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EXHIBIT 1.1
TLFC IV EQUIPMENT LEASE TRUST 1996-1
$127,848,986 CLASS A 5.98% LEASE BACKED NOTES
TL LEASE FUNDING CORP. IV
(SELLER)
TRANS LEASING INTERNATIONAL, INC.
(SERVICER)
UNDERWRITING AGREEMENT
November 20, 1996
FIRST UNION CAPITAL MARKETS CORP.
One First Union Center
Charlotte, North Carolina 28288-0735
Dear Sirs:
TL Lease Funding Corp. IV, a Delaware corporation (the
"Seller"), proposes to form an owner trust, TLFC IV Equipment Lease Trust
1996-1 (the "Trust"), pursuant to a Trust Agreement (the "Trust Agreement") to
be dated as of November 26, 1996 between the Seller and Bankers Trust
(Delaware), as owner trustee (the "Owner Trustee"), which will issue (i)
$127,848,986 aggregate principal amount of its Class A 5.98% Lease Backed Notes
(the "Class A Notes") and (ii) $13,536,951 aggregate principal amount of its
Class B 6.64% Lease Backed Notes (the "Class B Notes"; and together with the
Class A Notes, the "Notes") pursuant to an Indenture to be dated as of November
26, 1996 (the "Indenture") between the Trust and Manufacturers & Traders Trust
Company, as trustee (the "Indenture Trustee"). The Class B Notes are
subordinate to the Class A Notes and are not being sold hereunder. The assets
of the Trust (the "Trust Fund") will include leases which cover a variety of
new and used "small-ticket" medical and office equipment and automobiles and
light-duty trucks or interests therein (the "Leases"), collections thereunder
due after October 31, 1996 (the "Cutoff Date"), interests in the underlying
equipment (the "Equipment"; and together with the Leases, the "Receivables"),
the lease files with respect to the Leases and certain physical damage
insurance policies with respect to the Equipment, together with the proceeds
thereof. The Seller will acquire the Leases, the Equipment and related assets
from Trans Leasing International, Inc. who will service such Leases, Equipment
and related assets for the Trust ("Trans Leasing"; and in its capacity as
Servicer, the "Servicer"). The Notes will be secured by the Trust Fund
pursuant to the Indenture. The beneficial interest in the Trust will be
represented by a certificate (the "Trust Certificate") which will initially be
issued to the Seller in partial consideration for the Leases, the Equipment and
related assets transferred to the
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Trust by the Seller under the Pooling and Servicing Agreement to be dated as of
November 26, 1996 among the Seller, the Servicer and the Trust (the "Pooling
and Servicing Agreement"). Capitalized terms used and not otherwise defined
herein shall have the meanings given them in the Pooling and Servicing
Agreement.
This is to confirm the agreement concerning your purchase of
the Class A Notes from the Seller.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF TRANS
LEASING AND THE SELLER. Trans Leasing and the Seller jointly and severally
represent and warrant to and agree with you that:
(a) A registration statement on Form S-3 (No. 33-95108),
together with Amendments Nos. 1 and 2 thereto, has been filed by the
Seller with the Securities and Exchange Commission (the "Commission")
and has become effective under the Securities Act of 1933, as amended
(the "Securities Act"). Such registration statement may have been
amended or supplemented from time to time prior to the date hereof.
Any such amendment or supplement was filed with the Commission in
accordance with the Securities Act and the rules and regulations of
the Commission thereunder (the "Rules and Regulations"). The Seller
proposes to file with the Commission pursuant to Rule 424(b)(4) of the
Rules and Regulations a prospectus supplement (the "Prospectus
Supplement") to the prospectus dated November 20, 1996, relating to
the Class A Notes and the method of distribution thereof. Copies of
such registration statement, any amendment or supplement thereto, such
prospectus and the Prospectus Supplement have been previously
delivered to you. Such registration statement, including exhibits
thereto and such prospectus, as amended or supplemented to the date
hereof, and as further supplemented by the Prospectus Supplement, are
hereinafter referred to as the "Registration Statement" and the
"Prospectus," respectively. The conditions to the use of a
registration statement on Form S-3 under the Securities Act have been
satisfied.
