COPELCO CAPITAL FUNDING CORP. X
________% CLASS A-1 LEASE-BACKED NOTES, SERIES 1997-A
________% CLASS A-2 LEASE-BACKED NOTES, SERIES 1997-A
________% CLASS A-3 LEASE-BACKED NOTES, SERIES 1997-A
________% CLASS A-4 LEASE-BACKED NOTES, SERIES 1997-A
________% CLASS B LEASE-BACKED NOTES, SERIES 1997-A
FORM OF UNDERWRITING AGREEMENT
________, 1997
▇▇▇▇▇▇ BROTHERS INC.
Three World Financial Center
New York, New York 10285
FIRST UNION CAPITAL MARKETS CORP.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇-▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Copelco Capital Funding Corp. X, a corporation organized and existing under
the laws of Delaware (the "Issuer") and Copelco Capital, Inc., a corporation
organized and existing under the laws of Delaware ("Copelco"), hereby agree with
you as follows:
Section 1. Issuance and Sale of Notes. The Issuer has authorized the
issuance of $_________________ (the "Class A-1 Initial Principal Amount") of
______% Class A-1 Lease-Backed Notes, Series 1997-A (the "Class A-1 Notes");
_________________ (the "Class A-2 Initial Principal Amount") of ______% Class
A-2 Lease-Backed Notes, Series 1997-A (the "Class A-2 Notes");
$_________________ (the "Class A-3 Initial Principal Amount") of ______% Class
A-3 Lease-Backed Notes, Series 1997-A (the "Class A-3 Notes");
$_________________ (the "Class A-4 Initial Principal Amount"; together with the
Class A-1 Initial Principal Amount, Class A-2 Initial Principal Amount and Class
A-3 Initial Principal Amount, the "Class A Initial
Principal Amount") of ______% Class A-4 Lease-Backed Notes, Series 1997-A (the
"Class A-4 Notes"; together with the Class A-1 Notes, Class A-2 Notes and Class
A-3 Notes, the "Class A Notes"); $_______________ (the "Class B Initial
Principal Amount") of _____% Class B Lease-Backed Notes, Series 1997-A (the
"Class B Notes"; together with the Class A Notes, the "Offered Notes") and
$_________________ (the "Class C Initial Principal Amount"; together with the
Class A Initial Principal Amount and the Class B Initial Principal Amount, the
"Initial Principal Amount") of ____% Class C Lease-Backed Notes, Series 1997-A
(the "Class C Notes"; together with the Offered Notes, the "Notes"). The Notes
will be issued pursuant to an Indenture, dated as of ______________, 1997 (the
"Indenture"), between the Issuer and Manufacturers and Traders Trust Company
(the "Trustee"). The Notes are more fully described in the Final Prospectus (as
defined below), a copy of which the Issuer is furnishing to you. The Notes will
evidence secured debt obligations of the Issuer. The assets of the Issuer will
include a pool of primarily business equipment and medical equipment lease
contracts, including all payments due thereunder (the "Leases") and certain
interests in the underlying equipment (the "Equipment"). Capitalized terms used
and not defined herein shall have the meanings specified in the Indenture.
The Class A Notes will be sold by the Issuer to all of you as underwriters
(the "Class A Underwriters"). Class B Notes will be sold by the Issuer to ▇▇▇▇▇▇
Brothers Inc. and First Union Capital Markets Corp. only (the "Class B
Underwriters").
The terms which follow, when used in this Agreement, shall have the
meanings indicated:
"Effective Date" means each date that the Registration Statement and
any post-effective amendment or amendments thereto became or become
effective under the Securities Act.
"Execution Time" means the date and time that this Agreement is
executed and delivered by the parties hereto.
"Final Prospectus" means any prospectus delivered to purchasers of the
Offered Notes at or before the time of confirmation of their purchases.
"Preliminary Prospectus" means any preliminary prospectus included in
the Registration Statement, and which, as of the Effective Date, omits Rule
430A Information.
"Registration Statement" means the registration statement referred to
in the preceding paragraph and any registration statement required to be
filed under the Securities Act or rules thereunder, including amendments,
incorporated documents, exhibits and financial statements, in the form in
which it has or shall become effective and, in the event that any
post-effective amendment thereto becomes effective prior to the Issuance
Date, shall also mean such registration statement as so amended. Such term
shall include Rule 430A Information deemed to be included therein at the
Effective Date as provided by Rule 430A.
