class A-1
Note Balance has been reduced to zero, an amount equal to the product of (a) the
Class A Percentage and (b) Monthly Principal; PROVIDED, HOWEVER, that in no
event shall the Class A-1 Monthly Principal due on any Payment Date exceed the
Class A-1 Note Balance as of such Payment Date and (B) on the Class A-1 Stated
Maturity Date, the entire amount of the then-Outstanding Note Balance.
CLASS A-1 NOTE BALANCE: means, as of the Closing Date,
$39,800,000 and thereafter shall equal the Class A-1 Note Balance as of the
Closing Date reduced by all principal payments on all of the Class A-1 Notes.
CLASS A-1 NOTE RATE: means six and 72375/100000 percent
(6.72375%) per annum based upon the actual number of days elapsed.
CLASS A-1 NOTEHOLDER: means, at any time, any Person in whose
name a Class A-1 Note is registered in the Note Register.
CLASS A-1 NOTES: means any Class A-1 Notes described in
Article II of, and authorized by, and authenticated and delivered under, the
Amended and Restated Indenture.
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CLASS A-1 OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class A-1 Monthly Interest
payable on all prior Payment Dates over (b) the aggregate amount of interest
actually paid to the Class A-1 Noteholders on all prior Payment Dates.
CLASS A-1 OVERDUE PRINCIPAL: means, as of any Payment Date,
the excess, if any, of (a) the aggregate amount of Class A-1 Monthly Principal
due on the Class A-1 Notes on all prior Payment Dates over (b) the aggregate
amount of principal actually paid to the Class A-1 Noteholders on all prior
Payment Dates.
CLASS A-1 STATED MATURITY DATE: means the Payment Date
occurring on May 14, 2001.
CLASS A-2 MONTHLY INTEREST: means, for any Payment Date
(except the Initial Payment Date), the product of (i) one-twelfth, (ii) the
Class A-2 Note Rate and (iii) the Class A-2 Note Balance on the immediately
preceding Payment Date (or, in the case of the Initial Payment Date, the Closing
Date) after giving effect to all principal payments on the Class A-2 Notes on
such Payment Date. The Class A-2 Monthly Interest shall be calculated on a
twelve month year of thirty days in each month, except for the Initial Payment
Date, for which interest shall accrue from the Closing Date to but excluding
such Initial Payment Date.
CLASS A-2 MONTHLY PRINCIPAL: means (A) prior to the Payment
Date upon which the Class A-1 Note Balance is paid in full, zero, (B) on each
Payment Date after the Class A-1 Note Balance has been reduced to zero and until
the Class A-2 Note Balance has been reduced to zero, the product of (x) the
Class A Percentage and (y) Monthly Principal; PROVIDED HOWEVER, that in no case
shall the Class A-2 Monthly Principal due on any Payment Date exceed the Class
A-2 Note Balance, and (C) on the Class A-2 Stated Maturity Date, the entire
amount of the then outstanding Class A-2 Note Balance.
CLASS A-2 NOTE BALANCE: means, as of the Closing Date,
$39,000,000 and thereafter shall equal the Class A-2 Note Balance as of the
Closing Date reduced by all principal payments on all of the Class A-2 Notes.
CLASS A-2 NOTE RATE: means seven and 265/1000 percent (7.265%)
per annum based upon thirty days elapsed each month in a twelve-month year.
CLASS A-2 NOTEHOLDER: means, at any time, any Person in whose
name a Class A-2 Note is registered in the Note Register.
CLASS A-2 NOTES: means any Class A-2 Notes described in
Article II of, and authorized by, and authenticated and delivered under, the
Amended and Restated Indenture.
CLASS A-2 OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class A-2 Monthly Interest
payable on all prior Payment Dates over (b) the aggregate amount of interest
actually paid to the Class A-2 Noteholders on all prior Payment Dates.
CLASS A-2 OVERDUE PRINCIPAL: means, as of any Payment Date,
the excess, if any, of (a) the aggregate amount of Class A-2 Monthly Principal
due on the Class A-2 Notes on all prior
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<PAGE>
Payment Dates over (b) the aggregate amount of principal actually paid to the
Class A-2 Noteholders on all prior Payment Dates.
CLASS A-2 STATED MATURITY DATE: means the Payment Date
occurring on December 14, 2002.
CLASS A-3 MONTHLY INTEREST: means, for any Payment Date
(except the Initial Payment Date), the product of (i) one-twelfth, (ii) the
Class A-3 Note Rate and (iii) the Class A-3 Note Balance on the immediately
preceding Payment Date (or, in the case of the Initial Payment Date, the Closing
Date) after giving effect to all principal payments on the Class A-3 Notes on
such Payment Date. The Class A-3 Monthly Interest shall be calculated based upon
a twelve month year of thirty days in each month, except for the Initial Payment
Date, for which interest shall accrue from the Closing Date to but excluding
such Initial Payment Date.
CLASS A-3 MONTHLY PRINCIPAL: means (A) prior to the Payment
Date upon which the Class A-2 Note Balance is paid in full, zero, (B) on each
Payment Date after the Class A-2 Note Balance has been reduced to zero and until
the Class A-3 Note Balance has been reduced to zero, the product of (x) the
Class A Percentage and (y) Monthly Principal; PROVIDED HOWEVER, that in no case
shall the Class A-3 Monthly Principal due on any Payment Date exceed the Class
A-3 Note Balance, and (C) on the Class A-3 Stated Maturity Date, the entire
amount of the then outstanding Class A-3 Note Balance.
CLASS A-3 NOTE BALANCE: means, as of the Closing Date,
$83,000,000 and thereafter shall equal the Class A-3 Note Balance as of the
Closing Date reduced by all principal payments on all of the Class A-3 Notes.
CLASS A-3 NOTE RATE: means seven and 550/1000 percent (7.550%)
per annum based upon thirty days elapsed each month in a twelve-month year.
CLASS A-3 NOTEHOLDER: means, at any time, any Person in whose
name a Class A-3 Note is registered in the Note Register.
CLASS A-3 NOTES: means any Class A-3 Notes described in
Article II of, and authorized by, and authenticated and delivered under, the
Amended and Restated Indenture.
CLASS A-3 OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class A-3 Monthly Interest
payable on all prior Payment Dates over (b) the aggregate amount of interest
actually paid to the Class A-3 Noteholders on all prior Payment Dates.
CLASS A-3 OVERDUE PRINCIPAL: means, as of any Payment Date,
the excess, if any, of (a) the aggregate amount of Class A-3 Monthly Principal
due on the Class A-3 Notes on all prior Payment Dates over (b) the aggregate
amount of principal actually paid to the Class A-3 Noteholders on all prior
Payment Dates.
CLASS A-3 STATED MATURITY DATE: means the Payment Date
occurring on July 14, 2004.
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CLASS A-4 MONTHLY INTEREST: means, for any Payment Date
(except the Initial Payment Date), the product of (i) one-twelfth, (ii) the
Class A-4 Note Rate and (iii) the Class A-4 Note Balance on the immediately
preceding Payment Date (or, in the case of the Initial Payment Date, the Closing
Date) after giving effect to all principal payments on the Class A-4 Notes on
such Payment Date. The Class A-4 Monthly Interest shall be calculated based upon
a twelve month year of thirty days in each month, except for the Initial Payment
Date, for which interest shall accrue from the Closing Date to but excluding
such Initial Payment Date.
CLASS A-4 MONTHLY PRINCIPAL: means (A) prior to the Payment
Date upon which the Class A-3 Note Balance is paid in full, zero, (B) on each
Payment Date after the Class A-3 Note Balance has been reduced to zero and until
the Class A-4 Note Balance has been reduced to zero, the product of (x) the
Class A Percentage and (y) Monthly Principal; PROVIDED HOWEVER, that in no case
shall the Class A-4 Monthly Principal due on any Payment Date exceed the Class
A-4 Note Balance, and (C) on the Class A-4 Stated Maturity Date, the entire
amount of the then outstanding Class A-4 Note Balance.
CLASS A-4 NOTE BALANCE: means, as of the Closing Date,
$95,625,000 and thereafter shall equal the Class A-4 Note Balance as of the
Closing Date reduced by all principal payments on all of the Class A-4 Notes.
CLASS A-4 NOTE RATE: means seven and 780/1000 percent (
7.780%) per annum based upon thirty days elapsed each month in a twelve-month
year.
CLASS A-4 NOTEHOLDER: means, at any time, any Person in whose
name a Class A-4 Note is registered in the Note Register.
CLASS A-4 NOTES: means any Class A-4 Notes described in
Article II of, and authorized by, and authenticated and delivered under, the
Amended and Restated Indenture.
CLASS A-4 OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class A-4 Monthly Interest
payable on all prior Payment Dates over (b) the aggregate amount of interest
actually paid to the Class A-4 Noteholders on all prior Payment Dates.
CLASS A-4 OVERDUE PRINCIPAL: means, as of any Payment Date,
the excess, if any, of (a) the aggregate amount of Class A-4 Monthly Principal
due on the Class A-4 Notes on all prior Payment Dates over (b) the aggregate
amount of principal actually paid to the Class A-4 Noteholders on all prior
Payment Dates.
CLASS A-4 STATED MATURITY DATE: means the Payment Date
occurring on June 14, 2008.
CLASS B DISTRIBUTION SUB-ACCOUNT: means the sub-account or
sub-accounts by that name established and maintained by the Trustee pursuant to
Section 3.01 of the Amended and Restated Indenture.
CLASS B MONTHLY INTEREST: means, for any Payment Date (except
the Initial Payment Date), the product of (i) one-twelfth, (ii) the Class B Note
Rate and (iii) the Class B Note Balance
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on the immediately preceding Payment Date (or, in the case of the Initial
Payment Date, the Closing Date) after giving effect to all principal payments on
the Class B Notes on such Payment Date. The Class B Monthly Interest shall be
calculated based upon a twelve month year of thirty days in each month, except
for the Initial Payment Date, for which interest shall accrue from the Closing
Date to but excluding such Initial Payment Date.
CLASS B MONTHLY PRINCIPAL: means (A) on any Payment Date other
than the Class B Stated Maturity Date, the product of (x) the Class B Percentage
and (y) Monthly Principal, and (B) on the Class B Stated Maturity Date, the
entire amount of the then outstanding Class B Note Balance.
CLASS B NOTE BALANCE: means, as of the Closing Date,
$4,387,000 and thereafter shall equal the Class B Note Balance as of the Closing
Date reduced by all principal payments on the Class B Notes.
CLASS B NOTE RATE: means seven and 760/1000 percent (7.760%)
per annum based upon thirty days elapsed each month in a twelve-month year.
CLASS B NOTEHOLDER: means, at any time, any Person in whose
name a Class B Note is registered in the Note Register.
CLASS B NOTES: means any Class B Notes described in Article II
of, and authorized by, and authenticated and delivered under, the Amended and
Restated Indenture.
CLASS B OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class B Monthly Interest payable
on all prior Payment Dates over (b) the aggregate amount of interest actually
paid to the Class B Noteholders on all prior Payment Dates.
CLASS B OVERDUE PRINCIPAL: means, as of any Payment Date, the
excess, if any, of (a) the aggregate amount of Class B Monthly Principal due on
the Class B Notes on all prior Payment Dates over (b) the aggregate amount of
principal actually paid to the Class B Noteholders on all prior Payment Dates.
CLASS B PERCENTAGE: means 1.5%.
CLASS B STATED MATURITY DATE: means the Payment Date occurring
on June 14, 2008.
CLASS C DISTRIBUTION SUB-ACCOUNT: means the sub-account or
sub-accounts by that name established and maintained by the Trustee pursuant to
Section 3.01 of the Amended and Restated Indenture.
CLASS C MONTHLY INTEREST: means, for any Payment Date (except
the Initial Payment Date), the product of (i) one-twelfth, (ii) the Class C Note
Rate and (iii) the Class C Note Balance on the immediately preceding Payment
Date (or, in the case of the Initial Payment Date, the Closing Date) after
giving effect to all principal payments on the Class C Note on such Payment
Date. The Class C Monthly Interest shall be calculated based upon a twelve month
year of thirty days in each
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month, except for the Initial Payment Date, for which interest shall accrue from
the Closing Date to but excluding such Initial Payment Date.
CLASS C MONTHLY PRINCIPAL: means, (A) on any Payment Date
other than the Class C Stated Maturity Date, an amount equal to the product of
(x) the Class C Percentage and (y) the Monthly Principal and (B) on the Class C
Stated Maturity Date, the entire amount of the then outstanding Class C Note
Balance.
CLASS C NOTEHOLDER: means, at any time, any Person in whose
name a Class C Note is registered in the Note Register.
CLASS C NOTE BALANCE: means, as of the Closing Date,
$8,775,000 and thereafter shall equal the Class C Note Balance as of the Closing
Date reduced by all principal payments on the Class C Notes.
CLASS C NOTE RATE: means seven and 860/1000 percent (7.860%)
per annum based upon thirty days elapsed each month in a twelve-month year.
CLASS C NOTES: means any Class C Notes described in Article II
of, and authorized by, and authenticated and delivered under, the Amended and
Restated Indenture.
CLASS C OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class C Monthly Interest payable
on all prior Payment Dates over (b) the aggregate amount of interest actually
paid to the Class C Noteholders on all prior Payment Dates.
CLASS C OVERDUE PRINCIPAL: means, as of any Payment Date, the
excess, if any, of (a) the aggregate amount of Class C Monthly Principal due on
the Class C Notes on all prior Payment Dates over (b) the aggregate amount of
principal actually paid to the Class C Noteholders on all prior Payment Dates.
CLASS C PERCENTAGE: means 3.0%.
CLASS C STATED MATURITY DATE: means the Payment Date occurring
on June 14, 2008.
CLASS D DISTRIBUTION SUB-ACCOUNT: means the sub-account or
sub-accounts by that name established and maintained by the Trustee pursuant to
Section 3.01 of the Amended and Restated Indenture.
CLASS D MONTHLY INTEREST: means, for any Payment Date (except
the Initial Payment Date), the product of (i) one-twelfth, (ii) the Class D Note
Rate and (iii) the Class D Note Balance on the immediately preceding Payment
Date (or, in the case of the Initial Payment Date, the Closing Date) after
giving effect to all principal payments on the Class D Notes on such Payment
Date. The Class D Monthly Interest shall be calculated based upon a twelve month
year of thirty days in each month, except for the Initial Payment Date, for
which interest shall accrue from the Closing Date to but excluding such Initial
Payment Date.
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CLASS D MONTHLY PRINCIPAL: means (A) on any Payment Date other
than the Class D Stated Maturity Date, the product of (x) the Class D Percentage
and (y) Monthly Principal, and (B) on the Class D Stated Maturity Date, the
entire amount of the then outstanding Class D Note Balance.
CLASS D NOTE BALANCE: means, as of the Closing Date,
$5,850,000 and thereafter shall equal the Class D Note Balance as of the Closing
Date reduced by all principal payments on the Class D Notes.
CLASS D NOTE RATE: means eight and 340/1000 percent (8.340%)
per annum based upon thirty days elapsed each month in a twelve-month year.
CLASS D NOTEHOLDER: means at any time, any Person in whose
name a Class D Note is registered in the Note Register.
CLASS D NOTES: means any Class D Notes described in Article II
of, and authorized by, and authenticated and delivered under, the Amended and
Restated Indenture.
CLASS D OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class D Monthly Interest payable
on all prior Payment Dates over (b) the aggregate amount of interest actually
paid to the Class D Noteholders on all prior Payment Dates.
CLASS D OVERDUE PRINCIPAL: means, as of any Payment Date, the
excess, if any, of (a) the aggregate amount of Class D Monthly Principal due on
the Class D Notes on all prior Payment Dates over (b) the aggregate amount of
principal actually paid to the Class D Noteholders on all prior Payment Dates.
CLASS D PERCENTAGE: means 2.0%.
CLASS D STATED MATURITY DATE: means the Payment Date occurring
on June 14, 2008.
CLASS E DISTRIBUTION SUB-ACCOUNT: means the sub-account or
sub-accounts by that name established and maintained by the Trustee pursuant to
Section 3.01 of the Amended and Restated Indenture.
CLASS E MONTHLY INTEREST: means, for any Payment Date (except
the Initial Payment Date), the product of (i) one-twelfth, (ii) the Class E Note
Rate and (iii) the Class E Note Balance on the immediately preceding Payment
Date (or, in the case of the Initial Payment Date, the Closing Date) after
giving effect to all principal payments on the Class E Note on such Payment
Date. The Class E Monthly Interest shall be calculated based upon a twelve month
year of thirty days in each month, except for the Initial Payment Date, for
which interest shall accrue from the Closing Date to but excluding such Initial
Payment Date.
CLASS E MONTHLY PRINCIPAL: means, (A) on any Payment Date
other than the Class E Stated Maturity Date, an amount equal to the product of
(x) the Class E Percentage and (y) the
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Monthly Principal and (B) on the Class E Stated Maturity Date, the entire amount
of the then outstanding Class E Note Balance.
CLASS E NOTEHOLDER: means at any time, any Person in whose
name a Class E Note is registered in the Note Register.
CLASS E NOTE BALANCE: means, as of the Closing Date,
$7,313,000 and thereafter shall equal the Class E Note Balance as of the Closing
Date reduced by all principal payments on the Class E Notes.
CLASS E NOTE RATE: means ten and 680/1000 percent (10.680%)
per annum based upon thirty days elapsed each month in a twelve-month year.
CLASS E NOTES: means any Class E Notes described in Article II
of, and authorized by, and authenticated and delivered under, the Amended and
Restated Indenture.
CLASS E OVERDUE INTEREST: means, for any Payment Date, the
excess, if any, of (a) the aggregate amount of Class E Monthly Interest payable
on all prior Payment Dates over (b) the aggregate amount of interest actually
paid to the Class E Noteholders on all prior Payment Dates.
CLASS E OVERDUE PRINCIPAL: means, as of any Payment Date, the
excess, if any, of (a) the aggregate amount of Class E Monthly Principal due on
the Class E Notes on all prior Payment Dates over (b) the aggregate amount of
principal actually paid to the Class E Noteholders on all prior Payment Dates.
CLASS E PERCENTAGE: means 2.5%.
CLASS E STATED MATURITY DATE: means the Payment Date occurring
on June 14, 2008.
CLASS F DISTRIBUTION SUB-ACCOUNT: means the sub-account or
sub-accounts by that name that may be established and maintained by the Trustee
pursuant to Section 3.01 of the Amended and Restated Indenture.
CLASS F INSTRUMENTS: means any Class F Instruments described
in Article II of the Amended and Restated Indenture, that may be issued from
time to time under the Amended and Restated Indenture and the related
Supplement.
CLASS F INSTRUMENTHOLDER: means at any time, any Person in
whose name a Class F Instrument is registered in the Note Register.
CLOSING DATE: means May 11, 2000.
CODE: means the Internal Revenue Code of 1986, as amended.
COLLECTION ACCOUNT: means the account or accounts by that name
established and maintained by the Trustee pursuant to Section 3.01 of the
Amended and Restated Indenture.
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COLLECTION PERIOD: means, with respect to each Payment Date
related thereto, the entire calendar month immediately preceding such Payment
Date.
COMMISSION: means the Securities and Exchange Commission.
COMPANY ASSETS: means (i) the Contributed Property related to
the Contracts set forth on each Subsequent Contract Transfer Form other than,
and notwithstanding any other provision to the contrary, any and all ownership
interests of the Company in Equipment, with respect to which the Company shall
instead grant to the Issuer a first priority perfected security interest
therein, (ii) all of the Company's rights and privileges, but none of its
obligations, under the Amended and Restated Contribution and Servicing Agreement
and each Substitute Contract Transfer Form and (iii) all payments, income and
proceeds of the foregoing or relating thereto.
CONTRACT: means each separate noncancelable Finance Lease,
Fair Market Value Lease, Leveraged Lease Loan, Lease Receivable Purchase or
Secured Equipment Note acquired from time to time by the Transferor from the
Contributor, directly or indirectly, pursuant to the Amended and Restated
Contribution and Servicing Agreement. The term shall include any Contract
transferred to the Transferor on the Closing Date or, directly or indirectly,
any Substitution Date in connection with any substitution in accordance with the
Amended and Restated Contribution and Servicing Agreement, respectively.
CONTRACT FILE: means the following documents or instruments
with respect to each Contract:
(i) The executed original counterpart of the Contract
that constitutes "chattel paper" or an "instrument" for purposes of
Section 9-105(1)(b) and 9-305 of the UCC;
(ii) Documents evidencing or related to any insurance
policy with respect to the related Equipment;
(iii) A copy of each delivery and acceptance
certificate with respect to each Contract that is a lease or a copy of
each original invoice for the related Equipment and the receipt of
delivery related thereto with respect to each Contract that is a loan;
(iv) A copy of the financing statement filed with
respect to the related Equipment with evidence of proper recording;
(v) A copy of any related agreement with the vendor,
dealer or manufacturer of the Equipment or with any Person from whom
DVI acquired the Contract and rights in the related Equipment (if
applicable); and
(vi) Copies of such documents that the Servicer or its
Affiliates keep on file indicating that the Equipment is subject to the
interest of the Trustee, in accordance with their customary procedures
relating to the individual Contract, Obligor or Equipment.
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CONTRACT PAYMENT: means any payment which the Obligor is
required to make pursuant to a Contract after, with respect to the Initial
Contracts, the Cut-off Date, other than (i) certain amounts included in such
payments for which the Contributor is not the ultimate beneficiary thereof,
including, but not limited to, property taxes, sales taxes, manufacturer's
maintenance costs, insurance premiums and supplies and transaction costs and
(ii) Purchase Option Payments.
CONTRACT SCHEDULE: means the schedule of Contracts attached to
the Amended and Restated Contribution and Servicing Agreement and the Amended
and Restated Indenture and as amended from time to time, setting forth the
following information as to each Contract: (i) the Contract Number, (ii) the
Original Equipment Cost, if available, (iii) the Discounted Contract Balance as
of the Cut-off Date, (iv) the Obligor, (v) the State of location of the related
Equipment, (vi) the commencement date and original term of each Contract, (vii)
the remaining term and amount of the Contract Payments for each original
Contract as of the Cut-off Date, (viii) the type of related Equipment, (ix) the
related cash flow schedule, (x) the type of Contract and (xi) the applicable
Pool on such Contracts. The Contract Schedule shall be deemed supplemented and
amended to incorporate therein any Substitute Contracts.
CONTRACT TRANSFER DATE: means any date on or prior to the
Closing Date that, pursuant to the Amended and Restated Contribution and
Servicing Agreement, the Contributor may transfer a Contract to the Transferor.
CONTRIBUTED PROPERTY: means all of the Contributor's right,
title and interest in and to (a) all Contracts, including those listed on the
Contract Schedule delivered by the Contributor to the Transferor and all
Substitute Contracts (including its interest in the proceeds of such Contracts
and including the assignment of the security interest of the Obligor of a
Leveraged Lease Loan in the equipment lease that is subject thereto), including
all payments received on or with respect to such Contracts after the Cut-off
Date but excluding the Retained Interest, and including any Broker Agreement
Rights relating to such Contracts, (b) any documents in the Contract Files
relating to the Contracts listed on the Contract Schedule delivered by the
Contributor to the Transferor, (c) Insurance Policies and Insurance Proceeds
relating to the Contracts (or the related Equipment) listed on the Contract
Schedule delivered by the Contributor to the Transferor, (d) the Equipment
(which shall be either a first priority perfected security interest in Equipment
(other than with respect to Equipment relating to a Secured Equipment Note or
Finance Lease and for which the Original Equipment Cost is less than $25,000)
or, with respect to DVI Fair Market Value Leases, an ownership interest in the
Equipment) and any collateral, including, without limitation, any credit
enhancement (other than accounts receivable of an Obligor), which relates
specifically to a Contract and (e) all payments, income and proceeds of the
foregoing or relating thereto.
CONTRIBUTION DATE: means, with respect to the Initial
Contracts, the Closing Date, and, with respect to any Substitute Contract, the
related Substitution Date.
CONTRIBUTOR: means DVI Financial Services Inc., a corporation
organized and existing under the laws of the State of Delaware, and its
successors.
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CORPORATE TRUST OFFICE: means the principal corporate trust
office of the Trustee located on the Closing Date at 180 Fifth Street, St. Paul,
Minnesota 55101, or at such other address as the Trustee may designate from time
to time by notice to the Noteholders and the Transferor.
CUT-OFF DATE: means for each Initial Contract, April 30, 2000;
and as to any Substitute Contract, the last day of the month prior to the month
in which such Substitute Contract is substituted.
DEFAULT: means any occurrence that is, or with notice or the
lapse of time or both would become, an Indenture Event of Default.
DEFAULTED CONTRACT: means any Contract with respect to which
under the Amended and Restated Contribution and Servicing Agreement, (i) any
Contract Payment (or portion thereof) is delinquent for more than 180 days as of
the last day of the calendar month, (ii) the Servicer has declined to make a
Servicer Advance with respect to any delinquent amounts in accordance with the
Amended and Restated Contribution and Servicing Agreement on the grounds that
such advance would be a Nonrecoverable Advance, (iii) any Contract has been
rejected by or on behalf of the Obligor in a bankruptcy proceeding or (iv) the
Lessor with respect to any Leveraged Lease Loan has rejected the related lease
in a bankruptcy proceeding. For purposes of clause (i), the delinquency of a
Contract Payment shall be measured based on the Contract Payments required to be
made during the term of such Contract as of the date that such Contract became
part of the Trust Property without giving effect to any modifications, (except
those modifications permitted pursuant to Section 4.02 of the Amended and
Restated Contribution and Servicing Agreement) waivers or extensions
subsequently granted by the Servicer.
DEFINITIVE NOTE: a Note issued in definitive form pursuant to
the terms and conditions of Article Two of the Amended and Restated Indenture.
DELINQUENCY CONDITION: shall be deemed to exist on and as of
any Determination Date if (x) the quotient of (1) the sum of the Discounted
Contract Balances of all Contracts listed as more than 90 days delinquent as of
the last day of the three immediately preceding calendar months, divided by (2)
three exceeds (y) the product of (1) 0.06 and (2) the quotient of (A) the sum of
the Aggregate Discounted Contract Balance as of the last day of the three
immediately preceding Collection Periods, divided by (B) three.
DELINQUENT CONTRACT: means, as of any Determination Date, any
Contract (other than a Contract which became a Defaulted Contract prior to such
Determination Date) with respect to which the Obligor has not paid all Contract
Payments due as of the end of the immediately preceding Collection Period. The
delinquency of a Contract Payment shall be measured based on the Contract
Payments required to be made during the term of such Contract as of the date
such Contract became part of the Trust Property without giving effect to any
modifications, waivers or extensions subsequently granted by the Servicer.
DEPOSITARY: means The Depository Trust Company until a
successor depositary shall have become such pursuant to the applicable
provisions of the Amended and Restated Indenture, and thereafter "Depositary"
shall mean or include each Person who is then a Depositary thereunder. For
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purposes of the Amended and Restated Indenture, unless otherwise specified
pursuant to Section 2.02 thereof, any successor Depositary shall, at the time of
its designation and at all times while it serves as Depositary, be a clearing
agency registered under the Exchange Act, and any other applicable statute or
regulation.
DEPOSITARY PARTICIPANT: means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Depositary
effects book-entry transfers and pledges of securities deposited with the
Depositary.
DEPOSITED AVAILABLE FUNDS: has the meaning set forth in
Section 3.04(c) of the Amended and Restated Indenture.
DETERMINATION DATE: means, with respect to any Payment Date,
the third Business Day immediately preceding each Payment Date.
DISCOUNT RATE: means 8.318% per annum.
DISCOUNTED CONTRACT BALANCE: means, with respect to any
Contract, on any date of determination, an amount equal to the sum of (a) the
present value of each remaining Contract Payment to become due under a Contract
before the last day of the month prior to the month of the Stated Maturity Date,
discounted monthly from the last day of the Collection Period in which such
Contract Payment is to become due at a rate equal to one-twelfth (or with
respect to the period from the Closing Date to but excluding the Initial Payment
Date, a fraction, the numerator of which is equal to the number of days from the
Closing Date to but excluding the Initial Payment Date, and the denominator of
which is equal to 360) of the Discount Rate and (b) one hundred percent (100%)
of the unpaid balance, as of such date of determination of Contract Payments due
with respect to such Contract which were not the subject of a Servicer Advance;
PROVIDED, HOWEVER, that, except for purposes of computing the Repurchase Amount
or for computing the Discounted Contract Balance of a Predecessor Contract, (x)
on the date a Contract becomes a Defaulted Contract, the Discounted Contract
Balance for such Contract will be zero and (y) any Purchase Option Payments
shall not be included in the Discounted Contract Balance. For purposes of
calculating the Discounted Contract Balance of a Contract, any Contract Payment
for which the Contributor received on or prior to the Cut-off Date a security
deposit or an advance payment shall be deemed to be zero.
DISTRIBUTION ACCOUNT: means the account or accounts by that
name established and maintained by Trustee pursuant to Section 3.01 of the
Amended and Restated Indenture.
DVI: means DVI Financial Services Inc., a corporation
organized and existing under the laws of the State of Delaware, and its
successors.
DVI FAIR MARKET VALUE LEASE: means a Fair Market Value Lease
originated by DVI.
DVI GROUP: means, as of any relevant date, the affiliated
group within the meaning of section 1504 of the Code of which DVI, Inc., or any
successor thereto, is the common parent, or of which DVI, the Transferor, the
Managing Member and the Issuer are members, and shall mean any group eligible to
file consolidated or combined returns for state, local or foreign tax purposes
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which includes DVI, the Managing Member and the Transferor, regardless of the
identity of the common parent.
DVI, INC.: means DVI, Inc., a corporation organized and
existing under the laws of the State of Delaware, and its successors.
DUFF & PHELPS: means Duff & Phelps Credit Rating Co. and any
successor.
ELIGIBLE CONTRACT: means any Initial Contract which meets the
Contributor's credit requirements in effect on the Closing Date and satisfies
each of the representations and warranties set forth in Section 2.03 of the
Amended and Restated Contribution and Servicing Agreement and, with respect to
any Substitute Contract, satisfies the requirements of Section 7.01(d) of the
Amended and Restated Contribution and Servicing Agreement on the related
Substitution Date.
ELIGIBLE DEPOSIT ACCOUNT: any one or more of the following
accounts:
(i) a segregated account with an Eligible Institution;
or
(ii) a segregated trust account with the corporate
trust department of a depositary institution organized under the laws
of the United States of America or any one of the states thereof or the
District of Columbia (or any domestic branch of a foreign bank) subject
to regulations regarding fiduciary funds on deposit, having corporate
trust powers and acting as a trustee for funds deposited in such
account acceptable to the Rating Agencies.
ELIGIBLE INSTITUTION: means any one or more of the following
institutions: (i) the corporate trust department of the Trustee, or (ii) a
depositary institution organized under the laws of the United States of America
or any one of the states thereof or the District of Columbia acceptable to the
Rating Agencies (or any domestic branch of a foreign bank), which (a)(1) has
either (w) a long-term unsecured debt rating acceptable to the Rating Agencies
or (x) a short-term unsecured debt rating or certificate of deposit rating
acceptable to the Rating Agencies or (2) the parent corporation of which has
either (y) a long-term unsecured debt rating acceptable to the Rating Agencies
or (z) a short-term unsecured debt rating or certificate of deposit rating
acceptable to the Rating Agencies and (b) whose deposits are insured by the
Federal Deposit Insurance Corporation.
ELIGIBLE INVESTMENTS: means any and all of the following:
(i) direct obligations of, and obligations fully
guaranteed for timely payment by, the United States of America, the
Federal Home Loan Mortgage Corporation, the Federal National Mortgage
Association, the Federal Home Loan Banks or any agency or
instrumentality of the United States of America which has a rating of
at least "AAA" by Duff & Phelps and "Aaa" by Moody's at the time of
such investment the obligations of which are backed by the full faith
and credit of the United States of America;
(ii) (A) demand and time deposits in, certificates of
deposit of, banker's acceptances issued by or federal funds sold by any
depository institution or trust company (including the Trustee or its
agent acting in their respective commercial capacities)
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incorporated under the laws of the United States of America or any
State thereof and subject to supervision and examination by federal
and/or state authorities, so long as at the time of such investment or
contractual commitment providing for such investment, such depository
institution or trust company has a long term unsecured debt rating of
"AA+" by Duff & Phelps or "A+" by Fitch IBCA, and at least "A1" by
Moody's, and a short term unsecured debt rating in the highest
available rating category of each of the Rating Agencies and provided
that each such investment has an original maturity of no more than 365
days, and (B) any other demand or time deposit or deposit which is
fully insured by the Federal Deposit Insurance Corporation;
(iii) repurchase obligations with a term not to exceed 30
days with respect to any security described in clause (i) above and
entered into with a depository institution or trust company (acting as
a principal) rated "AA+" by Duff & Phelps or "A" by Fitch IBCA, at
least "A1" or higher by Moody's or Prime-1 by Moody's and "A" or higher
by S&P; PROVIDED, HOWEVER, that collateral transferred pursuant to such
repurchase obligation must (A) be valued weekly at current market price
plus accrued interest, (B) pursuant to such valuation, equal, at all
times, 105% of the cash transferred by the Trustee in exchange for such
collateral and (C) be delivered to the Trustee or, if the Trustee is
supplying the collateral, an agent for the Trustee, in such a manner as
to accomplish perfection of a security interest in the collateral by
possession of certificated securities;
(iv) securities bearing interest or sold at a discount
issued by any corporation incorporated under the laws of the United
States of America or any State thereof which has a long term unsecured
debt rating in the highest available rating category of each of the
Rating Agencies at the time of such investment;
(v) commercial paper having an original maturity of
less than 365 days and issued by an institution having a long term
unsecured debt rating of "AA+" by Duff & Phelps, "A+" by Fitch IBCA or
"A1" by Moody's and a short term unsecured debt rating in the highest
available rating category of each of the Rating Agencies at the time of
such investment;
(vi) a guaranteed investment contract approved in
writing by each of the Rating Agencies and issued by an insurance
company or other corporation having a long term unsecured debt rating
in the highest available rating category of each of the Rating Agencies
at the time of such investment;
(vii) money market funds having ratings in the highest
available rating category of each of the Rating Agencies at the time of
such investment; any such money market funds which provide for demand
withdrawals being conclusively deemed to satisfy any maturity
requirements for Eligible Investments set forth in the Amended and
Restated Indenture; and
(viii) any investment approved in writing by each of the
Rating Agencies.
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EQUIPMENT: means the underlying equipment subject to a
Contract, which is principally medical diagnostic and therapeutic equipment,
together with the income and proceeds thereof.
ERISA: means the Employee Retirement Income Security Act of
1974, as amended.
EXCHANGE ACT: means the Securities Exchange Act of 1934, as
amended.
EXCLUDED AMOUNTS: means any payments received from an Obligor
in connection with any late charges, taxes, fees or other charges imposed by any
Governmental Authority, any indemnity payments made by an Obligor for the
benefit of the originator or vendor under the related Contract or any payments
collected from an Obligor for the benefit of the originator or vendor which
relate to maintenance payments pursuant to the related Contract or maintenance
agreement, as applicable.
FAIR MARKET VALUE LEASE: means any Contract in the form of a
lease that contains a purchase option based on either (a) a stated non de
minimis percentage of the original cost of the related Equipment or (b) the fair
market value of the related Equipment at the expiration, or earlier termination,
of the Contract. A Fair Market Value Lease is identified as "FMV" on the
Contract Schedule.
FINANCE LEASE: means any Contract in the form of a lease that
contains an end of term purchase option for a nominal amount. A Finance Lease is
identified as "FL" on the Contract Schedule.
