Schedule
to the
Master Agreement
dated as of December 7, 2000
between
Xxxxxx Brothers Special Financing Inc. and IKON Receivables, LLC
("Party A") ("Party B")
Part 1
Termination Provisions
In this Agreement:
(a) Specified Entity. "Specified Entity" is not applicable to Party A or Party
B.
(b) Specified Transactions. "Specified Transaction" has the meaning specified
in Section 14.
(c) Breach of Agreement. The "Breach of Agreement" provision of Section
5(a)(ii) will not apply to either Party A or Party B.
(d) Credit Support Default. The "Credit Support Default" provision of Section
5(a)(iii) is hereby amended by adding, at the end thereof, the following:
"provided that, not withstanding anything to the contrary contained in
this Agreement or this Section 5, an Event of Default relative to the
Party B Credit Support Provider (as herein defined) will not constitute an
Event of Default with respect to Party B."
(e) Misrepresentation. The "Misrepresentation" provision of Section 5(a)(iv)
will not apply to either Party A or Party B.
(f) Default under Specified Transaction. The "Default under Specified
Transaction" provision of Section 5(a)(v) will not apply to either Party A
or Party B.
(g) Cross Default. The "Cross Default" provisions of Section 5(a)(vi) will not
apply to either Party A or Party B.
(h) Tax Event. The "Tax Event" provisions of Section 5(b)(ii) will not apply
to either Party A or Party B.
(i) Tax Event Upon Merger. The "Tax Event Upon Merger" provision of Section
5(b)(iii) will not apply to either Party A or Party B.
(j) Credit Event upon Merger. The "Credit Event Upon Merger" provision
(Section 5(b)(iv)) will not apply to Party A or Party B.
(k) Automatic Early Termination. The "Automatic Early Termination" provision
of Section 6(a) will not apply to Party A or Party B.
(l) Payments on Early Termination. For the purpose of Section 6(e) but subject
to part 5 of this Schedule:
(i) Market Quotation will apply, other than for an Additional
Termination Event.
(ii) The Second Method will apply, other than for an Additional
Termination Event.
(m) Termination Currency. "Termination Currency" shall be United States
Dollars.
(n) Security. On or before December 7, 2000, and from time to time thereafter,
Party A shall deliver credit support (the "Initial Collateral"), in the
manner and to the extent set forth in the Credit Support Annex (the
"Credit Support Annex") between Party A and Party B, attached as Exhibit A
hereto. In the event that the long-term unsecured debt credit rating
assigned to the Party A Guarantor is reduced below either "A" by S&P or
"A-2" by Moody's (such an occurrence, a "Level I Downgrade"), Party A
shall (i) promptly, but in any event not later than two (2) Local Business
Days following the date of the Level I Downgrade, give Party B notice of
the Level I Downgrade and (ii) provide, at its own cost, additional credit
support ("Level I Additional Collateral") in addition to Initial
Collateral in the manner and to the extent set forth in the Credit Support
Annex, on or before the seventh day after the date of the Level I
Downgrade.
(o) Additional Termination Event. Additional Termination Event will apply as
follows. The occurrence of any of the following events (each such
occurrence, a "Level II Downgrade") shall be an Additional Termination
Event, with Party A as the sole Affected Party, and notwithstanding
anything to the contrary in this Agreement, the provisions of Part 1(p) of
this Schedule will apply if any Additional Termination Event occurs:
(i) The Party A Guarantor (including any successor to the Party
Guarantor under this Agreement as a result of any merger,
consolidation or transfer of assets involving the Party A Guarantor)
at any time is rated below the applicable Specified Rating (as so
defined) by any of the Rating Agencies (as so defined); or
(ii) either of the Rating Agencies withdraws its rating of the Party A
Guarantor; or
(iii) Party A fails to take the actions set forth in Part 1(n) of this
Schedule upon the occurrence of a Level I Downgrade within the time
period set forth in Part 1(n) of this Schedule.