"Rule 424" and "Rule 430A" refers to such rules under the Securities
Act.
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"Rule 430A Information" means information with respect to the Offered
Notes and the offering thereof permitted, pursuant to Rule 430A, to be
omitted from the Registration Statement when it becomes effective.
"Underwriter" means any of ▇▇▇▇▇▇ Brothers Inc., First Union Capital
Markets Corp. or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated.
"Underwriting Information" has the meaning given to such term in
Section 8(b) hereof.
Section 2. Purchase and Sale of Offered Notes.
(a) Subject to the terms and conditions and in reliance upon the covenants,
representations and warranties set forth herein, the Class A Underwriters agree
to purchase from the Issuer the Class A Initial Principal Amount of the Class A
Notes and the Class B Underwriters agree to purchase from the Issuer the Class B
Initial Principal Amount of the Class Notes pursuant to the terms of this
Agreement on the Issuance Date at the purchase price or prices (the "Purchase
Price") set forth on Schedule A attached hereto.
(b) The obligations of each of the Underwriters hereunder to purchase the
respective Offered Notes of each Class shall be several and not joint. Each
Underwriter's obligation shall be to purchase the aggregate principal amount of
Offered Notes of the related Class as is indicated with respect to each
Underwriter on Schedule A attached hereto. The rights of the Issuer, Copelco and
the non-defaulting Underwriter shall be as set forth in Section 13 hereof.
(c) It is understood that the Underwriters propose to offer the Offered
Notes for sale to the public in the manner set forth in the Final Prospectus.
Section 3. Delivery and Payment. (a) Delivery of and payment for the
Offered Notes to be purchased by the Underwriters shall be made at the offices
of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, at 10:00
A.M., New York time, on _____________, 1997 (the "Issuance Date"). The Offered
Notes shall be registered in the names of the Underwriters against payment by
the Underwriters of the Purchase Price therefor, to or upon the order of the
Issuer by one or more wire transfers in immediately available funds. Following
the Effective Date, at the request of the Underwriters, delivery of one or more
global notes (the "Global Notes") representing the Offered Notes shall be made
to the respective accounts of the Underwriters against delivery to the Trustee
of the originally issued Offered Notes (the date of such delivery being
hereinafter referred to as the "Exchange Date"). The Global Notes to be so
delivered shall be registered in the name of Cede & Co., as nominee for The
Depository Trust Company ("DTC"). The interests of beneficial owners of the
Offered Notes will be represented by book entries on the records of DTC and
participating members thereof. Definitive Notes representing the Offered Notes
will be available under the circumstances described in the Indenture.
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The Issuer agrees to have the Global Notes available for inspection,
checking and packaging by the Underwriters in New York, New York, not later than
1:00 p.m., New York City time, on the Business Day prior to the Exchange Date.
Section 4. Representations and Warranties. (a) The Issuer hereby represents
and warrants to, and agrees with, the Underwriters as follows:
(i) The Issuer meets the requirements for use of Form S-1 under the
Securities Act of 1933, as amended (the "Securities Act") and has filed
with the Securities and Exchange Commission (the "Commission") a
registration statement (Registration No. 333-23679), including the
Preliminary Prospectus relating to the Offered Notes, on such Form S-1 for
the registration under the Securities Act of the Offered Notes. The Issuer
may have filed one or more amendments thereto, including the related
Preliminary Prospectus, each of which has previously been furnished to you.
The Issuer will file with the Commission either, (A) prior to the
effectiveness of such Registration Statement, a further amendment thereto
(including the form of Final Prospectus) or, (B) after effectiveness of
such Registration Statement, a Final Prospectus in accordance with Rules
43OA and 424(b)(1) or (4). In the case of clause (B), the Issuer will
include in such Registration Statement, as amended at the Effective Date,
all information (other than Rule 430A Information) required by the
Securities Act and the rules thereunder to be included with respect to the
Offered Notes and the offering thereof. As filed, such amendment and form
of Final Prospectus, or such Final Prospectus, shall include all Rule 430A
Information and, except to the extent you shall agree in writing to a
modification, shall be in all substantive respects in the form furnished to
you prior to the Execution Time or, to the extent not completed at the
Execution Time, shall contain only such specific additional information and
other changes (beyond that contained in the latest Preliminary Prospectus
which has previously been furnished to you) as the Issuer has advised you,
prior to the Execution Time, will be included or made therein.
