EXECUTION COPY
DYN FUNDING CORPORATION
Issuer
and
BANKERS TRUST COMPANY
Trustee
on behalf of the Series 1997-1 Noteholders
SERIES 1997-1 SUPPLEMENT
Dated April 18, 1997
to
DYNCORP TRADE RECEIVABLES MASTER INDENTURE
Dated April 18, 1997
$50,000,000
7.486% FIXED RATE CONTRACT RECEIVABLE COLLATERALIZED NOTES
SERIES 1997-1, CLASS A
Up to $90,000,000
FLOATING RATE CONTRACT RECEIVABLE COLLATERALIZED NOTES
SERIES 1997-1, CLASS B
TABLE OF CONTENTS
Page
ARTICLE I
Creation of Series 1997-1 Notes
Section 1.01. Designation................................................... 2
ARTICLE II
Definitions
Section 2.01. Definitions.................................................. 3
ARTICLE III
Reserve Fund
Section 3.01. Reserve Fund................................................. 8
ARTICLE IV
Rights of Series 1997-1 Noteholders
and Distribution of Collections
Section 4.01. Collection and Distribution of Money........................ 10
Section 4.02. Distribution Account........................................ 11
Section 4.03. General Provisions Regarding
Distribution Account and Reserve Fund..................................... 13
Section 4.04. Determination of LIBOR...................................... 14
ARTICLE V
Redemption of Series 1997-1 Notes
Section 5.01. Optional Redemption......................................... 16
Section 5.02. Special and Mandatory Redemptions........................... 16
Section 5.03. Notice of Optional Redemption by Issuer..................... 18
Section 5.04. Deposit of Redemption Price for Optional, Special........... 18
and Mandatory Redemptions
Section 5.05. Series 1997-1 Notes Payable on Redemption Date.............. 19
Section 5.06. Payments Upon Certain Events of Default and Triggers........ 20
ARTICLE VI
Transfer of Notes
Section 6.01. Exemption from Securities Act............................... 21
Section 6.02. Further Restrictions on Transfer............................ 21
Section 7.01. Amendment................................................... 22
Section 7.02. Governing Law............................................... 22
Section 7.03. Counterparts................................................ 22
Section 7.04. Ratification of Indenture................................... 22
Section 7.05. Cross-references............................................ 22
Section 7.06. Issuer Covenant............................................. 22
Section 7.07. Tax Treatment............................................... 22
Exhibits
Exhibit A. Form of Class A Note
Exhibit B. Form of Class B Note
Exhibit C. Form of Representation Letter
SERIES 1997-1 SUPPLEMENT dated April 18, 1997 (this "Series
1997-1 Supplement") between DYN FUNDING CORPORATION, a
corporation organized and existing under the laws of the State of
Delaware (herein, together with its permitted successors and
assigns, the "Issuer"), and BANKERS TRUST COMPANY, a New York
banking corporation, as trustee (herein, together with its
successors in the trusts thereunder as provided in the Indenture
referred to below, the "Trustee"), under the DynCorp Trade
Receivables Master Indenture, dated April 18, 1997 (the
"Indenture") between the Issuer and the Trustee (the Indenture
together with this Series 1997-1 Supplement, the "Agreement").
Pursuant to Section 2.04 of the Indenture, the Issuer may
direct the Trustee to authenticate the initial Series of Notes.
The Principal Terms of this Series are set forth in this Series
1997-1 Supplement to the Indenture.
Pursuant to this Series 1997-1 Supplement, the Issuer shall
create the initial Series of Notes and specify the Principal
Terms thereof.
In addition to the Grant of the Indenture, the Issuer hereby
Grants to the Trustee, for the exclusive benefit of the Holders
of the Series 1997-1 Notes, all of the Issuer's right, title and
interest in and to the Distribution Account, including all
Eligible Investments therein and all income from the investment
of funds therein, and the Reserve Fund and all proceeds in any
way derived from any of the foregoing items. Such Grants are
made in trust to secure the Series 1997-1 Notes equally and
ratably without prejudice, priority or distinction, except as
expressly provided in the Agreement, between any Series 1997-1
Notes, and to secure (i) the payment of all amounts due on the
Series 1997-1 Notes in accordance with their terms, (ii) the
payment of all other sums payable under the Agreement and (iii)
compliance with the provisions of the Agreement all as provided
in the Agreement.