For purposes of this Agreement, "Rating Agency" means each of Standard & Poor's
Rating Services ("S&P"), and Xxxxx'x Investors Service, Inc. ("Moody's"), and
the "Specified Rating" of the Party A Guarantor and related "Specified Ratings"
are as follows:
Specified Rating Specified Rating and Rating Agency
---------------- ----------------------------------
long-term senior unsecured debt
credit rating "A-" -- S&P
"A-3" -- Moody's
(p) Termination Rights and Consequences of an Additional Termination Event.
Section 6(b) is hereby amended, at the end thereof, by the insertion of
the following: "notwithstanding anything to the contrary in this Agreement
or this Section 6(b), neither party may designate an Early Termination
Date in connection with an Event of Default relating to the Party B Credit
Support Provider."
Notwithstanding Section 6(b)(iv) of this Agreement, upon the occurrence of any
of the Additional Termination Events listed in items (i) or (ii) of Part 1(o) of
this Schedule:
(A) The Party A Guarantor shall promptly, but in any event, not later than
two (2) Local Business Days following a Level II Downgrade, give Party B
notice of the circumstances constituting the relevant Level II Downgrade.
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(B) In the event of a Level II Downgrade, Party A shall, at its own cost
or benefit, either (x) on or before the 30th day after the date of such
Level II Downgrade, cause a substitute swap counterparty ("X") that (i) is
reasonably acceptable to Party B and the Party B Credit Support Provider,
(ii) has a long-term unsecured debt rating (or a counterparty or financial
program rating, or the equivalent) sufficient to maintain the then-current
ratings of the Notes as required by each of the Rating Agencies to assume
the obligations of Party A under the Transaction or replace the
Transaction with a transaction on identical terms, with X to be "Party A";
or (y) on or before the 7th business day after the date of such Level II
Downgrade, deliver additional credit support ("Level II Additional
Collateral") in addition to the Initial Collateral and the Level I
Additional Collateral to the extent set forth in the Credit Support Annex,
in either case in such manner (i) that is satisfactory to Party B and the
Party B Credit Support Provider and (ii) as is necessary for the Rating
Agencies to confirm not later than that day that the arrangements and/or
Level II Additional Collateral delivered are sufficient to maintain or, if
applicable, restore their respective ratings of the Notes to the ratings
in effect immediately before the Level II Downgrade. For this purpose,
"Notes" means the IKON Receivables, LLC Lease-Backed Notes, Series 2000-2.
(C) If Party A shall fail to comply with the requirements of subparagraph
(B) above and Party B designates an Early Termination Date as a result of
the failure, Party B will calculate and certify to Party A the sum of the
Loss, costs and expenses actually incurred by Party B as a result of the
early termination.
Part 2
Tax Representations
(a) Payer Tax Representations. For the purpose of Section 3(e), Party A makes
the following representation:
It is not required by any applicable law, as modified by the practice of
any relevant governmental revenue authority, of any Relevant Jurisdiction
to make any deduction or withholding for or on account of any Tax from any
payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) or
amounts treated as interest under applicable tax laws) to be made by it to
the other party under this Agreement. In making this representation, it
may rely on:
(i) the accuracy of any representation made by the other party pursuant
to Section 3(f);
(ii) the satisfaction of the agreement of the other party contained in
Section 4(a)(i) or 4(a)(iii) and the accuracy and effectiveness of
any document provided by the other party pursuant to Section 4(a)(i)
or 4(a)(iii); and
(iii) the satisfaction of the agreement of the other party contained in
Section 4(d);
provided that it shall not be a breach of this representation where
reliance is placed on clause (ii), and the other party does not deliver a
form or document under Section 4(a)(iii) by reason of material prejudice
to its legal or commercial position.
(b) Payee Tax Representations. For the purpose of Section 3(f), Party A makes
no Payee Tax Representation. For the purpose of Section 3(f), Party B
makes no Payee Tax Representation.