FITCH IBCA: means Fitch IBCA, Inc.
GAAP: means generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a significant segment of
the accounting profession, which are applicable to the circumstances as of the
date of determination.
GLOBAL NOTE: means either a Rule 144A Global Note or a Public
Global Note.
GRANT: means to grant, bargain, sell, convey, assign,
transfer, mortgage, pledge, create and perfect a security interest in and right
of set-off against, deposit, set over and confirm.
HOLDER OR NOTEHOLDER: means, at any time, any Person in whose
name a Note is registered in the Note Register.
INDENTURE EVENT OF DEFAULT: as defined in Section 6.01 of the
Amended and Restated Indenture.
INITIAL AGGREGATE DISCOUNTED CONTRACT BALANCE: means an amount
equal to $292,528,909.43.
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INITIAL CONTRACT: means any Contract acquired by the
Transferor on or prior to the Closing Date as set forth on Schedule 1 of the
Amended and Restated Indenture.
INITIAL PAYMENT DATE: means the initial Payment Date pursuant
to the Transaction Documents, which is contemplated (subject to prepayment
provisions of the Amended and Restated Indenture) to be, when used with respect
to interest on any Note, June 14, 2000, and when used with regard to principal,
with respect to the Class A-1 Notes, the Class B Notes, the Class C Notes, the
Class D Notes or the Class E Notes, June 14, 2000, when used with respect to the
Class A-2 Notes, January 14, 2001, when used with respect to the Class A-3
Notes, August 14, 2001 and when used with respect to the Class A-4 Notes,
February 14, 2003.
INSURANCE POLICY: means, with respect to an item of Equipment,
any insurance policy required to be maintained by the Obligor pursuant to the
related Contract that covers physical damage to the Equipment.
INSURANCE PROCEEDS: means proceeds paid (i) by any insurer
pursuant to any Insurance Policy covering a Contract or (ii) if the Obligor has
self-insured with respect to a Contract, by the Obligor, in either case, net of
reasonable costs of collecting such proceeds not otherwise reimbursed.
INSURED EXPENSES: means expenses covered by any Insurance
Policy.
ISSUER: means DVI Receivables XI, L.L.C., a Delaware limited
liability company.
ISSUER ORDER or ISSUER REQUEST: means a written order or
request delivered to the Trustee and signed in the name of the Issuer by an
Authorized Officer.
LEASE RECEIVABLE PURCHASE: means any Contract in the form of a
purchase by DVI from a lessor of lessor's right, title and interest in Contract
Payments related to an underlying equipment lease and that is secured by the
lessor's rights in the related Equipment. A Lease Receivable Purchase is
identified as "LRP" on the Contract Schedule.
LESSOR: means the Person who is the lessor under the equipment
lease related to a Leveraged Lease Loan or Lease Receivable Purchase.
LEVERAGED LEASE LOAN: means any Contract in the form of a loan
that is (a) made by the Contributor to a lessor of the related Equipment
pursuant to an underlying noncancelable equipment lease and (b) secured by a
pledge by such lessor to the Contributor of all of its right, title and interest
to such noncancelable equipment lease (including such lessor's right to receive
rental payments from the lessee on such equipment lease) and the related
Equipment. A Leveraged Lease Loan is identified as "LL" on the Contract
Schedule.
LOCK-BOX ACCOUNT: means an account designated as such,
established and maintained pursuant to Section 3.01 of the Amended and Restated
Indenture.
LOCK-BOX AGREEMENT: means (i) the agreement dated as of
December 6, 1999, by and between the Contributor and First Union National Bank
or (ii) the agreement dated as of October 5,
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1994, by and between the Contributor (as assignee of Affiliated Capital
Corporation) and First National Bank of Chicago, pursuant to which a Lock-Box
Account is established and maintained.
LOCK-BOX BANK: means, as of any date, the bank or trust
company at which a Lock- Box Account is established and maintained as of such
date.
MANAGING MEMBER: means DVI Receivables Corp. VIII, a Delaware
corporation.
MONTHLY INTEREST: means as of any Payment Date, the sum of (i)
the Class A Monthly Interest, (ii) the Class B Monthly Interest, (iii) the Class
C Monthly Interest, (iv) the Class D Monthly Interest and (v) the Class E
Monthly Interest.
MONTHLY PRINCIPAL: means, with respect to any Payment Date, an
amount equal to the excess of (a) the Aggregate Discounted Contract Balance at
the close of business on the last day of the second preceding Collection Period
over (b) the Aggregate Discounted Contract Balance at the close of business on
the last day of the immediately preceding Collection Period.
MONTHLY SERVICER REPORT: means the report attached as Exhibit
B to the Amended and Restated Contribution and Servicing Agreement.
MOODY'S: means Moody's Investors Service, Inc. and any
successor.
NONRECOVERABLE ADVANCE: means any Servicer Advance previously
made in respect of a Delinquent Contract by the Servicer pursuant to the terms
of the Amended and Restated Contribution and Servicing Agreement, which in the
good faith judgment of the Servicer and pursuant to an Officer's Certificate,
will not be ultimately recoverable by the Servicer from payments by the related
Obligor or disposition of the related Equipment.
NOTE BALANCE: means, as of the Closing Date, $257,425,000 for
the Class A Notes cumulatively (and, with respect to each tranche thereof,
$39,800,000 for the Class A-1 Notes, $39,000,000 for the Class A-2 Notes,
$83,000,000 for the Class A-3 Notes and $95,625,000 for the Class A-4 Notes),
$4,387,000 for the Class B Notes, $8,775,000 for the Class C Notes, $5,850,000
for the Class D Notes and $7,313,000 for the Class E Notes and thereafter shall
equal the Note Balance for such class reduced by all principal payments on such
class of Notes.
NOTE OWNER: means, with respect to a Global Note, the Person
who is the owner of such Global Note, as reflected on the books of the
Depositary, or on the books of a Person maintaining an account with the
Depositary (directly as a Depositary Participant or an indirect participant, in
each case in accordance with the rules of the Depositary).
NOTE PURCHASE AGREEMENT: means any agreement (other than the
Underwriting Agreement) between the Issuer, the Transferor, the Contributor, the
purchaser(s) specified therein and any other parties specified therein, relating
to the purchase of Notes.
NOTE RATE: means the annualized rate of interest on the
relevant class of Notes (Class A-1 Note Rate on the Class A-1 Notes, Class A-2
Note Rate on the Class A-2 Notes, Class A-3 Note
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Rate on the Class A-3 Notes, Class A-4 Note Rate on the Class A-4 Notes, Class B
Note Rate on the Class B Notes, Class C Note Rate on the Class C Notes, Class D
Note Rate on the Class D Notes, Class E Note Rate on the Class E Notes and the
interest rate set forth in the Supplement for the Class F Instruments).
NOTE REGISTER: as defined in Section 2.04 of the Amended and
Restated Indenture.
NOTEHOLDER OR HOLDER: means, at any time, any Person in whose
name a Note is registered in the Note Register.
NOTEHOLDER COUNSEL: means the single legal counsel as selected
by Noteholders evidencing more than 50% of the Voting Rights.
NOTES: means any of the Class A Notes, Class B Notes, Class C
Notes, Class D Notes or Class E Notes described in Article II of the Amended and
Restated Indenture, and authorized by, and authenticated and delivered under,
the Amended and Restated Indenture or any Supplement.
OBLIGOR: means the obligor under any Contract, including any
guarantor.
OFFERED NOTES: means the Class A Notes, the Class B Notes, the
Class C Notes, the Class D Notes and the Class E Notes.
OFFICER'S CERTIFICATE: means a certificate delivered to the
Trustee and signed by Chairman, the President, a Vice President, the Treasurer,
an Assistant Treasurer, the Secretary or an Assistant Secretary of the relevant
entity.
OPINION OF COUNSEL: means a written opinion of counsel, which
shall be reasonably satisfactory in form and substance to the Person to whom it
is to be delivered. Except as otherwise expressly provided in the Amended and
Restated Indenture, such opinion may be delivered by inside or outside counsel
for the Contributor, the Transferor or the Issuer.
ORIGINAL EQUIPMENT COST: means (i) with respect to each
Contract originated by DVI, the vendor's invoice price of the related Equipment
at the time of origination of the related Contract and (ii) with respect to each
Contract acquired by DVI from others, the amount recorded on DVI's records as
paid by DVI to acquire such Contract and the broker's interest in the related
Equipment.
OUTSTANDING OR OUTSTANDING: means, when used with reference to
the Notes and as of any particular date, any Note theretofore and thereupon
being authenticated and delivered except:
(i) any Note canceled by the Trustee at or before
said date;
(ii) any Note, or portion thereof, for payment of
redemption of which monies equal to the principal amount or redemption price
thereof, as the case may be, with interest to the date of maturity or
redemption, shall have theretofore been irrevocably deposited with the Trustee
(whether upon or prior to maturity or the redemption date of such Note);
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(iii) any Note in lieu of or in substitution for
which another Note shall have been authenticated and delivered; and
(iv) any Note owned either by the Transferor or by
the Managing Member or any Affiliate of either the Transferor or the Managing
Member (except that, in determining whether the Trustee shall be protected in
relying upon any request, demand, authorization, direction, notice, consent or
waiver of Noteholders under the Amended and Restated Indenture, only Notes which
the Trustee knows to be so owned shall be disregarded).
OVERDUE INTEREST: means, for any Payment Date, the sum of (i)
the Class A Overdue Interest, (ii) the Class B Overdue Interest, (iii) the Class
C Overdue Interest, (iv) the Class D Overdue Interest and (v) the Class E
Overdue Interest.
OWNERSHIP INTEREST: means an ownership interest in a Global
Note.
PARTIAL PREPAYMENT AMOUNT: means, with respect to the
Collection Period and a Contract for which the Obligor has requested to make a
voluntary partial prepayment and for which no Substitute Contract has been
provided, an amount equal to the excess, if any, of (A) the difference between
(i) the Discounted Contract Balance of such Contract as of the first day of such
Collection Period together with one month of interest thereon at the Discount
Rate and (ii) the Discounted Contract Balance of such Contract as of the first
day of such Collection Period calculated based on the amount of each Contract
Payment payable by the Obligor after giving effect to the reduction of such
Contract Payment which will result from such partial prepayment, minus (B) any
Contract Payments actually received by the Servicer with respect to the prepaid
portion of such Contract for the current Collection Period on or before the date
of such partial prepayment.
PARTIAL REDEMPTION PRICE: with respect to any Offered Note,
and as of any date of partial redemption fixed by the Issuer, an amount equal to
the sum of (x) the product of (i) the quotient of (A) the aggregate Discounted
Contract Balance of the Contracts in Pool B as of such date of partial
redemption, divided by (B) the Aggregate Discounted Contract Balance as of such
date of partial redemption and (ii) the outstanding Note Balance of such Offered
Note and (y) interest accrued thereon to, but not including, such Redemption
Date at the applicable Note Rate.
PAYMENT DATE: means the fourteenth day of each month (or if
such date is not a Business Day, the immediately succeeding Business Day),
commencing June 14, 2000.
PERSON: means any individual, corporation, limited liability
company, partnership, joint venture, association, joint stock company, trust
(including any beneficiary thereof), unincorporated organization or government
or any agency or political subdivision thereof.
PLACEMENT AGENT: means Lehman Brothers Inc.
PLAN: means an "employee benefit plan" within the meaning of
Section 3(3) of ERISA or a "plan" within the meaning of Section 4975(e)(1) of
the Code.
POOL: means either Pool A or Pool B.
22
<PAGE>
POOL A: means the Contracts identified on the Contract
Schedule as constituting Pool A and the other Trust Property related thereto.
POOL A AGGREGATE DISCOUNTED CONTRACT BALANCE: means, with
respect to any date of determination, the sum of the Discounted Contract
Balances of all Contracts in Pool A.
POOL A NON-PERFORMING CONTRACT SUBSTITUTION: shall have the
meaning ascribed thereto in Section 7.01(a)(1) of the Amended and Restated
Contribution and Servicing Agreement.
POOL A PREPAID CONTRACT SUBSTITUTION: shall have the meaning
ascribed thereto in Section 7.01(a)(2) of the Amended and Restated Contribution
and Servicing Agreement.
POOL B: means the Contracts identified on the Contract
Schedule as constituting Pool B and the other Trust Property related thereto.
POOL B AGGREGATE DISCOUNTED CONTRACT BALANCE: means, with
respect to any date of determination, the sum of the Discounted Contract
Balances of all Contracts in Pool B.
POOL B GENERAL CONTRACT SUBSTITUTION: shall have the meaning
ascribed thereto in Section 7.01(b)(1) of the Amended and Restated Contribution
and Servicing Agreement.
POOL B PREPAID CONTRACT SUBSTITUTION: shall have the meaning
ascribed thereto in Section 7.01(b)(2) of the Amended and Restated Contribution
and Servicing Agreement.
PREDECESSOR NOTES: means, 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, for the purpose of this definition, any
Note authenticated and delivered under Section 2.05 of the Amended and Restated
Indenture 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).
PREDECESSOR CONTRACT: means, with respect to any Substitute
Contract acquired by the Transferor by substitution pursuant to Section 7 of the
Amended and Restated Contribution and Servicing Agreement and by the Issuer by
substitution pursuant to Section 7 of the Amended and Restated Subsequent
Contract Transfer Agreement, the Contract or Contracts for which such Substitute
Contract or any intervening Substitute Contract has been substituted.
PREPAYMENT AMOUNT: means, with respect to any Contract, the
sum of (1) the Discounted Contract Balance as of the first day of the Collection
Period preceding such prepayment, together with one month of interest thereon at
the Discount Rate, (2) any unreimbursed Servicer Advances with respect to such
Contract and (3) any Contract Payments due and outstanding under such Contract
that are not the subject of a Servicer Advance.
PRINCIPAL TERMS: as defined in Section 2.06(b) of the Amended
and Restated Indenture.
23
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PRIORITY PAYMENTS: shall have the meaning ascribed thereto in
Section 3.04(c) of the Amended and Restated Indenture.
PROSPECTUS SUPPLEMENT: means the prospectus supplement, dated
May 8, 2000, relating to the Class A Notes, the Class B Notes, the Class C Notes
and the Class D Notes.
PUBLIC GLOBAL NOTE: means a Book-Entry Note evidencing all or
part of an issuance of the Class A Notes, Class B Notes, Class C Notes or Class
D Notes to which the provisions of Article II of the Amended and Restated
Indenture shall apply.
PURCHASE OPTION PAYMENT: means as specified in each Contract,
any payment made by the Obligor to purchase the Equipment covered thereby,
including any funds received in respect of either (w) an end of term purchase
option for $1, (x) an end of term option to purchase the Equipment at a stated
percentage of the original cost of the Equipment, (y) an option to purchase the
Equipment at the fair market value of the Equipment determined at the end of the
Contract term or (z) an end of term option to extend the term of the lease for
another immediately successive twelve month period upon the expiration of which
the lessee will own the equipment.
RATING AGENCIES: means, when used in the singular, any one of,
and, when used in the plural, each of Fitch IBCA and Moody's.
RATINGS EFFECT: means a reduction or withdrawal of a rating on
a class of Notes by a Rating Agency.
RECORD DATE: means, with respect to any Payment Date relating
to any Definitive Note, the fifth Business Day immediately preceding such
Payment Date, and, with respect to any Payment Date relating to any Book-Entry
Note, the Business Day immediately preceding such Payment Date.
RECOVERIES: means, with respect to any Contract, any cash sale
proceeds, vendor recourse, payments under personal and other guaranties,
litigation judgments and the present value (calculated at the implicit yield on
each of the Defaulted Contracts) of re-lease rents.
REDEMPTION DATE: means, with respect to any redemption or
partial redemption of Notes, a date fixed pursuant to Section 10.01 of the
Amended and Restated Indenture.
REDEMPTION PRICE: means, with respect to any Note, and as of
any redemption date fixed by the Issuer, the sum of (x) the outstanding Note
Balance of such Note, and (y) interest accrued thereon to, but not including,
such Redemption Date at the applicable Note Rate.
REDEMPTION RECORD DATE: means, with respect to any redemption
of Notes, a date fixed pursuant to Section 10.01 of the Amended and Restated
Indenture.
RELATED PERSON: means any Person (whether or not incorporated)
which is under common control with the Contributor within the meaning of Section
414(b) or (c) of the Code, or of Section 4001(b) of ERISA.
24
<PAGE>
REPORTABLE EVENT: means any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder, a withdrawal from a "Pension
Plan" described in Section 4063 of ERISA, or a cessation of operations described
in Section 4062(3) of ERISA.
REPURCHASE AMOUNT: means, with respect to any Contract, the
sum of (1) the Discounted Contract Balance as of the first day of the Collection
Period preceding such repurchase, together with one month of interest thereon at
the Discount Rate and (2) any unreimbursed Servicer Advances with respect to
such Contract.
RESERVE ACCOUNT: means the account specified in Section
3.01(a) of the Amended and Restated Indenture.
RESERVE ACCOUNT BALANCE: means an amount equal to deposits of
all Reserve Account Deposit Amounts as reduced by (a) all Reserve Account Draws
and (b) all Reserve Account Withdrawals paid to the Transferor, or the Class F
Instrumentholder, if any.
RESERVE ACCOUNT DEPOSIT AMOUNT: means, on any Payment Date, an
amount equal to the excess of (A) the Reserve Account Required Amount over (B)
the amount on deposit in the Reserve Account (after giving effect to any Reserve
Account Draws on such Payment Date).
RESERVE ACCOUNT DRAW: means, with respect to each Payment
Date, the amount, if any, withdrawn by the Trustee from the Reserve Account for
payment of the Priority Payments pursuant to Section 3.04(c) of the Amended and
Restated Indenture.
RESERVE ACCOUNT PROPERTY: means the property set forth in
Section 3.08(a) of the Amended and Restated Indenture.
RESERVE ACCOUNT REQUIRED AMOUNT: means, with respect to the
Initial Payment Date, $2,925,289.09 (the "INITIAL RESERVE ACCOUNT REQUIRED
AMOUNT"); and, with respect to each Payment Date thereafter, the lesser of
either (i) the Initial Reserve Account Required Amount or (ii) the sum of (a)
the Class A Note Balance, (b) the Class B Note Balance, (c) the Class C Note
Balance, (d) the Class D Note Balance and (e) the Class E Note Balance;
PROVIDED, HOWEVER, that if a Restricting Event has occurred and is then
continuing, then notwithstanding the foregoing, the Reserve Account Required
Amount shall be equal to the sum of (i) the Reserve Account Required Amount on
the immediately preceding Payment Date (after giving effect to any additions to
or withdrawals from the Reserve Account on such Payment Date) and (ii) all
amounts otherwise payable to the Issuer or the Class F Instrumentholder, if any,
in accordance with Section 3.04(b) of the Amended and Restated Indenture.
RESERVE ACCOUNT WITHDRAWAL: means, for each Payment Date, the
amount of such excess, if any, withdrawn from the Reserve Account for payment to
the Issuer or the Class F Instrumentholder pursuant to Section 3.08 of the
Amended and Restated Indenture.
RESIDUAL PAYMENT: means any amount received either by the
Servicer or the Trustee as a Purchase Option Payment under a Contract or
proceeds of the sale of an item of Equipment subject to the lien of the Amended
and Restated Indenture or rental payments from the re-leasing of
25
<PAGE>
an item of Equipment subject to the lien of the Amended and Restated Indenture
after the final Contract Payment due and payable under the initial terms of the
Contract to which such item of Equipment is subject is made.
RESIDUAL PRINCIPAL BALANCE: means the excess of (x) the
Aggregate Discounted Contract Balance, over (y) the sum of the Class A Note
Balance, the Class B Note Balance, the Class C Note Balance, the Class D Note
Balance and the Class E Note Balance.
RESPONSIBLE OFFICER: means, with respect to the Trustee, any
President, Senior Vice President, Vice President, Assistant Vice President,
Trust Officer or Assistant Secretary with direct responsibility for the
administration of the Trustee's obligations and duties under the Amended and
Restated Indenture and with respect to a particular matter, any officer to whom
such matter is referred because of such other officer's knowledge or familiarity
with the particular subject.
RESTRICTING EVENT: means the condition that exists on any
Payment Date if any one of the following conditions exists: (i) a Delinquency
Condition exists or (ii) an Indenture Event of Default has occurred and is then
continuing.
RETAINED INTEREST: means all right, title and interest of the
Contributor in and to (i) the Contributed Property prior to and including the
Cut-off Date, (ii) each periodic payment, if any, set forth in a Contract in
respect of maintenance, insurance or taxes and (iii) each Purchase Option
Payment, if any.
RULE 144A GLOBAL NOTE: means a Note evidencing all or a part
of an issuance of the Class E Notes, registered in the name of the Depositary or
its nominee, and delivered to the Depositary pursuant to the Depositary's
instruction, in accordance with Section 2.02 of the Amended and Restated
Indenture and bearing the legend prescribed in Section 2.02 of the Amended and
Restated Indenture.
S&P: means Standard & Poor's Ratings Services, a division of
The McGraw-Hill Companies, Inc. and any successor.
SCHEDULED TERMINATION DATE: means, with respect to any
Contract, the date upon which such Contract is scheduled to terminate in
accordance with its terms.
SECURED EQUIPMENT NOTE: means any Contract in the form of a
loan to the user of the related Equipment secured by such Equipment. A Secured
Equipment Note is identified as "LOAN" on the Contract Schedule.
SECURITIES ACT: means The Securities Act of 1933 as amended.
SERVICER: means initially, the Contributor and thereafter,
either the Contributor or the then-acting Successor Servicer(s), if any,
appointed pursuant to the terms of the Amended and Restated Contribution and
Servicing Agreement.
26
<PAGE>
SERVICER ADVANCE: means an advance made by the Servicer in
accordance with Section 5.01 of the Amended and Restated Contribution and
Servicing Agreement.
SERVICER EVENT OF DEFAULT: means as defined in Section 10.01
of the Amended and Restated Contribution and Servicing Agreement.
SERVICER ORDER: means a written order or request delivered to
the Trustee and signed in the name of the Servicer by an Authorized Officer.
SERVICING FEE: means an amount equal to the product of (i)
one-twelfth (or with respect to the Initial Payment Date, a fraction, the
numerator of which is equal to the number of days from the Closing Date to but
excluding the Initial Payment Date, and the denominator of which is equal to
360), (ii) the Servicing Fee Rate and (iii) the Aggregate Discounted Contract
Balance as of the beginning of the previous Collection Period.
SERVICING FEE RATE: means 0.45 %.
STATED MATURITY DATE: means, with respect to the Class A-1
Notes, the Class A-1 Stated Maturity Date, with respect to the Class A-2 Notes,
the Class A-2 Stated Maturity Date, with respect to the Class A-3 Notes, the
Class A-3 Stated Maturity Date, with respect to the Class A-4 Notes, the Class
A-4 Stated Maturity Date, with respect to the Class B Notes, the Class B Stated
Maturity Date, with respect to the Class C Notes, the Class C Stated Maturity
Date, with respect to the Class D Notes, the Class D Stated Maturity Date, and
with respect to the Class E Notes, the Class E Stated Maturity Date.
SUBORDINATION DEFICIENCY EVENT: means the occurrence of the
Class A Note Balance being greater than the Aggregate Discounted Contract
Balance as of the date of determination.
SUBSTITUTE CONTRACT: means an Eligible Contract substituted by
the Contributor pursuant to either Section 5.03 or Section 7.01 of the Amended
and Restated Contribution and Servicing Agreement.
SUBSTITUTE CONTRACT TRANSFER FORM: means a Substitute Contract
Transfer Form, substantially in the form of Exhibit A to the Amended and
Restated Subsequent Contract Transfer Agreement.
SUBSTITUTION DATE: means any Business Day on which the
Contributor transfers a Substitute Contract to the Transferor (which Substitute
Contract is subsequently transferred by the Transferor to the Issuer and then
pledged by the Issuer to the Trustee).
SUCCESSOR SERVICER: means the Trustee or any successor to the
Servicer pursuant to the Amended and Restated Contribution and Servicing
Agreement.
SUPPLEMENT: means a supplement to the Amended and Restated
Indenture complying with the terms of the Amended and Restated Indenture.
27
<PAGE>
TRANSACTION DOCUMENTS: means collectively, the Amended and
Restated Contribution and Servicing Agreement, the Amended and Restated
Subsequent Contract Transfer Agreement, the Amended and Restated Indenture, the
Underwriting Agreement, any Note Purchase Agreement(s) and any and all
agreements relating to the servicing of the Contracts and the issuance of the
Notes.
TRANSFEROR: means DVI Receivables Corp. XI, a corporation
organized and existing under the laws of the State of Delaware and wholly-owned
by DVI, and its permitted successors and assigns.
TRANSFEROR ORDER or TRANSFEROR REQUEST: means a written order
or request delivered to the Trustee and signed in the name of the Transferor by
an Authorized Officer.
TRUST INDENTURE ACT OR TIA: means the Trust Indenture Act of
1939, as amended from time to time, as in effect on any relevant date.
TRUST PROPERTY: means (a) the Company Assets, (b) all moneys
from time to time held by the Trustee pursuant to Section 3.01 of the Amended
and Restated Indenture pending deposit in one of the accounts referred to
therein, (c) all moneys from time to time on deposit in each Lock-Box Account,
Collection Account, the Reserve Account, the Distribution Account, Class A
Distribution Sub-Account, Class B Distribution Sub-Account, Class C Distribution
Sub-Account, Class D Distribution Sub-Account, the Class E Distribution
Sub-Account and Class F Distribution Sub- Account, if any, including all
investments and income from the investment of such moneys, (d) all of the
Issuer's right, title and interest then or thereafter acquired under the Amended
and Restated Contribution and Servicing Agreement, (e) all of the Issuer's
right, title and interest then or thereafter acquired under the Amended and
Restated Subsequent Contract Transfer Agreement and (f) all income, payments and
proceeds of any of the foregoing.
TRUST STATUTE: means Chapter 38 of Title 12 of the Delaware
Code, 12 Del. C.ss.3801 ET. SEQ.
TRUSTEE: means the Person named as the "Trustee" in the first
paragraph of the Amended and Restated Indenture until a successor Person shall
have become the Trustee pursuant to the applicable provisions of the Amended and
Restated Indenture, and thereafter "Trustee" shall mean such successor Person;
PROVIDED, that the provisions of Sections 7.06 and 8.11 of the Amended and
Restated Indenture, as applicable to any Person at any time serving as Trustee
under the Amended and Restated Indenture, shall survive (with respect to any
period prior to the date of such termination) the termination of such Person's
status as Trustee under the Amended and Restated Indenture and the succession of
any other Person to such status.
UNDERWRITERS: means Lehman Brothers, Inc., Prudential
Securities Incorporated and Banc One Capital Markets, Inc.
UNDERWRITING AGREEMENT: means the underwriting agreement dated
as of May 5, 2000, by and among Prudential Securities Incorporated, Lehman
Brothers Inc., Banc One Capital Markets, Inc., the Contributor, the Issuer and
the Transferor.
28
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UNIFORM COMMERCIAL CODE or UCC: means, 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.
UNITS: means the membership interests in the Issuer.
VOTING RIGHTS: means, for so long as any Notes remain
outstanding, and shall encompass, for so long as any Class A Note, Class B Note,
Class C Note, Class D Note or Class E Note is outstanding, the voting rights as
of the date of determination (i) the votes of Class A-1 Noteholders evidencing
100% of the then-outstanding Class A-1 Note Balance, and, after the Note Balance
of such class equals zero, then (ii) the votes of Class A-2 Noteholders
evidencing 100% of the then-outstanding Class A-2 Note Balance, and, after the
Note Balance of such class equals zero, then (iii) the votes of the Class A-3
Noteholders evidencing 100% of the then-outstanding Class A-3 Note Balance, and,
after the Note Balance of such class equals zero, then (iv) the votes of the
Class A-4 Noteholders evidencing 100% of the then-outstanding Class A-4 Note
Balance, and, after the Note Balance of such class equals zero, then (v) the
votes of Class B Noteholders evidencing 100% of the then-outstanding Class B
Note Balance, and, after the Note Balance of such class equals zero, then (vi)
the votes of the Class C Noteholders evidencing 100% of the then-outstanding
Class C Note Balance, and, after the Note Balance of such class equals zero,
then (vii) the votes of Class D Noteholders evidencing 100% of the
then-outstanding Class D Note Balance, and, after the Note Balance of such class
equals zero, then (viii) the votes of the Class E Noteholders evidencing 100% of
the then-outstanding Class E Note Balance. When none of the Class A Notes, Class
B Notes, Class C Notes, Class D Notes and Class E Notes is outstanding, 100% of
the Voting Rights shall be exercised by the Holders of the Class F Instrument,
if any. When used in the Transaction Documents, "50% of the Voting Rights" and
"662/3% of the Voting Rights" shall be deemed to refer to fifty and sixty-six
and two-thirds percent, respectively, of each class of Notes then Outstanding
and then entitled to vote as measured by the Outstanding Note Balance of such
class on such date of determination.
29
EXHIBIT 4.2
================================================================================
DVI FINANCIAL SERVICES INC.,
CONTRIBUTOR AND SERVICER
AND
DVI RECEIVABLES CORP. XI
AMENDED AND RESTATED CONTRIBUTION AND SERVICING AGREEMENT
Dated as of December 1, 1999
================================================================================
ALL RIGHTS IN AND TO THIS AGREEMENT ON THE PART OF DVI RECEIVABLES CORP. XI HAVE
BEEN ASSIGNED TO DVI RECEIVABLES XI, L.L.C. AND REASSIGNED AND ARE SUBJECT TO A
SECURITY INTEREST IN FAVOR OF U.S. BANK TRUST NATIONAL ASSOCIATION, AS TRUSTEE,
UNDER THE AMENDED AND RESTATED INDENTURE DATED AS OF DECEMBER 1, 1999 FOR THE
BENEFIT OF THE PERSONS REFERRED TO THEREIN.
<PAGE>
TABLE OF CONTENTS
Page
SECTION 1. CAPITAL CONTRIBUTION...............................................2
1.01 Contribution.......................................................2
SECTION 2. REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF
THE CONTRIBUTOR............................................................4
2.01 Corporate Organization and Authority...............................4
2.02 Business and Property..............................................5
2.03 Equipment and Contracts............................................5
2.04 Contract Schedule.................................................10
2.05 Pending Litigation................................................10
2.06 No Material Event.................................................10
2.07 Transactions Legal and Authorized.................................10
2.08 Governmental Consent..............................................11
2.09 Compliance with Law...............................................11
2.10 Ordinary Course; No Insolvency....................................11
2.11 Assets and Liabilities............................................11
2.12 Fair Consideration; Valid Sale....................................11
2.13 Ability to Pay Debts..............................................12
2.14 Bulk Transfer Provisions..........................................12
2.15 Tax Returns.......................................................12
2.16 Transfer Taxes....................................................12
2.17 Principal Executive Office........................................12
2.18 Legal Name........................................................12
2.19 Servicing Provisions Customary....................................13
2.20 Defaults..........................................................13
2.21 ERISA.............................................................13
2.22 All Filings Made..................................................13
2.23 Nonconsolidation..................................................13
2.24 All Representations and Warranties True...........................14
2.25 Prospectus Supplement. ..........................................14
2.26 Insurance. ......................................................14
2.27 No Bankruptcy Petition Against the Transferor, the Managing
Member or the Issuer 15
SECTION 3. REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS OF
THE TRANSFEROR....................................................15
3.01 Transferor Organization and Authority; Subsidiaries...............15
3.02 Due Authorization and No Violation................................15
3.03 No Litigation.....................................................15
3.04 Principal Office..................................................16
3.05 Tax Returns.......................................................16
3.06 Solvency..........................................................16
i
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Page
3.07 Approvals.........................................................16
3.08 Nonconsolidation..................................................16
SECTION 4. ADMINISTRATION OF CONTRACTS.......................................17
4.01 Servicer to Act...................................................17
4.02 Contract Amendments and Modifications; Repurchase of Contracts
by Servicer.......................................................18
4.03 Contract Defaults; Residual Realizations..........................19
4.04 Costs of Servicing; Servicer's Fee................................20
4.05 Other Transactions................................................21
4.06 Collection of Moneys..............................................21
4.07 Voluntary Termination.............................................21
SECTION 5. SERVICER ADVANCES; REPURCHASE OF CONTRACTS........................22
5.01 Servicer Advances.................................................22
5.02 Indemnification...................................................22
5.03 Repurchase and Substitution of Contracts; Other Payments..........23
SECTION 6. INFORMATION TO BE PROVIDED........................................24
6.01 Monthly Servicer Report...........................................24
6.02 Tax Reporting and Treatment.......................................24
6.03 Other Information.................................................24
6.04 Annual Independent Certified Public Accountant's Report...........25
6.05 Payment Advices...................................................25
SECTION 7. SUBSTITUTION OF CONTRACTS.........................................25
7.01 Substitution......................................................25
7.02 Notice of Substitution............................................27
7.03 Contributor's and Servicer's Subsequent Obligations...............28
7.04 Usage of Predecessor Contracts in Calculations....................28
SECTION 8. THE SERVICER......................................................28
8.01 Corporate Existence of the Servicer...............................28
8.02 Limitation on Liability of the Servicer and Others................28
8.03 Servicer Not to Resign or be Removed..............................29
8.04 Financial and Business Information................................29
8.05 Officer's Certificates............................................30
8.06 Inspection........................................................30
8.07 Servicer Records..................................................31
8.08 Insurance.........................................................31
8.09 No Bankruptcy Petition Against the Transferor, the Managing
Member or the Issuer 31
8.10 Fidelity Bond and Errors and Omissions Insurance..................31
ii
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Page
SECTION 9. THE CONTRIBUTOR...................................................31
9.01 Corporate Existence of the Contributor............................31
9.02 Financial and Business Information................................32
9.03 Inspection........................................................32
9.04 No Bankruptcy Petition Against the Managing Member, the Transferor
or the Issuer 33
9.05 Accounts, Books and Records.......................................33
9.06 Tax Returns.......................................................33
9.07 Insurance.........................................................34
9.08 Protection of Right, Title and Interest...........................34
9.09 Other Liens or Interests..........................................34
9.10 Costs and Expenses................................................35
SECTION 10. EVENTS OF DEFAULT.................................................35
10.01 Servicer Events of Default........................................35
10.02 Termination.......................................................37
10.03 Trustee to Act; Appointment of Successor..........................37
10.04 Servicer to Cooperate.............................................38
10.05 Remedies Not Exclusive............................................38
10.06 Waiver of Past Defaults...........................................38
SECTION 11. ASSIGNMENT........................................................38
11.01 Assignment to Trustee.............................................38
11.02 Assignment by Contributor or Servicer.............................39
SECTION 12. NATURE OF CONTRIBUTOR'S OBLIGATIONS AND SECURITY THEREFOR 39
12.01 Contributor's Obligations Absolute................................39
12.02 Power of Attorney.................................................40
SECTION 13. MISCELLANEOUS PROVISIONS..........................................40
13.01 Sale..............................................................40
13.02 Amendment.........................................................40
13.03 Waivers...........................................................41
13.04 Notices...........................................................41
13.05 Costs and Expenses................................................42
13.06 Third Party Beneficiaries.........................................42
13.07 Survival of Representations.......................................42
13.08 Confidential Information..........................................42
13.09 Headings and Cross-References.....................................43
13.10 GOVERNING LAW.....................................................43
13.11 Consent to Jurisdiction...........................................43
13.12 Counterparts......................................................43
13.13 Statutory References..............................................43
EXHIBITS
iii
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Exhibit A Contract Schedule
Exhibit B Monthly Servicer Report
Exhibit C Reserved
Exhibit D Substitute Contract Transfer Form
Exhibit E Form of Re-Assignment
Exhibit F Form of Officer's Certificate for Section 7
Exhibit G Forms of Contracts
Exhibit H Underwriting Guidelines
APPENDICES
Appendix I Defined Terms
iv
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AMENDED AND RESTATED CONTRIBUTION AND SERVICING AGREEMENT
This Agreement is made and dated as of December 1, 1999, by and
between DVI FINANCIAL SERVICES INC., a Delaware corporation ("DVI"), as
contributor (in such capacity, the "CONTRIBUTOR") and servicer (in such
capacity, the "SERVICER") hereunder, and DVI RECEIVABLES CORP. XI, a Delaware
corporation (the "TRANSFEROR").