(b) The Registration Statement, at the time it became
effective, any post-effective amendment thereto, at the time it became
effective, and the Prospectus, as of the date of the Prospectus
Supplement, complied in all material respects with the applicable
requirements of the Securities Act and the Rules and Regulations and
the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the rules and regulations of the Commission thereunder and
did not include any untrue statement of a material fact and, in the
case of the Registration Statement and any post-effective amendment
thereto, did not omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading
and, in the case of the Prospectus, did not omit to state any material
fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading; on the
Closing Date (as hereinafter defined), the Registration Statement and
the Prospectus, as amended or supplemented as of the Closing Date,
will comply in all material respects with the applicable requirements
of the Securities Act and the Rules
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and Regulations and the Trust Indenture Act and the rules and
regulations of the Commission thereunder and neither the Prospectus
nor any amendment or supplement thereto will 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. The
representation and warranty in the preceding sentence does not apply
to (i) that part of the Registration Statement which shall constitute
the Statement of Eligibility and Qualification (Form T-1) of the
Indenture Trustee under the Trust Indenture Act or (ii) that
information contained in or omitted from the Registration Statement or
the Prospectus (or any amendment or supplement thereto) in reliance
upon and in conformity with the Underwriter's Information (as defined
herein). The form of the Indenture has been qualified under the Trust
Indenture Act.
(c) The Seller has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with power and authority to own its properties and to
conduct its business as such properties are presently owned and such
business is presently conducted, and had at all relevant times, and
now has, power, authority and legal right to acquire, own and sell the
Receivables.
(d) The representations and warranties of the Seller in
Section 3.02 of the Contribution and Sale Agreement and Section 2.4 of
the Pooling and Servicing Agreement will be true and correct as of the
Closing Date.
(e) The representations and warranties of Trans Leasing in
Sections 3.01 of the Contribution and Sale Agreement and of the
Servicer in Section 3.6 of the Pooling and Servicing Agreement will be
true and correct as of the Closing Date.
(f) Each of the Seller and Trans Leasing has the power and
authority to execute and deliver this Agreement and to carry out the
terms of this Agreement and the execution, delivery and performance by
each of the Seller and Trans Leasing of this Agreement have been duly
authorized by each of the Seller and Trans Leasing by all necessary
corporate action.
(g) This Agreement has been duly executed and delivered by
Trans Leasing and the Seller.
(h) When authenticated by the Indenture Trustee in accordance
with the Indenture and delivered and paid for pursuant to this
Agreement, the Class A Notes will be duly issued and constitute legal,
valid and binding obligations of the Trust enforceable against the
Trust in accordance with their terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, or other
similar laws affecting the enforcement of creditors' rights in general
and by general principles of equity, regardless of whether such
enforcement is considered in a proceeding in equity or at law.
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(i) The execution, delivery and performance of this Agreement
and the consummation by each of the Seller and Trans Leasing of the
transactions contemplated hereby shall not conflict with, result in
any breach of any of the terms and provisions of or constitute (with
or without notice or lapse of time) a default under, the certificate
of incorporation or by-laws of such party, or any indenture, agreement
or other instrument to which either such party is a party or by which
it is bound, or violate any law or, to either such party's knowledge,
any order, rule or regulation applicable to such party of any court or
of any federal or state regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over such party
or any of its properties which conflict, breach, default or violation
would reasonably be expected to (x) have a material adverse effect on
the condition (financial or otherwise), results of operations or
business of the Seller or Trans Leasing, as the case may be, or (y)
have a material adverse effect on the ability of the Seller or Trans
Leasing, as the case may be, to perform its obligations under this
Agreement or any of the agreements contemplated hereby; and, except
for the registration of the Class A Notes under the Securities Act,
the qualification of the Indenture under the Trust Indenture Act and
such consents, approvals, authorizations, registrations or
qualifications as may be required under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and applicable state securities
laws in connection with your purchase and distribution of the Class A
Notes no permit, consent, approval of, or declaration to or filing
with, any governmental authority is required in connection with the
execution, delivery and performance of this Agreement or the
consummation of the transactions contemplated hereby.
(j) To either of the Seller's or Trans Leasing's knowledge,
there are no proceedings or investigations pending or threatened
before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality having jurisdiction over such
party or its properties against such party or its properties (i)
asserting the invalidity of this Agreement or any of the Class A
Notes, (ii) seeking to prevent the issuance of any of the Class A
Notes or the consummation of any of the transactions contemplated by
this Agreement, (iii) seeking any determination or ruling that might
materially and adversely affect the performance by such party of its
obligations under, or the validity or enforceability of, the Class A
Notes or this Agreement, or (iv) that may adversely affect the federal
or state income, excise, franchise or similar tax attributes of the
Class A Notes.
(k) There are no contracts or other documents which are
required to be described in the Prospectus or filed as exhibits to the
Registration Statement by the Securities Act or by the Rules and
Regulations and which have not been so described or filed.