Part 3
Agreement to Deliver Documents
For the purpose of Sections 4(a)(i) and (ii) of this Agreement, each party
agrees to deliver the following documents, as applicable (and each party's
representation in Section 3(d) will apply to each document required from it as
provided below, other than any opinion of counsel):
(a) Documents to be delivered by Party B: (1) the Indenture dated as of
December 1, 2000 among Party B, IOS Capital, Inc. ("IOS") and The Chase
Manhattan Bank (the "Indenture") and (2) the
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Assignment and Servicing Agreement dated as of December 1, 2000 among
Party B, IOS Capital, Inc. and IKON Receivables-1, LLC (the "Assignment
and Servicing Agreement").
(b) Other documents to be delivered by Party A and Party B: evidence
reasonably satisfactory to the other party as to the authority, incumbency
and specimen signature of each person executing any document on its behalf
in connection with this Agreement, Confirmation of the Transaction and any
Credit Support Document.
Part 4
Miscellaneous
(a) Addresses for Notices. For the purpose of Section 12(a):
(i) Addresses for notices or communications to Party A:
Xxxxxx Brothers Special Financing Inc.
3 World Financial Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
With a copy to the Party A Guarantor:
Xxxxxx Brothers Holdings Inc.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
(ii) Address for notices or communications to Party B:
IKON Receivables, LLC
0000 Xxxx Xxxx
X.X. Xxx 0000
Xxxxx, Xxxxxxx 00000
With a copy to:
Chief Counsel
IOS Capital, Inc.
00 Xxxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
With a copy to the Party B Credit Support Provider:
Ambac Assurance Corporation
Xxx Xxxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: General Counsel
(b) Process Agent. For the purpose of Section 13(c):
Party A appoints as its Process Agent: None.
Party B appoints as its Process Agent: None.
(c) Offices. The provisions of Section 10(a) will apply to this Agreement.
(d) Multibranch Party. For the purpose of Section 10(c):
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Party A is not a Multibranch Party.
Party B is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is Party A unless Party A is a
Defaulting Party, in which case Party B or its designee will be the
Calculation Agent.
(f) Credit Support Document.
With respect to Party A:
(i) the Credit Support Annex; and
(ii) that certain Guarantee of Xxxxxx Brothers Holdings Inc., dated as of
December 7, 2000 (the "Guarantee Agreement") by Xxxxxx Brothers
Holdings Inc, a Delaware corporation (the "Party A Guarantor"), in
favor of Party B, as the same may be amended from time to time.
With respect to Party B: that certain Financial Guaranty Insurance Policy
issued by Ambac Assurance Corporation (the "Party B Credit Support
Provider") in favor of Party A dated as of December 7, 2000 (the
"Policy"), as the same may be amended from time to time.
(g) Credit Support Providers.
Credit Support Provider in relation to Party A: Xxxxxx Brothers Holdings
Inc., a Delaware corporation (the "Party A Guarantor"), pursuant to the
Guarantee Agreement.
Credit Support Provider in relation to Party B: Ambac Assurance
Corporation, a Wisconsin stock insurance corporation (the "Party B Credit
Support Provider"), pursuant to the Policy.
(h) Governing Law. This Agreement will be governed by and construed in
accordance with the law of the State of New York, without reference to
choice of laws doctrine.
(i) Netting of Payments. Sub-paragraph (ii) of Section 2(c) of this Agreement
will apply.
(j) Affiliate. Affiliate will have (i) with respect to Party A, the meaning
specified in Section 14, and (ii) with respect to Party B, is not
applicable.
Part 5
Other Provisions
(a) Set-off. The definition of "Set-off" is hereby amended to mean the
set-off, offset, combination of accounts, right of retention or
withholding or similar right or requirement to which the payer of an
amount under Section 6 is entitled or subject, arising under this
Agreement that is exercised by, or imposed on, such payer. Neither Party A
nor Party B may Set-off amounts which may arise under another contract or
agreement between such parties against obligations under this Agreement.