(ii) On the Effective Date, the Registration Statement did or will
comply in all material respects with the applicable requirements of the
Securities Act and the rules thereunder; on the Effective Date and when the
Final Prospectus is first filed (if required) in accordance with Rule
424(b) and on the Issuance Date, the Final Prospectus will comply in all
material respects with the applicable requirements of the Securities Act
and the rules thereunder; on the Effective Date, the Registration Statement
did not or will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; and the Final
Prospectus, as of its date and on the Issuance Date, did not or will not
include any untrue statement of a material fact or 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 the Issuer makes no representations or warranties as to the
Underwriting Information.
(iii) This Agreement has been duly authorized, executed and delivered
by the Issuer and constitutes a legal, valid and binding agreement of the
Issuer enforceable
4
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 Indenture and the Sales and Servicing Agreement have
been duly authorized by the Issuer and, when executed and delivered by the
Issuer, will constitute the legal, valid and binding obligation of the
Issuer, enforceable in accordance with its terms.
(v) The issuance of the Offered Notes has been duly authorized by the
Issuer and, when duly and validly executed, authenticated and delivered in
accordance with the Indenture and this Agreement, 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.
(vi) The issue and sale of the Offered Notes and the performance of
this Agreement, the Indenture and the Sales and Servicing Agreement by the
Issuer 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 any law, governmental rule or regulation, or any judgment,
decree or order binding on the Issuer or its properties, or any of the
provisions of any indenture, mortgage, deed of trust, contract or other
agreement or instrument to which the Issuer is a party or by which it is
bound or (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 issue and sale of the Offered Notes or the consummation by
the Issuer of the transactions contemplated by this Agreement, 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 Offered Notes
by the Underwriters.
(vii) The Issuer is not, and will not, as of the Issuance Date, be an
"investment company" under the Investment Company Act of 1940, as amended
(the "1940 Act").
(viii) The Issuer hereby makes and repeats each of the representations
and warranties set forth in Article Eleven of the Indenture. 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) Copelco hereby represents and warrants to and agrees with the
Underwriters as follows:
(i) This Agreement has been duly authorized, executed and delivered,
the Sales and Servicing Agreement has been duly authorized, and this
Agreement constitutes, and when executed and delivered, the Sales and
Servicing Agreement will constitute the legal, valid and binding
obligations of Copelco, enforceable in accordance
5
with their respective terms, except that the provisions hereof relating to
indemnification of the Underwriters may be subject to limitations of public
policy.
(ii) The performance of this Agreement by Copelco, and the
consummation by Copelco of the transactions herein 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 judgment,
decree or order binding on Copelco or its properties, or any of the
provisions of any indenture, mortgage, deed of trust, contract or other
agreement or instrument to which Copelco is a party or by which it is bound
or (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 court or governmental agency or body is required for the
consummation by Copelco of the transactions contemplated by this Agreement,
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 Offered Notes by the Underwriters.
(iii) Copelco hereby makes and repeats the representations and
warranties set forth in Section 2 of the Sales and Servicing 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) Copelco represents and warrants it has delivered to the
Underwriters complete and correct copies of its balance sheet and
statements of income and retained earnings reported by Copelco Capital Inc.
and Copelco Financial Services Group, Inc. (the "Copelco Entities") for the
year ended December 31, 1996. Except as set forth in or contemplated in the
Registration Statement and the Final Prospectus, there has been no material
adverse change in the condition (financial or otherwise) of the Copelco
Entities since December 31, 1996.
(v) Any taxes, fees and other governmental charges arising from the
execution and delivery of this Agreement, the Sales and Servicing Agreement
and the Indenture and in connection with the execution, delivery and
issuance of the Offered Notes and with the transfer of the Leases and the
Equipment, have been paid or will be paid by the Issuer.
(c) Each of the Issuer and Copelco represents and warrants to you, jointly
and severally, 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, the Sales and Servicing Agreement, the
Indenture or the Offered Notes, (B) seeking to prevent the issuance of the
Offered Notes or the consummation of any of the transactions contemplated
by this Agreement, the Sales and Servicing Agreement or the Indenture or
(C) seeking any determination or ruling that might materially and adversely
affect (x) its
6
performance of its obligations under this Agreement, the Sales and
Servicing Agreement or the Indenture (as applicable) or (y) the validity or
enforceability of this Agreement, the Sales and Servicing Agreement, the
Indenture or the Offered Notes.