(l) The Seller (i) is not in violation of its certificate of
incorporation or by-laws, (ii) is not in default, in any material
respect, and no event has occurred which, with notice or lapse of time
or both, would constitute such a default, in the due performance or
observance of any term, covenant or condition contained in any
indenture, agreement, mortgage, deed of trust or other instrument to
which the Seller is a party
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or by which the Seller is bound or to which any of the Seller's
property or assets is subject or (iii) is not in violation in any
respect of any law, order, rule or regulation applicable to the Seller
or any of the Seller's property of any court or of any federal or
state regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over it or any of its property,
except any violation or default that would not reasonably be expected
to have a material adverse effect on the condition (financial or
otherwise), results of operations, business or prospects of the
Seller.
(m) The Contribution and Sale Agreement, the Pooling and
Servicing Agreement, the Trust Agreement, the Indenture and the
Administration Agreement conform in all material respects with the
descriptions thereof contained in the Registration Statement and the
Prospectus.
(n) Neither the Trust nor the Seller is required to be
registered under the Investment Company Act of 1940, as amended.
(o) None of Trans Leasing, the Seller or anyone acting on the
Seller's behalf has taken any action that would require qualification
of the Trust Agreement or the Pooling and Servicing Agreement under
the Trust Indenture Act.
2. PURCHASE BY THE UNDERWRITER. On the basis of the
representations, warranties and agreements contained herein, and subject to the
terms and conditions set forth herein, the Seller agrees to issue and sell to
you and you agree to purchase from the Seller, the Class A Notes at a purchase
price equal to 99.685% of the principal amount thereof plus accrued interest
from November 20, 1996 to the Closing Date. In addition the Seller agrees to
pay to you a structuring fee of $127,849 on the Closing Date.
The Seller shall not be obligated to deliver any of the Class
A Notes except upon payment for all the Class A Notes to be purchased as
provided herein. You shall promptly notify the Seller of the completion of the
distribution of the Class A Notes.
3. DELIVERY OF AND PAYMENT FOR THE CLASS A NOTES. Delivery
of and payment for the Class A Notes shall be made at the office of Xxxxxxxx &
Xxxxx, or at such other place as shall be agreed upon by you and the Seller, at
10:00 A.M., New York City time, on November 26, 1996, or at such other date or
time, not later than seven full business days thereafter, as shall be agreed
upon by you and the Seller (such date and time being referred to herein as the
"Closing Date"). On the Closing Date, the Seller shall deliver or cause to be
delivered to you the Class A Notes against payment to or upon the order of the
Seller of the purchase price by wire transfer in immediately available funds.
Time shall be of the essence, and delivery at the time and place specified
pursuant to this Agreement is a further condition of your obligation. Upon
delivery, the Class A Notes shall be represented by one or more global
certificates registered in the name of Cede & Co., as nominee of The Depository
Trust Company ("DTC"). The interest of the beneficial owners of the Class A
Notes will be represented by book-entries on the records of DTC and
participating members thereof. Definitive certificates representing the Class
A Notes will be available only under limited circumstances.
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4. FURTHER AGREEMENTS OF THE SELLER. The Seller agrees with
you:
(a) To file the Prospectus Supplement with the Commission
pursuant to and in accordance with Rule 424(b)(4) of the Rules and
Regulations within the time period prescribed by such rule and provide
evidence satisfactory to First Union of such timely filing.
(b) During any period in which a prospectus relating to the
Class A Notes is required to be delivered under the Securities Act:
advise you promptly of any proposal to amend the Registration
Statement or amend or supplement the Prospectus, furnish a copy
thereof to you and your counsel and not to amend or supplement the
Prospectus unless the form of such amendment or supplement is
reasonably satisfactory to you; to advise you promptly of (i) the
effectiveness of any post-effective amendment to the Registration
Statement, (ii) any request by the Commission for any amendment of the
Registration Statement or the Prospectus or for any additional
information, (iii) the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
initiation or threatening of any proceedings for that purpose, (iv)
the issuance by the Commission of any order preventing or suspending
the use of any prospectus relating to the Class A Notes or the
initiation or threatening of any proceedings for that purpose and (v)
the receipt by the Seller of any notification with respect to the
suspension of the qualification of the Class A Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose; and to use best efforts to prevent the issuance of any
such stop order or of any order preventing or suspending the use of
any prospectus relating to the Class A Notes or suspending any such
qualification and, if any such stop order or order of suspension is
issued, to obtain the lifting thereof at the earliest possible time.