(b) Covenant Not to Institute Proceedings. Prior to the date that is one year
and one day after the date on which all of the Notes (as defined in the
Indenture) have been paid in full, Party A shall not acquiesce, petition
or otherwise invoke or cause Party B to invoke the process of any
bankruptcy court of other governmental authority for the purpose of
commencing or sustaining a case against Party B under any federal or state
bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of Party B or any substantial part of their respective properties
or the winding up or liquidation of affairs of Party B. Party A
acknowledges that Party B is a legal entity separate from any other entity
and that the holders of the Notes have relied on such separateness, and
Party A agrees, which agreement shall be enforceable by such holders at
law or through an action for specific
5
performance, not to seek or support the substantive consolidation of Party
B with any other entity as long as the Notes remain outstanding. The
provisions of this clause (b) shall survive any termination of this
Agreement.
(c) Successors. Notwithstanding any limitation imposed by Section 7 of this
Agreement or any other provision of this Agreement to the contrary, the
term "Party B" shall include all successors in interest to Party B
pursuant to its limited liability company agreement, and no consent of
Party A shall be required for any transfer or assignment to such successor
in interest.
(d) Limited Recourse; No Petition for Bankruptcy. Notwithstanding the
provisions of this Agreement which impose on Party B an obligation
(including any indemnity given hereunder) at any time to make any payment
to Party A, the rights of recourse of Party A for the obligations of Party
B hereunder shall be limited to amounts available under the terms of the
Indenture and Assignment and Servicing Agreement. Accordingly, Party A
shall have no claim for recourse against Party B or any of its directors,
officers, or affiliates, in respect of any amount which is or remains
unsatisfied after the application of those funds and any obligations
hereunder of Party B not so satisfied will automatically be extinguished.
Party A, by entering into this Agreement, hereby covenants and agrees
that, in connection with any obligations of Party B under this Agreement,
Party A will not institute against Party B, or join in any institution
against Party B of, any proceeding under any bankruptcy, insolvency or
similar law until the Notes have been paid in full and the longest
applicable preference period has lapsed. The provisions of this clause (e)
shall survive any termination of this Agreement.
(e) Waiver of Jury Trial. EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY AND
ALL RIGHT TO TRIAL BY JURY IN ANY PROCEEDINGS ARISING UNDER OR IN
CONNECTION WITH THIS AGREEMENT, ANY CREDIT SUPPORT DOCUMENT OR THE
TRANSACTION.
(f) Swap Exemption. Each party hereto represents to the other party on and as
of the date hereof and on each date on which a Transaction is entered into
between them hereunder, in connection with the negotiation of, the
entering into, and the execution of this Agreement, any Credit Support
Document to which it is a party, each Transaction and any other
documentation relating to this Agreement to which it is a party, that:
(i) This Agreement and each Transaction constitute a "swap agreement"
within the meaning of the United States Commodity Futures Trading
Commission Regulations ("CFTC Regulations") Section 35.1(b)(1),
Section 101(53)(B) of the U.S. Bankruptcy Code and the CFTC Policy
Statement concerning Swap Transactions, 54 Fed. Reg. 30694 (July 21,
1989) (the "CFTC Swap Policy Statement").
(ii) It is an "eligible swap participant" as defined in Section
35.1(b)(2) of the CFTC Regulations.
(iii) Neither this Agreement nor any Transaction is one of a fungible
class of agreements that are standardized as to their material
economic terms, with the meaning of Section 35.2(b) of the CFTC
Regulations.
(iv) The economic terms of this Agreement, any Credit Support Document to
which it is a party and the Transaction have been individually
tailored and negotiated by it, and the creditworthiness of the other
party was a material consideration in its entering into or
determining the terms of this Agreement, any such Credit Support
Document and the Transaction (including, without limitation,
pricing, cost and credit enhancement terms), within the meaning of
Section 35.2(c) of the CFTC Regulations.