(ii) KMPG-Peat Marwick is an independent public accountant with
respect to the Copelco Entities and the Issuer within the meaning of the
Securities Act and the rules and regulations promulgated thereunder.
Section 5. Covenants of the Issuer and Copelco. The Issuer and Copelco,
jointly and severally, hereby covenant and agree with you as follows:
(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 Final Prospectus is otherwise required under Rule 424(b),
the Issuer will file the Final 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 Issuer 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 Final Prospectus or for any additional information, (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 Issuer of any notification with
respect to the suspension of the qualification of the Offered Notes for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Issuer will not file any amendment of the Registration Statement or
supplement to the Final Prospectus to which the Underwriters reasonably object.
The Issuer and Copelco 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 a Final Prospectus relating to the Offered Notes
is required to be delivered under the Securities Act, any event occurs as a
result of which the Final 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
Final Prospectus to comply with the Securities Act or the rules thereunder, the
Issuer 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 Issuer will make generally available to
Offered Noteholders and to the Underwriters an earnings statement or statements
of the Issuer which will satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 under the Securities 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
7
long as delivery of a prospectus by any of the Underwriters or any dealer may be
required by the Securities Act, as many copies of each Final Prospectus relating
to the Offered Notes and any supplement thereto as the Underwriters may
reasonably request.
(e) Copelco and the Issuer will take all reasonable actions requested by
the Underwriters to arrange for the qualification of the Offered Notes for sale
under the laws of such jurisdictions within the United States or as necessary to
qualify for DTC and as the Underwriters may designate, will maintain such
qualifications in effect so long as required for the completion of the
distribution of the Offered Notes, provided, in connection therewith the Issuer
shall not be required to qualify as a foreign corporation doing business in any
jurisdiction.
(f) For so long as the Offered Notes are outstanding, the Issuer and
Copelco shall deliver to the Underwriters by first-class mail and as soon as
practicable a copy of all reports and notices delivered to the Trustee or the
Offered Noteholders under the Indenture.
(g) For so long as the Offered Notes are outstanding, the Issuer and
Copelco will furnish to the Underwriters as soon as practicable after filing any
other information concerning the Issuer or Copelco 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(g) hereof is conditional upon the furnishing of
documents reasonably available to the Issuer or Copelco, the Issuer and Copelco
shall furnish such documents.
Section 6. Conditions of Underwriters' Obligation. The obligations of the
Underwriters to purchase and pay for the Offered Notes on the Issuance Date
shall be subject to the accuracy in all material respects of the representations
and warranties of the Issuer and Copelco herein, in the Sales and Servicing
Agreement and in the Indenture, to the performance by the Issuer and Copelco in
all material respects of their obligations hereunder and to the following
additional conditions:
(a) The Issuer and Copelco shall each have delivered a certificate (an
"Officer's Certificate"), dated the Issuance Date, signed by its President and
its Chief Financial Officer, to the effect that:
(i) the representations and warranties made by the Issuer or Copelco
(as the case may be) in this Agreement, the Indenture and the Sales and
Servicing Agreement are true and correct in all material respects at and as
of the date of such Officer's Certificate as if made on and as of such date
(except to the extent they expressly relate to an earlier date);
(ii) the Issuer or Copelco (as the case may be) has complied with all
the agreements and satisfied all the conditions on its part to be performed
or satisfied under this Agreement, the Indenture and the Sales and
Servicing Agreement at or prior to the date of such Officer's Certificate;
8
(iii) nothing has come to such officer's attention that would lead him
to believe that the Final Prospectus contains any untrue statement of a
material fact or omits to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; and
(iv) such officer is not aware of (A) any request of the Commission
for further amendment of the Registration Statement or the Final Prospectus
for any additional information, (B) the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or
the initiation or threatening of any proceeding for that purpose or (C) any
notification with respect to the suspension of the qualification of the
Offered Notes for sale in any jurisdiction or the threatening of any
proceeding for that purpose.