(c) If, during any period in which a prospectus relating to
the Class A Notes is required to be delivered under the Securities Act
but in no event after February 18, 1997, any event shall have occurred
as a result of which the Prospectus, as then amended or supplemented,
would include an untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein,
in the light of the circumstances when such Prospectus is delivered to
a purchaser, not misleading, or if for any other reason it shall be
necessary at such time to amend or supplement the Prospectus in order
to comply with the Securities Act, to notify you immediately thereof,
and to promptly prepare and file with the Commission, subject to
paragraph (b) of this Section 4, an amendment or a supplement to the
Prospectus such that the statements in the Prospectus, as so amended
or supplemented will not, in the light of the circumstances when the
Prospectus is delivered to a purchaser, be misleading, or such that
the Prospectus will comply with the Securities Act. You hereby agree
that if you receive a notice from the Seller pursuant to this
paragraph (c), you will not deliver the Prospectus in connection with
any sales of the Class A Notes after receipt of such notice until the
Prospectus is so amended or supplemented unless otherwise required by
law (except for any such requirement arising as a result of voluntary
actions taken by you after receipt of such notice).
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(d) During the period described in paragraph (c) of this
Section 4, to deliver promptly without charge to you such number of
the following documents as you may from time to time reasonably
request: (i) conformed copies of the Registration Statement as
originally filed with the Commission and each amendment thereto (in
each case excluding exhibits other than this Agreement, the
Contribution and Sale Agreement, the Pooling and Servicing Agreement,
the Trust Agreement, the Indenture and the Administration Agreement)
and (ii) any preliminary prospectus supplement with respect to the
Class A Notes, the Prospectus and any amendment or supplement thereto.
(e) During the period described in paragraph (c) of this
Section 4, to file promptly with the Commission any amendment to the
Registration Statement or the Prospectus or any supplement to the
Prospectus requested by the Commission.
(f) For so long as any of the Class A Notes are outstanding,
to furnish to you (i) copies of all materials furnished by the Trust
to its Securityholders and all reports and financial statements
furnished by the Trust to the Commission pursuant to the Exchange Act
or any rule or regulation of the Commission thereunder and (ii) from
time to time, such other information concerning the Seller and the
Trust as you may reasonably request.
(g) Promptly from time to time to take such action as you may
reasonably request to qualify the Class A Notes for offering and sale
under the securities laws of such jurisdictions as you may request and
to comply with such laws so as to permit the continuance of sales and
dealings therein in such jurisdictions for as long as may be necessary
to complete the distribution of the Class A Notes; provided that in
connection therewith the Seller shall not be required to qualify as a
foreign corporation, to file a general consent to service of process
in any jurisdiction or to subject itself to taxation.
(h) For a period of 90 days from the date of the Prospectus,
to not offer for sale, sell, contract to sell or otherwise dispose of,
directly or indirectly, or file a registration statement for, or
announce any offering of, any securities collateralized by, or
evidencing an ownership interest in, a pool of equipment leases (other
than the Notes, the Trust Certificate and notes for borrowed money
under a credit facility) without your prior written consent.
(i) For a period from the date of this Agreement until the
retirement of the Class A Notes, or until such time as you shall no
longer maintain a secondary market in the Class A Notes, whichever
occurs first, to deliver to you the annual statement of compliance and
the annual independent certified public accountants' report furnished
to the Owner Trustee and the Indenture Trustee, pursuant to the
Pooling and Servicing Agreement, as soon as such statements and
reports are furnished to the Owner Trustee and the Indenture Trustee,
respectively.
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(j) To the extent, if any, that the initial rating provided
with respect to the Class A Notes by the Standard & Poor's Ratings
Group ("S&P") and Xxxxx'x Investors Service, Inc. ("Xxxxx'x) is
conditional upon the furnishing of documents or the taking of any
other actions by Trans Leasing or the Seller, to furnish such
documents and take any such other actions.
5. CONDITIONS OF UNDERWRITER'S OBLIGATIONS. Your obligations
hereunder are subject to the accuracy in all material respects, when made and
on the Closing Date, of the representations and warranties of Trans Leasing and
the Seller contained herein, to the accuracy in all material respects of the
statements of Trans Leasing or the Seller made in any certificates pursuant to
the provisions hereof, to the performance in all material respects by the
Seller of its obligations hereunder, and to each of the following additional
terms and conditions:
(a) Prior to the Closing Date, no stop order suspending the
effectiveness of the Registration Statement or any part thereof shall
have been issued and remain outstanding and no proceeding for that
purpose shall have been initiated and not terminated or threatened by
the Commission; and any request of the Commission for inclusion of
additional information in the Registration Statement or the Prospectus
or otherwise shall have been complied with to the reasonable
satisfaction of you; and the Seller shall have filed the Prospectus
Supplement with the Commission pursuant to Rule 424(b)(4) of the Rules
and Regulations within the time period prescribed by such rule.