(v) It has entered into this Agreement and the Transaction in
conjunction with a line of its business (including financial
intermediation services) or the financing of its business, within
the meaning of the CFTC Swap Policy Statement.
6
(g) Relationship between Parties. In connection with the negotiation of, the
entering into, and the confirming of this Agreement, and any other
documentation relating to this Agreement, including any Credit Support
Document, to which it is a party or that it is required by this Agreement
to deliver, each party hereby represents and warrants, and, in connection
with the negotiation of, the entering into and the confirming of the
execution of the Transaction, each party will be deemed to represent, to
the other party as of the date hereof (or in connection with the
Transaction, as of the date which it entered into the Transaction) that
(absent a written agreement between the parties that expressly imposes
affirmative obligations to the contrary for the Transaction):
(i) Non Reliance. It is acting for its own account, and it has made its
own independent decisions to enter into the Transaction and as to
whether the Transaction is appropriate or proper for it based upon
its own judgment and upon advice from such advisers as it has deemed
necessary. It is not relying on any communication (written or oral)
of the other party as investment advice or as a recommendation to
enter into the Transaction; it being understood that information and
explanations related to the terms and conditions of the Transaction
shall not be considered investment advice or a recommendation to
enter into the Transaction. No communications (written or oral)
received from the other party shall be deemed to be an assurance or
guarantee as to the expected results of the Transaction.
(ii) Assessment and Understanding. It is capable of assessing the merits
of and understanding (on its own behalf or through independent
professional advice), and understands and accepts, the terms,
conditions and risks of the Transaction. It is also capable of
assuming, and assumes, the risks of the Transaction. It has
determined to its satisfaction whether or not the rates, prices or
amounts and other economic terms of the Transaction and the
indicative quotations (if any) provided by the other party reflect
those in the relevant market for similar transactions, and all
trading decisions have been the result of arm's length negotiations
between the parties.
(iii) Status of Parties. The other party is not acting as a fiduciary for
or an adviser to it in respect of the Transaction.
(h) Applicable Only to One Rate Swap Transaction. This Agreement shall be
effective only for a single rate swap transaction between the parties
hereto with a specified Effective Date identical to the issue date for the
Notes (as defined in Part 1(p) of this Schedule) (the "Transaction").
(i) Amendments/waivers. Section 9(b) of this Agreement is hereby amended by
(i) adding the words "or any Credit Support Documents" after the word
"Agreement" in the first line thereof and (ii) by adding the words "and
the Party B Credit Support Provider and the Party A Guarantor" after the
word "parties" on the third line thereof.
(j) Payments on Early Termination. Notwithstanding the printed provisions of
this Agreement, Party B shall be under no obligation to make a payment to
Party A pursuant to Section 6(e) of this Agreement as modified by this
Schedule unless such termination is at the direction of the Party B Credit
Support Provider pursuant to Part 5(r)(i) of this Schedule.
(k) Confidential Information. Each party may share any information concerning
the other party with any of its Affiliates.
(l) Consent to Telephonic Recording. Each party consents to the monitoring or
recording, at any time and from time to time and to the extent lawful, by
the other party of the telephone conversations of trading and marketing
personnel of the parties and their authorized representatives in
connection with this Agreement or the Transaction; and the parties waive
any further notice of such monitoring or recording and agree and to the
extent lawful to give proper notice and obtain any necessary consent of
such personnel for any such monitoring or recording, provided that, each
party shall have the right to receive a copy of any such recording upon
which the other party would seek to rely in the event of a dispute.
7
(m) Change of Account. Section 2(b) of this Agreement is hereby amended by the
addition of the following after the word "delivery" in the first line
thereof:
"to another account in the same legal and tax jurisdiction as the original
account."
(n) Information Relating to Assets. Party A may request Party B to obtain the
Servicer Report (as defined in the Assignment and Servicing Agreement) and
any other reasonably available reports, notices, financial statements or
other information in respect of the assets of Party B that are to be
amounts available under the Indenture for payments due to Party A under
this Agreement.