RECITALS
A. Pursuant to this Agreement, the Contributor is contributing and
assigning to the Transferor, (i) all right, title and interest of the
Contributor in, to and under, INTER ALIA, a pool of non-cancelable Finance
Leases, Fair Market Value Leases, Leveraged Lease Loans, Lease Receivable
Purchases and Secured Equipment Notes described in Exhibit A hereto (the
"INITIAL CONTRACTS"), (ii) certain payments and proceeds received relating to
the Initial Contracts that are payable after the Cut-Off Date and (iii) an
interest in each item of underlying Equipment that is subject to each Initial
Contract. The Contributor may contribute and assign certain Substitute Contracts
and an interest in the Equipment related thereto and certain other related
payments and proceeds in accordance with the terms of this Agreement.
B. Pursuant to the Amended and Restated Subsequent Contract Transfer
Agreement (the "SCTA"), dated as of December 1, 1999 by and between the
Transferor and the Issuer, the Transferor is transferring to the Issuer all of
its right, title and interest in and to the Trust Property.
C. Pursuant to the Amended and Restated Indenture (the "AMENDED AND
RESTATED INDENTURE"), dated as of December 1, 1999, the Issuer is issuing its
Asset-Backed Securities (the "NOTES"). Pursuant to the Amended and Restated
Indenture, the Issuer is granting to the trustee thereunder (the "TRUSTEE"), for
the benefit and security of the holders from time to time of the Notes, a
security interest in the Trust Property, which includes, INTER ALIA, all right,
title (other than ownership of any Equipment) and interest of the Transferor in,
to and under the Contracts, the Equipment and this Agreement.
D. In connection with the contribution and assignment of such
Contracts and the transfer of an interest in the related Equipment, the
Contributor agrees to undertake certain obligations set forth herein.
E. In consideration for the Servicing Fee and other amounts as more
particularly set forth herein, the Servicer agrees to undertake certain
obligations set forth herein.
F. Capitalized terms used but not defined herein shall have the
respective meanings set forth in Appendix I hereto.
<PAGE>
AGREEMENTS
SECTION 1. CAPITAL CONTRIBUTION
1.01 CONTRIBUTION.
(a) Upon the terms and conditions herein set forth, the Contributor
hereby agrees to transfer, assign and contribute, on one or more Contract
Transfer Dates, to the Transferor as a capital contribution (or, in case of any
Substitute Contracts, the related Substitution Date), without recourse except as
set forth herein, all of the Contributor's right, title and interest in and to
the Contributed Property. The Transferor assumes all of the Contributor's
obligations under the Contracts arising after the related Cut-Off Date. All
funds received by the Contributor on or in connection with the Contracts that
are payable after the applicable Cut-Off Date shall be received, held and
applied by the Contributor in trust for the benefit of the Transferor as owner
of the Contracts.
(b) After giving effect to such contribution, the ownership of each
Contract will be vested in the Transferor. The Contract Files and any other
documents relating to the Contracts and the other Contributed Property that are
delivered as part of the Contributed Property or as incidental thereto are and
shall be held in trust by the Trustee for the benefit of the Noteholders. The
Contributor agrees to take no action inconsistent with the ownership of the
Contracts and the other Contributed Property, to promptly indicate to all
parties with a valid interest inquiring as to the true ownership of the
Contracts and the other Contributed Property, that the Contracts and the other
Contributed Property have been contributed and assigned to the Transferor and to
claim no ownership interest in the Contracts and the other Contributed Property.
(c) The Contributor shall take, or cause to be taken, such actions and
execute such documents as are necessary to protect the Trustee's interest in the
Contracts, security interest in the Equipment and the other Contributed Property
against all other Persons, including, without limitation, the following: (i) in
the case of the Contracts, on or before the Closing Date (or, in case of any
Substitute Contracts, the related Substitution Date), (A) filing UCC-1 financing
statements naming the Contributor as debtor, the Transferor as secured party,
the Issuer as assignee of the secured party and the Contracts as collateral in
the jurisdiction in which the principal place of business of the Contributor is
located, (B) UCC-1 financing statements naming the Transferor as debtor, the
Issuer as secured party, the Trustee as assignee of the secured party and the
Contracts as collateral in the jurisdiction in which the principal place of
business of the Transferor is located, (C) filing UCC financing statements
naming the Issuer as debtor and the Trustee as secured party in the jurisdiction
in which the principal place of business of the Issuer is located, and (D)
filing UCC-3 termination statements or releases from lenders, if any, with liens
on the Contracts; (ii) in the case of the assignment or grant of its interests
in the Equipment, within thirty days after the Closing Date (or, in case of any
Substitute Contracts, the related Substitution Date), (A) with respect to a
security interest in Equipment (other than Equipment for which the Original
Equipment Cost is less than $25,000 and subject to Finance Leases or Secured
Equipment Notes), filing UCC financing statements naming the Obligor as debtor,
the Contributor as secured party, U.S. Bank Trust National Association, as
custodian or as trustee, as assignee of the secured party and the Equipment as
collateral, in the appropriate filing offices in the jurisdiction in which the
Equipment was located on the date on which the Contract was originated, (B) with
respect to the Transferor's interest in the Equipment related to DVI Fair Market
Value Leases, filing precautionary UCC-1 financing
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statements (i) naming the Contributor as debtor, the Transferor as secured
party, and the Issuer as assignee of secured party, and the Equipment as
Collateral, in the appropriate filing offices in the jurisdiction in which the
Equipment is located on the relevant transfer date, (ii) naming the Transferor
as debtor, the Issuer as secured party, and U.S. Bank Trust National
Association, as trustee or as custodian as assignee of the secured party, and
the Equipment as Collateral, in the appropriate filing offices in the
jurisdiction in which the Equipment is located on the relevant transfer date,
(iii) naming the Issuer as debtor and U.S. Bank Trust National Association, as
trustee or as custodian as secured party, and the Equipment as Collateral, in
the appropriate filing offices in the jurisdiction in which the Equipment is
located on the relevant transfer date, (C) with respect to all Fair Market Value
Leases other than DVI Fair Market Value Leases, filing UCC-1 financing
statements (i) naming the originator as debtor, the Contributor as secured party
and DVI's interest in the Equipment as Collateral, (ii) naming the Contributor
as debtor, the Transferor as secured party, and the Issuer as assignee of the
secured party, and the related Equipment as Collateral, filed in the appropriate
filing offices in the jurisdiction in which the Transferor maintains its chief
executive office, (iii) naming the Transferor as debtor, the Issuer as secured
party, and U.S. Bank Trust National Association, as custodian or as Trustee, as
assignee of the secured party, and the related Equipment as Collateral, filed in
the appropriate filing offices in the jurisdiction in which the Transferor
maintains its chief executive office, (iv) naming the Issuer as debtor, and U.S.
Bank Trust National Association, as custodian or as Trustee, as secured party
and the related Equipment as Collateral, filed in the appropriate filing offices
in the jurisdiction in which the Transferor maintains its chief executive
office, (D) with respect to all Fair Market Value Leases, filing UCC-1 financing
statements naming the Transferor as debtor, U.S. Bank Trust National
Association, as custodian or trustee, as secured party and the Transferor's
security interest in the Equipment as collateral in the appropriate filing
offices in the jurisdiction in which the Transferor maintains its chief
executive office, (E) filing UCC-3 assignments of any "precautionary" filings
naming the Obligor as debtor, the Contributor as secured party, U.S. Bank Trust
National Association, as custodian or as trustee, as assignee of the secured
party and the Equipment as collateral (other than Equipment subject to either
Finance Leases or Secured Equipment Notes and for which the Original Equipment
Cost is less than $25,000), in the appropriate filing offices where the
Equipment was located at the time the Contract was originated, (F) with respect
to Equipment subject to Leveraged Lease Loans or Lease Receivable Purchases,
filing UCC-3 assignments naming the Obligor as debtor, the Contributor as
secured party, U.S. Bank Trust National Association, as custodian or as trustee,
as assignee of the secured party and the Equipment as collateral, in the
appropriate filing offices in the jurisdiction where the Equipment was located
on the date the underlying contract was originated, (G) filing UCC-3 termination
statements or releases from lenders, if any, with liens on the Equipment, (H)
with respect to any Equipment for which a certificate of title has been issued,
making an application for notation of lien on each such certificate of title
indicating the interest of the Trustee, (I) filing UCC assignments with respect
to each Contract acquired by the Contributor from a third party, naming such
person as debtor/seller, the Contributor as secured party/purchaser, the Trustee
as assignee of the secured party and such acquired contracts as collateral, (J)
filing UCC assignments with respect to each Leveraged Lease Loan or Lease
Receivable Purchase, naming the related Obligor as debtor, the Contributor as
secured party, the Trustee as assignee of the secured party and the related
underlying equipment lease as collateral, (K) delivering a certificate
certifying that it has (1) made the filings of UCC financing statements set
forth above and certifying that copies of such UCC financing statements are on
file with the Trustee and (2) made the applications set forth above and
attaching copies of such applications. Thereafter, the Contributor promptly
shall file such additional UCC financing statements, continuation statements and
assignments and cause to be made such
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notations on certificates of title with respect thereto as may be necessary
because of equipment replacements in accordance with the provisions of any
Contract, or otherwise so that the interest of the Trustee in (x) each of the
Contracts, (y) the Equipment which is subject to the Contracts and (z) the
remainder of the Trust Property will be perfected by such filings with the
appropriate UCC filing offices and/or notations on the appropriate certificates
of title.
(d) If (i) any change in either the Contributor's name, structure or
the location of its principal place of business or chief executive office
occurs, then the Contributor shall deliver thirty (30) days' prior written
notice of such change or relocation to the Transferor and the Trustee and (ii)
if the Contributor becomes aware of the change in location of any Equipment,
then, no later than sixty (60) days after the effective date of such change or
relocation, shall file such amendments or statements as may be required to
preserve and protect the Transferor's, the Issuer's and the Trustee's interest
in the Contracts, the Equipment and the other Trust Property. The Contributor
shall pay all filing fees or taxes payable in respect of any UCC financing or
continuation statements required to be filed pursuant to this Section 1.01(d).
(e) On or prior to the Closing Date or the related Substitution Date,
as applicable, the Contributor shall deliver to the Trustee the sole original,
manually executed counterpart of each Contract that constitutes "chattel paper"
(or, if the original Contract is in the form of a schedule or supplement to a
master lease or loan, all original counterparts of such schedule or supplement
previously in the possession of the Contributor or the Transferor together with
a true and correct copy of such master lease or loan) or an "instrument". The
Contributor will cause its accounting records to be clearly and unambiguously
marked to show that such Contract has been transferred by the Contributor to the
Transferor, and by the Transferor to the Issuer, and then pledged by the Issuer
to the Trustee for the benefit of the Noteholders.
SECTION 2. REPRESENTATIONS, WARRANTIES, COVENANTS AND
AGREEMENTS OF THE CONTRIBUTOR
The Contributor (in its capacity as such and as the initial Servicer
under this Agreement) hereby represents and warrants to the Transferor and
covenants and agrees with the Transferor for the benefit of the Transferor, the
Issuer, the Trustee and the Noteholders with respect to the Initial Contracts,
as of the Closing Date and, with respect to any Substitute Contracts (except for
Sections 2.02 and 2.25) as of each Substitution Date (unless otherwise indicated
herein):
2.01 CORPORATE ORGANIZATION AND AUTHORITY. The Contributor (in its
capacity as such and as the initial Servicer under this Agreement):
(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 could not individually or in the aggregate have a material
adverse effect on the business or condition (financial or otherwise) of the
Contributor or impair the enforceability of any Contract) and to enter into
and perform
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its obligations under this Agreement and each Transaction Document to which
it is a party and the transactions contemplated hereby, including
performance of the duties of the Servicer and the Contributor hereunder;
(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 could not individually or in the aggregate have a material
adverse effect on the Trust Property or the business or condition
(financial or otherwise) of the Contributor or impair the enforceability of
any Contract); and
(d) has duly executed and delivered this Agreement and each
Transaction Document to which it is a party and all other documents
delivered in connection herewith, and this Agreement are each the legal,
valid and binding obligation of the Contributor enforceable in accordance
with the terms hereof except as enforcement of such terms may be limited by
bankruptcy, insolvency, moratorium or other similar laws affecting the
rights of creditors generally and by equitable principles (regardless of
whether such enforceability is in a proceeding in equity or at law).
2.02 BUSINESS AND PROPERTY. The Prospectus Supplement (the "PROSPECTUS
SUPPLEMENT") dated May 8, 2000, to the Prospectus, dated January 12, 2000,
correctly describes in all material respects the Initial Contracts and the
general nature of the business of the Contributor.
2.03 EQUIPMENT AND CONTRACTS.
(a) As to each Contract:
(i) (A) immediately prior to the transfers and conveyances set forth
herein, the Contributor will be the sole owner of, and have good and marketable
title to, the subject Contracts. With respect to any Leveraged Lease Loans, Fair
Market Value Lease or Lease Receivable Purchase, the Contributor will have a
valid first priority security interest in the equipment lease and the Equipment
that has been pledged as collateral security for such Leveraged Lease Loan, Fair
Market Value Lease or Lease Receivable Purchase; (B) immediately prior to the
transfers and conveyances set forth herein, the Contributor will have acquired
either good title to each item of Equipment or, with respect to the Equipment
that is the subject of a Secured Equipment Note, Lease Receivables Purchase,
Finance Lease or a Leveraged Lease Loan, a valid first priority perfected
security interest therein from the related Obligor (except for Equipment
relating to a Secured Equipment Note or Finance Lease and for which the Original
Equipment Cost is less than $25,000). Immediately prior to such date, with
respect to each item of Equipment related to Fair Market Value Leases, the
Contributor will have paid in full to the manufacturer or supplier or Obligor,
as the case may be, the purchase price and any related charges in connection
with the acquisition of such Equipment; (C) upon the transfer to the Transferor
by the Contributor of the Contributor's interest in the Contracts and its
interest in the Equipment pursuant to Section 1 hereof, the Transferor will,
after giving effect to the provisions of Section 1.01(d), have a valid first
priority perfected ownership interest in, and have good title to the Contributed
Property including the Contracts and either a valid first priority security
interest in the Contributor's interest in the Equipment (except for Equipment
relating to a Secured Equipment Note or Finance Lease and for which the Original
Equipment Cost is less than
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$25,000), or, with respect to DVI Fair Market Value Leases, an ownership
interest in the related Equipment subject to any Contract; at such time, the
Contracts and the Transferor's interest in the Equipment will be free and clear
of all Liens other than the rights of each Obligor under the Contract to which
such Obligor is a party and Liens to be discharged on the Closing Date; and
there will be no delinquent taxes or other outstanding charges affecting the
Equipment which are or may be Liens;
(ii) each of the Contracts is a legal, valid and binding full recourse
obligation of the related Obligor, enforceable by the Contributor (and its
designee) against such Obligor in accordance with the terms thereof, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization or
other laws relating to or affecting the enforcement of creditors' rights and by
general equitable principles, and is in full force and effect, and any and all
requirements of any federal, state or local law including, without limitation,
usury, truth-in-lending and equal credit opportunity laws applicable to the
origination, enforceability or assignment of each Contract have been complied
with; and the Contributor has no knowledge of any challenge, dispute or claim by
the Obligor under or affecting any Contract or of the bankruptcy or the
insolvency of any such Obligor;
(iii) the obligation of each Obligor to pay Contract Payments under
each of its related Contract(s) throughout the term thereof is and will be
unconditional, without any right of set- off by such Obligor and without regard
to any event affecting the Equipment, the obsolescence of any Equipment, any
claim of such Obligor against the Contributor or any change in circumstance of
such Obligor or any other circumstance whatsoever;
(iv) the Contributor has no knowledge that any item of the Equipment
has suffered any loss or damage except for such Equipment that has been restored
to its original condition, ordinary wear and tear excepted;
(v) each Contract requires the Obligor thereunder to either maintain
insurance covering damage to, destruction or theft of the Equipment subject
thereto in an amount at least equal to the remaining Discounted Contract Balance
of such Contract;
(vi) as of the Cut-Off Date, (A) no Contract had a remaining term of
more than 86 months, (B) no Contract Payment under any Contract is delinquent
for more than sixty (60) days and (C) no event of default has occurred and is
continuing under any Contract;
(vii) there will be no facts or circumstances existing as of the time
of the transfer pursuant to this Agreement which give rise, or would give rise
at any time in the future, to any right of rescission, offset, counterclaim or
defense, including the defense of usury, to the obligations of any Obligor,
including the obligation of such Obligor to pay all amounts due with respect to
any Contract and neither the operation of any of the terms of any Contract or
the exercise of any right thereunder will render such Contract unenforceable in
whole or in part or subject to any right of rescission, offset, counterclaim or
defense, including the defense of usury, and no such right of rescission,
offset, counterclaim or defense has been asserted with respect thereto;
(viii) no Contract has been amended, altered or modified in any
respect and no provision of any Contract has been waived, except in writing and
copies of all such writings are attached to the Contract delivered to the
Transferor;
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(ix) no Obligor has been released, in whole or in part, from any of
its obligations in respect of a Contract; no Contract has been satisfied,
cancelled or subordinated, in whole or in part, or rescinded, and no Equipment
has been released from the related Contract, in whole or in part, nor has any
instrument been executed that would effect any such satisfaction, release,
cancellation, subordination or rescission;
(x) each Contract is in substantially one of the forms included as
Exhibit G to this Agreement, and no Contract shall have been the subject of any
restructuring of the terms and provisions thereof;
(xi) no Contract permits early termination or voluntary prepayment by
the Obligor;
(xii) no right of the Contributor with respect to an Obligor's failure
to pay all rent due under any Contract has been waived by the Contributor;
(xiii) each Contract is "chattel paper" or an "instrument" under the
UCC as in effect in the applicable jurisdiction; the sole executed counterpart
of each Contract that constitutes chattel paper or an instrument is in the
possession of the Trustee and all of the documents required to be delivered to
the Trustee in connection therewith pursuant to Section 1 have been so
delivered;
(xiv) no Obligor is an Affiliate of the Contributor or the Servicer;
(xv) the Contributor has no knowledge that the obligations of any
Obligor under any Contract will not be paid in full;
(xvi) no Contract will have been originated in or be subject to the
laws of any jurisdiction whose laws would make the assignment and transfer
thereof pursuant to the terms hereof or of the other Transaction Documents
unlawful;
(xvii) in the case of each Contract which consists of a master lease
and one or more exhibits or schedules thereto, (A) the Contributor has not
assigned and will not assign such master lease in its entirety, and has not
delivered and will not deliver physical possession of such master lease, to any
Person other than the Trustee and (B) such exhibits or schedules constitute a
separate contract and are not part of any other contract not sold to the
Transferor;
(xviii) all parties to each Contract had requisite authority and
capacity to execute such Contract;
(xix) prior to the time of assignment, transfer, sale and contribution
to the Transferor, each Contract will have been originated by the Contributor in
the ordinary course of its business, except for certain Contracts which have
been acquired by the Contributor in the ordinary course of its business, and
each Contract shall have been underwritten by the Contributor in accordance with
the standards set forth on Exhibit H hereto;
(xx) the Contributor is not aware of any fact that would prevent or
prohibit Obligors from being reimbursed by Medicare or Medicaid for any services
provided;
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(xxi) the Contract Schedule accurately reflects the information
relating to each Contract;
(xxii) there are no proceedings or investigations pending or, to the
knowledge of the Contributor, threatened, before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality (A)
asserting the invalidity of any of the Contracts, (B) seeking to prevent the
payment and discharge of any of the Contracts or (C) seeking any determination
or ruling that would materially and adversely affect the performance by an
Obligor of its obligations under, or the validity or enforceability of the
Contracts;
(xxiii) each Contract effects either the lease of or the grant of a
perfected first priority security interest in, a specified item of Equipment
(other than Equipment relating to a Secured Equipment Note or Finance Lease and
for which the Original Equipment Cost is less than $25,000) in favor of the
Contributor as lessor, secured party or seller as the case may be, and contains
provisions sufficient for the realization of such leasehold interest, security
interest or ownership interest as the case may be, as against such Equipment,
and is assignable by the Contributor without the consent of any other Person;
(xxiv) each Contract provides that the Contributor has no obligation
to assemble, install, test, adjust or service the Equipment subject to a
Contract. Each Contract provides that the Obligor, at its sole expense, at all
times during the term of the Contract and until return of the Equipment will
maintain the Equipment in good operating order, repair, condition, appearance
and protect the Equipment from deterioration, and provide all accessories,
upgrades, repairs, replacement parts and service required therefor except that
the equipment lease pledged as collateral security for a Leveraged Lease Loan
may in certain instances provide that the related lessor is responsible for
maintaining such Equipment;
(xxv) the Contributor has no knowledge that any Obligor under a
Contract is a Person involved in the business of selling medical equipment of
the same type as the Equipment subject to such Contract;
(xxvi) with respect to each item of Equipment either (A) no such
Equipment has been relocated from the jurisdiction set forth in the Contract or,
(B) if such Equipment has been relocated from the jurisdiction set forth in the
Contract and the Contributor has knowledge of any such relocation, all UCC
filings necessary to continue the first priority security interest in such
Equipment have been made (other than Equipment relating to a Secured Equipment
Note or Finance Lease and for which the Original Equipment Cost is less than
$25,000);
(xxvii)no Contract is a consumer lease as defined in Article 2A of the
UCC;
(xxviii) each Obligor has accepted the related Equipment and, after
reasonable opportunity to inspect and test, has not notified the Contributor of
any defects therein;
(xxix) no Obligor is a government or municipality; and
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(xxx) no Contract requires the prior written consent of the Obligor or
contains any other restriction relating to the transfer or assignment of such
Contract by the Contributor or the seller except such consent as has been
obtained on or prior to the date of such transfer.
(b) The Contributor represents and warrants, as to the Contracts in
the aggregate:
(i) the Aggregate Discounted Contract Balance of the Contracts as of
the Closing Date is equal to $292,528,909.43; and
(ii) the Contracts have the following characteristics: (A) each
Initial Contract has a Discounted Contract Balance as of the Cut-Off Date
of not more than $4,681,554.10; (B) no Discounted Contract Balance of any
Contract will include an amount attributable to any (i) Purchase Option
Payment for such Contract, (ii) Contract Payment due on or prior to the
Cut-Off Date, (iii) security deposit or (iv) advance payment; (C) as of the
Cut-Off Date, no item of Equipment has been repossessed; (D) as of the
Cut-Off Date no Contract is a refinancing due to delinquencies under a
prior lease, security agreement or loan with the same Obligor relating to
the Equipment; (E) the Obligor with respect to each Contract has a place of
business in, or is organized under, the laws of any state or territory of
the United States of America; (F) with respect to the Initial Contracts,
each Contract will have a Scheduled Termination Date no later than a day in
May, 2007; (G) as of the Cut-Off Date, (i) the Discounted Contract Balance
of Contracts that have Balloon Payments constitute not more than 9.25% of
the Aggregate Discounted Contract Balance, (ii) the Discounted Contract
Balance of Contracts that have non-level payments to the Scheduled
Termination Date (excluding Contracts that have Balloon Payments)
constitutes not more than 40.0% of, with respect to the Initial Contracts,
the Aggregate Discounted Contract Balance of the Initial Contracts as of
the Closing Date; (H) as of the Closing Date, (i) the sum of the Discounted
Contract Balances of all Contracts with Equipment located in any one State
will not exceed 17.0% of, with respect to the Initial Contracts, the
Aggregate Discounted Contract Balance of the Initial Contracts, (ii) no
single Obligor will have a Discounted Contract Balance that exceeds 2.5% of
the Aggregate Discounted Contract Balance on the Closing Date, (iii) the
sum of the Discounted Contract Balances of any five Contracts shall not
exceed 10.71% of the Aggregate Discounted Contract Balance on the Closing
Date and (iv) the sum of the Discounted Contract Balances of all Contracts
for which the related Equipment is magnetic resonance imaging equipment
will not exceed $121,000,000 of the Aggregate Discounted Contract Balance
as of the Closing Date; (I) not more than 10.0% of the Aggregate Discounted
Contract Balance will arise from Contracts which constitute loans to
manufacturers, wholesalers, and retailers; (J) the Obligor under each
Contract has made at least one Contract Payment under such Contract prior
to the first Payment Date occurring after the time such Contract was
executed by the parties thereto in addition to any payment made at the time
of the signing of such Contract except for Contracts representing 3.0% of
the Aggregate Discounted Contract Balance as of the Closing Date which
Contracts provide for the related initial Contract Payment to be due within
30 days of the Payment Date occurring on June, 2000; and (K) the sum of the
Discounted Contract Balance of all Contracts that are Lease Receivable
Purchases shall not exceed, at any time, more than 3.0% of the Aggregate
Discounted Contract Balance as of the Closing Date.
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2.04 CONTRACT SCHEDULE. The Contract Schedule (i) accurately sets
forth the identifying number of each Contract, the Obligor's name and address,
the original Scheduled Maturity Date of each Contract, the remaining maturity of
each Contract, the Discounted Contract Balance of each Contract as of the
Cut-Off Date, the amount and scheduled due date of each Contract Payment due
under each of the Contracts, and the original amount funded on each Contract,
(ii) accurately sets forth the information with respect to certain other
characteristics of the Contracts and the Equipment described on such list, (iii)
identifies those Contracts which constitute Pool A and those Contracts which
constitute Pool B and (iv) is otherwise true and correct in all material
respects.
2.05 PENDING LITIGATION. There are no actions, suits, proceedings,
investigations or injunctive or other orders pending, or to the knowledge of the
Contributor or Servicer threatened, against or affecting the Contributor or
Servicer or any subsidiary in or before any court, governmental authority or
agency or arbitration board or tribunal, including, but not limited to, any such
actions, suits, proceeding, investigation or order 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, or condition
(financial or otherwise) of the Contributor or Servicer and its subsidiaries, or
the ability of the Contributor or Servicer to perform its obligations under this
Agreement or the payment or enforceability of any Contract.
2.06 NO MATERIAL EVENT. No event has occurred which materially
adversely affects the Contributor's operations, including, but not limited to,
its ability to perform the transaction contemplated hereunder.
2.07 TRANSACTIONS LEGAL AND AUTHORIZED. This Agreement and all other
documents delivered in connection herewith and the assignment, transfer and
contribution by the Contributor to the Transferor of all of the Contributor's
right, title and interest in and to each Contract and a security interest in
each item of Equipment at any time transferred hereunder and compliance by the
Contributor and the Servicer with all of the provisions of this Agreement:
(a) have been duly authorized by all necessary corporate action
on the part of the Contributor or the Servicer, as the case may be, and do
not and will not require any stockholder approval, or approval or consent
of any trustee or holders of any indebtedness or obligations of the
Contributor or the Servicer, as the case may be;
(b) are within the corporate powers of the Contributor and the
Servicer; and
(c) are legal and will not conflict with, result in any breach in
any of the provisions of, constitute a default under, or result in the
creation of any lien upon any property of the Contributor or the Servicer,
as the case may be, under the provisions of, any agreement, charter
instrument, by-law or other instrument to which the Contributor or the
Servicer, as the case may be, is or will be 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 Contributor or the Servicer, as
the case may be, or its properties, or any order to which the Contributor
or the Servicer, as the case may be, or its properties is subject, of or by
any government or governmental agency or authority.
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2.08 GOVERNMENTAL CONSENT. Except for the filing of the UCC financing
statements and the making of applications as set forth in Section 1.01(c)
hereof, no consent, approval or authorization of, or filing, registration or
qualification with, any governmental authority is or will be necessary or
required on the part of the Contributor in connection with the execution and
delivery of this Agreement or the assignment, transfer and contribution of the
Contracts and the Equipment hereunder.
2.09 COMPLIANCE WITH LAW. Each of the Contributor and the Servicer:
(a) is not in violation of any laws, ordinances, governmental
rules or regulations or court orders to which it is subject; and
(b) has not failed to obtain any licenses, permits, franchises or
other governmental authorizations necessary to the ownership of its
property or to the conduct of its business.
2.10 ORDINARY COURSE; NO INSOLVENCY. The transactions contemplated by
this Agreement are being consummated by the Contributor and the Servicer,
respectively, in furtherance of the Contributor's and the Servicer's ordinary
business purposes and constitute a practical and reasonable course of action by
the Contributor and the Servicer, respectively, designed to improve the
financial position of the Contributor and the Servicer, respectively, with no
contemplation of insolvency and with no intent to hinder, delay or defraud any
of its present or future creditors. Neither as a result of the transactions
contemplated by this Agreement, nor immediately before or after such
transactions, will the Contributor or the Servicer be insolvent, and both the
Contributor and the Servicer shall have adequate capital for the conduct of its
business and the payment of anticipated obligations.
2.11 ASSETS AND LIABILITIES.
(a) Both immediately before and after the assignment, transfer and
contribution of Contracts (including the right to receive all payments due or to
become due thereunder) and the other Contributed Property, the present fair
salable value of the Contributor's assets will be in excess of the amount that
will be required to pay the Contributor's probable liabilities as they then
exist and as they become absolute and matured.
(b) Both immediately before and after the assignment and transfer of
Contracts and the other Contributed Property, the sum of the Contributor's
assets will be greater than the sum of the Contributor's debts, valuing the
Contributor's assets at a fair salable value.
2.12 FAIR CONSIDERATION; VALID SALE. The consideration received and to
be received by the Contributor in exchange for the assignment, transfer and
contribution of the Contracts and the Contributed Property is fair consideration
having value equivalent to or in excess of the value of the assets being
transferred by the Contributor. This Agreement effects a valid assignment,
transfer and contribution of the Contributor's interest in the Contracts and the
other Contributed Property, enforceable against creditors of and purchasers from
the Contributor.
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2.13 ABILITY TO PAY DEBTS. Neither as a result of the transactions
contemplated by this Agreement nor otherwise does the Contributor believe that
it will incur debts beyond its ability to pay or which would be prohibited by
its charter documents or by-laws. The Contributor's assets and cash flow enable
it to meet its present obligations in the ordinary course of business as they
become due.
2.14 BULK TRANSFER PROVISIONS. No transfer, assignment or conveyance
of Contracts or the other Contributed Property by the Contributor to the
Transferor contemplated by this Agreement will be subject to the bulk transfer
or any similar statutory provisions in effect in any applicable jurisdiction.
2.15 TAX RETURNS.
(a) The provisions for taxes on the books of the Contributor and
each subsidiary are in accordance with generally accepted accounting principles.
(b) The Contributor and the Transferor are members of an
affiliated group, within the meaning of Section 1504 of the Code, that files a
consolidated return for federal income tax purposes, and all of the entities
with which the Contributor is consolidated for federal income tax purposes
(including the Transferor) have timely filed all tax returns required to be
filed in any jurisdiction and have paid all taxes, assessments, fees and other
governmental charges upon them or their properties, income or franchises, shown
to be due and payable on such returns, except to the extent any such entity is
contesting the same in good faith by appropriate proceedings and has set aside
adequate reserves in accordance with generally accepted accounting principles
for the payment thereof. The Contributor does not know of any proposed
additional tax assessment against any such entity in any material amount or of
any basis therefor.
2.16 TRANSFER TAXES. No transfer, assignment or conveyance of
Contracts or the other Contributed Property contemplated by this Agreement is
subject to or will result in any tax, fee or governmental charge payable by the
Contributor or the Transferor to any federal, state or local government
("TRANSFER TAXES"). In the event that the Contributor or the Transferor receives
actual notice of any Transfer Taxes arising out of the transfer, assignment and
conveyance of any Contracts and/or the other Contributed Property, on written
demand by the Transferor, or upon the Contributor otherwise being given notice
thereof, the Contributor shall pay, and otherwise indemnify and hold the
Transferor, the Issuer, the Trustee and the holders of the Notes harmless, on an
after-tax basis, from and against any and all such Transfer Taxes (it being
understood that neither the holders of the Notes nor the Trustee shall have any
obligation to pay such Transfer Taxes).
2.17 PRINCIPAL EXECUTIVE OFFICE. The principal place of business and
chief executive office of each of the Contributor and the Servicer, and has been
for at least four months prior to the date of execution and delivery of this
Amended and Restated Agreement, is located at 500 Hyde Park, Doylestown,
Pennsylvania 18901.
2.18 LEGAL NAME. The legal name of the Contributor is as set forth in
this Agreement and the Contributor has not changed its name in the last six
years and does not have any trade names, fictitious names, assumed names or
"doing business as" names except Medical Equipment Finance Company, DVI Capital,
DVI Vendor, DVI Strategic Partner Group, DVI Health
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Services Corp., DVI Finance Inc., DVI Affiliated Capital, Third Coast Capital
and Medical Devices Capital Company.
2.19 SERVICING PROVISIONS CUSTOMARY. The servicing arrangements
hereunder, including, without limitation, the terms and conditions pursuant to
which the Contributor will act as Servicer and the Servicer's Fee and other
amounts to be paid to the Contributor, are consistent with the arrangements and
customary practices of the Contributor when providing comparable services to
nonaffiliated entities and of other services in the equipment leasing industry.
2.20 DEFAULTS. As of the Closing Date, neither the Contributor nor the
Servicer is in default with respect to any debt or obligation.
2.21 ERISA. The Contributor neither maintains, contributes to, nor has
any obligations to contribute to any "employee pension benefit plans," as such
term is defined in Section 3(2) of ERISA (other than the 401(k) Plan of DVI,
Inc.). The execution and delivery of this Agreement and the other applicable
Transaction Documents and the consummation of the transactions contemplated
thereby will neither result in, constitute or otherwise give rise to a
"prohibited transaction" as described in Section 406 of ERISA or Section 4975 of
the Code, with respect to a Contributor Plan. For the purpose of this Section
2.21, the term "CONTRIBUTOR PLAN" shall mean an "employee benefit plan" (as
defined in Section 3 of ERISA) which is or has been established or maintained,
or to which contributions are, have been or are required to be made, by the
Contributor or by any trade or business, whether or not incorporated, which,
together with the Contributor, is under common control, as described in Section
414(b) or (c) of the Code or Section 4001 of ERISA.
2.22 ALL FILINGS MADE. At the Closing Date, no further filings
(including, without limitation, UCC filings) or other actions are necessary in
any jurisdiction to give the Transferor either a security or an ownership
interest in the Contracts and the other Contributed Property, except that with
respect to the Equipment, the Contributor shall, within 30 days of the Closing
Date, file the UCC financing statements and made the necessary applications with
respect to the Equipment that are described in Section 1.01(c) hereof.