(b) All corporate proceedings and other legal matters
incident to the authorization, form and validity of this Agreement,
the Class A Notes, the Trust Certificate, the Contribution and Sale
Agreement, the Pooling and Servicing Agreement, the Trust Agreement,
the Indenture and the Administration Agreement, the Registration
Statement and the Prospectus, and all other legal matters relating to
such agreements and the transactions contemplated hereby and thereby
shall be reasonably satisfactory in all material respects to your
counsel, and the Seller shall have furnished to such counsel all
documents and information that they may reasonably request to enable
them to pass upon such matters.
(c) Xxxxxxxx & Xxxxx shall have furnished to you their
written opinion, as counsel to the Seller, addressed to you and dated
the Closing Date, in substantially the form of Exhibit A hereto.
(d) Xxxxxxxx & Xxxxx shall have furnished to you their
written opinion, as counsel to the Seller, addressed to you and dated
the Closing Date, in form and substance reasonably satisfactory to
you, with respect to the characterization of the transfer of the
Receivables by Trans Leasing to the Seller pursuant to the
Contribution and Sale Agreement as a sale and the non-consolidation of
Trans Leasing and the Seller.
(e) You shall have received from Xxxxxxx Xxxxxxx & Xxxxxxxx,
your counsel, such opinion or opinions, dated the Closing Date, with
respect to such matters as you
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may require, and the Seller shall have furnished to such counsel such
documents as they reasonably request for enabling them to pass upon
such matters.
(f) Xxxxxxxx, Xxxxxx & Xxxxxx shall have furnished to you
their written opinion, as counsel to the Owner Trustee, addressed to
you and dated the Closing Date, in substantially the form of Exhibit B
hereto.
(g) Xxxxxxx, Xxxx, Xxxxxxx, Xxxxx & Goodyear shall have
furnished to you their written opinion, as counsel to the Indenture
Trustee, addressed to you and dated the Closing Date, in substantially
the form of Exhibit C hereto.
(h) You shall have received a letter dated the date hereof
(the "Procedures Letter") from Deloitte & Touche LLP verifying the
accuracy of such financial and statistical data contained in the
Prospectus as you shall deem advisable, other than the statistical
data appearing in the Prepayment Table in the Prospectus Supplement.
In addition, if any amendment or supplement to the Prospectus made
after the date hereof contains financial or statistical data, you
shall have received a letter dated the Closing Date confirming the
Procedures Letter and providing additional comfort on such new data on
substantially the same basis as provided in the Procedures Letter.
(i) You shall have received certificates, dated the Closing
Date, of any of the Chairman of the Board, the President, any Vice
President and the chief financial officer of each of Trans Leasing and
the Seller stating that (A) the representations and warranties of
Trans Leasing or the Seller, as the case may be, contained in this
Agreement, the Contribution and Sale Agreement, the Pooling and
Servicing Agreement, the Trust Agreement, the Indenture and the
Administration Agreement are true and correct in all material respects
on and as of the Closing Date, (B) Trans Leasing or the Seller, as the
case may be, has complied in all material respects with all agreements
and satisfied in all material respects all conditions on its part to
be performed or satisfied hereunder and under such agreements at or
prior to the Closing Date, (C) no stop order suspending the
effectiveness of the Registration Statement has been issued and is
outstanding and no proceedings for that purpose have been instituted
and not terminated or, to the best of his or her knowledge, are
contemplated by the Commission, and (D) since September 30, 1996,
there has been no material adverse change in the financial position or
results of operations of Trans Leasing, the Seller or the Trust or any
change, or any development including a prospective change, in or
affecting the condition (financial or otherwise), results of
operations or business of Trans Leasing, the Seller or the Trust
except as set forth in or contemplated by the Registration Statement
and the Prospectus. Any officer making such certification may rely
upon his or her knowledge as to the proceedings pending or threatened.
(j) The Class A Notes shall have been given a rating by both
S&P and Moody's that is equal to or better than the rating required
for the Class A Notes as set forth in the Prospectus Supplement.
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(k) Subsequent to the execution and delivery of this
Agreement there shall not have occurred any of the following:
(i) trading in securities generally on the New York Stock
Exchange, the American Stock Exchange or the over-the-counter
market shall have been suspended or limited, or minimum prices
shall have been established on either of such exchanges or
such market by the Commission, by such exchange or by any
other regulatory body or governmental authority having
jurisdiction, or trading in securities of Trans Leasing on any
exchange or in the over-the-counter market shall have been
suspended or (ii) a general moratorium on commercial banking
activities shall have been declared by Federal or New York
State authorities or (iii) an outbreak or escalation of
hostilities or a declaration by the United States of a
national emergency or war or such a material adverse change in
general economic, political or financial conditions (or the
effect of international conditions on the financial markets in
the United States shall be such) as to make it, in your
judgment impracticable or inadvisable to proceed with the
public offering or the delivery of the Class A Notes on the
terms and in the manner contemplated in the Prospectus.
