IKON RECEIVABLES LLC
$_________ - _____% Class [A-1] Lease-Backed Notes, Series 1999-1
$_________ - _____% Class [A-2] Lease-Backed Notes, Series 1999-1
$_________ - _____% Class [A-3] Lease-Backed Notes, Series 1999-1
$_________ - _____% Class [A-4] Lease-Backed Notes, Series 1999-1
$_________ - _____% Class [B] Lease-Backed Notes, Series 1999-1
FORM OF UNDERWRITING AGREEMENT
__________, 1999
▇▇▇▇▇▇ BROTHERS
3 World Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
IKON Receivables LLC, a limited liability company organized and
existing under the laws of Delaware (the "Issuer") and IOS Capital, Inc., a
corporation organized and existing under the laws of Delaware ("IOS Capital"),
hereby agree with you as follows:
Section 1. Issuance and Sale of Notes. The Issuer has authorized the
issuance of $___________ (the "Class [A-1] Aggregate Principal Amount") of
_____% Class [A-1] Lease-Backed Notes, Series 1999-1 (the "Class [A-1] Notes");
$___________ (the "Class [A-2] Aggregate Principal Amount") of _____% Class
[A-2] Lease-Backed Notes, Series 1999-1 (the "Class [A-2] Notes"); $___________
(the "Class [A-3] Aggregate Principal Amount") of _____% Class [A-3]
Lease-Backed Notes, Series 1999-1 (the "Class [A-3] Notes"); $__________ (the
"Class [A-4] Aggregate Principal Amount"; together with the Class [A-1]
Aggregate Principal Amount, Class [A-2] Aggregate Principal Amount and Class
[A-3] Aggregate Principal Amount, the "Class [A] Aggregate Principal Amount") of
_____% Class [A-4] Lease-Backed Notes, Series 1999-1 (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] Aggregate Principal
Amount") of _____% Class [B] Lease-Backed Notes, Series 1999-1 (the "Class [B]
Notes"; together with the Class [A] Notes, the "Notes." The Notes will be issued
pursuant to an Indenture, dated as of _________, 1999 (the "Indenture"), between
the Issuer, IOS Capital and _______ (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 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 Notes will be sold by the Issuer to you as underwriter in the
amount set forth on Schedule I hereto.
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 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" refer to such rules under the
Securities Act.
"Rule 430A Information" means information with respect to the
Notes and the offering thereof permitted, pursuant to Rule 430A, to be
omitted from the Registration Statement when it becomes effective.
"Underwriter" means ▇▇▇▇▇▇ Brothers.
"Underwriting Information" has the meaning given to such term
in Section 8(b) hereof.
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Section 2. Purchase and Sale of Notes.
(a) Subject to the terms and conditions and in reliance upon the
covenants, representations and warranties set forth herein, the Underwriter
agrees to purchase from the Issuer the Class [A] Aggregate Principal Amount of
the Class [A] Notes and the Class [B] Aggregate Principal Amount of the Class
[B] 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) It is understood that the Underwriter proposes to offer the
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 Notes to be purchased by the
Underwriter shall be made at the offices of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, at 10:00 A.M., New York time, on ________,
1999 (the "Issuance Date"). The Notes shall be registered in the name of the
Underwriter against payment by the Underwriter 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
Underwriter, delivery of one or more global notes (the "Global Notes")
representing the Notes shall be made to the account of the Underwriter against
delivery to the Trustee of the originally issued 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
Notes will be represented by book entries on the records of DTC and
participating members thereof. Definitive Notes representing the Notes will be
available under the circumstances described in the Indenture.
Section 4. Representations and Warranties.
(a) The Issuer hereby represents and warrants to, and agrees with,
the Underwriter as follows:
(i) The Issuer meets the requirements for use of Form S-3
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. 333-71073), including the
Preliminary Prospectus relating to the Notes, on such Form S-3 for the
registration under the Securities Act of the 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 430A and 424(b)(1),
(2) or (4). In the case of clause (B), the Issuer will include in such
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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 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 in accordance with its terms, except
that the provisions hereof relating to indemnification of the Underwriter
may be subject to limitations of public policy.
(iv) Each of the Indenture and the Assignment and Servicing
Agreement has 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 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 contribution of the Notes and the
performance of this Agreement, the Indenture and the Assignment and
Servicing Agreement by the Issuer will (A) not conflict with or result in
a breach of, and
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will not constitute a default under any of the provisions of, its
certificate of formation 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 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
Notes by the Underwriter.