2.23 NONCONSOLIDATION. The Contributor is operated in such a manner
that it would not be substantively consolidated with the Transferor or the
Issuer, such that the separate existence of the Contributor and the Transferor
or the Issuer would not be disregarded in the event of a bankruptcy or
insolvency of the Contributor or the Transferor or the Issuer, and in such
regard, among other things:
(a) the Contributor is not involved in the day to day management
of the Transferor or the Issuer;
(b) the Contributor maintains separate corporate records and
books of account from the Transferor and the Issuer and otherwise observes
corporate formalities and has a separate business office from the
Transferor and the Issuer;
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(c) the financial statements and books and records of the
Contributor prepared after the respective dates of creation of the
Transferor and the Issuer reflect and will reflect the separate existence
of the Transferor and the Issuer;
(d) the Contributor maintains its assets separately from the
assets of the Transferor and the Issuer (including through the maintenance
of a separate bank account), the Contributor's funds and assets, and
records relating thereto, have not been and are not commingled with those
of the Transferor or the Issuer and the separate creditors of the
Transferor and the Issuer will be entitled to be satisfied out of the
Transferor's assets or the Issuer's assets, respectively, prior to any
value in the Transferor becoming available to the Transferor's
equityholders or the Contributor's creditors;
(e) all business correspondence of the Contributor and other
communications are conducted in the Contributor's own name and on its own
stationery;
(f) the Transferor and the Issuer do not act as an agent of the
Contributor in any capacity and the Contributor does not act as agent for
the Transferor or the Issuer, but instead presents itself to the public as
a corporation separate from the Transferor and the Issuer; PROVIDED that
the Contributor is the Servicer hereunder; and
(g) the Transferor is not engaged in any other activities other
than the transactions contemplated by the Transaction Documents.
2.24 ALL REPRESENTATIONS AND WARRANTIES TRUE. All representations and
warranties made by the Contributor in any certificate or other document
delivered at the closing of the transactions contemplated by the applicable
Transaction Document, including all representations and warranties made to
Thacher Proffitt & Wood in support of their opinions, are true and correct in
all material respects.
2.25 PROSPECTUS SUPPLEMENT. The Prospectus Supplement does not contain
any untrue statement of material fact or omit to state a material fact necessary
to make the statements contained therein not misleading in light of the
circumstances under which they were made; PROVIDED, HOWEVER, the Contributor
makes no representation or warranty as to the information contained in or
omitted from the Prospectus Supplement in reliance upon and in conformity with
information furnished to the Contributor in writing by Lehman Brothers, Inc.,
Prudential Securities Incorporated or Banc One Capital Markets, Inc. or any of
their respective Affiliates (I.E. the paragraphs under the headings "THE
UNDERWRITING" or "PLAN OF DISTRIBUTION") or by the Trustee (under the heading
"THE TRUSTEE").
2.26 INSURANCE. In addition to the insurance maintained by the
Obligors with respect to the Equipment, the Contributor maintains, among other
policies, a general liability insurance policy in the aggregate amount of
$1,000,000 and an excess liability insurance policy in umbrella form in the
aggregate amount of $3,000,000 for a total of $4,000,000 of liability insurance.
Each of such policies is in full force and effect and covers all Equipment owned
by the Contributor and the Transferor. All premiums in respect of such policies
have been paid. Each of the Trustee on behalf of the Noteholders, and the
Transferor is named as additional insureds on such liability policies.
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2.27 NO BANKRUPTCY PETITION AGAINST THE TRANSFEROR, THE MANAGING
MEMBER OR THE ISSUER. The Contributor covenants and agrees it will not, prior to
the date that is one year and one day after the payment in full of all amounts
owing pursuant to the Transaction Documents, institute against, or join any
other Person in instituting against, any of the Transferor, the Managing Member
or the Issuer, any bankruptcy, reorganization, receivership, arrangement,
insolvency or liquidation proceedings or other similar proceedings under any
federal or state bankruptcy or similar law. This Section 2.27 shall survive the
termination of this Agreement.
SECTION 3. REPRESENTATIONS, WARRANTIES, COVENANTS AND
AGREEMENTS OF THE TRANSFEROR
The Transferor hereby represents to the Contributor as of the Closing
Date and warrants, covenants and agrees as follows:
3.01 TRANSFEROR ORGANIZATION AND AUTHORITY; SUBSIDIARIES. The
Transferor is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of formation, and has full power and
authority to own and convey the Contracts and execute and deliver the
Transaction Documents to which the Transferor is a party (collectively, the
"TRANSFEROR DOCUMENTS") and all related documents, and to perform the terms and
provisions hereof. The Transferor has no subsidiaries, but is the sole
beneficial owner of the Issuer.
3.02 DUE AUTHORIZATION AND NO VIOLATION. Each of the Transferor
Documents and all related documents have been duly authorized, executed and
delivered by the Transferor, and is the legal, valid and binding obligation of
the Transferor enforceable in accordance with its terms, except as the same may
be limited by insolvency, bankruptcy, reorganization or other laws relating to
or affecting the enforcement of creditors' rights or by general equitable
principles. The consummation of the transactions contemplated by the Transferor
Documents and all related documents and the fulfillment of the terms hereof,
will not conflict with or result in a breach of any of the terms or provisions
of, or constitute a default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any of the property or assets of the
Transferor pursuant to the terms of any indenture, mortgage, deed of trust, loan
agreement, guarantee or similar agreement or instrument under which the
Transferor is a debtor or guarantor (other than the liens created pursuant to
the Transaction Documents), nor will such action result in any violation of the
provisions of the certificate of incorporation or the by-laws of the Transferor.
All applicable laws, rules, regulations, and orders with respect to the
Transferor, its business and properties, have been complied with. No consents
and no filings or governmental approvals that have not been made or obtained are
required for due execution, delivery and performance of the agreements by the
Transferor.
3.03 NO LITIGATION. No legal or governmental proceedings are pending
to which the Transferor is a party or of which any property of the Transferor is
the subject, and, to the knowledge of the Transferor, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others
and no injunctions, writs, restraining orders or other orders of any nature are
in effect or, to the knowledge of the Transferor, threatened, other than such
proceedings which will not have a material adverse effect upon the general
affairs, financial position, net worth or results of operations of the
Transferor and will not materially and adversely affect the performance
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by the Transferor of its obligations under, or the validity and enforceability
of, the Transferor Documents and all related documents.
3.04 PRINCIPAL OFFICE. The Transferor's principal place of business
and chief executive office is located at 500 Hyde Park, Doylestown, Pennsylvania
18901. The legal name of the Transferor is as set forth herein and the
Transferor has no tradenames, fictitious names, assumed names or "doing
business" names.
3.05 TAX RETURNS. The Transferor has filed on a timely basis all tax
returns required to be filed in any jurisdiction and has paid all taxes,
assessments, fees and other governmental charges upon it or its properties,
income or franchises, shown to be due and payable on such returns, except to the
extent the Transferor is contesting the same in good faith by appropriate
proceedings and has set aside adequate reserves in accordance with generally
accepted accounting principles for the payment thereof. The Transferor does not
know of any proposed additional tax assessment against it in any material amount
or of any basis therefor.
3.06 SOLVENCY. The Transferor is solvent and will not become insolvent
after giving effect to the contemplated transactions. The Transferor is paying
its debts as they become due and will have adequate capital to conduct its
business after giving effect to the contemplated transactions.
3.07 APPROVALS. All approvals, authorizations, consents, orders or
other actions of any person, corporation or other organization, or of any court,
governmental agency or body or official, required in connection with the
execution and delivery of the Transferor Documents have been or will be taken or
obtained on or prior to the Closing Date.
3.08 NONCONSOLIDATION. The Transferor is operated in such a manner
that it would not be substantively consolidated with the Contributor, such that
the separate existence of the Transferor and the Contributor would not be
disregarded in the event of a bankruptcy or insolvency of the Transferor or the
Contributor, and in such regard, among other things:
(a) the Transferor is not involved in the day to day management
of the Contributor;
(b) the Transferor maintains separate Transferor records and
books of account from the Contributor and otherwise observes Transferor
formalities and has a separate business office from the Contributor;
(c) the financial statements and books and records of the
Transferor prepared after the date of creation of the Contributor reflect
and will reflect the separate existence of the Contributor;
(d) the Transferor maintains its assets separately from the
assets of the Contributor (including through the maintenance of a separate
bank account), the Transferor's funds and assets, and records relating
thereto, have not been and are not commingled with those of the Contributor
and the separate creditors of the Contributor will be entitled to be
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satisfied out of the Contributor's assets prior to any value in the
Contributor becoming available to the Contributor's equityholders or the
Transferor's creditors;
(e) all business correspondence of the Transferor and other
communications are conducted in the Transferor's own name and on its own
stationery;
(f) the Contributor does not act as an agent of the Transferor in
any capacity and the Transferor does not act as agent for the Contributor,
but instead presents itself to the public as a corporation separate from
the Contributor; PROVIDED that the Contributor is the Servicer hereunder;
and
(g) the Transferor will at all times maintain two Independent
Directors (as such term is defined in the certificate of incorporation of
the Transferor).
SECTION 4. ADMINISTRATION OF CONTRACTS
4.01 SERVICER TO ACT.
(a) Notwithstanding the transfers and assignments of the Contracts and
the other Contributed Property contemplated hereby, the Servicer, for the
benefit of the Transferor, and, upon assignment of the Transferor's rights
hereunder to the Issuer (and the Issuer's assignment thereof to the Trustee for
the benefit of the Trustee and the Noteholders), will service and administer
each Contract in accordance with the terms thereof and of this Agreement. The
Servicer shall provide the Obligors with appropriate invoices and such other
notices as may be required to ensure that all Contract Payments, Prepayment
Amounts and Partial Prepayment Amounts on or in respect of each Contract are
remitted by the Obligors directly to a Lock-Box Account.
(b) The Servicer shall do, and shall have full power and authority to
do, subject only to the specific requirements and prohibitions of this
Agreement, any and all things in connection with the servicing and
administration of the Contracts and the Equipment which are in the same manner
in which it services contracts and equipment held for its own account
(including, without limitation, servicing and administration of Contracts with
respect to which the related Equipment may be substituted or upgraded) and
consistent with prudent and customary practices of servicers in the industry,
but in performing its duties hereunder, the Servicer will act on behalf and for
the benefit of the Transferor, the Issuer, the Trustee and the Noteholders,
subject at all times to the provisions of the Transaction Documents, without
regard to any relationship which the Servicer or any Affiliate of the Servicer
may otherwise have with an Obligor. Notwithstanding the prior sentence, the
Servicer shall, within ten (10) Business Days after the Closing Date, notify
each Obligor to make all payments with respect to its respective Contracts which
are due after the Cut-Off Date directly to a Lock-Box Account. The Servicer
shall give the Trustee and the Rating Agencies prior written notice of any
change in the location of a Lock-Box Account and the Servicer shall give at
least ten (10) days' prior written notice of the new location to each Obligor.
The Servicer shall at all times act in accordance with the provisions of each
Contract, and shall observe and comply with all requirements of law applicable
to it. Except as permitted by the terms of any Contract following a default
thereunder, the Servicer shall not take any action which would result in the
interference
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with the Obligor's right to quiet enjoyment of the Equipment subject to the
Contract during the term thereof.
(c) Without limiting the generality of the foregoing, the Servicer
will be responsible, among other duties, to (i) invoice each Obligor for all
Contract Payments required to be paid by such Obligor in such manner and to the
same extent as the Servicer does with respect to similar contracts held for its
own account, (ii) maintain with respect to each Contract and each item of
Equipment, and with respect to each payment by each Obligor and compliance by
each Obligor with the provisions of each Contract, complete and accurate records
in such manner and to the same extent as the Servicer does with respect to
similar contracts held for its own account and (iii) execute, deliver and file
(or cause the same to be done), and the Servicer is hereby authorized and
empowered to execute, deliver, and file on behalf of the Transferor, the Issuer
and the Trustee, any and all tax returns with respect to sales, use, personal
property and other taxes (other than corporate income and franchise tax returns)
and any and all reports or licensing applications required to be filed in any
jurisdiction with respect to any Contract or any item of Equipment and any and
all filings required by Section 4.01(d) below.
(d) The Servicer will file the UCC financing statements as set forth
in Sections 1.01(c) and 7.01(c) hereof within the time frames set forth therein
and thereafter will file such additional UCC financing statements and
continuation statements and assignments in accordance with the provisions of any
Contract and item of Equipment or otherwise so that the security interest in
favor of the Trustee in each of the Contracts and the related Equipment will be
perfected by such filings with the appropriate UCC filing offices. The
Transferor agrees to execute such UCC financing statements and continuation
statements as shall be necessary and shall furnish the Servicer with any powers
of attorney or other documents necessary and appropriate to carry out its
servicing and administration duties hereunder.
(e) The Servicer will maintain, or cause to be maintained, with
respect to the Contracts and the Equipment, liability insurance in amounts at
least as great as those described in Section 2.26.
4.02 CONTRACT AMENDMENTS AND MODIFICATIONS; REPURCHASE OF CONTRACTS BY
SERVICER. (a) In performing its obligations hereunder, the Servicer may, acting
in the name of the Transferor and without the necessity of obtaining the prior
consent of the Transferor or the Trustee, enter into and grant modifications,
waivers and amendments to the terms of any Contract except for modifications,
waivers or amendments that (i) are inconsistent with the servicing standards set
forth in Section 4.01 above, (ii) would extend the date of the final Contract
Payment on any Contract by more than 24 months, (iii) would reduce or adversely
affect, individually or in the aggregate, the Obligor's obligation to maintain,
service, insure and care for the Equipment or would permit the alteration of any
item of Equipment in any way which could adversely affect its present or future
value,(iv) extend the Stated Maturity Date of the Notes, (v) have a material
adverse effect on the weighted average life of any Class of Notes, (vi) be
implemented on more than twenty percent of the Initial Aggregate Discounted
Contract Balance of the Contracts, (vii) be effected on any Contract that is
either 90 days or more delinquent or Defaulted Contract, (viii) PROVIDED that
the Issuer fails to deposit an amount into the Collection Account equal to such
decrease, decrease the Discounted Contract Balance of any Contract or (ix)
otherwise could adversely affect, individually or in the aggregate, the
interests of any of the Transferor, the Issuer, the Trustee or the Noteholders.
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Notwithstanding the provisions of clause (ii) of the preceding sentence, the
Servicer may (1) permit any of the actions set forth in clause (ii) of the
preceding sentence, which in the Servicer's sole discretion, in accordance with
the same manner in which it services contracts and equipment held for its own
account, would maximize Recoveries on any Defaulted Contract, or (2) permit
termination of a Contract which does not otherwise provide for termination by
requiring, in the case of either clause (1) or (2), that the Obligor pay, or, if
the terms of such extension or termination do not provide for such payment by
the Obligor that the Servicer deposit, in lieu of all future Contract Payments
with respect to such Contract, an amount which equals or exceeds the applicable
Prepayment Amount for such Contract as of 11:00 A.M. New York time on the second
Business Day prior to the Payment Date next succeeding the making of such
payment is deposited into the Collection Account; PROVIDED, HOWEVER, that the
Servicer will not be permitted to allow prepayment by an Obligor if there are
any amounts due under the related Contract after such prepayment.
In the event of any modification, waiver or amendment of any Contract
in accordance with this Section 4.02, the Servicer will promptly furnish the
Transferor, the Issuer and the Trustee with a copy thereof, together with a
certificate of the Servicer signed by one of its executive or financial officers
stating that such modification, waiver or amendment is not prohibited by the
provisions of this Section 4.02.
(b) If an Obligor requests either an upgrade or a trade-in of an item
of Equipment, the Servicer may either (x) remove such Contract and the related
Equipment from the Trust Property PROVIDED that the Servicer either (i) subject
to the limitations set forth in Section 7.01(c), transfers a Substitute Contract
and the related Equipment to the Transferor in accordance with Section 7 of this
Agreement or (ii) deposits an amount equal to the Prepayment Amount for such
Contract into the Collection Account or (y) permit such Contract and remaining
related Equipment to remain in the Trust Property, PROVIDED that the Servicer
deposits an amount equal to the Partial Prepayment Amount for such Contract into
the Collection Account.
4.03 CONTRACT DEFAULTS; RESIDUAL REALIZATIONS.
(a) Upon receipt of notice from the Transferor, the Issuer, the
Trustee or any other Person, or if the Servicer otherwise learns that the
Obligor under any Contract is in default thereunder, the Servicer will take such
action as is appropriate, consistent with the Servicer's administration of
contracts held for its own account and consistent with the customary practices
of servicers in the industry, including such action as may be necessary to
cause, or attempt to cause, the Obligor thereunder to cure such default (if the
same may be cured) or to terminate or attempt to terminate such Contract and to
recover, or attempt to recover, all damages resulting from such default.
(b) The Servicer will use its best efforts (i) to sell or re-lease any
Equipment and realize on any other collateral related to a Defaulted Contract in
a timely manner and upon reasonable terms and conditions so as to maximize, to
the extent possible under then prevailing market conditions, as expeditiously as
is consistent with sound commercial practice and the Servicer standard
referenced in Section 4.01, the net proceeds from such Equipment and other
collateral, if any and (ii) to sell or re-lease any Equipment remaining subject
to the lien of the Amended and Restated Indenture upon the expiration of the
Contract to which such Equipment is subject, in a timely manner and in a manner
consistent with that utilized by the Servicer with respect to
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equipment owned by it so as to maximize, to the extent possible under then
prevailing market conditions, the net proceeds from such Equipment.
(c) In the event that the Servicer is required to sell any item of
Equipment pursuant to the provisions of this Section 4.03 at a time when the
Servicer is trying to lease or sell other similar items of equipment, the
Servicer will not favor any such other item in its remarketing efforts.
4.04 COSTS OF SERVICING; SERVICER'S FEE.
(a) All costs of servicing each Contract in the manner required by
this Section 4 shall be borne by the Servicer, but the Servicer shall be
entitled to retain, out of any amounts actually recovered by the Servicer in the
performance of its obligations under Section 4.03 hereof with respect to any
Contract or the Equipment subject thereto, the Servicer's actual out-of-pocket
expenses reasonably incurred in the course of such performance with respect to
such Contract or Equipment (For all purposes of this Section 4, the Servicer's
"out-of-pocket expenses" means only those expenses incurred to non-Affiliated
third parties (E.G., outside counsel in a collection suit) and shall not include
salaries, operating costs, overtime wages and other such "overhead" costs or
expenses of the Servicer or its Affiliates, and shall not include expenses of or
payments to an agent or subservicer allowed under Section 11.02, except that
out-of-pocket expenses for the fees and expenses of an agent used to remarket
Equipment subject to Contracts shall be included as "out-of- pocket expenses").
In addition, the Servicer shall be entitled to receive from the Transferor on
each Payment Date any unreimbursed Nonrecoverable Advances or Servicer Advances
with respect to any Contract (in accordance with Section 5) and a servicing fee
(the "SERVICING FEE") in the amount described in paragraph (b) below.
(b) As compensation to the Servicer for its servicing of the
Contracts, the Servicer will be entitled to receive on each Payment Date from
amounts on deposit in the Collection Account the Servicing Fee in an amount
equal to the product of (i) one-twelfth, (ii) the Servicing Fee Rate and (iii)
the Aggregate Discounted Contract Balance as of the beginning of the related
Collection Period. In addition, the Servicer will be entitled to receive as
additional compensation late payment fees, the penalty portion of interest paid
on past due amounts, origination fees, documentation fees, other administrative
fees or similar charges allowed by applicable law with respect to the Contracts,
and certain other similar fees paid by the Obligors ("SERVICING CHARGES") and
earnings from any Eligible Investments of amounts on deposit in the Collection
Account.
(c) The Servicer hereby agrees:
(i) to pay to the Trustee from time to time such compensation for
all services rendered by it under the Amended and Restated Indenture as the
Servicer and the Trustee have agreed in writing prior to the Closing Date,
such payment to be made independent of the other payment obligations of the
Servicer hereunder;
(ii) except as otherwise expressly provided herein, to reimburse
the Trustee upon its request for all reasonable expenses, disbursements,
and advances incurred or made by the Trustee in accordance with any
provision of the Amended and Restated Indenture (including the reasonable
compensation and the expenses and disbursements of its
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agents and counsel), except any such expense, disbursement, or advance as
may be attributable to its negligence or bad faith;
(iii) to pay the Trustee its annual administrative fee on the
Closing Date;
(iv) to pay the reasonable fees and expenses of Trustee's
counsel, Dorsey and Whitney, on the Closing Date; and
(v) to pay the reasonable annual administrative fee of each
Lock-Box Bank.
To the extent the Trustee has not been paid pursuant to the Amended
and Restated Indenture, then all of the expenses set forth in this clause (c)
shall be borne by the Servicer, and the Servicer shall not be entitled to
reimbursement of such amounts from the Trust Property.
4.05 OTHER TRANSACTIONS. Nothing in this Agreement shall preclude the
Contributor or the Servicer from entering into other contracts or other
financial transactions with any Obligor or selling or discounting any such
contract with any Person.
4.06 COLLECTION OF MONEYS.
(a) Subject to Section 4.06(b), the Servicer shall remit or cause each
Lock-Box Bank to remit all payments received by it on or in respect of any
Contract or Equipment (including any Residual Payment) during such Collection
Period into the Collection Account (including any such amounts then held by the
Servicer) as soon as practicable, but in any event within two Business Days
after receipt thereof; PROVIDED, HOWEVER, that upon satisfaction of conditions
provided by the Rating Agencies from time to time, the Servicer shall be
permitted to deposit such amounts received during a particular Collection Period
into the Collection Account within two Business Days prior to the related
Payment Date.
(b) Any such amounts remitted to the Collection Account may not
include Excluded Amounts.
(c) Notwithstanding the provisions of paragraph (a) hereof, the
Servicer may retain, or will be entitled to be reimbursed, from amounts
otherwise payable into, or on deposit in, the Collection Account with respect to
a Collection Period, amounts previously deposited in the Collection Account but
later determined to have resulted from mistaken deposits or payments due before
or on the Cut-Off Date or postings of checks returned for insufficient funds
(PROVIDED that the Servicer accounts for such amounts in the Monthly Servicer's
Report for the related Collection Period). The amount to be retained or
reimbursed hereunder shall not be included in funds available for distribution
with respect to the related Payment Date.
(d) Pending their deposit into the Collection Account, all collections
shall be segregated by book-entry or similar form of identification on the
Servicer's books and records and identified as the property of the Transferor.
4.07 VOLUNTARY TERMINATION.
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(a) At the option of the Servicer, the obligations and
responsibilities of the Servicer with respect to all of the Contracts shall
terminate on any Payment Date on which the Pool A Aggregate Discounted Contract
Balance is less than 10% of the Pool A Aggregate Discounted Contract Balance as
of the Closing Date and the Pool B Aggregate Discounted Contract Balance is less
than 20% of the Pool B Aggregate Discounted Contract Balance as of the Closing
Date so long as the Servicer deposits or causes to be deposited into the
Collection Account the Repurchase Amount for each Contract.
(b) At the option of the Servicer, the obligations and
responsibilities of the Servicer with respect to the Contracts in Pool B shall
terminate on any Payment Date on which the Pool B Aggregate Discounted Contract
Balance is less than 20% of the Pool B Aggregate Discounted Contract Balance as
of the Closing Date so long as the Servicer deposits or causes to be deposited
into the Collection Account the Repurchase Amount for each Contract in Pool B.
SECTION 5. SERVICER ADVANCES; REPURCHASE OF CONTRACTS
5.01 SERVICER ADVANCES. Following each Determination Date, the
Servicer shall advance and remit to the Trustee, in such manner as will ensure
that the Trustee will have immediately available funds on account thereof by
11:00 A.M. New York time on the second Business Day prior to the next succeeding
Payment Date, a Servicer Advance equal to an amount sufficient to cover all
amounts due and unpaid on any Delinquent Contract as of the related
Determination Date; PROVIDED, HOWEVER, that the Servicer will not be obligated
to make a Servicer Advance with respect to (a) any Defaulted Contract, (b) any
Contract that was finally liquidated on or prior to such Determination Date or
(c) any Contract if the Servicer, in its good faith judgment, believes that such
Servicer Advance would be a Nonrecoverable Advance. If the Servicer determines
that any Servicer Advance it has made, or is contemplating making, would be a
Nonrecoverable Advance, the Servicer shall deliver to the Trustee an Officer's
Certificate stating the basis for such determination.
The Servicer shall be reimbursed for Servicer Advances on each Payment
Date from amounts on deposit in the Collection Account as follows: (i) for any
Servicer Advance made with respect to a Delinquent Contract, from subsequent
collections of such delinquent Contract Payments, Prepayment Amounts or
Repurchase Amounts and (ii) for any Nonrecoverable Advance, from all collections
received on all of the Contracts.
5.02 INDEMNIFICATION. Each of the Contributor and the Servicer agrees
to indemnify and hold harmless the Transferor, the Issuer, the Managing Member,
the Servicer, the Trustee, (which shall include each of their respective
members, directors, officers, employees and agents), the Contributor and each
Noteholder, as the case may be, (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 (except to the extent caused by gross negligence or
willful misconduct on the part of the Indemnified Party) as a result of claims,
actions, suits or judgments asserted or imposed against an Indemnified Party and
arising out of the transactions contemplated hereby or by the Amended and
Restated Indenture or arising out of, or based upon, action or inaction by the
Contributor or the Servicer, as the case may be, that is contrary to the terms
of this Agreement or the other Transaction Documents to which it
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is a party or a breach by the Contributor or the Servicer, as the case may be,
of any of its covenants set forth in any of the Transaction Documents to which
it is a party or any information certified in any schedule delivered by the
Contributor or the Servicer, as the case may be, being untrue in any material
respect as of the date of such Certification, 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 Servicer's
possession or under its control pursuant to this Agreement, 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 the foregoing indemnity shall in no way be deemed to impose on the
Contributor any obligation, other than to the extent specifically set forth in
this Section 5, to make any payment with respect to principal or interest on the
Notes or to reimburse the Transferor for any payments on account of the Notes.
In every circumstance where the Indemnified party seeking indemnity hereunder
for legal fees, counsel fees and related costs and expenses is a Noteholder it
is understood, and the Noteholders by their acceptance of their respective Notes
agree, that such reimbursement, indemnification and holding harmless is limited
to the reasonable fees, related costs and expenses of the Noteholders Counsel
only. The obligations of the Contributor under this Section 5.02 shall survive
the termination of the Agreement the resignation or removal of the Trustee and
the termination of the Servicer pursuant to the terms hereof.
5.03 REPURCHASE AND SUBSTITUTION OF CONTRACTS; OTHER PAYMENTS. (a) The
Contributor or the Servicer, as the case may be, shall inform the Transferor,
the Issuer, the Managing Member and the Trustee promptly, in writing, upon the
discovery of a breach of any of the Contributor's representations and warranties
set forth herein. With respect to any breach of the Contributor's
representations and warranties set forth herein which materially and adversely
affects the interest of the Noteholders in any Contract or Contracts, the
Contributor, unless within 90 days following the discovery or receipt of notice
of such breach such breach has been cured or waived in all respects by the
Noteholders evidencing more than 50% of the Voting Rights, shall either (a)
purchase such Contract and the security interest in the related Equipment from
either the Transferor or the Issuer, as the case may be, or (b) replace such
Contract and the security interest in the related Equipment with a Substitute
Contract in accordance with the provisions of Sections 7.01, 7.02 and 7.03 of
this Agreement. In the event of a repurchase of a Contract, the Contributor
shall remit to the Trustee (upon written notice to the Trustee thereof) for
deposit into the Collection Account the Repurchase Amount of each such Contract
to be repurchased on or prior to 11:00 A.M. New York City time on the second
Business Day prior to the Payment Date immediately following the date when the
Contributor shall become obligated to purchase (or, if such Contract is then a
Defaulted Contract, an amount equal to the Repurchase Amount as of the date such
Contract first became a Defaulted Contract, together with interest thereon at
the Discount Rate from the date such Contract first became a Defaulted Contract
to the end of the month preceding the date of payment). In connection with such
repurchase, the Servicer shall be reimbursed in accordance with Section 3.04(b)
of the Amended and Restated Indenture for all amounts, if any, theretofore
advanced by the Servicer pursuant to Section 5.01 with respect to such Contract.
The Trustee shall deposit such Repurchase Amounts in the Collection Account on
or prior to 11:00 A.M. New York City time on the second Business Day immediately
following the date on which the Trustee receives such Repurchase Amounts.
Without limiting the generality of the foregoing, it is agreed and understood
that for purposes of this Section 5.03, any inaccuracy in any representation or
warranty with respect to (i) the priority of the lien of the Amended and
Restated Indenture with respect to any Contract or
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(ii) the amount (if less than represented) of the Contract Payments or
Repurchase Amount under any Contract shall be deemed to be material.
(b) With respect to all Predecessor Contracts and the security
interest in the related Equipment purchased or replaced by the Contributor
pursuant to this Section 5 hereof, the Transferor will deliver to the
Contributor, an instrument substantially in the form of Exhibit E hereto,
assigning to the Contributor, without recourse, representation or warranty
(except as to the absence of liens, claims, or encumbrances resulting from
actions taken, or failed to be taken, by the Transferor), all of the
Transferor's right, title and interest in and to such Predecessor Contracts and
the security interest in the related Equipment, and all security and documents
relating thereto.
(c) The Transferor, the Issuer and the Trustee agree that the
obligation of the Contributor to repurchase or substitute any Contract pursuant
to this Section 5.03 shall constitute the sole remedy for any such breach
available against the Contributor by the Transferor, the Issuer, any Noteholder
or the Trustee; PROVIDED, that the limitation contained in this clause (c) shall
not otherwise limit the rights of any such Person under Section 5.02.
SECTION 6. INFORMATION TO BE PROVIDED
6.01 MONTHLY SERVICER REPORT. On or prior to each Determination Date,
the Servicer shall deliver a report in writing substantially in the form of
Exhibit B (the "MONTHLY SERVICER REPORT") to the Trustee and the Rating
Agencies.
6.02 TAX REPORTING AND TREATMENT. (a) The Servicer shall furnish or
cause to be furnished to each Noteholder, within a reasonable time after the end
of each calendar year, to each Noteholder who was a Noteholder at any time
during such year, a report setting forth the amount of principal and interest
paid on the Notes during such year and indicating such other customary factual
information as the Servicer deems necessary, or as any Noteholder reasonably
requests, to enable Noteholders to prepare their respective tax returns. In
addition, the Servicer shall provide, or cause to be provided to the Internal
Revenue Service and each Noteholder, information statements required by the Code
(and the regulations issued thereunder) or as such Noteholders may reasonably
request from time to time with respect to in the case of any class of Notes that
is issued with original issue discount within the meaning of section 1273 of the
Code ("OID"), information statements with respect to OID. For purposes of
consolidated federal and state income and franchise tax reporting, the
Contributor will be treated (i) as the owner of the Contracts and the other
Contributed Property and (ii) as the borrower under the Amended and Restated
Indenture.
(b) The Transferor, the Issuer, the Managing Member, the Contributor,
the Servicer, any subservicer and each Noteholder by acceptance of its Note (and
any Person that is a beneficial owner of any interest in a Note, by virtue of
such Person's acquisition of a beneficial interest therein) agrees to treat the
Notes as indebtedness for purposes of federal, state and local income or
franchise taxes (and any other tax imposed on or measured by income).
6.03 OTHER INFORMATION. The Servicer shall, at the Trustee's request,
furnish to the Trustee from time to time certain information and make various
calculations which are relevant to
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the performance of the Trustee's duties as set forth in the Amended and Restated
Indenture. Copies of all information furnished pursuant to this Section shall
also be furnished to the Rating Agencies.
6.04 ANNUAL INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT'S REPORT. The
Servicer shall cause a firm of independent certified public accountants (who may
also render other services to the Servicer or to the Contributor) to deliver to
the Trustee, the Rating Agencies and each Noteholder within 90 days following
the end of each fiscal year of the Servicer, beginning with June 30, 2001, a
written statement to the effect that such firm has examined in accordance with
generally accepted practices samples of the accounts, records, and computer
systems of the Servicer for the fiscal year ended on the previous June 30
relating to the Contracts (which accounts, records, and computer systems shall
be described in one or more schedules to such statement), that such firm has
compared the information contained in the Servicer's reports delivered in the
relevant period with information contained in the accounts, records, and
computer systems for such period, and that, on the basis of such examination and
comparison, such firm is of the opinion that the Servicer has, during the
relevant period, serviced the Contracts in compliance with such servicing
procedures, manuals, and guides and in the same manner as it services comparable
leases for itself or others, and that such certificates, accounts, records, and
computer systems have been properly prepared and maintained in all material
respects, except in each case for (a) such exceptions as such firm shall believe
to be immaterial and (b) such other exceptions as shall be set forth in such
statement. Copies of all information furnished pursuant to this Section shall
also be furnished to the Rating Agencies.
6.05 PAYMENT ADVICES. Each payment by the Contributor or the
Transferor or the Servicer to the Trustee pursuant to any of the provisions of
the Transaction Documents shall be accompanied by written advice containing
sufficient information to identify the Contract and/or Equipment to which such
payment relates, the Section of the Transaction Documents pursuant to which such
payment is made, and the proper application pursuant to the provisions of the
applicable Transaction Document of the amounts being paid.
SECTION 7. SUBSTITUTION OF CONTRACTS
7.01 SUBSTITUTION. (a) (1) With respect to Pool A, in addition to the
Servicer's other rights of substitution, the Servicer will have the right (but
not the obligation), at any time in connection with exercise by the Transferor
of its rights of substitution under the SCTA, to substitute (a "POOL A
NON-PERFORMING CONTRACT SUBSTITUTION") one or more Eligible Contracts and the
security interest in the related Equipment subject thereto (the foregoing
collectively, a "SUBSTITUTE CONTRACT") for a Contract in Pool A and the security
interest in the related Equipment subject thereto (the foregoing collectively, a
"PREDECESSOR CONTRACT") if:
(i) (A) any Contract Payment on the Predecessor Contract is delinquent
for at least sixty (60) consecutive days as of the most recent
Determination Date; or
(B) a bankruptcy petition has been filed by or against the
Obligor or, with respect to a Leveraged Lease Loan, the related Lessor,
under any Predecessor Contract; or
(C) the Predecessor Contract was initially classified as a
Defaulted Contract during the related Collection Period;
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PROVIDED, HOWEVER, that if the Predecessor Contract included a first
priority perfected security interest in Equipment related to a Fair Market
Value Lease, the related Substitute Contract, if related to a Fair Market
Value Lease, shall also include a first priority perfected security
interest in the Equipment related thereto; and
(ii) the conditions set forth in Section 7.01(d) have been satisfied
and the sum of (x) the Discounted Contract Balances of all Substitute
Contracts substituted under this Section 7.01(a)(1) and (y) amounts
deposited by the Servicer in the Collection Account in connection with all
such substitutions under this Section 7.01(a)(1) does not exceed 10% of the
Pool A Aggregate Discounted Contract Balance as of the Closing Date.
(2) With respect to Pool A, in addition to the Servicer's other rights
of substitution, the Servicer will have the right (but not the obligation) at
any time in connection with exercise by the Transferor of its rights of
substitution under the SCTA, to substitute (a "POOL A PREPAID CONTRACT
SUBSTITUTION") one or more Substitute Contracts for a Predecessor Contract in
Pool A if (i) the Predecessor Contract has been prepaid and (ii) the conditions
set forth in Section 7.01(d) have been satisfied and the sum of (x) the
Discounted Contract Balance of all Substitute Contracts substituted under this
Section 7.01(a)(2) and Section 4.02(b) and (y) amounts deposited by the Servicer
in the Collection Account in connection with all such substitutions under this
Section 7.01(a)(2) and Section 4.02(b) does not exceed 10% of the Pool A
Aggregate Discounted Contract Balance as of the Closing Date.
(b) (1) With respect to Pool B, in addition to the Servicer's other
rights of substitution, the Servicer will have the right (but not the
obligation), at any time in connection with exercise by the Transferor of its
rights of substitution under the SCTA, to substitute (a "POOL B GENERAL CONTRACT
SUBSTITUTION") one or more Substitute Contracts for a Predecessor Contract in
Pool B if the conditions set forth in Section 7.01(d) have been satisfied and
the sum of (x) the Discounted Contract Balances of all Substitute Contracts
substituted under this Section 7.01(b)(1) and (y) amounts deposited by the
Servicer in the Collection Account in connection with all such substitutions
under this Section 7.01(b)(1) does not exceed 10% of the Pool B Aggregate
Discounted Contract Balance as of the Closing Date.