(b) You shall have received from ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq., a favorable
opinion (subject to customary and usual qualifications), dated the Issuance Date
and reasonably satisfactory in form and substance to the Underwriters and their
counsel with respect to, or to the effect that: (i) the due formation and
qualification of each of the Issuer and Copelco and that the Issuer and Copelco,
as applicable, have the corporate power and authority to perform this Agreement,
the Sales and Servicing Agreement, the Indenture and the Placement Agreement
(the "Transaction Documents") and the transactions contemplated herein and
therein; (ii) the due authorization, execution, delivery and enforceability of
this Agreement and the other Transaction Documents as applicable, by the Issuer
and Copelco; (iii) each of this Agreement and the other Transaction Documents
are the legal, valid and binding obligation of the Issuer and Copelco, as
applicable, enforceable against each of them in accordance with its terms
(subject to customary exceptions relating to bankruptcy and laws affecting
creditors' rights); (iv) the Notes have been duly authorized, executed and
delivered by the Issuer and constitute the legal, valid and binding obligations
of the Issuer, enforceable in accordance with their terms (subject to customary
exceptions as to bankruptcy and laws affecting creditors' rights) and are
entitled to the benefits of the Indenture; (v) the issuance and sale of the
Notes by the Issuer, the performance of this Agreement by the Issuer and Copelco
and the compliance by the Issuer and Copelco with the terms of the Transaction
Documents, as applicable, and the consummation of the transactions contemplated
herein and therein will not conflict with the organizational documents of the
Issuer or Copelco, or to the best of such counsel's knowledge, any other
contracts to which the Issuer or Copelco is a party or by which either of them
is bound; (vi) to the best of such counsel's knowledge, there is no legal or
governmental proceeding threatened or pending against the Issuer or Copelco
which would have a material adverse effect on the issuance of the Notes; (vii)
in the event a court disregarded the intent of the parties and characterized the
transfers as a pledge of collateral, the Sales and Servicing Agreement and
accompanying documentation creates a valid security interest in the Leases and
the Equipment (or interests therein) under New Jersey law; (viii) assuming no
prior financing statements covering the Leases are in effect based on a review
of certain UCC searches, that financing statements covering the Leases and
naming (A) the Issuer as secured party and Copelco as debtor and (B) the Issuer
as debtor and the Trustee as secured party are being filed in the appropriate
filing offices of the State of New Jersey, and assuming that the Trustee has
taken possession of the Leases, the Trustee has a first priority perfected
security interest in all right, title and interest of Copelco and the Issuer in
the Leases; and (ix) on the Issuance Date the Registration Statement is
effective, and, that to the best of such
9
counsel's knowledge no stop order suspending the effectiveness of the
Registration Statement has been issued or is threatened, and that although such
counsel is not passing on the factual accuracy, completeness or fairness of the
statements contained in the Registration Statement and the Prospectus, nothing
came to such counsel's attention that leads such counsel to believe that either
the Registration Statement or the Prospectus (as of the Effective Date or the
date of the Prospectus) contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made not misleading. In rendering such opinion, counsel may rely, to the extent
deemed proper and as stated therein, as to matters of fact on certificates of
responsible officers of the Issuer or Copelco and public officials and as to
matters of state law of jurisdictions other than the jurisdictions in which such
counsel is admitted to practice, on opinions of local counsel satisfactory to
the Underwriters.
(c) The Underwriters shall have received from ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, special
counsel for the Underwriters, such opinion or opinions, dated the Issuance Date,
with respect to the validity of the Offered Notes, the Registration Statement,
the Final Prospectus, true sale, nonconsolidation and other related matters as
the Underwriters may require.
(d) At the Execution Time and at the Issuance Date, KMPG-Peat Marwick shall
have furnished to the Underwriters a letter or letters, dated the date of this
Agreement and the Issuance Date, respectively, in form and substance
satisfactory to the Underwriters.
(e) The Class A Notes shall have been rated at least _____, the Class B
Notes shall have been rated at least _____ and the Class C Notes have been rated
at least _____, by at least one nationally recognized rating agency, which
ratings shall not have been reduced or withdrawn as evidenced by the Officer's
Certificate referred to in Section 6(b).
(f) Counsel to the Trustee shall have delivered a favorable opinion
(subject to customary and usual exceptions), dated the Issuance Date, as the
case may be, and satisfactory in form and substance to the Underwriters and
counsel for the Underwriters and to the Issuer and Copelco and their counsel
with respect to, or to the effect that: (i) the due incorporation and valid
existence of the Trustee, (ii) the due authorization, execution and delivery by
the Trustee of the Indenture, (iii) the Indenture is the legal, valid and
bending obligation of the Trustee, enforceable against the Trustee in accordance
with its terms (subject to customary and usual exceptions), (iv) no approvals or
filings with any Governmental Authority required in connection with the
execution, delivery or performance by the Trustee of the Indenture and (v) the
execution, delivery and performance of the Indenture will not cause any default
under the Trustee's organizational documents or other contracts to which it is a
party or by which it is bound.