(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").
(b) IOS Capital hereby represents and warrants to and agrees with
the Underwriter as follows:
(i) This Agreement has been duly authorized, executed and
delivered, the Assignment and Servicing Agreement has been duly
authorized, and this Agreement constitutes, and when executed and
delivered, the Assignment and Servicing Agreement will constitute the
legal, valid and binding obligations of IOS Capital, enforceable in
accordance with their respective terms, except that the provisions hereof
relating to indemnification of the Underwriter may be subject to
limitations of public policy.
(ii) The performance of this Agreement by IOS Capital, and the
consummation by IOS Capital 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 IOS Capital or its properties, or any of the
provisions of any indenture, mortgage, deed of trust, contract or other
agreement or instrument to which IOS Capital 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 IOS Capital 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 Notes by the
Underwriter.
(iii) IOS Capital hereby makes and repeats the representations
and warranties set forth in Section 2 of the Assignment and Servicing
Agreement. Such representations and warranties are incorporated by
reference in this Section
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4(b), and the Underwriter may rely thereon as if such representations and
warranties were fully set forth herein.
(iv) IOS Capital represents and warrants it has delivered to
the Underwriter complete and correct copies of its balance sheet and
statements of income and retained earnings reported by IOS Capital, Inc.
and IKON Office Solutions, Inc. (the "IKON Entities") for the year ended
September 30, 1998. 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
IKON Entities since September 30, 1998.
(v) Any taxes, fees and other governmental charges arising
from the execution and delivery of this Agreement, the Assignment and
Servicing Agreement and the Indenture and in connection with the
execution, delivery and issuance of the Notes and with the transfer of the
Leases and the Equipment, have been paid or will be paid by the Issuer.
(vi) Ernst & Young LLP is an independent public accountant
with respect to the IKON 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 IOS Capital. The Issuer and
IOS Capital, 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 Underwriter of such timely filing. The Issuer will promptly advise the
Underwriter (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 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 Underwriter reasonably objects.
The Issuer and IOS Capital will use their 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 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
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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 Underwriter 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 Underwriter and counsel for the
Underwriter, without charge, a signed copy of the Registration Statement
(including exhibits thereto) and, so long as delivery of a prospectus by any of
the Underwriter or any dealer may be required by the Securities Act, as many
copies of each Final Prospectus relating to the Notes and any supplement thereto
as the Underwriter may reasonably request.
(e) IOS Capital and the Issuer will take all reasonable actions
requested by the Underwriter to arrange for the qualification of the Notes for
sale under the laws of such jurisdictions within the United States or as
necessary to qualify for DTC and as the Underwriter may designate, will maintain
such qualifications in effect so long as required for the completion of the
distribution of the Notes; provided, in connection therewith the Issuer shall
not be required to qualify as a foreign corporation doing business in any
jurisdiction.
(f) For so long as the Notes are outstanding, the Issuer and IOS
Capital shall deliver to the Underwriter 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 Notes are outstanding, the Issuer and IOS
Capital will furnish to the Underwriter as soon as practicable after filing any
other information concerning the Issuer or IOS Capital 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 IOS Capital, the Issuer and IOS
Capital shall furnish such documents.
Section 6. Conditions of Underwriter's Obligation. The obligations
of the Underwriter to purchase and pay for the Notes on the Issuance Date shall
be subject to the accuracy in all material respects of the representations and
warranties of the Issuer and IOS Capital herein, in the Assignment and Servicing
Agreement and in the Indenture,
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to the performance by the Issuer and IOS Capital in all material respects of
their obligations hereunder and to the following additional conditions:
(a) The Issuer and IOS Capital shall each have delivered a
certificate (an "Officer's Certificate"), dated the Issuance Date, signed by its
Vice President and its Chief Financial Officer, to the effect that:
(i) the representations and warranties made by the Issuer or
IOS Capital (as the case may be) in this Agreement, the Indenture and the
Assignment 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 IOS Capital (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 Assignment and Servicing Agreement at or prior to the date of such
Officer's Certificate;
(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 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) with respect to IOS
Capital and an opinion from ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, LLP, counsel to
the Issuer, dated the Issuance Date and reasonably satisfactory in form and
substance to the Underwriter and their counsel with respect to, or to the effect
that: (i) the due formation and qualification of each of the Issuer and IOS
Capital and that the Issuer and IOS Capital, as applicable, have the corporate
power and authority to perform this Agreement, the Assignment and Servicing
Agreement, the Indenture (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 IOS Capital; (iii) each of this Agreement and the
other Transaction Documents are the legal, valid and binding obligation of the
Issuer and IOS Capital, 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
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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 IOS Capital and the compliance by the Issuer and IOS
Capital 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 IOS Capital, or to
the best of such counsel's knowledge, any other contracts to which the Issuer or
IOS Capital 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 IOS Capital 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 Assignment and Servicing Agreement and accompanying
documentation creates a valid security interest in the Leases and the Equipment
(or interests therein) under Delaware 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 IOS Capital 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 Delaware, 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 IOS Capital and the Issuer in the
Leases; and (ix) on the Issuance Date the Registration Statement is effective,
and, that to the best of such 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 IOS
Capital 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 Underwriter.