(2) With respect to Pool B, in addition to the Servicer's other rights
of substitution, the Servicer will have the right (but not the obligation), at
any time in connection with exercise by the Transferor of its rights of
substitution under the SCTA, to substitute (a "POOL B PREPAID CONTRACT
SUBSTITUTION") one or more Substitute Contracts for a Predecessor Contract in
Pool B if (i) the Predecessor Contract has been prepaid and (ii) the conditions
set forth in Section 7.01(d) have been satisfied and the sum of (x) the
Discounted Contract Balance of all Substitute Contracts substituted under this
Section 7.01(b)(2) and Section 4.02(b) and (y) amounts deposited by the Servicer
in the Collection Account in connection with all such substitutions under this
Section 7.01(b)(2) and Section 4.02(b) does not exceed 10% of the Pool B
Aggregate Discounted Contract Balance as of the Closing Date; unless the Rating
Agencies have otherwise permitted.
(c) Any substitution pursuant to this Section 7.01 or Section 5.03
shall become effective upon (i) delivery to the Trustee and the Transferor of
the Substitute Contract Contribution Form, substantially in the form of Exhibit
D hereto, transferring to the Transferor (and the Issuer, as assignee of the
Transferor) all right, title and interest of the Contributor or the Servicer in
and to
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the Eligible Contract being substituted and a security interest in the related
Equipment subject thereto, and granting the Trustee a valid and first priority
security interest in such Substitute Contracts and the related Equipment (other
than with respect to a Secured Equipment Note or Finance Lease and for which the
Original Equipment Cost is less than $25,000) subject thereto, (ii) delivery to
the Trustee of amendments to, or executed originals of, the UCC financing
statements referred to in Section 1.01(c) hereof reflecting the deletion of the
Predecessor Contract and the addition of the Substitute Contract, (iii) delivery
to the Contributor by the Transferor of an instrument, substantially in the form
of Exhibit E hereto, transferring to the Contributor or the Servicer, without
representation or warranty, all of the Transferor's right, title and interest in
and to the Predecessor Contract, (iv) delivery to the Trustee of the sole
original, manually executed counterpart of each Contract that constitutes
"chattel paper" or an "instrument" under the UCC and (v) delivery to the Trustee
of an amendment to the Contract Schedule, reflecting the deletion of the
Predecessor Contract and the addition of the Substitute Contract. Upon delivery
of each Substitute Contract and the Substitute Contract Transfer Form therefor,
the definition of "Contributed Property" will be automatically amended to
include such Substitute Contract and all related property and rights contained
in the definition of Contributed Property.
(d) With respect to a substitution of Contracts in accordance with the
provisions of this Section 7 and Section 5.03 hereof, each proposed Substitute
Contract must (i) be an Eligible Contract; (ii) satisfy all of the
representations and warranties set forth in Section 2.03(a) of this Agreement;
(iii) have a Discounted Contract Balance such that the sum of its Discounted
Contract Balance, including any additional cash delivered by the Servicer into
the Collection Account in connection therewith, is not less than the Discounted
Contract Balance of the Contract(s) being replaced; (iv) not cause the remaining
weighted average life of the Contracts (as calculated based upon the Contract
Payments which constitute the Discounted Contract Balance of the Contracts) to
be materially altered; and (v) in accordance with the Servicer's standard credit
evaluation policies, be of equal or better credit quality than the Contract
being replaced. For purposes of determining compliance with clause (iii) of the
preceding sentence, if more than one Substitute Contract is being provided on
any date, the Discounted Contract Balance of the Substitute Contracts and the
Contracts being replaced shall be determined on an aggregate basis.
7.02 NOTICE OF SUBSTITUTION. In the Monthly Servicer Report to be
delivered on each Determination Date, the Contributor shall give written notice
to the Trustee, each Noteholder, the Rating Agencies and the Servicer of each
substitution of Contracts pursuant to Section 7.01(a) hereof and of any
substitution or repurchase pursuant to Section 5.03 hereof during the preceding
Collection Period. Such Monthly Servicer Report or other written notice shall
(i) specify the amount of each periodic Contract Payment under the Predecessor
Contract and the amount of each periodic Contract Payment under each Eligible
Contract being substituted, (ii) specify the residual values of the Equipment
subject to the Predecessor Contract and the Equipment subject to the Eligible
Contract being substituted, (iii) specify the Discounted Contract Balance of the
Predecessor Contracts, the Discounted Contract Balance of the Substitute
Contracts, any Excess Substituted Discounted Contract Balance, and any amounts
to be deposited in the Collection Account in connection with such Substitute
Contracts and (iv) with respect to a substitution pursuant to Section 7.01(a)
hereof, be accompanied by an Officer's Certificate, substantially in the form of
Exhibit F hereto, certifying as to compliance with the provisions of Section
7.01(a) hereof.
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7.03 CONTRIBUTOR'S AND SERVICER'S SUBSEQUENT OBLIGATIONS. Upon any
substitution of Contracts in accordance with the provisions of this Section 7 or
Section 5.03, the Contributor's and the Servicer's obligations hereunder with
respect to the Predecessor Contract shall cease (except for the Servicer's
obligation as set forth in Section 4.03 hereof to take such action as is
necessary and appropriate to maximize net proceeds to be paid to the Trustee)
but the Contributor and the Servicer shall each thereafter have the same
obligations with respect to the Substitute Contract substituted as it has with
respect to all other Contracts subject to the terms hereof.
7.04 USAGE OF PREDECESSOR CONTRACTS IN CALCULATIONS. After
substitution therefore in accordance with the terms and conditions of the
Transaction Documents, no Predecessor Contract or any other Contract repurchased
or substituted for in accordance with the Transaction Documents, including the
subsequent default, delinquency or breach thereof, shall be included in any
calculation or determination made under the Transaction Documents, including,
without limitation, the calculation of either any Amortization Event or
Indenture Event of Default.
SECTION 8. THE SERVICER
8.01 CORPORATE EXISTENCE OF THE SERVICER. The Servicer will keep in
full force and effect its existence, rights and franchise as a corporation under
the laws of its jurisdiction of incorporation and will preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is necessary to protect the validity and enforceability
of any of the Contracts or to permit performance of the Servicer's duties under
this Agreement.
The Servicer shall not merge or consolidate with any other Person
unless: (i) the entity surviving such merger or consolidation is a corporation
organized under the laws of the United States or any state thereof, (ii) the
surviving entity, if not the Servicer, shall execute and deliver to the
Transferor and the Trustee, in form and substance satisfactory to each of them,
(x) an instrument expressly assuming all of the obligations of the Servicer
hereunder, and (y) an Officer's Certificate to the effect that such Person is a
corporation of the type described in the preceding clause (i), has effectively
assumed the obligations of the Servicer hereunder, that all conditions precedent
provided for in this Agreement relating to such transaction have been complied
with, that all financing statements and continuation statements and amendments
thereto have been executed and filed that are necessary fully to preserve and
protect the interest of the Transferor, the Issuer and Trustee in the Trust
Property, and reciting the details of such filings, or stating that no such
action shall be necessary to preserve and protect such interest, (iii) the
Servicer shall deliver to the Trustee a letter from each Rating Agency to the
effect that such consolidation, merger or succession will not, in and of itself,
result in a downgrading of the ratings for the Notes and (iv) immediately after
giving effect to such transaction, no Servicer Event of Default, and no event
which, after notice or lapse of time, or both, would become a Servicer Event of
Default shall have occurred and be continuing.
8.02 LIMITATION ON LIABILITY OF THE SERVICER AND OTHERS. (a) Neither
the Servicer nor any of the directors, officers, employees or agents of the
Servicer shall incur any liability to the Transferor, the Issuer, the Trustee or
the holders of the Notes, for any action taken or not taken in good faith
pursuant to the terms of this Agreement with respect to any Contract (including
any Defaulted Contract) or the Equipment subject thereto; PROVIDED, HOWEVER,
that this provision shall not protect the Servicer or any such person against
any breach of representations or warranties made
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by it herein or in any certificate delivered in conjunction with the purchase of
the Notes or for any liability that would otherwise be imposed by reason of
willful misfeasance or negligence in the performance of its duties hereunder or
by reason of reckless disregard of obligations and duties hereunder.
(b) Except as provided in this Agreement, the Servicer shall not be
under any obligation to appear in, prosecute, or defend any legal action that
shall not be incidental to its duties to service the Contracts in accordance
with this Agreement, and that in its opinion may involve it in any expense or
liability; PROVIDED, HOWEVER, that the Servicer may undertake, at its expense,
any reasonable action that it may deem necessary or desirable in respect of this
Agreement and the rights and duties of the parties to this Agreement and the
interests of the Noteholders under this Agreement.
(c) The Servicer, and any director or officer or employee or agent of
the Servicer, may rely in good faith on the advice of counsel selected by it
with due care or on any document of any kind, prima facie properly executed and
submitted by any Person respecting any matters arising hereunder.
8.03 SERVICER NOT TO RESIGN OR BE REMOVED. The Servicer shall not
resign from the servicing obligations and duties hereby imposed on it except in
connection with an assignment permitted by Section 11.02 hereof or upon
determination that such duties hereunder are no longer permissible under
applicable law. Any such determination permitting the resignation of the
Servicer shall be evidenced by an opinion of independent counsel, in form and
substance satisfactory to the Noteholders evidencing more than 50% of the Voting
Rights, to such effect delivered to the Trustee.
Except as provided in Section 10.02 hereof, the Servicer shall not be
removed or be replaced as Servicer with respect to any Contract or Equipment;
PROVIDED, HOWEVER, that upon the occurrence of any Amortization Event,
Noteholders evidencing not less than 66-2/3% of the Voting Rights shall have the
right to replace DVI as Servicer with a successor Servicer in accordance with
Section 10.02 hereof.
No resignation or removal of the Servicer shall in any event (i)
become effective until the successor Servicer shall have assumed the Servicer's
servicing responsibilities and obligations in accordance with Section 10.02
hereof, or (ii) affect the Contributor's obligations pursuant to this Agreement.
8.04 FINANCIAL AND BUSINESS INFORMATION. The Servicer will deliver to
the Transferor, the Issuer, the Trustee (who shall forward copies to each
Noteholder) and the Rating Agencies:
(a) promptly upon their becoming available, one copy of each
report (including the Servicer's (or for so long as DVI Financial Services
Inc. is the Servicer, DVI, Inc.'s) annual report to shareholders and
reports on Form 8-K, 10-K, and 10-Q, proxy statement, registration
statement, prospectus and notices filed with or delivered to any securities
exchange, the Securities and Exchange Commission or any successor agencies,
in each case relating to the Transferor or the Notes;
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(b) immediately upon becoming aware of the existence of any
condition or event which constitutes a Servicer Event of Default, a written
notice describing its nature and period of existence and what action the
Servicer is taking or proposes to take with respect thereto;
(c) promptly upon the Servicer's becoming aware of:
(i) any proposed or pending investigation of it by any
governmental authority or agency, or
(ii) any court or administrative proceeding
which individually or in the aggregate involves the possibility of
materially and adversely affecting the properties, business, profits or
conditions (financial or otherwise) of the Servicer, a written notice
specifying the nature of such investigation or proceeding and what action
the Servicer is taking or proposes to take with respect thereto and
evaluating its merits; and
(d) (i) upon request, the Servicer shall furnish to the
Transferor, the Issuer and the Trustee, within ten (10) Business Days, a
list of all Contracts (by contract number and name of Obligor), as of the
end of the most recent Collection Period, held as part of the Trust
Property, together with a reconciliation of such list to the Contract
Schedule and (ii) with reasonable promptness, any other data and
information which may be reasonably requested from time to time.
8.05 OFFICER'S CERTIFICATES. With each set of documents delivered
pursuant to Section 8.04(a), the Servicer will deliver an Officer's Certificate
stating (i) that the officer signing such Certificate have reviewed the relevant
terms of this Agreement and have made, or caused to be made under such officer's
supervision, a review of the activities of the Servicer during the period
covered by the statements then being furnished, (ii) that the review has not
disclosed the existence of any Servicer Event of Default or, if a Servicer Event
of Default exists, describing its nature and what action the Servicer has taken
and is taking with respect thereto and (iii) that on the basis of such review
the officer signing such certificate is of the opinion that during such period
the Servicer has serviced the Contracts in compliance with the procedures hereof
except as described in such certificate.
8.06 INSPECTION. The Servicer shall make available to the Trustee or
its duly authorized representatives, attorneys or auditors, and the Noteholders
or their duly authorized representative attorneys or auditors copies of the
Contract Files and the related accounts, records and computer systems maintained
by the Servicer at such times during normal operating hours as the Trustee shall
reasonably request which does not unreasonably interfere with the Servicer's
normal operations or customer or employee relations. Nothing in this Section
8.06 shall affect the obligation of the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Obligors, and the failure of
the Servicer to provide access to information as a result of such obligation
shall not constitute a breach of this Section 8.06. Any expense incident to the
exercise by the Trustee or any Noteholder during the continuance of a Servicer
Event of Default of any right under this Section 8.06 shall be borne by the
Servicer, but any expense due to the exercise of a right
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by any such Person prior to the occurrence of a Servicer Event of Default shall
be borne by such Person.
8.07 SERVICER RECORDS. On or before the Closing Date, the Servicer
will indicate in its records that it is servicing and administering each
Contract in its capacity as Servicer hereunder, at the request and for the
benefit of the Transferor (and subject to the provisions of the applicable
Transaction Documents) and its successors and assigns (including the Issuer and
the Trustee).
8.08 INSURANCE. The Servicer will track, on a quarterly basis,
casualty insurance premium payments by Obligors as required by the Contracts, in
the same manner in which the Servicer would service contracts and equipment held
for its own account.
8.09 NO BANKRUPTCY PETITION AGAINST THE TRANSFEROR, THE MANAGING
MEMBER OR THE ISSUER. The Servicer covenants and agrees it will not, prior to
the date that is one year and one day after the payment in full of all amounts
owing pursuant to the Transaction Documents, institute against, or join any
other Person in instituting against, any of the Transferor, the Managing Member
or the Issuer, any bankruptcy, reorganization, receivership, arrangement,
insolvency or liquidation proceedings or other similar proceedings under any
federal or state bankruptcy or similar law. This Section 8.09 shall survive the
termination of this Agreement.
8.10 FIDELITY BOND AND ERRORS AND OMISSIONS INSURANCE. The Servicer
shall maintain, at its own expense, a blanket fidelity bond and an errors and
omissions insurance policy, with coverage appropriate and customary in the
industry with responsible companies on all officers, employees or other persons
acting in any capacity with regard to the Contracts to handle funds, money,
documents and papers relating to the Contracts. Any such fidelity bond and
errors and omissions insurance shall protect and insure the Servicer against
losses, including forgery, theft, embezzlement, fraud, errors and omissions and
negligent acts of such persons and shall be maintained in a form and amount that
would meet the requirements of a prudent institutional servicer. No provision of
this Section 8.10 requiring such fidelity bond and errors and omissions
insurance shall diminish or relieve the Servicer from its duties and obligations
as set forth in this Agreement. Any such fidelity bond or insurance policy shall
not be cancelled or modified in a materially adverse manner without ten days'
prior written notice to the Rating Agencies. Promptly upon receipt of any notice
from the surety or the insurer that such fidelity bond or insurance policy has
been terminated or materially modified, the Servicer shall notify the Trustee
and the Rating Agency of any such termination or modification.
SECTION 9. THE CONTRIBUTOR
9.01 CORPORATE EXISTENCE OF THE CONTRIBUTOR. The Contributor will keep
in full force and effect its existence, rights and franchise as a corporation
under the laws of its jurisdiction of incorporation and will preserve its
qualification to do business as a foreign corporation in each jurisdiction in
which such qualification is necessary to protect the validity and enforceability
of any of the Contracts or to permit performance of the Contributor's duties
under this Agreement.
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The Contributor shall not merge or consolidate with any other Person
unless (i) the entity surviving such merger or consolidation is a corporation
organized under the laws of the United States or any jurisdiction thereof, (ii)
the surviving entity, if not the Contributor, shall execute and deliver to the
Transferor, the Servicer and the Trustee, in form and substance satisfactory to
each of them, (x) an instrument expressly assuming all of the obligations of the
Contributor hereunder, and (y) an Officer's Certificate to the effect that such
Person is a corporation of the type described in the preceding clause (i), has
effectively assumed the obligations of the Contributor hereunder, that all
conditions precedent provided for in this Agreement relating to such transaction
have been complied with, and, that all UCC financing statements and continuation
statements and amendments thereto have been executed and filed that are
necessary fully to preserve and protect the interest of the Transferor, the
Issuer and Trustee in the Trust Property, and reciting the details of such
filings, or stating that no such action shall be necessary to preserve and
protect such interest, (iii) the Contributor shall deliver to the Trustee a
letter from each Rating Agency to the effect that such consolidation, merger or
succession will not, in and of itself, result in a downgrading of the ratings
for the Notes and (iv) immediately after giving effect to such transaction, no
event of default under any Transaction Document, and no event which, after
notice or lapse of time, or both, would become an event of default shall have
occurred and be continuing.
9.02 FINANCIAL AND BUSINESS INFORMATION. The Contributor will deliver
to the Transferor, the Issuer, the Trustee and the Rating Agencies and, upon
request, to each Noteholder:
(a) promptly upon their becoming available, one copy of each
report (including DVI, Inc.'s annual report to shareholders and reports on
Form 8-K, 10-K, and 10-Q), proxy statement, registration statement,
prospectus and notice filed with or delivered to any securities exchange,
the Securities and Exchange Commission or any successor agencies;
(b) promptly upon the Contributor's becoming aware of
(i) any proposed or pending investigation of it by any
governmental authority or agency, or
(ii) any court or administrative proceedings
which individually or in the aggregate involves or may involve the
possibility of materially and adversely affecting the properties, business,
profits or conditions (financial or otherwise) of the Contributor, a
written notice specifying the nature of such investigation or proceeding
and what action the Contributor is taking or proposes to take with respect
thereto and evaluating its merits; and
(c) with reasonable promptness, any other data and information
which may be reasonably requested from time to time.
9.03 INSPECTION. The Contributor shall make available to the
Transferor, the Managing Member, the Issuer or the Trustee or their respective
duly authorized representatives, attorneys or auditors and the Noteholders or
their duly authorized representatives, attorneys or auditors its accounts,
records and computer systems regarding any Contract maintained by the
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Contributor at such times during normal operating hours as the Trustee, the
Managing Member, the Issuer or the Transferor shall reasonably instruct which do
not unreasonably interfere with the Contributor's normal operations or customer
or employee relations. Nothing in this Section 9.03 shall affect the obligation
of the Contributor to observe any applicable law prohibiting disclosure of
information regarding the Obligors, and the failure of the Contributor to
provide access to information as a result of such obligation shall not
constitute a breach of this Section 9.03. Any expense incident to the exercise
by the Trustee or any Noteholder during the continuance of a Servicer Event of
Default of any right under this Section 9.03 shall be borne by the Servicer, but
any expense due to the exercise of a right by any such Person prior to the
occurrence of a Servicer Event of Default shall be borne by such Person.
9.04 NO BANKRUPTCY PETITION AGAINST THE MANAGING MEMBER, THE
TRANSFEROR OR THE ISSUER. The Contributor covenants and agrees it will not,
prior to the date that is one year and one day after the payment in full of all
amounts owing pursuant to the Amended and Restated Indenture, institute against,
or join any other Person in instituting against, any of the Managing Member, the
Transferor or the Issuer, any bankruptcy, reorganization, receivership,
arrangement, insolvency or liquidation proceedings or other similar proceedings
under any federal or state bankruptcy or similar law. This Section 9.04 shall
survive the termination of this Agreement.
9.05 ACCOUNTS, BOOKS AND RECORDS.
(a) The Contributor shall maintain accounts and records as to each
Contract accurately and in sufficient detail to permit the reader thereof to
know at any time the status of such Contract, including payments and recoveries
made and payments owing (and the nature of each). Prior to the transfer of the
Contracts to the Transferor, the Contributor will clearly mark its books and
records and each Contract File (including each Contract) to reflect each sale of
a Contract and the Equipment subject thereto to the Transferor, the resale to
the Issuer and to show that the Issuer owns the Contracts absolutely. The
Contributor or the Transferor, as the case may be, will cause the electronic
ledger, the Contract File (including the Contract), with respect to each
Contract and the related Contract and the Contract Schedule to be clearly and
unambiguously marked to show that such Contract and the related Contract has
been contributed by Contributor to the Transferor, resold by the Transferor to
the Issuer and pledged by the Issuer to the Trustee for the benefit of the
Noteholders pursuant to the Amended and Restated Indenture.
(b) The Contributor shall maintain its computer systems so that, from
and after the time of sale hereunder of the Contracts to the Transferor, the
Contributor's master computer records (including archives) that refer to a
Contract and the related Contract shall indicate clearly the interest of the
Transferor in such Contract and that such Contract has been resold to the Issuer
and pledged by the Issuer to the Trustee for the benefit of the Noteholders.
Indication of the Transferor's ownership of a Contract, the resale to the
Issuer, and the pledge of such Contract by the Issuer to the Trustee for the
benefit of the Noteholders shall be deleted from or modified on the
Contributor's computer systems when, and only when, the Contract shall have been
paid in full or purchased or substituted by the Contributor pursuant to the
terms hereof.
9.06 TAX RETURNS. (a) At all times, so long as any of the Notes or the
other obligations secured by the Amended and Restated Indenture remain
outstanding, the Contributor, the Managing Member and the Transferor shall be
members of the same affiliated group within the
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meaning of Section 1504 of the Code (the "DVI GROUP") and shall join in the
filing of a consolidated return for federal income tax purposes.
(b) The Contributor shall promptly pay and discharge, or cause the
payment and discharge of, all federal income taxes (and all other material
taxes) when due and payable by Contributor, the DVI Group, the Managing Member,
or the Transferor, except (i) such as may be paid thereafter without penalty or
(ii) such as may be contested in good faith by appropriate proceedings and for
which an adequate reserve has been established and is maintained in accordance
with GAAP. The Contributor shall promptly notify the Transferor, the Trustee,
the Managing Member and the Noteholders of any material challenge, contest or
proceeding pending by or against Contributor, the Managing Member, or the DVI
Group before any taxing authority.
9.07 INSURANCE. The Contributor will at all times maintain general
liability and excess liability insurance policies in at least the amount set
forth in Section 2.26.
9.08 PROTECTION OF RIGHT, TITLE AND INTEREST.
(a) The Contributor shall not change its name, identity, or corporate
structure in any manner that would, could, or might make any UCC financing
statement or continuation statement filed by the Contributor in accordance with
Section 1.01(c) seriously misleading within the meaning of ss. 9-402(7) of the
UCC, unless it shall have given the Transferor at least thirty (30) days' prior
written notice thereof and shall promptly file appropriate amendments to all
previously filed UCC financing statements or continuation statements.
(b) If at any time the Contributor shall propose to sell, grant a
security interest in, or otherwise transfer any interest in contracts to any
prospective purchaser, lender, or other transferee, the Contributor shall give
to such prospective purchaser, lender, or other transferee computer tapes,
records, or print-outs (including any restored from archives) that, if they
shall refer in any manner whatsoever to any Contract, shall indicate clearly
that such Contract has been sold to the Transferor and then resold to the Issuer
and pledged by the Issuer to the Trustee for the benefit of the Noteholders.
(c) The Contributor shall deliver to the Transferor, the Managing
Member, the Rating Agencies and the Trustee promptly after the execution and
delivery of each amendment hereto, an opinion of counsel either (i) stating
that, in the opinion of such counsel, all UCC financing statements and
continuation statements necessary to preserve and protect fully the interest of
the Transferor, the Issuer and the Trustee in the Trust Property have been filed
or, with respect to the Equipment, are required to be filed within thirty (30)
days following the Closing Date or the Substitution Date, as applicable, or (ii)
stating that, in the opinion of such counsel, no such action shall be necessary
to preserve and protect such interest.
9.09 OTHER LIENS OR INTERESTS. Except for the conveyances hereunder,
the Contributor will not sell, pledge, assign or transfer to any other Person,
or grant, create, incur, assume or suffer to exist any lien on the Contracts or
any other Trust Property or any interest therein, and the Contributor shall
defend the right, title, and interest of the Transferor, the Issuer and the
Trustee in, to and under the Contracts and the other Trust Property against all
claims of third parties claiming through or under the Contributor; PROVIDED,
HOWEVER, that the Contributor's obligations to
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the Trustee under this Section 9.09 shall terminate upon the repayment in full
of the Notes and the expiration of any applicable preference period and, with
respect to any Contract, on the date it is paid in full or purchased by the
Contributor pursuant to Section 5.03 hereof.
9.10 COSTS AND EXPENSES. The Contributor agrees to pay all reasonable
costs and disbursements in connection with the performance of its obligations
hereunder and under the Amended and Restated Indenture.
SECTION 10. EVENTS OF DEFAULT
10.01 SERVICER EVENTS OF DEFAULT. The following events and conditions
shall constitute Servicer Events of Default hereunder:
(i) failure on the part of the Servicer (or for so long as the
Contributor is the Servicer, the Transferor) to (A) remit any payment to
the Trustee within the time period required by Section 4.06 hereof or (B)
make any Servicer Advance required by Section 5.01 hereof;
(ii) failure to pay to the Trustee on or before the date when due
in accordance with the terms hereof, any deposit required to be made by the
Servicer pursuant to Section 4.02 hereof;
(iii) failure on the part of either the Servicer (or for so long
as the Contributor is the Servicer, the Transferor) duly to observe or
perform in any material respect any other of their respective covenants or
agreements in this Agreement (including without limitation, failure of the
Servicer to deliver a Monthly Servicer Report on the date required pursuant
to Section 6.01 or the delivery of a Monthly Servicer Report which is
materially incorrect) which failure materially and adversely affects the
rights of the Noteholders and continues unremedied for a period of 30 days
after the Servicer becomes aware of such failure or the giving of written
notice of such failure (A) to the Servicer (or the Transferor, if
applicable) by the Trustee or (B) to the Servicer (or the Transferor, if
applicable) and the Trustee by Noteholders evidencing not less than 66-2/3%
of the Voting Rights, taken together.
(iv) if any representation or warranty of the Servicer made in
this Agreement or in any certificate or other writing delivered pursuant
hereto or the Transaction Documents or made by any successor Servicer in
connection with such successor Servicer's assumption of the duties of the
Servicer shall prove to be incorrect in any material respect as of the time
when the same shall have been made;
(v) the entry by a court having jurisdiction in the premises of
(A) a decree or order for relief in respect of the Servicer (or for so long
as the Contributor is the Servicer, the Transferor) in an involuntary case
or proceeding under any applicable federal or state bankruptcy, insolvency,
reorganization, or other similar law or (B) a decree or order adjudging the
Servicer (or for so long as the Contributor is the Servicer, the
Transferor) bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization,
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arrangement, adjustment, or composition of or in respect of the Servicer
(or for so long as the Contributor is the Servicer, the Transferor) under
any applicable federal or state law, or appointing a custodian, receiver,
liquidator, assignee, trustee, sequestrator, or other similar official of
the Servicer (or for so long as the Contributor is the Servicer, the
Transferor) or of any substantial part of the property of either, or
ordering the winding up or liquidation of the affairs of either, 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 90 consecutive days;
(vi) the commencement by the Servicer (or for so long as the
Contributor is the Servicer, the Transferor) 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 either to the
entry of a decree or order for relief in respect of the Servicer (or for so
long as the Contributor is the Servicer, the Transferor) 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 either, or the
filing by either of a petition or answer or consent seeking reorganization
or relief under any applicable federal or state law, or the consent by
either 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 Servicer (or for so long as the
Contributor is the Servicer, the Transferor) or of any substantial part of
the property of either, or the making by either of an assignment for the
benefit of creditors, or the failure by the Servicer (or for so long as the
Contributor is the Servicer, the Transferor) to pay its debts generally as
they become due, or the taking of corporate action by the Servicer (or for
so long as the Contributor is the Servicer, the Transferor) in furtherance
of any such action;
(vii) any assignment by the Servicer, or any attempt by the
Servicer to assign its duties or rights hereunder, except as specifically
permitted hereunder;
(viii) (A) the failure of the Servicer to make one or more
payments with respect to aggregate recourse indebtedness for borrowed money
exceeding $2,000,000 or (B) the occurrence of any other event or the
existence of any other condition, the effect of which event or condition is
to cause more than $2,000,000 of aggregate recourse indebtedness for
borrowed money of the Servicer to become due before its (or their) stated
maturity or before its (or their) regularly scheduled dates of payment, so
long as such failure, event or condition specified in either clause (A) or
(B) shall be continuing and shall not have been waived by the Person or
Persons entitled to performance;
(ix) the rendering against the Servicer of a final judgment,
decree or order (all possible appeals having been exhausted) for the
payment of money in excess of $2,000,000 which is uninsured, and the
continuance of such judgment, decree or order unsatisfied and in effect for
any period of 60 consecutive days without a stay of execution; or
(x) the occurrence of an Amortization Event (so long as the
Contributor is the Servicer).
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10.02 TERMINATION. If a Servicer Event of Default shall have occurred
and be continuing, the Trustee shall, upon the request of Noteholders evidencing
more than 66-2/3% of the Voting Rights, give written notice to the Servicer of
the termination of all of the rights and obligations of the Servicer (but none
of the Contributor's obligations hereunder, which shall survive any such
termination) under this Agreement. On the receipt by the Servicer of such
written notice, all rights and obligations of the Servicer under this Agreement,
including without limitation the Servicer's right hereunder to receive Servicing
Fees accruing subsequent to such termination date, but none of the Contributor's
obligations hereunder, shall cease and the same shall pass to and be vested in,
and assumed by, the Trustee pursuant to and under this Agreement and the Amended
and Restated Indenture subject to the provisions of Section 10.03; and, without
limitation, the Trustee is hereby authorized and empowered to execute and
deliver, on behalf of the Servicer, as attorney-in- fact or otherwise, any and
all other acts or things necessary or appropriate to effect the purposes of such
notice of termination, whether to complete the transfer and assignment of any
Contract and the related Contract and Equipment or such passing, vesting or
assumption or to cause Obligors to remit all future Contract Payments and other
amounts due under any Contract to such account as shall be specified by the
Trustee. The Servicer may be removed only pursuant to a Servicer Event of
Default.
10.03 TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR.
(a) On and after the time the Servicer receives a notice of
termination pursuant to Section 10.02 hereof, the Trustee (subject to subsection
(b) hereof) shall be the successor in all respects to the Servicer in its
capacity as servicer under this Agreement of the Contracts and, to such extent,
shall be subject to all the responsibilities, duties and liabilities (other than
the duty to advance funds and to indemnify) relating thereto placed on the
Servicer by the terms and provisions hereof (but not the obligations of the
Contributor contained herein which shall survive any such termination as above
provided) and shall be entitled to receive from the Transferor the Servicing Fee
and other servicing compensation provided for in Section 4.04 hereof; PROVIDED
that the Trustee shall in no way be responsible or liable for any action or
actions of the Servicer before the time the Servicer receives such a notice of
termination.
(b) The Trustee may, if it is unwilling or unable to act as the
successor Servicer, give notice of such fact to each Noteholder and (i) appoint
a successor Servicer with a net worth of at least $15,000,000 and reasonably
acceptable to Noteholders evidencing more than 50% of the Voting Rights and
whose regular business includes the servicing of receivables arising from
equipment similar to the Equipment, as the successor Servicer hereunder to
assume all of the rights and obligations of the Servicer hereunder, including,
without limitation, the Servicer's right (but not the obligations of the
Contributor contained herein) hereunder to receive the Servicing Fee (PROVIDED
THAT, notwithstanding any other provision to the contrary contained in any
Transaction Document, no increase in the Servicer Fee due to any successor
Servicer shall be made without the consent of the Noteholders that hold, as of
the date of determination, more than 50% of the then-Outstanding Note Balance of
each class of Notes then Outstanding) or, (ii) if no such institution is so
appointed, petition a court of competent jurisdiction to appoint an institution
meeting such criteria as the Servicer hereunder. Pending appointment of a
successor Servicer hereunder, the Trustee shall act in such capacity as
hereinabove provided. In connection with such appointment and assumption, the
Trustee shall cause such successor Servicer to enter into a servicing agreement
substantially in the form of this Agreement except that such agreement shall not
include any of the Contributor's representations, warranties or obligations and
the Trustee may make arrangements for the compensation of such
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successor Servicer out of payments on Contracts and the related Contracts as it
and such successor Servicer shall agree; PROVIDED, HOWEVER, that no such
compensation shall be in excess of that provided in Section 4.04 hereof. Neither
the Trustee nor a Successor Servicer shall be deemed to be in default hereunder
by reason of its failure to make, or its delay in making, any distribution
hereunder or any portion thereof which failure or delay was caused by (i) the
failure of the prior Servicer to deliver, or any delay in delivering, cash,
documents or records to it, or (ii) restrictions imposed by any regulatory
authority having jurisdiction over the prior Servicer.
10.04 SERVICER TO COOPERATE. The Servicer hereby agrees to cooperate
with the successor Servicer appointed in accordance with Section 10.02 or 10.03
hereof, as applicable, in effecting the termination and transfer of the
responsibilities and rights of the Servicer hereunder to the successor Servicer,
including, without limitation, the execution and delivery of assignments of UCC
financing statements, and the transfer to the successor Servicer for
administration by it of all cash amounts which shall at the time be held by the
Servicer or thereafter received with respect to the Contracts and the related
Contracts. The Servicer hereby agrees to transfer to any successor Servicer its
electronic records and all other records, correspondence and documents relating
to the Contracts and the related Contracts in the manner and at such times as
the successor Servicer shall reasonably request. The Servicer hereby designates
the successor Servicer its agent and attorney-in-fact to execute transfers of
UCC financing statements (including any and all UCC financing statements naming
an individual Obligor as debtor and the Contributor as secured party) and any
other filings or instruments which may be necessary or advisable to effect such
transfer of the Servicer's responsibilities and rights hereunder. Upon any such
termination or appointment of a successor Servicer, the Trustee shall give
prompt written notice thereof to each Noteholder in the manner provided in the
Amended and Restated Indenture.
10.05 REMEDIES NOT EXCLUSIVE. Nothing in the preceding provisions of
this Section 10 shall be interpreted as limiting or restricting any rights or
remedies which the Transferor, the Issuer, the Trustee, the Noteholders or any
other Person would otherwise have at law or in equity on account of the breach
or violation of any provision of this Agreement by the Servicer, including
without limitation the right to recover full and complete damages on account
thereof to the extent not inconsistent with Section 8.02 hereof.
10.06 WAIVER OF PAST DEFAULTS. Holders of Notes evidencing more than
50% of the Voting Rights may waive any default by the Servicer in the
performance of its obligations hereunder and its consequences. Upon any such
waiver of a past default, such default shall cease to exist, and any default
arising therefrom shall be deemed to have been remedied for every purpose of
this Agreement. No such waiver shall extend to any subsequent or other default
or impair any right consequent thereon except to the extent expressly so waived.