(l) The Trust Certificate shall have been duly authenticated
by the Owner Trustee in accordance with the Trust
Agreement and delivered and paid for in accordance with the
Pooling & Servicing Agreement.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance reasonably
satisfactory to your counsel.
6. TERMINATION. Your obligations hereunder may be terminated
by you, in your absolute discretion, by notice given to and received by the
Seller prior to delivery of and payment for the Class A Notes if, prior to that
time, any of the events described in Section 5(k) shall have occurred.
7. INDEMNIFICATION. (a) Trans Leasing and the Seller shall,
jointly and severally, indemnify and hold harmless you and each person, if any,
who controls you within the meaning of Section 15 of the Securities Act
(collectively referred to for the purposes of this Section 7 and Section 8 as
you) against any loss, claim, damage or liability, joint or several, to which
you may become subject, under the Securities Act or otherwise, insofar as such
loss, claim, damage or liability (or any action in respect thereof) arises out
of or is based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus supplement related to the
Class A Notes, the Registration Statement or the Prospectus or in any amendment
or supplement thereto or (ii) the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they are made,
not misleading, and shall reimburse you for any legal or other out-of-pocket
expenses reasonably incurred by you directly in connection with investigating
or preparing to defend or defending against or appearing as a third party
witness in connection with any such loss, claim, damage or liability (or any
action in respect thereof) as such expenses are incurred; provided, however,
that neither Trans Leasing nor the Seller shall be liable in any such case to
the extent that any such loss, claim, damage or liability (or any action in
respect thereof) arises out of or is based upon an
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untrue statement or alleged untrue statement in or omission or alleged omission
from (A) any preliminary prospectus supplement, the Registration Statement or
the Prospectus or any such amendment or supplement in reliance upon and in
conformity with the Underwriter's Information or (B) the Current Report on Form
8-K dated November 18, 1996 (the "Current Report") which the Seller proposes to
file with the Commission pursuant to Section 15(d) of the Securities Exchange
Act of 1934, as amended; provided further that as to any preliminary prospectus
or preliminary prospectus supplement related to the Class A Notes this
indemnity agreement shall not inure to the benefit of you, your officers or
employees or any person controlling you on account of any loss, claim, damage,
liability or action arising from the sale of Class A Notes to any person by you
if you failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented, to that person within the time required by the
Securities Act, and the untrue statement or alleged untrue statement of any
material fact or omission or alleged omission to state a material fact in such
preliminary prospectus or preliminary prospectus supplement was corrected in
the Prospectus, unless such failure resulted from non- compliance by the Seller
with Section 4(c); and provided further that as to any amended or supplemented
Prospectus this indemnity agreement shall not inure to the benefit of you, your
officers or employees or any person controlling you on account of any loss,
claim, damage, liability or action arising from the sale of Class A Notes to
any person by you if, at the time that you are required by the Securities Act
to send or give a copy of the Prospectus to such person, an amended or
supplemented Prospectus has been made available to you and you failed to send
or give a copy of such amended or supplemented Prospectus to that person within
the time required by the Securities Act, and the untrue statement or alleged
untrue statement of any material fact or omission or alleged omission to state
a material fact in the Prospectus was corrected in such amended or supplemented
Prospectus, unless such failure resulted from non-compliance by the Seller with
Section 4(c).
(b) You shall indemnify and hold harmless Trans Leasing,
the Seller, each of the Seller's directors, each officer of the Seller who
signed the Registration Statement and each person, if any, who controls the
Seller within the meaning of Section 15 of the Securities Act (collectively
referred to for the purposes of this Section 7 and Section 8 as the Seller),
against any loss, claim, damage or liability, joint or several, to which the
Seller may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage or liability (or any action in respect thereof) arises
out of or is based upon (i) (A) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus
supplement, the Registration Statement or the Prospectus or in any amendment or
supplement thereto or (B) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they are made, not
misleading, but in each case only to the extent that the untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with the written information furnished to the Seller by
you or on your behalf specifically for use therein or (ii) the failure to
deliver to any person the information contained in the Current Report prior to
the date of the filing of the Current Report, and shall reimburse the Seller
for any legal or other expenses reasonably incurred by the Seller in connection
with investigating or preparing to defend or defending against or appearing as
third party witness in connection with any such loss, claim, damage or
liability (or any action in respect thereof) as such expenses are incurred.