(c) The Underwriter shall have received from ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ LLP,
counsel for the Underwriter, such opinion or opinions, dated the Issuance Date,
with respect to the validity of the Notes, the Registration Statement, the Final
Prospectus, true sale, nonconsolidation and other related matters as the
Underwriter may require.
(d) At the Execution Time and at the Issuance Date, ▇▇▇▇▇ & Young
LLP shall have furnished to the Underwriter a letter or letters, dated the date
of this Agreement and the Issuance Date, respectively, in form and substance
satisfactory to the Underwriter.
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(e) The Class [A-1] Notes shall have been rated at least "__" and
"__", that the Class [A-2], [A-3] and [A-4] notes be rated at least "___" and
"___", that the Class [B] Notes be rated at least "__" and "__" by Standard &
Poor's Ratings Group ("S&P") and ▇▇▇▇▇'▇ Investors Service, Inc. ("Moody's"),
respectively, 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 Underwriter and
counsel for the Underwriter and to the Issuer and IOS Capital and their counsel
with respect to, or to the effect that: (i) the due incorporation and valid
existence of the Trustee and (ii) the due authorization, execution and delivery
by the Trustee of the Indenture.
(g) The Underwriter shall have received the approval of its
investment committee 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 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 Notes occurs by the Issuance Date through no fault of
the Issuer or IOS Capital or because the conditions set forth in Sections 6(c),
6(d), 6(e), 6(f), 6(g) and 6(h) have not been met, or (y) the Underwriter
terminates 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 IOS Capital's liability to the Underwriter shall be limited to
the reimbursement of the Underwriter's expenses incurred through the date of
termination for its reasonable out-of-pocket and incidental expenses. In
addition, whether or not the Notes are issued or sold:
(a) The Issuer or IOS Capital shall pay the reasonable fees and
expenses associated with the transactions contemplated hereby not paid by the
Underwriter 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(d);
(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 Underwriter;
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(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 Notes;
(viii) all expenses in connection with the qualification of
the Notes under state securities laws as provided in section 4(a)(vi),
including the fees and disbursements of counsel in connection with the
Blue Sky Survey;
(ix) the cost of preparing the Notes;
(x) the cost or expenses of any transfer agent or registrar;
and
(xi) all other costs and expenses incident to the performance
of their obligations hereunder which are not otherwise specifically
provided for in this Section 7; provided, however, that IOS Capital does
not hereby waive any rights to reimbursement from the Underwriter in the
event of any of the Underwriter's failure to perform in accordance with
this Agreement.
(b) It is understood and agreed that, except as provided in Sections
8 and 9, the Underwriter will pay securities transfer taxes on resale of any of
the Notes by them, and any advertising expenses connected with any offers they
may make.
Section 8. Indemnification and Contribution.
(a) The Issuer and IOS Capital, 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 IOS Capital 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).
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(b) The Underwriter agrees to indemnify and hold harmless the Issuer
and IOS Capital against any losses, claims, damages or liabilities to which the
Issuer or IOS Capital 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 IOS Capital by or on behalf of such Underwriter
expressly for use therein; and will reimburse the Issuer or IOS Capital for any
legal or other expenses reasonably incurred by the Issuer or IOS Capital 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 IOS Capital 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
Underwriter for inclusion in the Registration Statement or the Final Prospectus
(the "Underwriting Information"), and each of you confirm that such statements
are correct.