SECTION 11. ASSIGNMENT
11.01 ASSIGNMENT TO TRUSTEE. It is understood that this Agreement and
all rights of the Transferor hereunder and with respect to the Contributed
Property will be assigned by the Transferor to the Issuer, and then assigned by
the Issuer to the Trustee, for the benefit of the Trustee and the Noteholders,
and may be subsequently assigned by the Trustee to any successor Trustee. Each
of the Contributor and the Servicer hereby expressly agrees to each such
assignment and agrees that
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all of its duties, covenants, obligations, indemnities, representations and
warranties hereunder, and all of the rights and remedies of the Transferor
hereunder, shall be for the benefit of, and may be enforced directly by, the
Issuer, the Trustee, the Noteholders and any successor to or assignee of any
thereof.
11.02 ASSIGNMENT BY CONTRIBUTOR OR SERVICER. None of the respective
rights or obligations of the Contributor and the Servicer hereunder may be
assigned without the prior written consent of the Transferor and the Trustee
(acting upon the instructions of Noteholders evidencing not less than 66-2/3% of
the Voting Rights); PROVIDED that nothing herein shall preclude the Servicer
from performing its duties hereunder through the use of agents to the extent
that such use is consistent with the Servicer's business practices in dealing
with similar contracts and equipment for its own account, and PROVIDED, FURTHER,
that the use of an agent shall not relieve the Servicer from any of its
obligations hereunder.
SECTION 12. NATURE OF CONTRIBUTOR'S OBLIGATIONS AND SECURITY
THEREFOR
12.01 CONTRIBUTOR'S OBLIGATIONS ABSOLUTE. The obligations of the
Contributor hereunder, and the rights of the Issuer and the Trustee, as assignee
of the Transferor, in and to all amounts payable by the Contributor hereunder,
shall be absolute and unconditional and shall not be subject to any abatement,
reduction, setoff, defense, counterclaim or recoupment whatsoever including,
without limitation, abatements, reductions, setoffs, defenses, counterclaims or
recoupments due or alleged to be due to, or by reason of, any past, present or
future claims which the Contributor may have against the Servicer, the Issuer,
the Managing Member, the Transferor, the Trustee, any holder of the Notes or any
other Person for any reason whatsoever; nor, except as otherwise expressly
provided herein, shall this Agreement terminate, or the respective obligations
of the Transferor, the Contributor or the Servicer be otherwise affected, by
reason of any defect in any Contract or in any unit of Equipment or in the
respective rights and interests of the Transferor, the Issuer, the Contributor
and the Trustee in any thereof, or by reason of any liens, encumbrances,
security interests or rights of others with respect to any Contract or any unit
of Equipment, or any failure by the Transferor, or the Servicer to perform any
of its obligations herein contained, or by reason of any other indebtedness or
liability, howsoever and whenever arising, of the Transferor, the Issuer, the
Managing Member, the Servicer, the Trustee or any holder of the Notes to the
Contributor or any other Person or by reason of any insolvency, bankruptcy, or
similar proceedings by or against the Contributor, the Servicer, the Transferor,
the Issuer, the Trustee or any other Person or for any other cause whether
similar or dissimilar to the foregoing, any present or future law to the
contrary notwithstanding, it being the intention of the parties hereto that all
obligations of the Contributor hereunder and all amounts payable by the
Contributor hereunder shall continue to be due and payable in all events and in
the manner and at the times herein provided unless and until the obligation to
perform or pay the same shall be terminated or limited pursuant to the express
provisions of this Agreement; PROVIDED that nothing in this Section 12.01 shall
be interpreted as precluding the Contributor from pursuing independently any
claim it may have against the Transferor, the Servicer, the Issuer, the Managing
Member, any holder of the Notes or any other Person; PROVIDED, FURTHER, that any
claims of the Contributor against the Transferor shall be subordinate in right
of payment to amounts due and owing to the Trustee under the Amended and
Restated Indenture and any amounts received by the Contributor on such claims
shall be held in trust by the Contributor for the Trustee and turned over
39
<PAGE>
to the Trustee until such time as all amounts due the Trustee under the
Transaction Document are fully paid.
12.02 POWER OF ATTORNEY. Each of the Contributor and Servicer hereby
grants to each of the Transferor and the Trustee the power as its
attorney-in-fact (i) to file UCC financing statements in the appropriate offices
evidencing the conveyance of the Contracts and other Contributed Property to the
Transferor and (ii) in the event an event of default exists under any
Transaction Document, to do any and all other acts as may be necessary or
appropriate to effect the transaction contemplated herein. The Contributor will
execute any document or instrument deemed necessary by the Transferor or the
Trustee to effect or to evidence this power of attorney. All costs associated
with such filings or instructions shall be paid by the Contributor.
SECTION 13. MISCELLANEOUS PROVISIONS
13.01 SALE. The Contributor agrees to treat the conveyances to the
Transferor of the Contributor's interest in the Contracts and Equipment pursuant
to the terms of this Agreement for all purposes other than taxes measured by
income (including, without limitation, financial accounting purposes of the
Contributor on a stand alone basis) as a sale of the Contributor's interest in
the Contracts and Equipment on all relevant books, records, financial statements
and other applicable documents. The execution and delivery of this Agreement
shall constitute an acknowledgment by the Contributor and the Transferor that
each intends that the assignment and transfer herein contemplated constitutes an
outright sale and assignment to the Transferor by the Contributor of its
interest in the Contracts and the other Contributed Property, and not for
security, conveying good title in such interests free and clear of any liens,
and that such interest shall not be a part of the Contributor's estate in the
event of the bankruptcy or the occurrence of another similar event, of, or with
respect to, the Contributor. In the event that such conveyance is determined to
be made as security for a loan made by the Transferor, the Issuer, the Trust or
the Noteholders to the Contributor, the parties intend that the Contributor
shall have granted to the Transferor, and its successors and assigns, a security
interest in the Contracts and other Contributed Property and that this Agreement
shall constitute a security agreement under applicable law.
The conveyance to the Transferor shall be treated as a sale to the
extent of cash remitted to the Contributor and shall be treated as an additional
contribution to the capital of the Transferor to the extent of the excess of the
Discounted Contract Balances of the Contracts conveyed over the amount of such
cash.
13.02 AMENDMENT. This Agreement may be amended from time to time by
the parties hereto, without the consent of any of the Noteholders, to cure any
ambiguity, to correct or supplement any provision herein which may be
inconsistent with any other provision herein or to make any other provisions
with respect to matters or questions arising under this Agreement which shall
not be materially inconsistent with the provisions of this Agreement, PROVIDED
that such actions shall not adversely affect in any respect the interests of any
Noteholder.
This Agreement may also be amended from time to time by the parties
hereto with the consent of the Holders of Notes evidencing more than 50% of the
Voting Rights (and with prior written notice to the Rating Agencies) for the
purpose of adding any provisions to or changing in any
40
<PAGE>
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of the Holders of Notes; PROVIDED, HOWEVER, that such
amendment may not, without the consent of all of the Noteholders (i) increase or
reduce in any manner the amount of, or accelerate or delay the timing of,
collections of payments on the Contracts or distributions that are required to
be made for the benefit of such Noteholders, (ii) reduce the aforesaid
percentage of the Voting Rights which are required to consent to any such
amendment, or (iii) modify this Section 13.02. The Servicer shall deliver copies
of any amendment to this Agreement to each of the Rating Agencies and each
Noteholder.
13.03 WAIVERS. No failure or delay on the part of the Transferor, the
Issuer or the Trustee in exercising any power, right or remedy under this
Agreement shall operate as a waiver thereof, nor shall any single or partial
exercise of any such power, right or remedy preclude any other or further
exercise thereof or the exercise of any other power, right or remedy.
13.04 NOTICES. All communications and notices pursuant hereto to any
party shall be in writing or by telegraph, telex or telecopy and addressed or
delivered to it at its address (or in case of telex or telecopy, at its telex or
telecopy number at such address) as follows or at such other address as may be
designated by it by notice to the other party and, if mailed or sent by
telegraph or telex, shall be deemed given when mailed, communicated to the
telegraph office or transmitted by telex or telecopy:
(a) in the case of the Contributor or Servicer:
500 Hyde Park
Doylestown, Pennsylvania 18901
Attention: Securitization Manager
Telephone: (215) 489-8015
Telecopier: (215) 230-5328
(b) in the case of the Transferor:
500 Hyde Park
Doylestown, Pennsylvania 18901
Attention: Securitization Manager
Telephone: (215) 489-8015
Telecopier: (215) 230-5328
41
<PAGE>
(c) in the case of the Managing Member:
500 Hyde Park
Doylestown, Pennsylvania 18901
Attention: Securitization Manager
Telephone: (215) 489-8015
Telecopier: (215) 230-5328
(d) in the case of the Trustee:
181 Fifth Street
St. Paul, Minnesota 55101
Attention: Structured Finance
Telephone: (651) 244-0727
Telecopier: (651) 244-0089
(e) in the case of the Rating Agencies:
Fitch IBCA, Inc.
One State Street Plaza
New York, NY 10004
Attention: Ms. Wendy Geneen Cohn
Telephone: (212) 908-0681
Telecopier: (212) 480-4438
Moody's Investors Service, Inc.
99 Church Street, 4th Floor
New York, NY 10007
Attention: ABS Monitoring Department
Telephone: (212) 553-0300
Telecopier: (212) 553-3856
13.05 COSTS AND EXPENSES. The Contributor will pay all reasonable
expenses incident to the performance of its obligations under this Agreement and
any other Transaction Document and the Contributor agrees to pay all reasonable
out-of-pocket costs and expenses of the Transferor, including fees and expenses
of counsel, in connection with the enforcement of any obligation of the
Contributor hereunder.
13.06 THIRD PARTY BENEFICIARIES. The Issuer, the Trustee and the
Noteholders are express third party beneficiaries to this Agreement.
13.07 SURVIVAL OF REPRESENTATIONS. The respective agreements,
representations, warranties and other statements by the Contributor and the
Transferor set forth in or made pursuant to this Agreement shall remain in full
force and effect and will survive the Closing Date.
13.08 CONFIDENTIAL INFORMATION. The Transferor agrees that it will
neither use nor disclose to any person the names and addresses of the Obligors,
except in connection with the
42
<PAGE>
enforcement of the Transferor's rights hereunder, under the Contracts, under the
applicable Transaction Documents or as required by law.
13.09 HEADINGS AND CROSS-REFERENCES. The various headings in this
Agreement are included for convenience only and shall not affect the meaning or
interpretation of any provision of this Agreement. References in this Agreement
to Section names or numbers are to such Sections of this Agreement.
13.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
CONFLICTS OF LAW PRINCIPLES THEREOF.
13.11 CONSENT TO JURISDICTION. Each of the parties hereto irrevocably
submits to the jurisdiction of any New York State or Federal court sitting in
the Borough of Manhattan in the City of New York over any suit, action or
proceeding arising out of or relating to this Agreement. Each of the parties
hereto irrevocably waives, to the fullest extent permitted by law, any objection
which it may have to the laying of the venue of any such suit, action or
proceeding brought in such a court and any claim that any such suit, action or
proceeding brought in such a court has been brought in any inconvenient forum.
Each of the parties hereto agrees that the final judgment in any such suit,
action or proceeding brought in such a court shall be conclusive and binding
upon each of the parties hereto and may be enforced by the courts of New York
(or any other courts to the jurisdiction of which it is subject) by a suit upon
such judgment; PROVIDED that service of process is effected upon it as permitted
by law; PROVIDED, HOWEVER, that each of the parties hereto does not waive, and
the foregoing provisions of this sentence shall not constitute or be deemed to
constitute a waiver of, (i) any right to appeal any such judgment, to seek any
stay or otherwise to seek reconsideration or review of any such judgment or (ii)
any stay of execution or levy pending an appeal from, or a suit, action or
proceeding for reconsideration or review of, any such judgment.
13.12 COUNTERPARTS. This Agreement may be executed in two or more
counterparts and by different parties on separate counterparts, each of which
shall be an original, but all of which together shall constitute one and the
same instrument.
13.13 STATUTORY REFERENCES. References in this Agreement to any
section of the UCC shall mean, on or after the effective date of adoption of any
revision to the UCC in the applicable jurisdiction, such revised or successor
section thereto.
43
<PAGE>
AMENDED AND RESTATED CONTRIBUTION AND SERVICING AGREEMENT
DATED AS OF DECEMBER 1, 1999
IN WITNESS WHEREOF, the undersigned have caused this Agreement to be
duly executed by their respective officers thereunto duly authorized as of the
date first above written.
DVI FINANCIAL SERVICES INC.
By: /s/ Lisa J. Cruikshank
-------------------------
Name: Lisa J. Cruikshank
Title: Vice President
DVI RECEIVABLES CORP. XI
By: /s/ Lisa J. Cruikshank
--------------------------
Name: Lisa J. Cruikshank
Title: Vice President
<PAGE>
EXHIBIT A
CONTRACT SCHEDULE
-----------------
See Schedule 1 to the Amended and Restated Indenture.
A-1
<PAGE>
EXHIBIT B
MONTHLY SERVICER REPORT
-----------------------
B-1
<PAGE>
EXHIBIT C
RESERVED
--------
C-1
<PAGE>
EXHIBIT D
SUBSTITUTE CONTRACT TRANSFER FORM
---------------------------------
DVI Financial Services Inc. (the "CONTRIBUTOR") and DVI Receivables
Corp. XI (the "TRANSFEROR"), pursuant to the Amended and Restated Contribution
and Servicing Agreement, dated as of December 1, 1999 (the "CONTRIBUTION AND
SERVICING AGREEMENT"), hereby confirm their understanding with respect to the
contribution by the Contributor to the Transferor of those substitute Contracts
listed on the Schedule 1 attached hereto (the "SUBSTITUTE CONTRACTS"), together
with a security interest in all of the Contributor's right, title and interest
in and to the related Equipment and other related property described herein.
CONVEYANCE OF SUBSTITUTE CONTRACTS. The Contributor hereby makes a
capital contribution to the Transferor of all of Contributor's rights, title and
interest in, to, and under (i) the Substitute Contracts listed on Schedule 1
hereto including, without limitation, its interests in the proceeds of such
Substitute Contracts, the right to receive all amounts due or to become due
thereunder after __________ (the "CUT-OFF DATE"), but excluding any Retained
Interest, (ii) the Contract Files relating to such Contracts, (iii) a security
interest in the Equipment subject to such Substitute Contracts, (iv) any
remarketing agreement to the extent specifically relating to a Substitute
Contract, and all guarantees, cash deposits or credit support (other than any
accounts receivable of the related Obligor) supporting or securing payment of
any arrangements with the vendor, dealer or manufacturer of the Equipment to the
extent specifically relating to any Substitute Contract, (v) any insurance
carried by any Obligor under any Substitute Contract (or the related Equipment)
and (vi) all income, payments and proceeds of the foregoing.
The Contributor hereby confirms that:
(1) On or prior to ___________ (the "SUBSTITUTION DATE"), the
Contributor shall have deposited in the Collection Account all collections in
respect of the Substitute Contracts that were due on or after the related
Cut-Off Date;
(2) As of the Substitution Date, the Contributor was not insolvent nor
will it be made insolvent by such transfer nor is any of them aware of any
pending insolvency;
(3) Each Substitute Contract is an Eligible Contract;
(4) On or prior to the Substitution Date, the Contributor shall have
delivered to the Trustee the sole original, manually executed counterpart of
each Substitute Contract that constitutes "chattel paper" or an "instrument", as
such terms are defined in the UCC;
(5) The sum of the Discounted Contract Balances as of the Cut-Off Date
of the Substitute Contracts listed on Schedule 1 attached hereto is $__________;
(6) When the Substitute Contracts are added to the Trust Property, all
representations and warranties will be true and correct as of the Substitution
Date unless any breach of such representations and warranties resulting from the
inclusion of such Substitute Contract shall have been waived in advance by
Noteholders evidencing more than 50% of the Voting Rights;
D-1
<PAGE>
(7) The Contributor has delivered to the Trustee evidence of all UCC
filings necessary to give the Trustee a perfected first priority security
interest in the Substitute Contract and the related Equipment (other than
Equipment relating to a Secured Equipment Note or Finance Lease and for which
the Original Equipment Cost is less than $25,000);
(8) Such Substitute Contract(s) shall be added to, and constitute a
part of, [Pool A] [Pool B]; and
(9) Such Substitute Contract(s) is/are being substituted pursuant to
[Section 5.03 of the Agreement] [Section 7.01(a)(1) of the Agreement] [Section
7.01(a)(2) of the Agreement] [Section 7.01(b)(1) of the Agreement] [Section
7.01(b)(2) of the Agreement].
All terms and conditions of the Contribution and Servicing Agreement
and the other Transaction Documents with respect to the Contributor and the
Substitute Contracts have been complied with and are hereby ratified, confirmed
and incorporated herein; PROVIDED THAT in the event of any conflict, the
provisions of this Substitute Contract Transfer Form shall control over the
conflicting provisions of the Contribution and Servicing Agreement.
Terms capitalized herein and not defined herein shall have their
respective meanings as set forth in the Contribution and Servicing Agreement.
DVI FINANCIAL SERVICES INC.
By:_____________________________
Name:___________________________
Title:__________________________
DVI RECEIVABLES CORP. XI
By:_____________________________
Name:___________________________
Title:__________________________
D-2
<PAGE>
EXHIBIT E
FORM OF RE-ASSIGNMENT BY TRANSFEROR
PURSUANT TO SECTION 5.03(b) OR 7.01(c) OF THE
AMENDED AND RESTATED CONTRIBUTION AND SERVICING AGREEMENT
DVI Receivables Corp. XI (the "TRANSFEROR") pursuant to the Amended
and Restated Contribution and Servicing Agreement, dated as of December 1, 1999,
between the Transferor and DVI Financial Services Inc. (the "CONTRIBUTOR") does
hereby sell, transfer, assign, deliver and otherwise convey to Contributor,
without recourse, representation or warranty, all of the Transferor's right,
title and interest in and to all of the Predecessor Contracts listed on Schedule
A hereto and all security and documents relating thereto.
IN WITNESS WHEREOF, I have hereunto set my hand this ______ day of
___________.
DVI RECEIVABLES CORP. XI
By:_____________________________
Name:___________________________
Title:__________________________
E-1
<PAGE>
EXHIBIT F
FORM OF OFFICER'S CERTIFICATE PURSUANT TO SECTION 7
---------------------------------------------------
The undersigned certifies that the undersigned is a duly authorized
officer of DVI Financial Services Inc. (the "CONTRIBUTOR"), and that, as such
the undersigned is authorized to execute and deliver this certificate on behalf
of the Contributor, and further certifies pursuant to Section 7.02 of the
Amended and Restated Contribution and Servicing Agreement (the "AGREEMENT")
dated as of December 1, 1999, between the Contributor and DVI Receivables Corp.
XI (the "TRANSFEROR"), that to his or her knowledge, the Contributor's
contribution to the Transferor of those Substitute Contracts listed in Schedule
1 attached hereto, together with all of the Contributor's right, title and
interest in and to the related Contracts and the related Contributed Property,
is in compliance with Section 7 of the Agreement.
IN WITNESS WHEREOF, I have hereunto signed my name.
Date:
DVI FINANCIAL SERVICES INC.
By:_____________________________
Name:___________________________
Title:__________________________
F-1
<PAGE>
EXHIBIT G
FORMS OF CONTRACTS
------------------
Copies are on file at the offices of U.S. Bank Trust National Association,
as Indenture Trustee, and are available upon request.
G-1
<PAGE>
EXHIBIT H
UNDERWRITING GUIDELINES
-----------------------
Copies are on file at the offices of U.S. Bank Trust National Association,
as Indenture Trustee, and are available upon request.
H-1
<PAGE>
APPENDIX I
----------
See copy of Appendix I following
the Amended and Restated Indenture
EXHIBIT 4.3
AMENDED AND RESTATED
SUBSEQUENT CONTRACT TRANSFER AGREEMENT
between
DVI RECEIVABLES CORP. XI,
as Company
and
DVI RECEIVABLES XI, L.L.C.,
as Issuer
Dated as of December 1, 1999
<PAGE>
TABLE OF CONTENTS
ARTICLE I.
DEFINITIONS................................................................1
SECTION 1.01 DEFINITIONS.................................................1
ARTICLE II.
PROCEDURES FOR PURCHASES OF ELIGIBLE CONTRACTS.............................1
SECTION 2.01 TRANSFER....................................................1
SECTION 2.02 SUBSTITUTE CONTRACTS........................................2
SECTION 2.03 INTENT OF PARTIES; SECURITY INTEREST........................2
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY..............................3
SECTION 3.01 ORGANIZATION AND GOOD STANDING..............................3
SECTION 3.02 AUTHORIZATION...............................................3
SECTION 3.03 BINDING OBLIGATION..........................................3
SECTION 3.04 NO VIOLATION................................................4
SECTION 3.05 NO PROCEEDINGS..............................................4
SECTION 3.06 APPROVALS...................................................4
SECTION 3.07 ABILITY TO PERFORM..........................................4
SECTION 3.08 EQUIPMENT AND CONTRACTS.....................................4
SECTION 3.09 PRINCIPAL EXECUTIVE OFFICE..................................5
SECTION 3.10 NO PRIOR ASSIGNMENTS........................................5
SECTION 3.11 FAIR CONSIDERATION..........................................5
SECTION 3.12 NONCONSOLIDATION............................................6
SECTION 3.13 ORDINARY COURSE; NO INSOLVENCY..............................6
SECTION 3.14 ASSETS AND LIABILITIES......................................7
SECTION 3.15 VALID SALE..................................................7
SECTION 3.16 ABILITY TO PAY DEBTS........................................7
SECTION 3.17 BULK TRANSFER PROVISIONS....................................7
SECTION 3.18 TRANSFER TAXES..............................................7
ARTICLE IV.
CONDITIONS TO PURCHASE.....................................................8
SECTION 4.01 REPRESENTATIONS AND WARRANTIES..............................8
ARTICLE V.
COVENANTS OF THE COMPANY...................................................8
SECTION 5.01 BOOKS AND RECORDS...........................................8
SECTION 5.02 PRESERVATION OF OFFICE......................................8
SECTION 5.03 LIENS.......................................................9
-i-
<PAGE>
SECTION 5.04 NO BANKRUPTCY PETITION AGAINST THE ISSUER OR MANAGING
MEMBER............................................................9
SECTION 5.05 PROTECTION OF RIGHT, TITLE AND INTEREST.....................9
ARTICLE VI.
REPRESENTATIONS AND COVENANTS OF
THE ISSUER.................................................................9
SECTION 6.01 NONCONSOLIDATION...........................................10
SECTION 6.02 NO BANKRUPTCY PETITION AGAINST THE COMPANY.................10
ARTICLE VII.
SUBSTITUTION..............................................................11
SECTION 7.01 SUBSTITUTION...............................................11
SECTION 7.02 NOTICE OF SUBSTITUTION.....................................11
SECTION 7.03 CONTRIBUTOR'S AND COMPANY'S SUBSEQUENT OBLIGATIONS.
................................................................11
SECTION 7.04 USAGE OF PREDECESSOR CONTRACTS IN CALCULATION..............12
ARTICLE VIII.
MISCELLANEOUS.............................................................12
SECTION 8.01 AMENDMENT..................................................12
SECTION 8.02 EFFECT OF INVALIDITY OF PROVISIONS.........................13
SECTION 8.03 NOTICES....................................................13
SECTION 8.04 ENTIRE AGREEMENT...........................................13
SECTION 8.05 SURVIVAL...................................................13
SECTION 8.06 CONSENT TO SERVICE.........................................13
SECTION 8.07 JURISDICTION NOT EXCLUSIVE.................................14
SECTION 8.08 CONSTRUCTION...............................................14
SECTION 8.09 FURTHER ASSURANCES.........................................14
SECTION 8.10 THIRD PARTY BENEFICIARIES..................................14
SECTION 8.11 GOVERNING LAW..............................................15
SECTION 8.12 CONSENT TO JURISDICTION; WAIVER OF OBJECTION TO VENUE......15
SECTION 8.13 WAIVER OF JURY TRIAL.......................................15
SECTION 8.14 HEADINGS AND CROSS-REFERENCES..............................15
SECTION 8.15 COSTS AND EXPENSES.........................................16
SECTION 8.16 CONFIDENTIAL INFORMATION...................................16
SECTION 8.17 STATUTORY REFERENCES.......................................16
SECTION 8.18 EXECUTION IN COUNTERPARTS..................................16
EXHIBIT A SUBSEQUENT CONTRACT TRANSFER FORM
-ii-
<PAGE>
AMENDED AND RESTATED SUBSEQUENT CONTRACT TRANSFER AGREEMENT
("AGREEMENT") dated as of December 1, 1999, between DVI RECEIVABLES XI, L.L.C.,
a Delaware limited liability company (the "ISSUER"), and DVI RECEIVABLES CORP.
XI, a Delaware corporation (the "COMPANY").
WHEREAS, the Company will from time to time acquire certain Contracts
and other Contributed Property related thereto pursuant to the Amended and
Restated Contribution and Servicing Agreement dated as of the date hereof,
between the Company and DVI Financial Services Inc. (the "CONTRIBUTOR").
WHEREAS, the Company desires to transfer to Issuer all Contributed
Property (other than any ownership interest in certain Equipment) which it
acquires from the Contributor and certain other assets, and Issuer desires to
purchase such Contributed Property and other assets, in each instance in
accordance with the terms and conditions set forth in this Agreement.
WHEREAS, pursuant to the Amended and Restated Indenture (the "AMENDED
AND RESTATED INDENTURE"), dated as of the date hereof, by and between the Issuer
and U.S. Bank Trust National Association (the "TRUSTEE"), the Issuer intends to
issue its Series 2000-1 Notes, which will be collateralized by a pledge by the
Issuer to the Trustee, on behalf of the Noteholders of all of the Issuer's
right, title and interest in, to and under the Trust Property.
WHEREAS, to facilitate the issuance of its Series 2000-1 Notes, the
Issuer and the Company desire to amend and restate this Agreement in its
entirety.
NOW, THEREFORE, the parties, in consideration of good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
intending to be legally bound, hereby agree as follows:
ARTICLE I.
DEFINITIONS
-----------
SECTION 1.01 DEFINITIONS.
For purposes of this Agreement, capitalized terms used herein but not
otherwise defined shall have the respective meanings assigned to such terms in
Appendix I to the Amended and Restated Contribution and Servicing Agreement.
ARTICLE II.
PROCEDURES FOR PURCHASES OF ELIGIBLE CONTRACTS
----------------------------------------------
SECTION 2.01 TRANSFER.
(a) CONVEYANCE. Upon the terms and conditions herein set forth, in exchange
for cash consideration received therefore and for other good and valuable
consideration, the Company hereby
<PAGE>
transfers, pledges, assigns and sells to the Issuer on each Contribution Date
(or, in the case of any Substitute Contracts the related Substitution Date),
without recourse except as set forth herein, all of the Company's right, title
and interest in and to the Company Assets as set forth on the related Subsequent
Contract Transfer Form. All funds received by the Company on or in connection
with the Company Assets that are payable on and after the applicable Cut-off
Date shall be received, held and applied by the Company in trust for the benefit
of the Issuer as owner of the Contracts.
(b) After giving effect to such transfer and sale, the ownership of each
such Contract transferred on the related Contribution Date shall be vested in
the Issuer. The Contract Files and any other documents relating to each Contract
shall be held in trust by the Trustee for the benefit of the Noteholders
pursuant to the terms of the Amended and Restated Indenture. The Company agrees
to take no action inconsistent with the ownership of any Contract, to promptly
indicate to all parties with a valid interest inquiring as to the true ownership
of each Contract, that each Contract has been transferred and sold to the Issuer
and to claim no ownership interest in any such Contracts and the other Company
Assets.
(c) Any Company Assets transferred to the Company from time to time shall
forthwith be transferred to the Issuer without further act, notwithstanding the
delivery of any Subsequent Contract Transfer Forms in respect thereof.
SECTION 2.02 SUBSTITUTE CONTRACTS.
In consideration for the transfer by the Issuer to the Company of any
Predecessor Contract transferred to the Company by the Issuer in accordance with
the terms and conditions of Section 7 of the Amended and Restated Contribution
and Servicing Agreement, the Company shall transfer to the Issuer on the
Substitution Date related thereto, and the Issuer shall accept, a Substitute
Contract; PROVIDED that such Substitute Contract is in accordance with the terms
and conditions of the Amended and Restated Contribution and Servicing Agreement.
SECTION 2.03 INTENT OF PARTIES; SECURITY INTEREST.
The Issuer and the Company hereby confirm that the transactions
contemplated in this Agreement are intended as transfers, assignments,
conveyances and sales rather than as loan transactions. In the event, for any
reason, and solely in such event, any transaction hereunder is construed by any
court or regulatory authority as a loan or other than a transfer, assignment,
conveyance and sale of any or all Company Assets, then the Company shall be
deemed to have hereby pledged to the Issuer as security for the performance by
the Company of all of its obligations from time to time arising hereunder and
with respect to any and all purchases effected pursuant hereto, and shall be
deemed to have either assigned or granted to the Issuer a first priority
perfected (except Equipment for which the Original Equipment Cost is less than
$25,000 and subject to Finance Leases or Secured Equipment Notes, in which case,
the Company shall be deemed to have granted a valid security interest) security
interest in all of the Company Assets. In furtherance of the foregoing, (i) this
Agreement shall constitute a security agreement, (ii) the Trustee shall be
deemed to be a bailee for purposes of perfection of the security interest
granted to Issuer, (iii) Issuer shall
-2-
<PAGE>
have all of the rights of a secured party with respect to the Company Assets
pursuant to applicable law and (iv) in the manner consistent with the Amended
and Restated Indenture, the Company shall execute all documents, including, but
not limited to, UCC financing statements, to effectively perfect and evidence
Issuer's first priority security interest in the Company Assets except that UCC
financing statements need not be filed with respect to Equipment for which the
Original Equipment Cost is less than $25,000 and subject to Finance Leases or
Secured Equipment Notes. The Company also covenants not to pledge, assign or
grant any security interest to any other party in any of the Company Assets. The
consideration received and to be received by the Company in exchange for the
transfer, assignment and conveyance of the Company Assets is intended to be fair
consideration having value equivalent to or in excess of the value of the assets
being transferred by the Company.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
---------------------------------------------
The Company hereby makes the following representations and warranties for
the benefit of the Issuer, the Trustee and the Noteholders on which the Issuer
relies in purchasing and otherwise acquiring the Company Assets and on which the
Noteholders rely in funding advances under their respective Notes. Other than as
set forth in Section 3.08 hereof, such representations and warranties are and
will be true and correct as of the Closing Date and as of each Contribution Date
or Substitution Date, as the case may be (unless an earlier date is specified
therein) and shall survive each transfer, assignment, conveyance and sale to the
Issuer of the Company Assets and the subsequent pledge thereof by the Issuer
pursuant to the Amended and Restated Indenture.
SECTION 3.01 ORGANIZATION AND GOOD STANDING.
The Company is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware.
SECTION 3.02 AUTHORIZATION.
Company has all requisite power and authority and all necessary licenses
and permits to enter into and perform its obligations under this Agreement and
each Subsequent Contract Transfer Form (each, an "SCTF") and the transactions
contemplated hereby and thereby, and the execution, delivery, and performance of
this Agreement and each SCTF, have been duly authorized by the Company by all
necessary corporate action.
SECTION 3.03 BINDING OBLIGATION.
This Agreement has been, and each SCTF will be, duly and validly executed
and delivered by the Company and will constitute a legal, valid and binding
obligation of the Company, enforceable against the Company in accordance with
its respective terms, subject to bankruptcy, insolvency and other laws of
general application affecting the rights of creditors and equitable principles
(whether considered in a proceeding at law or in equity).
-3-
<PAGE>
SECTION 3.04 NO VIOLATION.
The consummation of the transactions contemplated by this Agreement and
each SCTF and the fulfillment of the terms thereof, will not conflict with,
result in any breach of any of the terms and provisions of, or constitute (with
or without notice, lapse of time or both) a default under the certificate of
incorporation or bylaws of the Company, or any indenture, agreement, mortgage,
deed of trust or other instrument to which the Company is a party or by which it
is bound, or result in the creation or imposition of any lien upon any of its
properties pursuant to the terms of such indenture, agreement, mortgage, deed of
trust or other such instrument, other than this Agreement, or violate any law,
or, to the best of the Company's knowledge, any order, rule or regulation
applicable to it of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Company or any of its properties.
SECTION 3.05 NO PROCEEDINGS.
The Company is not subject to any injunction, writ, action, suit,
restraining order or other order of any nature, and there are no actions, suits,
proceedings or investigations to which the Company is a party pending or, to the
knowledge of the Company, threatened, before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality (A)
asserting the invalidity of this Agreement or any SCTF, (B) seeking to prevent
the consummation of any of the transactions contemplated by this Agreement or
any SCTF or (C) seeking any determination or ruling that would materially and
adversely affect the performance by the Company of its obligations under, or the
validity or enforceability of this Agreement or any SCTF.
SECTION 3.06 APPROVALS.
All approvals, authorizations, consents, orders or other actions of any
person, corporation or other organization, or of any court, governmental agency
or body or official, required in connection with the execution and delivery of,
and compliance with the terms of, this Agreement or any SCTF, have been or will
be taken or obtained on or prior to the related Contribution Date.
SECTION 3.07 ABILITY TO PERFORM.
The Company has the ability to perform all of its obligations under this
Agreement, any SCTF and the Amended and Restated Contribution and Servicing
Agreement.
SECTION 3.08 EQUIPMENT AND CONTRACTS.
With respect to each Contract, the Company hereby represents and warrants
to the Issuer, as of each Contribution Date that:
(a) the sale to the Issuer of the Company's interest in such Contract(s)
transferred on such date and the assignment of the Company's security interest,
or grant of a first priority perfected security interest, as the case may be, in
the Equipment related thereto pursuant to Section 2.01 or Section 2.02 hereof
constitutes a valid transfer of all of the Company's right, title and interest
in such
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Company Assets or a grant of a first-priority perfected (except for Equipment
for which the Original Equipment Cost is less than $25,000 and subject to
Finance Leases or Secured Equipment Notes, with respect to which the Company
shall be deemed to have granted a valid security interest) security interest
therein from the Company in favor of the Issuer, free and clear of any and all
claims, charges, liens or security interests created by the Company or any of
its affiliates;
(b) the Company did not, in the exercise of its interest in any such
Company Assets waive, discharge, release or otherwise permit any modification
thereto not in effect or agreed to at the time the Company acquired its interest
therein; and
(c) notwithstanding the foregoing clauses (a) and (b), the Company makes no
representation or warranty with respect to claims, charges, liens or security
interests created, or waivers, discharges, releases or modifications made, by
the Contributor.
The representations and warranties described in this Section 3.08 shall
survive the conveyance of the Company Assets to the Issuer.
SECTION 3.09 PRINCIPAL EXECUTIVE OFFICE.
The principal executive office of the Company is located at 500 Hyde Park,
Doylestown, PA 18901, and has been so located for at least four months
immediately preceding the Closing Date. The Company has no trade names,
fictitious names, assumed names or "doing business as" names. If (i) any change
in either the Company's name, structure or the location of its principal place
of business or chief executive office occurs, then the Company shall deliver
thirty (30) days' prior written notice of such change or relocation to the
Issuer and the Trustee and (ii) if the Company becomes aware of the change in
location of any Equipment, then, no later than sixty (60) days after the
effective date of such change or relocation, shall file such amendments or
statements as may be required to preserve and protect the Issuer's and the
Trustee's interest in the Contracts, the Equipment and the other Trust Property.
The Company shall pay all filing fees or taxes payable in respect of any UCC
financing or continuation statements required to be filed pursuant to Section
1.03 of the Amended and Restated Contribution and Servicing Agreement and not
paid by the Contributor.
SECTION 3.10 NO PRIOR ASSIGNMENTS.
The Company has not pledged, assigned or encumbered or terminated, in whole
or in part, any of the Company Assets.