(g) The Underwriters shall have received the approval of each of their
respective investment committees with respect to the execution, delivery and
performance of this Agreement.
(h) All proceedings in connection with the transactions contemplated by
this Agreement and all documents incident hereto shall be reasonably
satisfactory in form and
10
substance to you, and you and your special counsel shall have received such
other information, certificates and documents as you or they may reasonably
request.
Section 7. Reimbursement of Expenses. In the event that (x) no closing of
the sale of the Offered Notes occurs by the Issuance Date through no fault of
the Issuer or Copelco or because the conditions set forth in Sections 6(c),
6(d), 6(e), 6(f) and 6(g) have not been met, or (y) the Underwriters terminate
the engagement pursuant to Section 10 or because any conditions precedent in
Section 6 (other than Section 6(d)) have not been fulfilled, then the Issuer and
Copelco's liability to the Underwriters shall be limited to the reimbursement of
the Underwriters' expenses incurred through the date of termination for its
reasonable out-of-pocket and incidental expenses. In addition, whether or not
the Offered Notes are issued or sold:
(a) The Issuer or Copelco 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:
(i) Rating Agency fees payable with respect to their ratings of the
Notes;
(ii) fees charged by the firm of independent public accountants
referred to in Section 6(e);
(iii) filing fees in connection with the transactions contemplated
hereby including, but not limited to, the Commission;
(iv) fees and expenses of counsel to the Underwriters;
(v) Trustee's fees and fees of counsel to the Trustee;
(vi) the costs and expenses of printing the Registration Statement and
the Prospectus;
(vii) the costs of printing or reproducing this Agreement, the Blue
Sky Survey and any other documents in connection with the offer, sale and
delivery of the Offered Notes;
(viii) all expenses in connection with the qualification of the
Offered 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;
(ix) the cost of preparing the Offered 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, however, that Copelco does not hereby waive any
rights to reimbursement from
11
the Underwriters in the event of any of the Underwriters' failure to
perform in accordance with this Agreement.
(b) It is understood and agreed that, except as provided in Section 8 and
9, the Underwriters will pay securities transfer taxes on resale of any of the
Offered Notes by them, and any advertising expenses connected with any offers
they may make.
Section 8. Indemnification and Contribution. (a) The Issuer and Copelco,
jointly and severally, will indemnify and hold harmless each Underwriter against
any losses, claims, damages or liabilities, joint or several, to which such
Underwriter may become subject, under the Securities Act or otherwise, insofar
as such losses, claims, damages or liabilities (or actions 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 Final
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 or necessary to make the statements therein not misleading,
and will promptly reimburse such 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, however, that the Issuer
and Copelco 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 Final Prospectus or any such amendment or
supplement, in reliance upon and in conformity with the Underwriting
Information (defined below).
(b) Each Underwriter agrees severally, and not jointly, to indemnify and
hold harmless the Issuer and Copelco against any losses, claims, damages or
liabilities to which the Issuer or Copelco may become subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions 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, the Final 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 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 Registration Statement or the Final
Prospectus or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Issuer or Copelco by or on
behalf of such Underwriter expressly for use therein; and will reimburse the
Issuer or Copelco for any legal or other expenses reasonably incurred by the
Issuer or Copelco 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. The Issuer and Copelco acknowledge that the statements set
forth in the last paragraph of the cover page and under the heading
"Underwriting" in the Registration Statement, the Preliminary Prospectus and the
Final Prospectus constitute the only information furnished in writing by or on
behalf of the Underwriters for inclusion in the Registration Statement or the
Final Prospectus (the "Underwriting Information"), and each of you confirm that
such statements are correct.