(o) Transfers/Assignments. Prior notice of any transfer of rights, obligations
or interests under or in this Agreement must be given to the Rating
Agencies and the Party B Credit Support Provider and the Party A
Guarantor.
(p) Notwithstanding anything to the contrary in this Agreement, Party B will
in no circumstances be required to make any payment of additional amounts
of the kinds contemplated in Section 2(d) of this Agreement.
(q) Amendments. Notwithstanding anything to the contrary contained in the
Agreement, Party A and Party B may not amend the terms of the Transaction
in a material way without first obtaining written confirmation from each
Rating Agency that such amendment will not result in a reduction,
downgrade or withdrawal of the then current rating of the Notes by such
Rating Agency.
(r) Party B Credit Support Provider and Party A Guarantor.
(i) If any event which would have been an Event of Default under Section
5(a) occurs with respect to Party B as the Defaulting Party, then
the Party B Credit Support Provider shall have the right (but not
the obligation) upon notice to Party A, to designate an Early
Termination Date with respect to Party B, with the same effect as if
such designation were made by Party A.
(ii) Notwithstanding Section 2(e), the Party B Credit Support Provider
shall not have any obligation to pay any additional amount
calculated by application of the Default Rate on any amount which
accrued under this Agreement; provided that the Party B Credit
--------
Support Provider shall be obligated to pay interest following a
payment default of the Party B Credit Support Provider under the
Policy at the Default Rate minus 1.00%.
(iii) Party A and Party B hereby acknowledge and agree that (a) (i) the
Party B Credit Support Provider shall be a third party beneficiary
under this Agreement and under the Confirmation, entitled to enforce
its rights hereunder and thereunder and (ii) the Party B Credit
Support Provider's obligations with respect to this Agreement and
the Confirmation shall be limited to the terms of the Policy and (b)
(i) the Party A Guarantor shall be a third party beneficiary under
this Agreement and under the Confirmation, entitled to enforce its
rights hereunder and thereunder and (ii) the Party A Guarantor's
obligations with respect to this Agreement and the Confirmation
shall be limited to the terms of the Guarantee Agreement.
(iv) (a) Party A and Party B hereby acknowledge that, to the extent of
payment made by the Party B Credit Support Provider to Party A under
the Policy, the Party B Credit Support Provider shall be fully
subrogated to the rights of Party A against Party B under the
Transaction to which such payments relate, including, but not
limited to, the right to receive payment from Party B and the
enforcement of any remedies. Party A hereby agrees to assign to the
Party B Credit Support Provider its right to receive payment from
Party B under the Transaction to the extent of any payment
thereunder by the Party B Credit Support Provider to Party A. Party
B hereby acknowledges and consents to the assignment by Party A to
the Party B Credit Support Provider of any rights and remedies that
Party A has under the Transaction or any other document executed in
connection herewith.
8
(b) Party A and Party B hereby acknowledge that, to the extent of payment
made by the Party A Guarantor to Party B under the Guarantee Agreement,
the Party A Guarantor shall be fully subrogated to the rights of Party B
against Party A under the Transaction to which such payments relate,
including, but not limited to, the right to receive payment from Party A
and the enforcement of any remedies. Party B hereby agrees to assign to
the Party A Guarantor its right to receive payment from Party A under the
Transaction to the extent of any payment thereunder by the Party A
Guarantor to Party B. Party A hereby acknowledges and consents to the
assignment by Party B to the Party A Guarantor of any rights and remedies
that Party B has under the Transaction or any other document executed in
connection herewith.
(v) The representations of Section 3 made by each party to the other party
shall also be deemed made to the Party B Credit Support Provider and the
Party A Guarantor as provided in Section 3.
(vi) Section 10 is hereby amended to add the following subsection:
"(c) Any notice that is required to be given to any party shall also be
given to the Party B Credit Support Provider and the Party A Guarantor."