The Trustee acknowledges such Grant, accepts the trusts
hereunder in accordance with the provisions hereof and agrees to
perform the duties herein.
I
Creation of Series 1997-1 Notes
Designation. (a) There is hereby created a Series of
Notes to be issued pursuant to this Series 1997-1 Supplement.
The Class A Notes shall be designated generally as the "7.486%
Fixed Rate Contract Receivable Collateralized Notes, Series 1997-
1, Class A" or the "Class A Notes." The Class B Notes shall be
designated generally as the "Floating Rate Contract Receivable
Collateralized Notes, Series 1997-1, Class B" or the "Class B
Notes". The Class A Notes and the Class B Notes shall be
designated generally as the "Series 1997-1 Notes". Such Notes
shall be issued in minimum principal amounts of $500,000 and any
amount in excess thereof.
(a) In the event that any term or provision contained
herein shall conflict with or be inconsistent with any term or
provision contained in the Indenture, the terms and provisions of
this Series 1997-1 Supplement shall be controlling. All
capitalized terms not otherwise defined herein are defined in the
Indenture. Each capitalized term defined herein shall relate
only to the Series 1997-1 Notes and no other Series of Notes
issued by the Issuer.
Definitions
Definitions. (a) Whenever used in this Series 1997-1
Supplement, the following words and phrases shall have the
following meanings:
Account: The Collection Account, the Distribution Account
or any Lockbox Account.
Amortization Date: April 30, 2002.
Called Principal: With respect to any Series 1997-1 Note,
the Class A Note Principal Balance or the Class B Note Principal
Balance, as applicable, that is declared to be due and payable
pursuant to (i) an Optional Redemption, Mandatory Redemption or
Special Redemption pursuant to Article V hereof or (ii) an
acceleration of maturity pursuant to Section 5.02 of the
Indenture.
Class A Initial Note Principal Balance: $50,000,000.
Class A Note: The meaning specified in Section 1.01 hereof.
Class A Note Interest Rate: With respect to any Class A
Note, a rate equal to 7.486% per annum.
Class A Note Principal Balance: As of any day, an amount
equal to (a) the Class A Initial Note Principal Balance, minus
(b) all amounts in respect of principal distributed to the Class
A Noteholders in reduction of the Class A Note Principal Balance
from time to time prior to such date.
Class A Stated Maturity: October 31, 2002.
Class B Note: The meaning specified in Section 1.01 hereof.
Class B Note Interest Rate: With respect to each Increase,
LIBOR plus 0.70% per annum.
Class B Note Principal Balance: As of any day, an amount
equal to (a) $0.00, plus (b) the aggregate amount of any Increase
in the Class B Note Principal Balance after the Closing Date,
minus (c) all amounts in respect of principal distributed to the
Class B Noteholders in reduction of the Class B Note Principal
Balance from time to time prior to such date.
Class B Note Purchase Agreement: The Class B Note Purchase
Agreement dated April 18, 1997 among the Purchaser, the Issuer
and any other purchaser specified therein from time to time.
Class B Purchase Limit: $90,000,000 on any day.
Class B Stated Maturity: October 31, 2002.
Closing Date: April 18, 1997.
Commitment Fee: For any Interest Period, an amount accruing
at a rate of 0.25% per annum on the average daily amount by which
the Class B Purchase Limit exceeds the Class B Note Principal
Balance.
Cut-off Date: April 16, 1997.
Distribution Account: The Eligible Account established and
maintained with the Trustee pursuant to Section 4.02 hereof.