(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
12
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 received by the Issuer and IOS
Capital on the one hand and the Underwriter on the other from the offering of
the Notes. If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law or if the indemnified party failed
to give the notice required under subsection (c) 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 IOS Capital on the one hand and the
Underwriter 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 IOS Capital on
the one hand and the Underwriter 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 IOS Capital bear to the total underwriting
discounts and commissions received by the Underwriter, 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 IOS Capital on
the one hand or the Underwriter on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Issuer, IOS Capital and the Underwriter agree that it
would not be just and equitable if contributions
13
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 Underwriter 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 IOS Capital under this Section
8 shall be in addition to any liability which the Issuer or IOS Capital may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls the Underwriter within the meaning of the
Securities Act; and the obligations of the Underwriter under this Section 8
shall be in addition to any liability which the Underwriter may otherwise have
and shall extend, upon the same terms and conditions, to each officer and
director of the Issuer and IOS Capital and to each person, if any, who controls
the Issuer or IOS Capital within the meaning of the Securities Act.
Section 9. Survival. The respective representations, warranties and
agreements of the Issuer, IOS Capital and the Underwriter 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,
IOS Capital or the Underwriter, and such representations, warranties and
agreements made by the Issuer and IOS Capital shall survive the delivery and
payment for the Notes. The provisions of Sections 7 and 8 shall survive the
termination or cancellation of this Agreement.
Section 10. Termination.
(a) This Agreement may be terminated by 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, 1998, any material adverse change in the condition, financial
or otherwise, of IOS Capital or the Issuer, or in the earnings, business affairs
or business prospects of IOS Capital 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 Notes or enforce contracts for the sale of
the 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
14
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 IOS
Capital, except in accordance with law, without the written consent of the
Underwriter.
(c) Notwithstanding anything herein to the contrary, in the event
the Issuer or IOS Capital 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 Underwriter's obligations
hereunder may be immediately cancelled by the Underwriter by notice thereof to
the Issuer or IOS Capital. 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 IOS Capital; if to IOS Capital, addressed to IOS Capital at ▇▇▇▇ ▇▇▇▇
▇▇▇▇, ▇.▇. Box 9115, Macon, Georgia, 31210, if to the Issuer, addressed to IKON
Receivables LLC at ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, or
such other address as IOS Capital 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 IOS Capital and their successors and assigns
and the Underwriter and its respective successors and assigns.
Section 13. Default by the Underwriter. If the Underwriter shall
fail on the Issuance Date to purchase the Class [A] Notes or Class [B] Notes,
which it is obligated to purchase, then the Underwriter will be in default under
this Agreement.
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 IOS CAPITAL HEREBY SUBMIT TO THE NONEXCLUSIVE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE UNITED STATES
DISTRICT COURT LOCATED IN THE
15
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 IOS
CAPITAL 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 IOS
CAPITAL 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 IOS CAPITAL HEREBY WAIVE ANY RIGHT TO HAVE A JURY
PARTICIPATE IN RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR
OTHERWISE ARISING OUT OF, CONNECTED WITH, RELATED TO, OR IN CONNECTION WITH THIS
AGREEMENT. INSTEAD, ANY DISPUTE RESOLVED IN COURT WILL BE RESOLVED IN A BENCH
TRIAL WITHOUT A JURY.
Section 16. Counterparts. This Agreement may be executed in two or
more counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument.
Section 17. Miscellaneous. Neither this Agreement nor any term
hereof may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. The headings in this
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.
If you are in agreement with the foregoing, please sign a
counterpart hereof and return the same to the Issuer or IOS Capital, whereupon
this Agreement shall become a binding agreement between the Underwriter, and the
Issuer and IOS Capital.
16
Very truly yours,
IOS CAPITAL, INC.
By:
-------------------------------
Name:
Title:
IKON RECEIVABLES, LLC
By:
-------------------------------
Name:
Title:
The foregoing Agreement is
hereby accepted and entered
into as of the date hereof.
▇▇▇▇▇▇ BROTHERS
By:
-------------------------------
Name:
Title:
SCHEDULE A
All Class [A] Notes and Class [B] Notes will be purchased by ▇▇▇▇▇▇ Brothers.
Principal Amount Purchase Price
Class [A-1] Notes ____________ ____________
Class [A-2] Notes ____________ ____________
Class [A-3] Notes ____________ ____________
Class [A-4] Notes ____________ ____________
Class [B] Notes ____________ ____________