(vii) Party A and Party B hereby confirm that (i) in the event Party B fails to
make a payment required by this Agreement or the Confirmation and the
Party B Credit Support Provider makes such payment on behalf of Party B
pursuant to the Policy, such non-payment by Party B shall not constitute
an Event of Default with respect to Party B under this Agreement or the
Confirmation and (ii) in the event Party A fails to make a payment
required by this Agreement or the Confirmation and the Party A Guarantor
makes such payment on behalf of Party A pursuant to the Guarantee
Agreement, such non-payment by Party A shall not constitute an Event of
Default with respect to Party A under this Agreement or the Confirmation.
9
IN WITNESS WHEREOF, the parties hereto have caused this Schedule to be
duly executed by their officer, hereunto duly authorized, with effect from the
date specified on the first page of this Schedule.
IKON RECEIVABLES, LLC, as Issuer
By: IKON RECEIVABLES FUNDING, INC., its
Manager
By: /s/ Xxxxxxx Xxxxx
-------------------------
Name: Xxxxxxx Xxxxx
Title: President
XXXXXX BROTHERS SPECIAL FINANCING INC.
By: /s/ Xxxxxx Xxxxxxx
--------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
10
December 7, 2000
Rate Swap Transaction
IKON RECEIVABLES, LLC, a Delaware Limited Liability Company (the "Issuer"),
formed pursuant to that certain Limited Liability Company Agreement dated as of
January 20, 1999, as amended, between IKON Receivables Funding, Inc., as Manager
and IKON Receivables-1, LLC.
Ladies and Gentlemen:
The purpose of this letter agreement (this "Confirmation") is to confirm
the terms and conditions of the transaction entered into between us on the Trade
Date specified below (the "Transaction"). This letter agreement constitutes a
"Confirmation" as referred to in the Master Agreement specified below.
The definitions and provisions contained in the 1998 Supplement to the
1991 ISDA Definitions and the 1991 ISDA Definitions (each, as published by the
International Swaps and Derivatives Association, Inc.) are incorporated into
this Confirmation (referred to herein as the "1998 ISDA Definitions" and the
"1991 ISDA Definitions" respectively, or collectively referred to as the "ISDA
Definitions"). For these purposes, all references in those Definitions to a
"Swap Transaction" shall be deemed to apply to the Transaction referred to
herein. In the event of any inconsistency between the 1998 ISDA Definitions and
the 1991 ISDA Definitions, the 1998 ISDA Definitions shall prevail. In the event
of any inconsistency between the ISDA Definitions and this Confirmation, this
Confirmation will govern. Each party represents and warrants to the other that
(i) it is duly authorized to enter into the Transaction and to perform its
obligations hereunder and (ii) the person executing and delivering this
Confirmation on behalf of the party is duly authorized to execute and deliver
it.
1. This Confirmation supplements, forms part of, and is subject to, the
Master Agreement dated as of December 7, 2000, as amended and supplemented from
time to time (the "Agreement"), between the Issuer and Xxxxxx Brothers Special
Financing Inc. ("LBSF"). All provisions contained in the Agreement govern this
Confirmation except as expressly modified below.
2. The terms of the particular Transaction to which this Confirmation
relates are as follows:
Notional Amount: For each Calculation Period, the aggregate outstanding
principal balance of the IKON Receivables, LLC
Lease-Backed Notes, Series 2000-2 Class A-3 Notes and
Class A-4 Notes (the "Issuer Securities") used as the
basis for calculating the regularly scheduled Class A-3
Interest Payments and Class A-4 Interest Payments
thereunder for the interest period thereunder scheduled
to begin and end on the first and last days,
respectively, of that Calculation Period, as such
Interest Payment amount is identified (subject to part
5b hereof) to LBSF by the entity acting at the relevant
time as the servicer under the Assignment and Servicing
Agreement (the "Servicer"). The Notional Amount for the
initial Calculation Period is U.S. $370,706,000.
Trade Date: November 29, 2000.
Effective Date: December 7, 2000.