The parties acknowledge and
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agree that the written information furnished to the Seller by you or on your
behalf (the "Underwriter's Information") consists solely of the paragraph below
the footnotes on the cover page of the Prospectus Supplement concerning the
terms of the offering and the third paragraph of text and the last sentence of
the seventh paragraph of text under the caption "Underwriting" in the
Prospectus Supplement.
(c) Promptly after receipt by an indemnified party under
this Section 7 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under this Section 7, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 7 except to the extent it has
been materially prejudiced by such failure; and, provided, further, that the
failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section 7. If any such claim or action shall be brought against an indemnified
party, and it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent that it
wishes, jointly with any other similarly notified indemnifying party, to assume
the defense thereof with counsel reasonably satisfactory to the indemnified
party. After notice from the indemnifying party to the indemnified party of
its election to assume the defense of such claim or action, the indemnifying
party shall not be liable to the indemnified party under this Section 7 for any
legal or other out-of-pocket expenses subsequently incurred by the indemnified
party in connection with the defense thereof other than reasonable costs of
investigation; provided, however, that the Seller and Trans Leasing, on the one
hand, and you, on the other hand, shall have the right to employ one counsel to
represent jointly the Seller and Trans Leasing, on the one hand, and you, on
the other hand (and its controlling persons who may be subject to liability
arising out of any claim in respect of which indemnity may be sought under this
Section 7) if, in the reasonable judgment of such party, it is advisable for
such party (and such controlling persons) to be jointly represented by separate
counsel (reasonably acceptable to the indemnifying party) because there may be
one or more legal defenses available to such parties which are different from
or additional to those available to the indemnifying party and the
representation of both the indemnified party and the indemnifying would be
inappropriate, and in that event the fees and expenses of such separate counsel
shall be paid by the indemnifying party. Each indemnified party, as a
condition of the indemnity agreements contained in Sections 7(a) and 7(b),
shall use all reasonable efforts to cooperate with the indemnifying party in
the defense of any such action or claim. No indemnifying party shall be liable
for any settlement of any such action effected without its written consent
(which consent shall not be unreasonably withheld), but if settled with its
prior written consent or if there be a final judgment of the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless any
indemnified party from and against any loss or liability by reason of such
settlement or judgment (to the extent provided herein).
The obligations of Trans Leasing and, the Seller and your
obligations in this Section 7 and in Section 8 are in addition to any other
liability which Trans Leasing, the Seller or you, as the case may be, may
otherwise have.
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8. CONTRIBUTION. If the indemnification provided for in
Section 7 is unavailable or insufficient to hold harmless an indemnified party
under Section 7(a) or (b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable
by such indemnified party as a result of such loss, claim, damage or liability
(i) in such proportion as shall be appropriate to reflect the relative benefits
received by Trans Leasing and the Seller on the one hand and you on the other
from the offering of the Class A Notes or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of Trans Leasing and the Seller on the one
hand and your fault on the other with respect to the statements or omissions
which resulted in such loss, claim, damage or liability, as well as any other
relevant equitable considerations. The relative benefits received by Trans
Leasing and the Seller on the one hand and you on the other with respect to
such offering shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Class A Notes purchased under this Agreement
(before deducting expenses) received by the Seller bear to the total
underwriting discounts and commissions received by you with respect to the
Class A Notes purchased under this Agreement, in each case as set forth in the
table on the cover page of the Prospectus Supplement. 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 Trans Leasing or
the Seller on the one hand or you on the other, the intent of the parties and
their relative knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission.
Trans Leasing, the Seller and you agree that it would not be
just and equitable if contributions pursuant to this Section 8 were to be
determined by pro rata allocation (even if you were treated as one entity for
such purpose) or by any other method of allocation which does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability referred to above in this Section 8 shall be deemed to include,
subject to the limitations on the fees and expenses of separate counsel set
forth in Section 7, for purposes of this Section 8, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such claim or any action in respect thereof. The amount paid
or payable by an indemnified party as a result of the loss, claim, damage or
liability referred to above in this Section 8 shall be subject to the
limitations on amounts payable with respect to settlements made without the
consent of the indemnifying party set forth in Section 7. Notwithstanding the
provisions of this Section 8, you shall not be required to contribute any
amount in excess of the amount by which the total price at which the Class A
Notes underwritten by you and distributed to the public were offered to the
public less the amount of any damages which you have otherwise paid or become
liable to pay by reason of any untrue or alleged untrue statement or omission
or alleged omission. 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.