12
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above 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, however, 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 interests with any other indemnified party. Upon receipt of notice
from the indemnifying party to such indemnified party of its election so to
appoint counsel to defend such action and approval by the 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 next preceding sentence, (ii) the indemnifying party shall not
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 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 indemnified 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) above in respect of any losses, claims, damages or liabilities (or actions
or proceedings in respect thereof) 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
13
received by the Issuer and Copelco on the one hand and the Underwriters on the
other from the offering of the Offered 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) above, 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 Issuer or Copelco 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 Issuer or Copelco 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 Issuer and Copelco
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
Final 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 Issuer or Copelco 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 Issuer, Copelco 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 subsection
(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 provisions of 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
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(e) The obligations of the Issuer and Copelco under this Section 8 shall be
in addition to any liability which the Issuer or Copelco may otherwise have and
shall extend, upon the same terms and conditions, to each person, if any, who
controls any of the Underwriters within the meaning of the Securities 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 Issuer and
Copelco and to each person, if any, who controls the Issuer or Copelco within
the meaning of the Securities Act.
Section 9. Survival. The respective representations, warranties and
agreements of the Issuer, Copelco 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 Issuer,
Copelco or the Underwriters, and such representations, warranties and agreements
made by the Issuer and Copelco shall survive the delivery and payment for the
14
Offered Notes. The provisions of Section 7 and 8 shall survive the termination
or cancellation of this Agreement.
Section 10. Termination. (a) This Agreement may be terminated by you at any
time upon the giving of notice at any time prior to the Issuance Date: (i) if
there has been, since December 31, 1996, any material adverse change in the
condition, financial or otherwise, of Copelco or the Issuer, or in the earnings,
business affairs or business prospects of Copelco or the Issuer, whether or not
arising in the ordinary course of business, or (ii) if there has occurred any
outbreak or escalation of hostilities or other calamity or crisis the effect of
which on the financial markets of the United States is such as to make it, in
your reasonable judgment, impracticable to market the Offered Notes or enforce
contracts for the sale of the Offered Notes, or (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 Section 7 or 8 hereof.
(b) This Agreement may not be terminated by the Issuer or Copelco, except
in accordance with law, without the written consent of the Underwriters.
(c) Notwithstanding anything herein to the contrary, in the event the
Issuer or Copelco 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 cancelled by the Underwriters by notice thereof to
the Issuer or Copelco. Any such cancellation shall be without liability of any
party to any other party except that the provisions of Sections 8 and 9 hereof
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 you, addressed to you, at the addresses first stated in this Agreement, or to
such other address as you may designate in writing to the Issuer and Copelco; if
to Copelco, addressed to Copelco at East Gate Center, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, if to the Issuer, addressed to Copelco at East
Gate Center, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-5400, or such
other address as Copelco or the Issuer may have designated in writing to you.
Section 12. Successors. This Agreement will inure to the benefit of and be
binding upon the Issuer and Copelco and their successors and assigns and the
Underwriters and their respective successors and assigns.
Section 13. Default by One of the Underwriters. If one of the Underwriters
shall fail on the Closing Date to purchase the Class A Notes or Class B Notes,
as the case may be,
15
which it is obligated to purchase hereunder (the "Defaulted Notes"), the
remaining Underwriter(s) (the "Non-Defaulting Underwriter(s)") 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 Underwriter(s) 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 Underwriter(s).
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 or the Company 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.
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) THE ISSUER AND COPELCO 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 HEREOF 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
ISSUER AND COPELCO HEREBY WAIVE ANY OBJECTION BASED ON FORUM NON CONVENIENS, AND
ANY OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER AND CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE
COURT. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF THE ISSUER OR COPELCO
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) THE ISSUER AND COPELCO 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.
16
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.
If you are in agreement with the foregoing, please sign a counterpart
hereof and return the same to the Issuer or Copelco, whereupon this Agreement
shall become a binding agreement between the Underwriters, and the Issuer and
Copelco.
17
Very truly yours,
COPELCO CAPITAL, INC.
By: ____________________________
Name:
Title:
COPELCO CAPITAL FUNDING CORP. X
By: ____________________________
Name:
Title:
The foregoing Agreement is hereby accepted and entered into as of the date
hereof.
▇▇▇▇▇▇ BROTHERS INC.,
As Class A Underwriter and Class B Underwriter
By: ____________________________
Name:
Title:
FIRST UNION CAPITAL MARKETS CORP.,
As Class A Underwriter and Class B Underwriter
By: ____________________________
Name:
Title:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED,
As Class A Underwriter
By: ____________________________
Name:
Title:
SCHEDULE A
Purchase Price
Class A Notes Class B Notes
▇▇▇▇▇▇ Brothers Inc. $__________ $__________
First Union Capital Markets Corp. $__________ $__________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated $__________ N.A.