SECTION 3.11 FAIR CONSIDERATION.
The consideration received by the Company in connection with the transfer
and sale of the Company Assets constitutes reasonably equivalent value and fair
consideration for the Company Assets.
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SECTION 3.12 NONCONSOLIDATION.
The Company is operated in such a manner that it would not be substantively
consolidated with Contributor, such that the separate existence of the Company
and Contributor would not be disregarded in the event of a bankruptcy or
insolvency of the Company or Contributor, and in such regard, among other
things:
(a) the Company is not involved in the day to day management of
Contributor;
(b) the Company maintains separate corporate records and books of account
from Contributor and otherwise observes corporate formalities and has a separate
business office from Contributor (which may be at the same address as
Contributor; PROVIDED that the Company and Contributor have entered into a
written agreement specifying a reasonable allocation of expenses with respect to
overhead and other shared costs with respect to such premises or a lease
agreement);
(c) the financial statements and books and records of the Company prepared
after the date of creation of Contributor reflect and will reflect the separate
existence of Contributor;
(d) the Company maintains its assets separately from the assets of
Contributor (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 Contributor and the separate creditors of
Contributor will be entitled to be satisfied out of Contributor's assets prior
to any value in Contributor becoming available to Contributor's equityholders or
the Company'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;
(f) Contributor does not act as an agent of the Company in any capacity and
the Company does not act as agent for Contributor, but instead presents itself
to the public as a corporation separate from Contributor; PROVIDED that
Contributor is the Servicer under the Amended and Restated Contribution and
Servicing Agreement; and
(g) the Company will cause its accounting records to be clearly and
unambiguously marked to show that such Contract has been transferred by the
Company to the Issuer and pledged by the Issuer to the Trustee for the benefit
of the Noteholders.
SECTION 3.13 ORDINARY COURSE; NO INSOLVENCY.
The transactions contemplated by this Agreement are being consummated by
the Company and the Issuer, respectively, in furtherance of the Company's
ordinary business purposes and constitute a practical and reasonable course of
action by the Company designed to improve the financial position of the Company
with no contemplation of insolvency and with no intent to hinder, delay or
defraud any of its present or future creditors. Neither as a result of the
transactions contemplated by this Agreement, nor immediately before or after
such transactions, will the
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Company be insolvent, and the Company has adequate capital for the conduct of
its business and the payment of anticipated obligations.
SECTION 3.14 ASSETS AND LIABILITIES.
(a) Both immediately before and after the assignment, transfer and
conveyance of Contracts (including the right to receive all payments due or to
become due thereunder) and the other Company Assets, the present fair salable
value of the Company's assets will be in excess of the amount that will be
required to pay the Company's probable liabilities as they then exist and as
they become absolute and matured.
(b) Both immediately before and after the assignment and transfer of
Contracts and the other Company Assets, the sum of the Company's assets will be
greater than the sum of the Company's debts, valuing the Company's assets at a
fair salable value.
SECTION 3.15 VALID SALE.
This Agreement effects a valid assignment, transfer and conveyance of the
Company's interest in the Company Assets, enforceable against creditors of the
Company.
The consideration received by the Transferor upon the sale of the Company
Assets to the Issuer constitutes reasonably equivalent value and fair
consideration for such Company Assets.
SECTION 3.16 ABILITY TO PAY DEBTS.
Neither as a result of the transactions contemplated by this Agreement nor
otherwise does the Company believe that it will incur debts beyond its ability
to pay or which would be prohibited by its charter documents or by-laws. The
Company's assets and cash flow enable it to meet its present obligations in the
ordinary course of business as they become due.
SECTION 3.17 BULK TRANSFER PROVISIONS.
No transfer, assignment or conveyance of Contracts or the other Company
Assets by the Company to the Issuer contemplated by this Agreement will be
subject to the bulk transfer or any similar statutory provisions in effect in
any applicable jurisdiction.
SECTION 3.18 TRANSFER TAXES.
No transfer, assignment or conveyance of Company Assets contemplated by
this Agreement is subject to or will result in any tax, fee or governmental
charge payable by the Company or the Issuer to any federal, state or local
government ("Transfer Taxes"). In the event that the Company or the Issuer
receives actual notice of any Transfer Taxes arising out of the transfer,
assignment and conveyance of any Company Assets, on written demand by the
Issuer, or upon the Company otherwise being given notice thereof, the Company
shall pay, and otherwise indemnify and hold the Issuer, the Trustee and the
holders of the Notes harmless, on an after-tax basis, from and against any
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and all such Transfer Taxes (it being understood that neither the holders of the
Notes nor the Trustee shall have any obligation to pay such Transfer Taxes).
ARTICLE IV.
CONDITIONS TO PURCHASE
----------------------
SECTION 4.01 REPRESENTATIONS AND WARRANTIES.
The obligation of the Issuer to purchase any Contracts on the Closing Date
each Contribution Date, is subject to receipt by the Issuer of the following:
(a) an Officer's Certificate from Company to the effect that, on or before
such Contribution Date (after giving effect to the sale of the Subsequent
Contracts on such date), all representations and warranties of the Company
contained herein shall be true and correct in all respects, with respect to each
Contract individually and all Contracts in the aggregate, with the same force
and effect as though such representations and warranties had been made on and as
of such date (unless such representations and warranties specifically relate to
an earlier date); and
(b) an Officer's Certificate from the Contributor to the effect that, on or
before such Contribution Date (after giving effect to the sale of Subsequent
Contracts on such date), all representations and warranties of the Contributor
contained in Section 2 of the Amended and Restated Contribution and Servicing
Agreement shall be true and correct in all respects, with respect to each
Contract individually and all Contracts in the aggregate as stated therein, with
the same force and effect as though such representations and warranties had been
made on and as of such date (unless such representations and warranties
specifically relate to an earlier date).
ARTICLE V.
COVENANTS OF THE COMPANY
------------------------
So long as this Agreement remains in effect or the Company shall have any
obligations hereunder, Company hereby covenants and agrees with Issuer as
follows:
SECTION 5.01 BOOKS AND RECORDS.
The Company will clearly mark its books and records to reflect each sale to
the Issuer of all Company Assets and to show that the Issuer owns the Company
Assets absolutely.
SECTION 5.02 PRESERVATION OF OFFICE.
The Company will give the Issuer, each Noteholder and the Trustee prior
written notice of any relocation of its principal executive office if, as a
result of such relocation, the applicable provisions of the UCC would require
the filing of any amendment of any previously filed financing or continuation
statement or of any new financing statement.
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SECTION 5.03 LIENS.
The Company shall defend the right, title and interest of the Issuer in the
Company Assets against all claims of third parties claiming through or under the
Company (excluding claims arising from actions of the Contributor, in its
capacity as Servicer under the Amended and Restated Contribution and Servicing
Agreement, or any agent of Contributor as such Servicer).
SECTION 5.04 NO BANKRUPTCY PETITION AGAINST THE ISSUER OR MANAGING MEMBER.
The Company covenants and agrees it will not, prior to the date that is one
year and one day after the payment in full of all amounts owing pursuant to the
Transaction Documents, institute against, or join any other Person in
instituting against, any of the Issuer, the Managing Member or itself, any
bankruptcy, reorganization, receivership, arrangement, insolvency or liquidation
proceedings or other similar proceedings under any federal or state bankruptcy
or similar law. This Section 5.04 shall survive the termination of this
Agreement.
SECTION 5.05 PROTECTION OF RIGHT, TITLE AND INTEREST.
(a) The Company shall not change its name, identity, or corporate structure
in any manner that would, could, or might make any UCC financing statement or
continuation statement filed by the Contributor in accordance with Section
1.01(d) of the Amended and Restated Contribution and Servicing Agreement
seriously misleading within the meaning of Section 9-402(7) of the UCC, unless
it shall have given the Issuer at least thirty (30) days' prior written notice
thereof and shall promptly file appropriate amendments to all previously filed
UCC financing statements or continuation statements.
(b) If at any time the Company shall propose to sell, grant a security
interest in or otherwise transfer any interest in contracts to any prospective
lender, or other transferee, the Company shall give to such prospective lender,
or other transferee, computer tapes, records, or print-outs (including any
restored from archives) that, if they shall refer in any manner whatsoever to
any Contract, shall indicate clearly that such Contract have been sold to the
Issuer and pledged by the Issuer to the Trustee for the benefit of the
Noteholders.
(c) The Company shall not amend its certificate of incorporation without
the prior written consent of the Rating Agencies.
ARTICLE VI.
REPRESENTATIONS AND COVENANTS OF
THE ISSUER
---------------------------------
The Issuer hereby represents and warrants to the Company as of the Closing
Date and as of each Contribution Date:
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SECTION 6.01 NONCONSOLIDATION.
The Issuer is operated in such a manner that it would not be substantively
consolidated with Contributor, such that the separate existence of the Issuer
and Contributor would not be disregarded in the event of a bankruptcy or
insolvency of the Issuer or Contributor, and in such regard, among other things:
(a) the Issuer is not involved in the day to day management of Contributor;
(b) the Issuer maintains separate company records and books of account from
Contributor and otherwise observes company formalities and has a separate
business office from the Company;
(c) the financial statements and books and records of the Issuer prepared
after the date of creation of Contributor reflect and will reflect the separate
existence of Contributor;
(d) the Issuer maintains its assets separately from the assets of
Contributor (including through the maintenance of a separate bank account), the
Issuer's funds and assets, and records relating thereto, have not been and are
not commingled with those of Contributor and the separate creditors of
Contributor will be entitled to be satisfied out of Contributor's assets prior
to any value in Contributor becoming available to Contributor's equityholders or
the Issuer's creditors;
(e) all business correspondence of the Issuer and other communications are
conducted in the Issuer's own name and on its own stationery;
(f) Contributor does not act as an agent of the Issuer in any capacity and
the Issuer does not act as agent for Contributor, but instead presents itself to
the public as a limited liability company separate from Contributor and the
Company; PROVIDED that Contributor is the Servicer under the Contribution and
Servicing Agreement.
(g) The Issuer shall not issue any securities or cause any Person of which
it is the sole shareholder or economic owner to issue any securities (other than
the Notes, any Class F Instruments and any securities issued prior to the
Closing Date) unless it shall have received from the Rating Agencies a written
confirmation that the issuance of such securities will not result in a Ratings
Effect with respect to any class of Notes.
SECTION 6.02 NO BANKRUPTCY PETITION AGAINST THE COMPANY.
The Issuer covenants and agrees it will not, prior to the date that is one
year and one day after the payment in full of all amounts owing pursuant to the
Transaction Documents, institute against, or join any other Person in
instituting against, any of the Company, the Managing Member or itself, any
bankruptcy, reorganization, receivership, arrangement, insolvency or liquidation
proceedings or other similar proceedings under any federal or state bankruptcy
or similar law. This Section 6.01 shall survive the termination of this
Agreement.
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ARTICLE VII.
SUBSTITUTION
------------
SECTION 7.01 SUBSTITUTION.
In the event that the Contributor contributes and assigns a Substitute
Contract to the Company pursuant to Section 7.01 of the Amended and Restated
Contribution and Servicing Agreement, the Company hereby agrees to sell,
transfer, convey and assign any such Substitute Contract and the security
interest in the related Equipment to the Issuer. In addition, the Company hereby
agrees to take any action to facilitate the transfer of any Predecessor
Contract, including (i) delivery to the Contributor by the Company of an
instrument, substantially in the form of Exhibit D of the Amended and Restated
Contribution and Servicing Agreement, transferring to the Contributor, without
representation or warranty, all of the Company's right, title and interest in
and to the related Predecessor Contract, (ii) delivery to the Trustee of the
original, manually executed counterpart of each Contract that constitutes
"chattel paper" or an "instrument" under the UCC as appropriate for the purposes
of perfecting a security interest under the UCC and (iii) delivery to the
Trustee of an amendment to the Contract Schedule, reflecting the deletion of the
Predecessor Contract and the addition of the Substitute Contract.
SECTION 7.02 NOTICE OF SUBSTITUTION.
In the Monthly Servicer Report to be delivered on each Determination Date,
the Company shall cause the Servicer to give written notice to the Trustee, each
Noteholder, and the Company of each substitution of Contracts pursuant to
Section 7.01 hereof during the preceding Collection Period. Such Monthly
Servicer Report or other written notice shall (i) specify the amount of each
periodic Contract Payment under the Predecessor Contract and the amount of each
periodic Contract Payment under each Eligible Contract being substituted, (ii)
specify the residual values of the Equipment subject to the Predecessor Contract
and the Equipment subject to the Eligible Contract being substituted, (iii)
specify the Discounted Contract Balance of the Predecessor Contracts, the
Discounted Contract Balance of the Substitute Contracts, and any amounts to be
deposited in the Collection Account in connection with such Substitute Contracts
and (iv) with respect to a substitution pursuant to Section 7.01 hereof, be
accompanied by an Officer's Certificate, substantially in the form of Exhibit F
of the Amended and Restated Contribution and Servicing Agreement, certifying as
to compliance with the provisions of Section 7.01 hereof.
SECTION 7.03 CONTRIBUTOR'S AND COMPANY'S SUBSEQUENT OBLIGATIONS.
Upon any substitution of Contracts in accordance with the provisions of
this Section 7, the Company's obligations hereunder with respect to the
Predecessor Contract shall cease but the Contributor and the Company shall each
thereafter have the same obligations with respect to the Substitute Contract
substituted as it has with respect to all other Contracts subject to the terms
hereof.
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SECTION 7.04 USAGE OF PREDECESSOR CONTRACTS IN CALCULATION.
After substitution therefor in accordance with the terms and conditions of
the Transaction Documents, no Predecessor Contract or any other Contract
repurchased or substituted for in accordance with the terms and conditions of
the Transaction Documents, including the subsequent default, delinquency or
breach thereof, shall be included in any calculation or determination made under
the Transaction Documents, including, without limitation, the calculation of
either any Amortization Event or Indenture Event of Default.
ARTICLE VIII.
MISCELLANEOUS
-------------
SECTION 8.01 AMENDMENT.
(a) This Agreement may be amended from time to time by the Issuer and
the Company with the consent of the Rating Agencies (but without the consent of
the Trustee or any of the Noteholders), to cure any ambiguity, to correct or
supplement any provision herein that may be inconsistent with any other
provisions herein, or to add or amend any other provisions with respect to
matters or questions arising under this Agreement; PROVIDED, HOWEVER, that such
amendment shall not adversely affect in any material respect the interests of
either the Trustee or the Noteholders, unless so consented to by each entity so
affected.
(b) This Agreement may also be amended from time to time by the Issuer
and the Company, with the consent of the Rating Agencies and the Majority of
Voting Rights, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement; PROVIDED,
HOWEVER, that no such amendment shall (a) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, collections of payments on
Contracts or payments that are required to be made on any Note without the
consent of the Holder of such Note, (b) reduce the aforesaid percentage required
to consent to any such amendment or (c) adversely affect in any material respect
the interests of the Trustee or any Noteholder without, in each instance, the
consent of each entity so affected.
(c) Approval of the particular form of any proposed amendment or
consent shall not be necessary for the consent of the Noteholders under Section
8.01(b), but it shall be sufficient if such consent shall approve the substance
thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Noteholders shall be subject to such
reasonable requirements as the Trustee may prescribe.
(d) Prior to the execution of any such amendment to this Agreement
proposed in accordance with Section 8.01(b), the Issuer shall deliver a copy of
the proposed amendment to the Company, the Rating Agencies and the Trustee.
(e) In executing any amendment to this Agreement pursuant to this
Section 8.01, the Trustee shall be entitled to receive (i) an Officer's
Certificate of the Company stating that all conditions precedent for entering
into such amendment as set forth in this Agreement have been met,
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and (ii) an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement.
SECTION 8.02 EFFECT OF INVALIDITY OF PROVISIONS.
In case any one or more of the provisions contained in this Agreement
should be or become invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall in no way be affected, prejudiced or disturbed thereby.
SECTION 8.03 NOTICES.
All demands, notices and communications hereunder shall be in writing,
personally delivered or mailed by certified mail-return receipt requested, or
delivered by courier, or delivered by facsimile to a facsimile and telephone
number provided by the relevant Person in writing, with subsequent telephone
confirmation of the receipt thereof, and shall be deemed to have been duly given
upon receipt (a) in the case of the Trustee, at the following address: 180 East
Fifth Street, St. Paul, Minnesota 55101, Attention: Structured Finance,
Facsimile: (651) 244-0089, (b) in the case of the Servicer, at the following
address: 500 Hyde Park, Doylestown, Pennsylvania 18901, Attention:
Securitization Manager, Facsimile: (215) 230-5328, (c) in the case of the
Issuer, 500 Hyde Park, Doylestown, Pennsylvania 18901, Attn: Securitization
Manager, Facsimile (215) 230-5328, with a copy to the Servicer at the address
set forth in clause (b) above, (d) in the case of the Company at the following
address: 500 Hyde Park, Doylestown, Pennsylvania 18901, Attention:
Securitization Manager, Facsimile: (215) 230-5328, (e) in the case of the Rating
Agencies, to the following addresses: Fitch IBCA, Inc., One State Street Plaza,
New York, New York 10004, Attention: Ms. Wendy Geneen Cohn, Facsimile: (212)
635-0476; and Moody's Investors Service, Inc., 99 Church Street, 4th Fl., New
York, New York 10007, Attention: ABS Monitoring Department, Facsimile: (212)
553-3856, or at other such respective address as shall be designated by such
party in a written notice to the other parties. Any notice required or permitted
to be mailed to a Noteholder shall be given by first class mail, postage
prepaid, at the address of such Holder as shown in the Note Register. Any notice
so mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Noteholder receives such
notice.
SECTION 8.04 ENTIRE AGREEMENT.
This Agreement, including the Exhibits hereto, contains the entire
agreement of the parties hereto with respect to the subject matter hereof, and
supersedes all prior and contemporaneous agreements between them, whether oral
or written, of any nature whatsoever with respect to the subject matter hereof.
SECTION 8.05 SURVIVAL.
All indemnities and undertakings of the Company and the Issuer hereunder
shall survive the termination of this Agreement.
SECTION 8.06 CONSENT TO SERVICE.
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Each party irrevocably consents to the service of process by registered or
certified mail, postage prepaid, to it at its address provided on the signature
page hereto.
SECTION 8.07 JURISDICTION NOT EXCLUSIVE.
Nothing herein will be deemed to preclude either party hereto from bringing
an action or proceeding in respect of this Agreement in any jurisdiction other
than as set forth in Section 8.12 hereof.
SECTION 8.08 CONSTRUCTION.
The headings in this Agreement are for convenience only and are not
intended to influence its construction. References to Sections, Schedules and
Exhibits in this Agreement are to the Sections of and Schedules and Exhibits to
this Agreement. Any Schedules and Exhibits are hereby incorporated into and form
a part of this Agreement. In this Agreement, the singular includes the plural,
the plural the singular, the words "and" and "or" are used in the conjunctive or
disjunctive as the sense and circumstances may require and the word "including"
means "including, but not limited to." Unless otherwise stated in this
Agreement, in the computation of a period of time from a specified date to a
later specified date, the word "from" means "from and including" and the words
"to" and "until" each means "to but excluding".
SECTION 8.09 FURTHER ASSURANCES.
In addition to its agreements set forth herein, the Company (at the
Issuer's expense) agrees to do such further acts and things and to execute and
deliver such additional assignments, agreements, powers and instruments as are
reasonably requested by the Issuer to carry into effect the purposes of this
Agreement and the transactions contemplated herein.
SECTION 8.10 THIRD PARTY BENEFICIARIES.
Each Noteholder and the Trustee shall be an express third party beneficiary
of this Agreement. The obligations of the Company hereunder may be assigned by
the Issuer to the Trustee under the Amended and Restated Indenture. The Company
acknowledges that the Issuer intends, pursuant to the Amended and Restated
Indenture, to pledge the Company Assets, together with its respective rights
under this Agreement to the Trustee on the Closing Date, each Contribution Date
and each Substitution Date, with respect to each Contract and each Substitute
Contract. The Company acknowledges and consents to such conveyance and waives
any further notice thereof and covenants and agrees that the representations and
warranties of the Company contained in this Agreement and the rights of the
Issuer hereunder, are intended to benefit the Trustee, and each Securityholder.
In furtherance of the foregoing, the Company covenants and agrees to perform its
duties and obligations hereunder, in accordance with the terms hereof and for
the benefit of the Trustee and the Noteholder and that, notwithstanding anything
to the contrary in this Agreement, the Company shall be directly liable to the
Trustee (notwithstanding any failure by the Servicer or the Issuer to perform
its duties and obligations hereunder, or under the Amended and Restated
Indenture or Amended and Restated Contribution and Servicing Agreement), and
that the Trustee may enforce
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the duties and obligations of the Company under this Agreement against the
Company for the benefit of the Securityholder.
SECTION 8.11 GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ITS RULES REGARDING CONFLICT OF
LAWS.
SECTION 8.12 CONSENT TO JURISDICTION; WAIVER OF OBJECTION TO VENUE.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, EACH OF THE ISSUER AND THE COMPANY HEREBY AGREED
TO THE NON-EXCLUSIVE JURISDICTION OF ANY FEDERAL COURT LOCATED WITH THE STATE OF
NEW YORK. EACH OF THE PARTIES HERETO IRREVOCABLY SUBMITS TO THE NON- EXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES
DISTRICT COURT LOCATED IN THE BOROUGH OF MANHATTAN, CITY OF NEW YORK, AND EACH
PARTY IRREVOCABLY HEREBY WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS, AND
ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER IN ANY OF THE
AFOREMENTIONED COURTS AND CONSENT TO THE GRANTING OF SUCH LEGAL OR EQUITABLE
RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT.
SECTION 8.13 WAIVER OF JURY TRIAL.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH OF THE ISSUER AND THE
COMPANY WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE,
WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE PARTIES HERETO
ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP
BETWEEN ANY OF THEM IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY. INSTEAD, ANY SUCH DISPUTE RESOLVED IN COURT WILL BE
RESOLVED IN A BENCH TRIAL WITHOUT A JURY.
SECTION 8.14 HEADINGS AND CROSS-REFERENCES.
The various headings in this Agreement are included for convenience only
and shall not affect the meaning or interpretation of any provision of this
Agreement. References in this Agreement to Section names or numbers are to such
Sections of this Agreement.
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SECTION 8.15 COSTS AND EXPENSES.
The Company will pay all reasonable expenses incident to the performance of
its obligations under this Agreement and under the Amended and Restated
Indenture and the Company agrees to pay all reasonable out-of-pocket costs and
expenses of the Issuer, including fees and expenses of counsel, in connection
with the enforcement of any obligation of the Company hereunder.
SECTION 8.16 CONFIDENTIAL INFORMATION.
The Issuer agrees and covenants that it will neither use nor disclose to
any person the names and addresses of the Obligors, except in connection with
the enforcement of the Issuer's rights hereunder, under the Contracts, under the
applicable Transaction Documents or as required by law.
SECTION 8.17 STATUTORY REFERENCES.
References in this Agreement to any section of the UCC shall mean, on and
after the effective date of adoption of any revision to the UCC in the
applicable jurisdiction, such revised or successor section thereto.
SECTION 8.18 EXECUTION IN COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original, and all of which shall constitute one and the same
instrument.
-16-
<PAGE>
[AMENDED AND RESTATED SUBSEQUENT CONTRACT TRANSFER AGREEMENT]
IN WITNESS WHEREOF, Issuer and Company have duly executed this Amended
and Restated Subsequent Contract Transfer Agreement as of the date and year
first above written.
DVI RECEIVABLES CORP. XI
By /s/ Lisa J. Cruikshank
---------------------------
Name: Lisa J. Cruikshank
Title: Vice President
Address: 500 Hyde Park
Doylestown, Pennsylvania 18901
Attn: Securitization Manager
Telephone: (215) 489-8015
Facsimile: (215) 230-5328
DVI RECEIVABLES XI, L.L.C.
By: DVI Receivables Corp. VIII, its managing member
By /s/ Lisa J. Cruikshank
---------------------------
Name: Lisa J. Cruikshank
Title: Vice President
Address: 500 Hyde Park
Doylestown, Pennsylvania 18901
Attn: Securitization Manager
Telephone: (215) 489-8015
Facsimile: (215) 230-5328
Consented to with respect to Section 8.01 only by:
PRUDENTIAL SECURITIES CREDIT CORP., LLC
By: /s/ Jeff K. French
-----------------------
Name: Jeff K. French
Title:
<PAGE>
EXHIBIT A
SUBSEQUENT CONTRACT TRANSFER FORM
---------------------------------
[DATE]
DVI Receivables Corp. XI, (the "Company") and DVI Receivables XI, L.L.C.
("the Issuer"), pursuant to the Amended and Restated Subsequent Contract
Transfer Agreement, dated as of December 1, 1999 (the "SCTA"), hereby confirm
their understanding with respect to the sale, transfer, assignment and
conveyance by the Company to the Issuer of those Contracts listed on Schedule 1
attached hereto (the "Contracts"), together with a first priority perfected
(except with regard to Equipment related to either a Finance Lease or a Secured
Equipment Note that had an Original Equipment Cost of less than $25,000)
security interest in all of the Company's right, title and interest in and to
the related Equipment (except for (i) such item of Equipment related to either a
Finance Lease or a Secured Equipment Note that had an Original Equipment Cost of
less than $25,000 and (ii) any ownership interest in such item of Equipment,
with respect to which the Company instead grants to the Issuer a first priority
perfected security interest therein), and other related property described
herein.
CONVEYANCE OF COMPANY ASSETS. On the date set forth above, the Company
hereby transfers to the Issuer all of the Company's rights, title and interest
in, to, and under the Contracts listed on Schedule 1 hereto including, without
limitation, its interests in the proceeds of such Contracts, the right to
receive all amounts due or to become due thereunder after __________ (the
"Cut-off Date") together with all of the other Company Assets related thereto.
The Company hereby confirms that:
(1) On or prior to the date hereof (the "Subsequent Contract Transfer
Date"), the Contributor shall have deposited in the Collection Account all
collections in respect of the Contracts that were due on or after the Cut-off
Date;
(2) Each representation and warranty of the Company under the Amended and
Restated Contribution and Servicing Agreement and the SCTA is true and correct
as of the date hereof, the Contributor was not insolvent nor will it be made
insolvent by the transfer contemplated herein nor is it aware of any pending
insolvency and the Company is not in breach of any covenant under the SCTA;
(3) Each Contract sold, transferred, assigned and conveyed pursuant hereto
is an Eligible Contract;
(4) On or prior to the Subsequent Contract Transfer Date, the Company shall
have delivered to the Trustee the sole original, manually executed counterpart
of each Contract;
(5) The sum of the Discounted Contract Balances as of the Cut-off Date of
the Contracts listed on Schedule 1 attached hereto is $__________ (calculated
using a Discount Rate of 8.318%);
A-1
<PAGE>
(6) Reserved
(7) When the Contracts are added to the Trust Property, all representations
and warranties of the Company in the SCTA will be true and correct as of the
date set forth in the heading of this Subsequent Contract Transfer Form unless
any breach of such representations and warranties resulting from the inclusion
of such Contract shall have been waived in advance by Noteholders evidencing
more than 50% of the Voting Rights; and
(8) The Contributor has delivered to the Trustee (i) amendments to, or
executed originals of, the UCC financing statements referred to in Section
1.01(d) of the Amended and Restated Contribution and Servicing Agreement (the
"Amended and Restated Contribution and Servicing Agreement"), dated as of
December 1, 1999 between Contributor Financial Services Inc. and the Company,
reflecting the addition of the Contract(s) and (ii) an amendment to the Contract
Schedule.
All terms and conditions of the SCTA with respect to the Company and the
Contracts have been complied with and are hereby ratified, confirmed and
incorporated herein;, PROVIDED THAT in the event of any conflict, the provisions
of this Subsequent Contract Transfer Form shall control over the conflicting
provisions of the Amended and Restated Contribution and Servicing Agreement.
A-2
<PAGE>
Terms capitalized herein and not defined herein shall have their respective
meanings as set forth in the SCTA and if not defined therein, then as such terms
are defined in Appendix I to the Amended and Restated Contribution and Servicing
Agreement.
DVI RECEIVABLES CORP. XI
By:_____________________________
Name:
Title:
By: DVI RECEIVABLES CORP. VIII, its managing
member
By:_____________________________
Name:
Title
A-3
EXHIBIT 4.4
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY OPERATING AGREEMENT
OF
DVI RECEIVABLES XI, L.L.C.
<PAGE>
AMENDED AND RESTATED
LIMITED LIABILITY COMPANY OPERATING AGREEMENT
OF
DVI RECEIVABLES XI, L.L.C.
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
1.1 ACT..........................................................1
1.2 AFFILIATE....................................................1
1.3 AGREEMENT....................................................1
1.4 ARTICLES.....................................................1
1.5 ASSIGNEE.....................................................1
1.6 CAPITAL CONTRIBUTION.........................................1
1.7 CLOSING......................................................1
1.8 COMPANY......................................................1
1.9 DISPOSITION (DISPOSE)........................................2
1.10 DISSOLUTION EVENT............................................2
1.11 DISTRIBUTION.................................................2
1.12 DVI..........................................................2
1.13 EFFECTIVE DATE...............................................2
1.14 EVENT OF BANKRUPTCY..........................................2
1.15 FISCAL YEAR..................................................2
1.16 INDENTURE....................................................2
1.17 INDEPENDENT DIRECTOR.........................................2
1.18 MANAGEMENT RIGHT.............................................2
1.19 MANAGING MEMBER..............................................3
1.20 MEMBER.......................................................3
1.21 MEMBERSHIP INTEREST..........................................3
1.22 NOTES........................................................3
1.23 OFFICER......................................................3
1.24 ORGANIZATION.................................................3
1.25 PERSON.......................................................3
1.26 PRINCIPAL OFFICE.............................................3
1.27 PROCEEDING...................................................3
1.28 PROPERTY.....................................................3
1.29 RELATED COMPANY..............................................3
1.30 SCTA.........................................................3
1.31 TAX CHARACTERIZATION AND ADDITIONAL TAX TERMS................3
1.32 TERM.........................................................4
<PAGE>
1.33 UNIT.........................................................4
ARTICLE II
FORMATION
2.1 ORGANIZATION.................................................4
2.2 AGREEMENT....................................................4
2.3 NAME.........................................................5
2.4 TERM.........................................................5
2.5 REGISTERED AGENT AND OFFICE..................................5
2.6 PRINCIPAL OFFICE.............................................5
ARTICLE III
LIMITED PURPOSE; NATURE OF BUSINESS
3.1 LIMITED BUSINESS PURPOSE.....................................5
ARTICLE IV
LIMITATIONS ON ACTIVITIES
4.1 LIMITATIONS ON ACTIVITIES....................................7
ARTICLE V
ACCOUNTING AND RECORDS
5.1 RECORDS TO BE MAINTAINED.....................................8
5.2 REPORTS......................................................9
5.3 TAX RETURNS AND REPORTS......................................9
5.4 RECORDS TO BE KEPT SEPARATE..................................9
ARTICLE VI
NAME AND ADDRESS OF MEMBER
ARTICLE VII
RIGHTS AND DUTIES OF MEMBER
7.1 LIABILITY OF MEMBER.........................................10
7.2 REPRESENTATIONS AND WARRANTIES..............................10
7.3 CONFLICTS OF INTEREST.......................................10
ARTICLE VIII
MANAGEMENT
8.1 MANAGEMENT OF THE COMPANY...................................10
8.2 AUTHORITY OF MANAGING MEMBER TO BIND THE COMPANY............11
8.3 ACTIONS OF THE MANAGING MEMBER..............................12
8.4 COMPENSATION OF MANAGING MEMBER.............................12
8.5 MANAGING MEMBER'S STANDARD OF CARE..........................12
8.6 RESIGNATION.................................................12
8.7 PAYMENT OF LIABILITIES......................................12
<PAGE>
ARTICLE IX
CONTRIBUTIONS
9.1 MEMBERSHIP INTEREST.........................................13
9.2 CONTRIBUTIONS...............................................13
9.3 WITHDRAWAL..................................................13
9.4 INTEREST....................................................13
9.5 NO PERSONAL LIABILITY.......................................13
ARTICLE X
ALLOCATIONS AND DISTRIBUTIONS
10.1 TAXABLE INCOME ALLOCATIONS..................................13
10.2 DISTRIBUTIONS...............................................13
ARTICLE XI
TRANSFER OF MEMBERSHIP INTEREST
11.1 COMPLIANCE WITH SECURITIES LAWS.............................13
11.2 TRANSFER OF ECONOMIC INTEREST...............................14
11.3 TRANSFER OF MEMBERSHIP INTEREST.............................14
11.4 STATUS OF TRANSFEREE........................................14
11.5 DISSOLUTION OR BANKRUPTCY OF THE MEMBER.....................15
ARTICLE XII
DISSOLUTION AND WINDING UP
12.1 DISSOLUTION.................................................15
12.2 EFFECT OF DISSOLUTION.......................................16
12.3 DISTRIBUTION OF ASSETS ON DISSOLUTION.......................16
12.4 WINDING UP AND FILING ARTICLES OF DISSOLUTION...............17
ARTICLE XIII
MISCELLANEOUS
13.1 NOTICES.....................................................17
13.2 HEADINGS....................................................17
13.3 ENTIRE AGREEMENT............................................17
13.4 BINDING AGREEMENT...........................................17
13.5 SAVING CLAUSE...............................................17
13.6 COUNTERPARTS................................................17
13.7 GOVERNING LAW...............................................17
13.8 NO MEMBERSHIP INTENDED FOR NONTAX PURPOSES..................17
13.9 NO RIGHTS OF CREDITORS AND THIRD PARTIES UNDER AGREEMENT....18
13.10 GENERAL INTERPRETIVE PRINCIPLES.............................18
<PAGE>
LIMITED LIABILITY COMPANY OPERATING AGREEMENT
OF
DVI RECEIVABLES XI, L.L.C.
This Amended and Restated Limited Liability Company Operating Agreement
of DVI Receivables XI, L.L.C. (the "Company"), a Delaware limited liability
company organized pursuant to the Delaware Limited Liability Company Act, shall
be effective as of December 1, 1999, by and between the Company and DVI
Receivables Corp. VIII, as the sole member of the Company.
ARTICLE I
DEFINITIONS
Capitalized terms not defined herein shall have the meaning set forth
in the Indenture (as defined below). For purposes of this Agreement (as defined
below), unless the context clearly indicates otherwise, the following terms
shall have the following meanings:
1.1 ACT. The Delaware Limited Liability Company Act and all amendments
thereto.
1.2 AFFILIATE. Any entity other than the Member (i) which owns
beneficially, directly or indirectly, 10% or more of the outstanding shares of
common stock of the Managing Member; or (ii) of which 10% or more of the
outstanding shares of its common stock is owned beneficially, directly or
indirectly, by any entity described in clause (i) above, or (iii) which is
"controlled", as defined in Section 230.405 of the Rules and Regulations of the
Securities and Exchange Commission, 17 C.F.R. Section 230.405, by an entity
described in clause (i) above.
1.3 AGREEMENT. This Limited Liability Company Operating Agreement
including all amendments adopted in accordance with this Agreement and the Act.
1.4 ARTICLES. The Articles of Organization of the Company, as amended
from time to time, and filed with the Department of State of the State of
Delaware.
1.5 ASSIGNEE. A transferee of the Membership Interest.
1.6 CAPITAL CONTRIBUTION. Any contribution of rights, Property or
services made by or on behalf of the Member or its Assignee.
1.7 CLOSING. The Closing as defined in the Indenture.
1.8 COMPANY. DVI Receivables XI, L.L.C., a limited liability company
formed under the laws of Delaware, and any successor limited liability company.