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9. PERSONS ENTITLED TO BENEFIT OF AGREEMENT. This Agreement
shall inure to the benefit of and be binding upon you, Trans Leasing, the
Seller, and their respective successors. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any person, firm or
corporation, other than you, Trans Leasing and the Seller and your and their
respective successors and the controlling persons and officers and directors
referred to in Sections 7 and 8 and their heirs and legal representatives, any
legal or equitable right, remedy or claim under or in respect of this Agreement
or any provision contained herein.
10. EXPENSES. Seller agrees with you to pay (a) the costs
incident to the authorization, issuance, sale, preparation and delivery of the
Class A Notes and any taxes payable in that connection; (b) the costs incident
to the preparation, printing and filing under the Securities Act of the
Registration Statement and any amendments and exhibits thereto; (c) the costs
of distributing the Registration Statement as originally filed and each
amendment thereto and any post-effective amendments thereof (including, in each
case, exhibits), any preliminary prospectus supplement, the Prospectus and any
amendment or supplement to the Prospectus, including, without limitation, the
Prospectus Supplement, all as provided in this Agreement; (d) the costs of
reproducing and distributing this Agreement and any other underwriting and
selling group documents by mail, telex or other means of communications; (e)
the fees and expenses of qualifying the Class A Notes under the securities laws
of the several jurisdictions as provided in Section 4(g) and of preparing,
printing and distributing Blue Sky Memoranda and Legal Investment Surveys
(including related the reasonable and documented fees and expenses of your
counsel); (f) any fees charged by S&P or Xxxxx'x for rating the Class A Notes;
(g) all fees and expenses of the Owner Trustee and the Indenture Trustee and
their respective counsel; (h) any transfer taxes payable in connection with its
sale of the Class A Notes pursuant to this Agreement; and (i) all other costs
and expenses incident to the performance of the obligations of Trans Leasing
and the Seller under this Agreement; provided that, except as otherwise
provided in this Section 10, you shall pay your own costs and expenses,
including the costs and expenses of your counsel and the expenses of
advertising any offering of the Class A Notes.
11. SURVIVAL. The respective indemnities, rights of
contribution, representations, warranties and agreements of Trans Leasing and,
the Seller and your indemnities, rights of contribution, and agreements
contained in this Agreement or made by you or them or on behalf of you or them
respectively, pursuant to this Agreement, shall survive the delivery of and
payment for the Class A Notes and shall remain in full force and effect,
regardless of any (i) termination or cancellation of this Agreement, (ii) any
investigation made by you or them or on behalf of you or them or any person
controlling any of them or (iii) acceptance of and payment for the Class A
Notes.
12. NOTICES, ETC. All statements, requests, notices and
agreements hereunder shall be in writing, and:
(a) if to you, shall be delivered or sent by mail or facsimile
transmission and confirmed to First Union Capital Markets Corp., One
First Union Center TW-10,
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Charlotte, North Carolina 28288-0610, Attention: Xxxxx Xxxxxx,
Telecopy Number: 000-000-0000;
(b) if to the Seller, shall be delivered or sent by mail or
facsimile transmission and confirmed to the address of the Seller set
forth in the Registration Statement, Attention: Chief Financial
Officer, with a copy to Trans Leasing at the address of the Servicer
set forth in the Registration Statement, Attention: Chief Financial
Officer;
(c) if to Trans Leasing, shall be delivered or sent by mail or
facsimile transmission and confirmed to the address of Trans Leasing
set forth in the Registration Statement, Attention: Chief Financial
Officer;
Any such statements, requests, notices or agreements shall take effect at the
time of receipt thereof.
13. DEFINITIONS OF CERTAIN TERMS. For purposes of this
Agreement, "business day" means any day on which the New York Stock Exchange,
Inc. is open for trading.
14. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
15. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but
all such counterparts shall together constitute one and the same instrument.
16. HEADINGS. The headings herein are inserted for
convenience of reference only and are not intended to be part of, or to affect
the meaning or interpretation of, this Agreement.
17. NO PETITION. You shall not, prior to the date which is
one year and one day after the final payment with respect to the Notes,
acquiesce, petition or otherwise invoke or cause the Seller to invoke the
process of any court or government authority for the purpose of commencing or
sustaining a case against the Seller under any federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Seller or any
substantial part of its property, or ordering the winding up or liquidation of
the affairs of the Seller.
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If the foregoing is in accordance with your understanding of
the agreement between the Seller and Trans Leasing and you, kindly indicate
your acceptance in the space provided for that purpose below.
Very truly yours,
TL LEASE FUNDING CORP. IV
By
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Name:
Title:
TRANS LEASING INTERNATIONAL, INC.
By
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Name:
Title:
Accepted:
FIRST UNION CAPITAL MARKETS CORP.
By
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Authorized Signatory