Termination Date: The earlier of the date on which the Notional
Amount is reduced to zero, and July 15, 2007, subject to
adjustment in accordance with the Following Business Day
Convention.
Fixed Amounts:
-------------
Fixed Rate Payer: The Issuer.
Fixed Rate: 6.475% per annum.
Day Count Fraction: 30/360
Fixed Rate Payer
Period End Dates: The 15th calendar day of each month in each year prior
to and excluding the Termination Date, commencing on
December 15, 2000, with No Adjustment.
Fixed Rate Payer
Payment Dates: Each Fixed Rate Payer Period End Date, subject to
adjustment in accordance with the Following Business Day
Convention.
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Fixed Rate Payer
Initial
Calculation
Period: Accrues from and including December 7, 2000 to but
excluding December 15, 2000, with No Adjustment of
Period End Dates.
Floating Amounts:
----------------
Floating Rate
Payer: LBSF.
Floating Rate
Payer Period End
Dates and Payment
Dates: Same as Fixed Rate Payer Period End Dates and Payment
Dates.
Floating Rate
Payer Initial
Calculation
Period: Accrues from and including December 7, 2000, to but
excluding, December 15, 2000, with No Adjustment of
Period End Dates.
Floating Rate
Option: USD-LIBOR-BBA
Designated Maturity: One Month
Spread: None
Floating Rate Day
Count Fraction: Actual /360
Reset Dates: The first day of each Calculation Period.
Business Days: New York.
Calculation Agent: LBSF, except as otherwise provided in the Agreement.
3. Account Details
Account for Payments to the Issuer:
The Chase Manhattan Bank
ABA# _______________
DDA# _______________
Reference: Collection Account; IKON Receivables, LLC
Lease-Backed Notes, Series 2000-2
Account for Payments to LBSF:
The Chase Manhattan Bank
ABA # 000-000-000
Account # 000-000-000
Reference: IKON Receivables, LLC Lease-Backed Notes,
Series 2000-2
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4. Offices
The Office of LBSF for the Transaction is at the address specified for
notices to it in the Schedule to the Agreement. The Office of the Issuer for the
Transaction is its office at the address specified for notices to it in the
Schedule to the Agreement.
5. Other Terms
The Assignment and Servicing Agreement dated as of December 7, 2000 (the
"Assignment and Servicing Agreement") by and among IKON Receivables, LLC, IOS
Capital, Inc., as originator and servicer, and IKON Receivables-1 LLC, as
seller, sets forth the agreement of IOS Capital, Inc., as Servicer, with respect
to its duties to communicate to the Issuer and LBSF information relating to the
interest scheduled to be paid by the Issuer from time to time under the Issuer
Securities. Neither party to the Transaction will have any responsibility to the
other in connection with any failure by the servicer to perform any of those
duties or any delay by it in doing so. Nothing in this provision shall affect
the rights of the parties hereto against the servicer for the failure by it to
perform its obligations under the Assignment and Servicing Agreement as set
forth herein.
THE AGREEMENT AND THIS CONFIRMATION REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR OR
CONTEMPORANEOUS WRITTEN OR ORAL AGREEMENTS BETWEEN THE PARTIES OR SUBSEQUENT
ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN
THE PARTIES.
Please confirm that the foregoing correctly sets forth the terms of our
agreement by executing the copy of this Confirmation enclosed for that purpose
and returning it to us or by sending to us a letter or telex substantially
similar to this letter, which letter or telex sets forth the material terms of
the Transaction to which this Confirmation relates and indicates agreement to
those terms.
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Yours sincerely,
XXXXXX BROTHERS SPECIAL FINANCING INC.
By:
--------------------------------------------------
Name:
Title:
Confirmed as of the date first above written:
IKON RECEIVABLES, LLC, as Issuer
By: IKON RECEIVABLES FUNDING, INC.,
its Manager
By:
--------------------------------------------------
Name:
Title:
[Signature Page to Confirmation of Issuer Swap Agreement]