<PAGE>
2
1.9 DISPOSITION (DISPOSE). Any sale, assignment, exchange, mortgage,
pledge, grant, hypothecation, or other transfer, absolute or as security or
encumbrance (including dispositions by operation of law).
1.10 DISSOLUTION EVENT. An event, the occurrence of which will result
in the dissolution of the Company under Article XII.
1.11 DISTRIBUTION. A transfer of Property to the Member or its designee
on account of the Member's Membership Interest as described in Article X.
1.12 DVI. DVI Financial Services Inc., a Delaware corporation.
1.13 EFFECTIVE DATE. December 1, 1999.
1.14 EVENT OF BANKRUPTCY. As to any Person means the filing of a
petition for relief as to such Person as debtor or bankrupt under the Bankruptcy
Reform Act of 1978, as amended, or other similar provision of law of any
jurisdiction (except if such petition is contested by such Person and has been
dismissed within 90 days); insolvency of such Person as finally determined by a
court proceeding; filing by such Person of a petition or application to
accomplish the same or for the appointment of a receiver or a trustee for such
Person or a substantial part of its assets; commencement of any proceedings
relating to such Person as a debtor under any other reorganization, arrangement,
insolvency, adjustment of debt or liquidation law of any jurisdiction, whether
now in existence or hereinafter enacted, if such Person indicates its approval
of such proceeding, consents thereto or acquiesces therein, or such proceeding
is contested by such Person and has not been finally dismissed within 90 days.
1.15 FISCAL YEAR. The year commencing on the opening of business on the
first day of July of each calendar year and terminating on the close of business
on the last day of June of the immediately succeeding calendar year thereto.
1.16 INDENTURE. That certain Amended and Restated Indenture, dated of
even date herewith, by and between the Company and U.S. Bank Trust National
Association, as Trustee.
1.17 INDEPENDENT DIRECTOR. An individual who is not, at the time of
initial appointment, nor has been, a director of any Affiliate of the Member
(except that an individual who serves in similar capacities for other "special
purpose corporations" formed by DVI or its affiliates is not thereby
disqualified from being an Independent Director) or is an officer of, employed
by, a creditor, supplier or contractor of, or holding any beneficial or economic
interest in the Member or any Affiliate of the Member, or is a family member of
any of the foregoing.
1.18 MANAGEMENT RIGHT. The right of the Member to participate in the
management of the Company, to vote on any matter, and to grant or to withhold
consent or approval of actions of the Company.
<PAGE>
3
1.19 MANAGING MEMBER. The Member, as set forth in Section 8.1.
1.20 MEMBER. DVI Receivables Corp. VIII, or any Assignee thereof.
1.21 MEMBERSHIP INTEREST. The rights of the Member to Distributions
(liquidating or otherwise) and allocations of the profits, losses, gains,
deductions, and credits of the Company, and, to the extent permitted by this
Agreement, to possess and exercise Management Rights.
1.22 NOTES. The Notes, as set forth in the Indenture, including any
Class F Instruments.
1.23 OFFICER. An individual appointed as an officer of the Company
pursuant to Section 8.1(c).
1.24 ORGANIZATION. A Person other than a natural person, including
without limitation corporations (both non-profit and other corporations),
partnerships (both limited and general), joint ventures, limited liability
companies, business trusts and unincorporated associations, but the term does
not include joint tenancies and tenancies by the entirety.
1.25 PERSON. An individual, trust, estate, or any Organization
permitted to be a member of a limited liability company under the laws of the
State of Delaware.
1.26 PRINCIPAL OFFICE. The Principal Office of the Company set forth in
Section 2.6.
1.27 PROCEEDING. Any administrative, judicial, or other adversary
proceeding, including without limitation litigation, arbitration, administrative
adjudication, mediation, and appeal or review of any of the foregoing.
1.28 PROPERTY. Any property, real or personal, tangible or intangible,
including money, and any legal or equitable interest in such property, but
excluding services and promises to perform services in the future.
1.29 RELATED COMPANY. The Member of the Company or any entity other
than the Company now or hereafter controlled directly or indirectly by, or under
direct or indirect common control with, the Member of the Company.
1.30 SCTA. That certain Amended and Restated Subsequent Contract
Transfer Agreement, dated of even date herewith, by and between the Company and
DVI Receivables Corp XI.
1.31 TAX CHARACTERIZATION AND ADDITIONAL TAX TERMS. For federal income
tax purposes, and to the extent applicable for state and local income and
franchise tax purposes, it is intended that the Company be disregarded as an
entity separate from the Member; provided, however, if it is determined that
there are two or more members of the Company then it is intended that the
Company be treated as a partnership for such purposes, and the Managing Member
shall (i)
<PAGE>
4
file any information returns and reports and make any elections or take any
other similar action required for the Company to be classified as a partnership
for such purposes and (ii) act as the tax matters partner of the Company
pursuant to Section 6231(a)(7) of the Code and applicable Tax Regulations.
(a) Code shall mean the Internal Revenue Code of 1986.
(b) Tax Regulations shall mean the federal income tax
regulations promulgated by the United States Treasury Department under
the Code as such Tax Regulations may be amended from time to time. All
references herein to a specific section of the Tax Regulations shall be
deemed also to refer to any corresponding provision of succeeding Tax
Regulations.
1.32 TERM. The term of this Agreement, as set forth in Section 2.4
hereof.
1.33 UNIT. One of the one hundred (100) units of Membership Interest
that are authorized to be issued under this Agreement. Each unit represents a
Membership Interest of one percent (1%). All Units issued pursuant this
Agreement are issued to the Member, as sole member of the Company.
ARTICLE II
FORMATION
2.1 ORGANIZATION. The Member hereby organizes the Company as a Delaware
limited liability company pursuant to the provisions of the Act.
2.2 AGREEMENT. (a) For and in consideration of the mutual covenants
herein contained and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, (i) the Company and DVI Receivables
Corp. VIII hereby agree to the terms and conditions of this Agreement, as it may
from time to time be amended and (ii) the Company hereby issues, assigns,
transfers and conveys all of its Membership Interests to DVI Receivables Corp.
VIII, and, prior to and at all times after the Effective Date, the term "Member"
shall be deemed to refer to DVI Receivables Corp. VIII, its successors and
assigns. It is the express intention of the Company and DVI Receivables Corp.
VIII that this Agreement shall be the sole source of agreement of the parties,
and, except to the extent a provision of this Agreement expressly incorporates
federal income tax rules by reference to sections of the Code or Tax Regulations
or is expressly prohibited or ineffective under the Act, this Agreement shall
govern, even when inconsistent with, or different than, the provisions of the
Act or any other law or rule, and to the extent any provision of this Agreement
is prohibited or ineffective under the Act, this Agreement shall be deemed to be
amended to the least extent necessary in order to make this Agreement effective
under the Act, in the event the Act is subsequently amended or interpreted in
such a way to make any provision of this Agreement that was formerly invalid
valid, such provision shall be considered to be valid from the effective date of
such interpretation or amendment.
<PAGE>
5
(b) The Company has been formed by DVI Receivables Corp. VIII
to serve as a special purpose entity in connection with securitization of
certain financial assets of DVI Receivables Corp. VIII or its Affiliates.
2.3 NAME. The name of the Company is DVI Receivables XI, L.L.C., and
all business of the Company shall be conducted under that name.
2.4 TERM. The Company shall be dissolved and its affairs wound up in
accordance with the Act and this Agreement one year and one day after the Notes
have been paid in full pursuant to the Indenture, unless the Term shall be
extended by amendment to this Agreement and the Articles.
2.5 REGISTERED AGENT AND OFFICE. The registered agent for the service
of process and the registered office shall be that Person and location reflected
in the Articles. The Member may, from time to time, change the registered agent
or office through appropriate filings with the Secretary of State of the State
of Delaware. In the event the registered agent ceases to act as such for any
reason or the registered office shall change, the Managing Member shall promptly
designate a replacement registered agent or file a notice of change of address
as the case may be.
2.6 PRINCIPAL OFFICE. The Principal Office of the Company shall be
located at
c/o DVI Financial Services Inc.
500 Hyde Park
Doylestown, PA 18901
Attention: Securitization Manager
Telephone: (215) 489-8015
or at such other address as designated by the Securitization Manager by written
notice to the Managing Member.
ARTICLE III
LIMITED PURPOSE; NATURE OF BUSINESS
3.1 LIMITED BUSINESS PURPOSE. The business purpose to be conducted or
promoted by the Company is limited to the following activities and none other:
(a) To acquire, own, purchase, hold, transfer, pledge and
otherwise deal with notes, debt, or other securities;
(b) To acquire, own, and hold one or more series of securities
("Pass-Through Securities") issued pursuant to one or more pooling
agreements (each, a "Pooling Agreement"), and to issue one or more
series of Pass-Through Securities; such Pass-Through Securities of each
series (i) will represent ownership interests in various equipment
finance contracts, the cash flow, income, payments and proceeds
therefrom and any related property and/or collections in respect
thereof, and (ii) may be structured to contain one or more classes
<PAGE>
6
of Pass-Through Securities, each class having the characteristics
specified in the related Pooling Agreement; and to sell, transfer,
assign, finance and refinance one or more Pass- Through Securities or
classes of Pass-Through Securities of any series;
(c) To issue, acquire, own and hold one or more series of debt
obligations ("Notes") with the prior written consent of Moody's
Investors Service, Inc., pursuant to one or more indentures, which
Notes are collateralized by equipment finance contracts or income,
payments or proceeds therefrom ("Funding Agreements"), Pass-Through
Securities or supplemental collateral (collectively, the "Collateral");
and to sell, transfer, assign and finance such Notes with Prudential
Securities Credit Corporation or Lehman Commercial Paper Inc. and such
other organizations as either of them shall designate;
(d) To establish one or more trusts ("Trusts") to engage in
any one or more of the activities described in any of the clauses above
or to issue, acquire, own, hold and sell a particular series of notes
to be issued pursuant to an indenture between such trust and an
indenture trustee (the "Trustee"); to receive upon the formation of any
such Trust one or more certificates ("Trust Certificates") representing
the beneficial ownership interest in such Trust; and to acquire, own,
hold, sell, transfer, assign, pledge, finance, refinance and otherwise
deal with any or all of the Trust Certificates in any such Trust;
(e) To invest and reinvest the funds received or collected by
the Company on Collateral in other investments of such types or in
other interest-bearing or discount securities, loans or other
investments;
(f) To convey or transfer all or any portion of the Company's
right, title and interest in and to the Collateral for any series of
Notes, subject and subordinate to the rights of the related
Noteholders;
(g) To transfer the Company's rights to (i) any cash flow in
excess of amounts necessary to pay holders of the Notes remitted, or to
be remitted to, the Company pursuant to an indenture with respect to
such Notes or (ii) amounts remitted or to be remitted to the Company
pursuant to a Pooling Agreement or a funding agreement;
(h) To acquire, own, hold, sell, transfer, assign, pledge,
finance, refinance and otherwise deal with (i) installment sales
contracts, equipment leases, equipment finance leases, rental and other
contract payments from leases or other contracts, equipment finance
loans and notes secured (in whole or in part) by income and proceeds
from equipment (collectively, "Contracts"), (ii) the equipment which is
the subject of such Contracts, (iii) policies of insurance relating to
such Contracts, Contract payments due thereunder, equipment, or
proceeds of any of the foregoing, (iv) any other assets which may be
incidental to the ownership of such Contracts, or (v) any participation
interest in or security based on or backed by assets described in (i)
through (iv) (collectively, "Lease Receivables");
(i) To borrow money pursuant to one or more interim finance
agreements between the Company and one or more lenders and acquiring,
owning, leasing, purchasing,
<PAGE>
7
investing, transferring, selling and/or pledging certain property to be
contributed to the Company pursuant to a contribution agreement or
subsequent contract transfer agreement in connection with such
borrowing; provided, however, that there may be only one interim
finance agreement outstanding at one time, unless all other existing
interim finance providers shall have so consented;
(j) To engage in any other acts or activities and to exercise
any power permitted to the Company under the Act so long as the same
are incidental to, or connected with, the foregoing or are necessary,
suitable or convenient to accomplish the foregoing;
(k) Provided, however, that the Company shall not engage in
any of the permitted activities set forth in (a) through (j) above if
doing so shall result in a downgrade of the rating by a nationally
recognized rating agency requested by the Company to rate the
securities related to any previously issued (by the Company or one of
the Trusts) Notes, Pass-Through Securities or Trust Certificates; and
(l) The Company shall pay its liabilities from its own assets,
and not have any liability to any Related Company or any creditor of
any Related Company.
ARTICLE IV
LIMITATIONS ON ACTIVITIES
4.1 LIMITATIONS ON ACTIVITIES. Notwithstanding any other provision of
this Agreement and any provision of law which otherwise so empowers the Company,
the Company shall not, and no Member shall have any right, power or authority to
cause the Company, without the unanimous affirmative vote of the Member's board
of directors, to perform any act in contravention of any of the following:
(a) The Company shall not
(i) consolidate or merge with or into any other
entity or person or dissolve or liquidate in whole or in part
or transfer its properties and assets substantially as an
entirety to any entity or
(ii) engage in any other action that bears on whether
the separate legal identity of the Company and the Member will
be respected, including, without limitation (A) holding itself
out as being liable for the debts of any other party; (B)
forming, or causing to be formed, any subsidiaries or (C)
acting other than in its name and through its duly authorized
officers or agents;
(b) The Company shall not engage in any joint activity or
transaction of any kind with or for the benefit of any Related Company,
including loans to or from any Related Company and any guarantee of the
indebtedness of any Related Company, except for
<PAGE>
8
(i) entering into the agreements referenced in or
contemplated by Article III,
(ii) purchasing management services and leasing
office space or equipment, in each case only to the extent
necessary for the conduct of the Company's business, and
(iii) payment of capital distributions to the Member;
(c) The Company shall not create, incur, assume, guarantee or
in any manner become liable in respect of any indebtedness, except as
stated in Article III, other than trade payables and expense accruals
incurred in the ordinary course of business and which are incident to
the business purpose of the Company as stated in Article III above;
(d) The Company shall not commingle its funds and assets with
those of any Related Company;
(e) Neither the Member nor the Company shall file or otherwise
initiate on behalf of the Company (i) a voluntary petition for relief
under any Chapter of the Bankruptcy Code, (ii) a receivership,
conservatorship or custodianship, (iii) an assignment for the benefit
of creditors or (iv) any other bankruptcy or insolvency related
proceeding;
(f) The Company shall not dissolve or wind up its affairs upon
the dissociation, dissolution or Event of Bankruptcy of any of its
Members;
(g) The Company shall not dissolve, even if it has no
remaining Members, if a personal representative of the last Member
agrees in writing to continue the Company and to act as the Member
hereunder until such time as another Member is effectively appointed
hereunder or, in the event that no such personal representative shall
agree, the Company shall make reasonable commercial efforts to cause
the Trustee to act as interim Member until a replacement Member is
effectively appointed; and
(h) In the event that the Member undergoes an Event of
Bankruptcy, the Member shall not reject the Agreement.
ARTICLE V
ACCOUNTING AND RECORDS
5.1 RECORDS TO BE MAINTAINED. The Company shall maintain the following
records at the Principal Office:
(a) a record of the full name and last known mailing address
of the Member, together with information relating to the Member's
Membership Interest;
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9
(b) a copy of the Articles and all amendments thereto,
together with executed copies of any powers of attorney pursuant to
which the Articles or any such amendment has been executed;
(c) a copy of the Company's federal, state and local income or
information tax returns and reports;
(d) a copy of this Agreement including all amendments thereto;
and
(e) the Company's books and records, including financial
statements of the Company, which shall be open to inspections by the
Member or its agents at reasonable times.
5.2 REPORTS. The Managing Member shall prepare annual reports,
including a balance sheet, statement of profit and loss and changes in the
Member's account, and a statement of cash flows.
5.3 TAX RETURNS AND REPORTS. The Managing Member shall prepare and
timely file income tax returns of the Company in all jurisdictions where such
filings are required.
5.4 RECORDS TO BE KEPT SEPARATE. The Company (a) shall maintain its
financial and accounting books and records separate from those of any other
entity or person, (b) shall pay from its assets all obligations and indebtedness
of any kind incurred by it, and shall not pay from its assets any obligations or
indebtedness of any other entity or person, and (c) shall observe all
formalities required by its Articles, this Agreement and the laws of the State
of Delaware.
ARTICLE VI
NAME AND ADDRESS OF MEMBER
The name and address (or such other address as designated by the Member
to the Company from time to time) of the Member on and after the Closing shall
be:
DVI Receivables Corp. VIII
c/o DVI Financial Services Inc.
500 Hyde Park
Doylestown, PA 18901
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10
ARTICLE VII
RIGHTS AND DUTIES OF MEMBER
7.1 LIABILITY OF MEMBER. The Member shall not have any liability for
the obligations or liabilities of the Company except to the extent provided in
the Act.
7.2 REPRESENTATIONS AND WARRANTIES. The Member hereby represents and
warrants to the Company that: (a) the Member is an entity that has power to
enter into this Agreement and to perform its obligations hereunder and that the
persons executing this Agreement on behalf of the entity have the power to do
so; and (b) the Member is acquiring its interest in the Company for the Member's
own account as an investment and without an intent to distribute the interest.
The Member acknowledges that its interest in the Company has not been registered
under the Securities Act of 1933 or any state securities laws, and may not be
resold or transferred without appropriate registration or the availability of an
exemption from such requirements.
7.3 CONFLICTS OF INTEREST.
(a) The Member shall be entitled to enter into transactions
that may be considered to be competitive with the Company, it being
expressly understood that the Member may enter into transactions that
are similar to the transactions into which the Company may enter.
Notwithstanding the foregoing, the Member shall account to the Company
and hold as trustee for it any Property, profit, or benefit derived by
the Member in the conduct and winding up of the Company business or
from a use or appropriation by the Member of Company Property including
information developed exclusively for the Company and opportunities
expressly offered to the Company.
(b) The Member does not violate a duty or obligation to the
Company merely because the Member's conduct furthers the Member's own
interest. No transaction with the Company shall be voidable solely
because the Member has a direct or indirect interest in the transaction
if the transaction is fair and reasonable to the Company.
ARTICLE VIII
MANAGEMENT
8.1 MANAGEMENT OF THE COMPANY.
(a) The Member shall be the managing member of the Company
(the "Managing Member") and, in such capacity, shall manage the Company
in accordance with this Agreement. The Managing Member is an agent of
the Company's business, and the actions of the Managing Member taken in
such capacity and in accordance with this Agreement shall bind the
Company.
(b) The Managing Member shall have full, exclusive and
complete discretion to manage and control the business and affairs of
the Company, to make all decisions affecting
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11
the business and affairs of the Company and to take all such actions as
it deems necessary or appropriate to accomplish the purpose of the
Company as set forth herein. The Managing Member shall be the sole
person or entity with the power to bind the Company, except and to the
extent that such power is expressly delegated to any other person or
entity by the Managing Member, and such delegation shall not cause the
Managing Member to cease to be the Member or the Managing Member. There
shall not be a "manager" (within the meaning of the Act) of the
Company.
(c) The Managing Member may appoint individuals ("Officers")
with or without such titles as it may elect, including the titles of
President, Vice President, Treasurer, Secretary, and Assistant
Secretary, to act on behalf of the Company with such power and
authority as the Managing Member may delegate in writing to any such
persons.
8.2 AUTHORITY OF MANAGING MEMBER TO BIND THE COMPANY. Only the Managing
Member, the officers and authorized agents of the Company shall have the
authority to bind the Company. Subject to Section 4.1, the Managing Member has
the power, on behalf of the Company, to do all things necessary or convenient to
carry out the business and affairs of the Company (as described in Article III),
including, without limitation:
(a) the institution, prosecution and defense of any Proceeding
in the Company's name;
(b) the entering into contracts;
(c) investment and reinvestment of the Company's funds, and
receipt and holding of Property as security for repayment;
(d) the conduct of the Company's business, the establishment
of Company offices, and the exercise of the powers of the Company;
(e) the appointment of employees and agents of the Company,
the defining of their duties and the establishment of their
compensation, and the dealing with tradespeople, accountants and
attorneys, on such terms as the Managers shall determine;
(f) the indemnification of any Person;
(g) the making of such elections under the Code and Tax
Regulations and other relevant tax laws as to the treatment of items of
Company income, gain, loss, deduction and credit, and as to all other
relevant matters as the Managing Member deems necessary or appropriate,
including without limitation, elections referred to in Section 754 of
the Code, the determination of which items of cash outlay shall be
capitalized or treated as current expenses, and the selection of the
method of accounting and bookkeeping procedures to be used by the
Company;
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12
(h) the amendment of any provision to this Agreement;
provided, however, that no provision of Article III and Article IV of
this Agreement or Sections 8.01, 8.06 and 5.04 of the SCTA shall be
amended without the consent of both of the Independent Directors of the
Member.
8.3 ACTIONS OF THE MANAGING MEMBER. The Managing Member has the power
to bind the Company as provided in this Article VIII. No Person dealing with the
Company shall have any obligation to inquire into the power or authority of the
Managing Member acting on behalf of the Company.
8.4 COMPENSATION OF MANAGING MEMBER. The Managing Member shall be
reimbursed for all reasonable expenses incurred in managing the Company and
shall be entitled to compensation in an amount to be determined from time to
time by consent of the Member, in its sole discretion. The Managing Member shall
not be required to devote full time to the management of the Company business,
but only so much time as shall be necessary or appropriate for the proper
management of such business.
8.5 MANAGING MEMBER'S STANDARD OF CARE. The Managing Member shall
discharge its duties to the Company in good faith and with that degree of care
that an ordinarily prudent person in a similar position would use under similar
circumstances. In discharging its duties, the Managing Member shall be fully
protected in relying in good faith upon the records required to be maintained
under Article VI and upon such information, opinions, reports or statements by
any Person as to matters the Managing Member reasonably believes are within such
other Person's professional or expert competence and who has been selected with
reasonable care by or on behalf of the Company, including information, opinions,
reports or statements as to the value and amount of the assets, liabilities,
profits or losses of the Company or any other facts pertinent to the existence
and amount of assets from which Distributions to the Member might properly be
paid. The Company shall indemnify and hold harmless the Managing Member against
any loss, damage or expense (including attorneys' fees) incurred by the Managing
Member as a result of any act performed or omitted on behalf of the Company or
in furtherance of the Company's interests without, however, relieving the
Managing Member of liability for failure to perform his or her duties in
accordance with the standards set forth herein. The satisfaction of any
indemnification and any holding harmless shall be from and limited to Company
Property.
8.6 RESIGNATION. Other than as set forth in Section 4.1(g) hereof, the
Member shall not resign or disassociate itself from the Company at any time
without first obtaining the effective appointment of a successor Member approved
by the Rating Agencies..
8.7 PAYMENT OF LIABILITIES. The Member shall at all times pay its
liabilities from its own assets, and not have any liability to any Related
Company or any creditor thereof.
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13
ARTICLE IX
CONTRIBUTIONS
9.1 MEMBERSHIP INTEREST. The Member holds all of the Units of
Membership Interest.
9.2 CONTRIBUTIONS. The Member is not required to make any Capital
Contribution to the Company.
9.3 WITHDRAWAL. The Member shall not be entitled to withdraw any part
of its Capital Contribution or to receive any distribution from the Company,
except after payment in full of all outstanding debt securities of the Company
or otherwise as specifically provided in this Agreement.
9.4 INTEREST. The Member shall not be entitled to interest on any
Capital Contribution or on any profits retained by the Company.
9.5 NO PERSONAL LIABILITY. The Member shall not have any liability for
the obligations or liabilities of the Company except to the extent provided in
the Act.
ARTICLE X
ALLOCATIONS AND DISTRIBUTIONS
10.1 TAXABLE INCOME ALLOCATIONS. Profits and losses, and each item of
Company income, gain, loss, deduction, credit and tax preference with respect
thereto, for each Fiscal Year (or shorter period in respect of which such items
are to be allocated) shall be allocated to the Member; provided, however, if it
is determined that there are two or more members of the Company, then such items
shall be allocated among the members in accordance with their respective
economic interests in the Company, determined generally by taking into account
the priorities of cash distributions set forth in the Indenture, the actual
distributions and the economic allocation of losses and other expenses among the
Members.
10.2 DISTRIBUTIONS. Distributions shall be made to the Member or its
designee in accordance with the Indenture.
ARTICLE XI
TRANSFER OF MEMBERSHIP INTEREST
11.1 COMPLIANCE WITH SECURITIES LAWS. No Unit of Membership Interest
has been registered under the Securities Act of 1933, as amended, or under any
applicable state securities laws. The Member may not transfer (a transfer, for
purposes of this Agreement, shall be deemed to include, but not be limited to,
any sale, transfer, assignment, pledge, creation of a security interest or other
Disposition) all or any part of the Member's Units of Membership Interest,
except upon compliance with the applicable federal and state securities laws.
The Managing Member shall have no obligation to register the Member's Units of
Membership Interest under the Securities Act of
<PAGE>
14
1933, as amended, or under any applicable state securities laws, or to make any
exemption therefrom available to the Member.
11.2 TRANSFER OF ECONOMIC INTEREST. The right to receive allocations of
profits and losses and to receive Distributions may not be transferred in whole
or in part unless the following terms and conditions have been satisfied:
The transferor shall have:
(a) assumed all costs incurred by the Company in connection
with the transfer;
(b) furnished the Company with a written opinion of counsel,
satisfactory in form and substance to counsel for the Company, that
such transfer complies with applicable federal and state securities
laws and this Agreement and that such transfer, for federal income tax
purposes, will not cause the termination of the Company under Section
708(b) of the Code, cause the Company to be treated as an association
taxable as a corporation for income tax purposes or otherwise adversely
affect the Company or the Member; and
(c) complied with such other conditions as the Managing Member
may reasonably require from time to time.
Transfers will be recognized by the Company as effective only upon the close of
business on the last day of the calendar month following satisfaction of the
above conditions. Any transfer in contravention of this Article XII and any
transfer which if made would cause a termination of the Company for federal
income tax purposes under Section 708(b) of the Code shall be void AB INITIO and
ineffectual and shall not bind the Company.
11.3 TRANSFER OF MEMBERSHIP INTEREST.
(a) The Member may not sell, assign, encumber, transfer or
otherwise Dispose of any Units of its Membership Interest (or take or
omit to take any action, filing, election or other action that could
result in a deemed sale, assignment, encumbrance, transfer or other
Disposition); provided, however that the Member may make such a
transfer to an Affiliate of the Member, which Affiliate shall have a
special purpose charter and bylaws substantially similar in all
material respects to those of the Member. Any attempted Disposition not
in accordance with this Agreement shall be void.
(b) Upon the transfer of units and admission of an additional
Member in accordance with this Agreement, this Agreement shall be
amended to reflect the admission of the substitute Member, and the
Member shall take any action required to record to reflect such
admission.
11.4 STATUS OF TRANSFEREE. A transferee of a Unit of Membership
Interest shall be entitled to receive that share of Profits, Losses and
Distributions, and the return of any Capital Contribution to which the
transferor would otherwise be entitled with respect to the interest transferred,
and shall
<PAGE>
15
have the rights of the transferring Member of the Company under the Act or this
Agreement. The Company shall also, if the transferee and transferor jointly
advise the Company in writing of a transfer of the Unit of Membership Interest,
furnish the transferee with pertinent tax information at the end of each Fiscal
Year.
11.5 DISSOLUTION OR BANKRUPTCY OF THE MEMBER. Upon the dissolution or
adjudication of bankruptcy of the Member, the Member's successors or assigns
shall have all the rights of the Member for the purpose of settling or managing
the Member's estate.
ARTICLE XII
DISSOLUTION AND WINDING UP
12.1 DISSOLUTION. The Company shall be dissolved and its affairs wound
up, upon the first to occur of any of the following events (each of which shall
constitute a Dissolution Event):
(a) the expiration of the Term of this Agreement, unless the
Company is continued with the consent of the Member, in its sole
discretion; or
(b) the determination in writing of the Managing Member to
dissolve and terminate the Company; provided, however, that the
Managing Member shall not, and the Managing Member hereby agrees not
to, take any action to dissolve or terminate the Company prior to the
expiration of the Term;
(c) the entry of a decree of judicial dissolution pursuant to
the Act; or
(d) the occurrence of an Event of Bankruptcy as to a Member or
the resignation, expulsion or dissolution of a Member or the occurrence
of any other event that terminates the membership of a Member, unless,
within 90 days of such event, there is at least one remaining Member
and the remaining Members unanimously agree to continue the business of
the Company, in which event the Company shall not be dissolved and the
Company and the business of the Company shall be continued; provided,
however, that if any Member is a partnership or a limited liability
company on the date of such occurrence, the dissolution of such Member
as a result of the dissolution, termination, resignation, death,
incompetence, removal or Event of Bankruptcy of a partner or member in
such partnership or limited liability company, as the case may be,
shall not be an event of dissolution of this Company if the business of
such Member is continued by its remaining partner(s) or member(s), as
the case may be, either alone or with additional partners or members,
and such Member and such partners or members comply with any other
applicable requirements of this Agreement; or
(e) the passage of 30 days after the sale or other disposition
of all or substantially all the assets of the Company (except that if
the Company receives an installment obligation as consideration for
such sale, the Company shall continue, unless sooner dissolved under
the provisions of this Agreement, until such time as such note or notes
are paid in full).
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16
Upon the dissolution of the Company for any reason, the Member shall
proceed promptly to wind up the affairs of and liquidate the Company; provided,
however, that if the Notes are outstanding, the Member shall not liquidate the
assets of the Company securing the Notes, except as permitted by the deed of
trust and assignment of leases pursuant to which such assets were encumbered,
without the consent of the secured party under such document, which may continue
to exercise all of its rights under such document and shall have complete and
independent ability to retain such assets until the Notes have been paid in full
or otherwise completely discharged pursuant to the Indenture. Subject to the
foregoing, the Member shall have reasonable discretion to determine the time,
manner and terms of any sale or sales of the Company's property pursuant to such
liquidation.
12.2 EFFECT OF DISSOLUTION. Upon dissolution, the Company shall not be
terminated and shall continue until the winding up of the affairs of the Company
is completed and a certificate of dissolution has been issued by the Secretary
of State of Delaware.
12.3 DISTRIBUTION OF ASSETS ON DISSOLUTION. Upon the winding up of the
Company, the Managing Member shall take full account of the assets and
liabilities of the Company, shall liquidate the assets (unless the Managing
Member determines that a distribution of any Company Property in- kind would be
more advantageous to the Member than the sale thereof) as promptly as is
consistent with obtaining the fair value thereof, and shall apply and distribute
the proceeds therefrom in the following order:
(a) first, to the payment of the debts and liabilities of the
Company to creditors, including the Member, if it is a creditor, to the
extent permitted by law, in satisfaction of such debts and liabilities,
and to the payment of necessary expenses of liquidation;
(b) second, to the setting up of any reserves which the
Managing Member may deem necessary or appropriate for any anticipated
obligations or contingencies of the Company arising out of or in
connection with the operation or business of the Company. Such reserves
may be paid over by the Managing Member to an escrow agent or trustee
selected by the Managing Member to be disbursed by such escrow agent or
trustee in payment of any of the aforementioned obligations or
contingencies and, if any balance remains at the expiration of such
period as the Managing Member shall deem advisable, shall be
distributed by such escrow agent or trustee in the manner hereinafter
provided;
(c) then, to the Member.
Liquidation proceeds shall be paid within 60 days of the end of the Company's
taxable year in which the liquidation occurs. Such distributions shall be in
cash or Property (which need not be distributed proportionately) or partly in
both, as determined by the Managing Member.
If at the time of liquidation the Managing Member shall determine that an
immediate sale of some or all Company Property would cause undue loss to the
Member, the Managing Member may, in order to avoid such loss, defer liquidation.
<PAGE>
17
12.4 WINDING UP AND FILING ARTICLES OF DISSOLUTION. Upon the
commencement of the winding up of the Company, articles of dissolution shall be
delivered by the Company to the Secretary of the State of Delaware for filing.
The articles of dissolution shall set forth the information required by the Act.
The winding up of the Company shall be completed when all debts, liabilities,
and obligations of the Company have been paid and discharged or reasonably
adequate provision therefor has been made, and all of the remaining Property of
the Company has been distributed to the Member.
ARTICLE XIII
MISCELLANEOUS
13.1 NOTICES. Notices to the Member shall be sent to the Principal
Office of the Company. Any notice or other communication required or permitted
hereunder shall be in writing, and shall be deemed to have been given with
receipt confirmed if and when delivered personally, given by prepaid telegram or
mailed first class, postage prepaid, delivered by courier, or sent by facsimile,
to the Member at such address.
13.2 HEADINGS. All Article and section headings in this Agreement are
for convenience of reference only and are not intended to qualify the meaning of
any Article or section.
13.3 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
between the parties and supersedes any prior agreement or understanding between
them respecting the subject matter of this Agreement.
13.4 BINDING AGREEMENT. This Agreement shall be binding upon, and inure
to the benefit of, the parties hereto and their permitted successors and
assigns.
13.5 SAVING CLAUSE. If any provision of this Agreement, or the
application of such provision to any Person or circumstance, shall be held
invalid, the remainder of this Agreement, or the application of such provision
to Persons or circumstances other than those as to which it is held invalid,
shall not be affected thereby. If the operation of any provision of this
Agreement would contravene the provisions of the Act, such provision shall be
void and ineffectual.
13.6 COUNTERPARTS. This Agreement may be executed in several
counterparts, and all so executed shall constitute one agreement, binding on all
the parties hereto, even though all parties are not signatory to the original or
the same counterpart. Any counterpart of either this Agreement shall for all
purposes be deemed a fully executed instrument.
13.7 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware.
13.8 NO MEMBERSHIP INTENDED FOR NONTAX PURPOSES. The Member has formed
the Company under the Act, and expressly does not intend hereby to form a
partnership, either general or limited, under the Delaware partnership laws.
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18
13.9 NO RIGHTS OF CREDITORS AND THIRD PARTIES UNDER AGREEMENT. This
Agreement is entered into between the Company and the Member for the exclusive
benefit of the Company, its Member, and their successors and assignees. This
Agreement is expressly not intended for the benefit of any creditor of the
Company or any other Person. Except and only to the extent provided by
applicable statute, no such creditor or any third party shall have any rights
under this Agreement or any agreement between the Company and the Member with
respect to any Capital Contribution or otherwise.
13.10 GENERAL INTERPRETIVE PRINCIPLES. For purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Agreement include the plural as
well as the singular, and the use of any gender herein shall be deemed
to include the other gender;
(b) accounting terms not otherwise defined herein have the
meanings given to them in the United States in accordance with
generally accepted accounting principles;
(c) references herein to "Sections", "paragraphs", and other
subdivisions without reference to a document are to designated
Sections, paragraphs and other subdivisions of this Agreement;
(d) a reference to a paragraph without further reference to a
Section is a reference to such paragraph as contained in the same
Section in which the reference appears, and this rule shall also apply
to other subdivisions;
(e) the words "herein", "hereof", "hereunder" and other words
of similar import refer to this Agreement as a whole and not to any
particular provision; and
(f) the term "include" or "including" shall mean without
limitation by reason of enumeration.
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[AMENDED AND RESTATED LIMITED LIABILITY COMPANY OPERATING AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands
and seals as of the Effective Date.
DVI Receivables Corp. VIII
By: /s/ John B. Boyle
-------------------
Name: John B. Boyle
Title: Vice President & CEO
DVI Receivables XI, L.L.C.
By: DVI Receivables Corp. VIII
Its Managing Member
By: /s/ John B. Boyle
-------------------
Name: John B. Boyle
Title: Vice President & CEO