Discounted Value: With respect to the Called Principal of
any Class A Note, the amount obtained by discounting all
Remaining Scheduled Payments with respect to such Called
Principal from their respective scheduled due date to the
Redemption Date with respect to such Called Principal, in
accordance with accepted financial practice and at a discount
factor (applied on a monthly basis) equal to the applicable
Reinvestment Yield with respect to such Called Principal.
Increase: Any increase in the Class B Note Principal
Balance corresponding to the amount of each advance of funds by
the Purchaser to the Issuer under the Class B Note Purchase
Agreement. Any such Increase shall not occur more frequently
than once per week.
Interest Period: With respect to the related Payment Date,
the period from and including the prior Payment Date to and
excluding such Payment Date; provided that the first Interest
Period shall begin on and include the Closing Date and end on and
include the day prior to the first Payment Date.
LIBOR Rate: The London interbank offered rate for one-month
Eurodollar deposits, calculated as provided in Section 4.04
hereof.
LIBOR Determination Date: With respect to any Payment Date,
the second Business Day immediately preceding such Payment Date.
London Business Day: Any Business Day on which dealings in
deposits in Eurodollars are transacted in the London interbank
market.
Mandatory Redemption: A redemption by the Issuer of all of
the Series 1997-1 Notes pursuant to Section 5.02(b) hereof.
Mandatory Redemption Level: A Collateral Value Ratio of
0.95.
Non-Amortization Period: The period beginning on the
Closing Date and ending on the close of business on the Payment
Date before the Amortization Date.
Optional Redemption: A redemption by the Issuer of all of
the Class A Notes pursuant to Section 5.01 hereof.
Payment Date: The 30th day of each month (except that
Payment Dates in the month of February shall be the last day of
such month), or, if such 30th day is not a Business Day, the next
succeeding Business Day commencing on April 30, 1997.
Principal Distribution Amount: With respect to each Payment
Date during the Amortization Period, the excess of (a) all
amounts on deposit in the Collection Account and the Distribution
Account representing Collections on the Receivables received from
and including the next preceding Determination Date (or, in the
case of the Amortization Date, from and including the first day
of the Amortization Period) through the day immediately preceding
such current Determination Date, including reinvestment income
thereon, and any other amounts on deposit in the Collection
Account and the Distribution Account over (b) the sum of the
amounts payable on such Payment Date in respect of (i) amounts
payable in respect of Administrative Expenses, (ii) all interest
due on the Series 1997-1 Notes, (iii) the amount payable pursuant
to any Special Redemption or Mandatory Redemption, (iv) any
amounts to be deposited in the Reserve Fund pursuant to Section
9.02(c) of the Indenture and (v) the Series 1997-1 Pro Rata Share
of the Servicing Fee plus any previously unpaid Series 1997-1 Pro
Rata Share of the Servicing Fee.
Purchasers: With respect to the Class B Notes, the
Purchasers of Class B Notes under the Class B Note Purchase
Agreement and their successors and assigns.
Redemption Date: With respect to the Called Principal of
any Series 1997-1 Note, the date on which such Called Principal
is declared to be due and payable pursuant to a redemption or an
acceleration of maturity pursuant to Section 5.02 of the
Indenture or Article V hereof. With respect to a Special
Redemption or Mandatory Redemption, the Redemption Date shall be
the Payment Date next succeeding the Determination Date on which
such Special Redemption or Mandatory Redemption is determined to
be required.
Redemption Price: With respect to any Series 1997-1 Note to
be redeemed by the Issuer pursuant to a Special Redemption,
Mandatory Redemption or Optional Redemption, the sum of (i) 100%
of the then Outstanding Note Principal Balance of the Series
1997-1 Notes to be redeemed, (ii) accrued and unpaid interest
thereon to the applicable Redemption Date and (iii) with respect
to the Class A Notes only, the applicable Yield Maintenance
Amount, if any.
Reference Banks: Barclays Bank PLC, Lloyds Bank PLC,
Citibank, N.A. and The Chase Manhattan Bank.
Reinvestment Yield: With respect to the Called Principal of
any Class A Note, the sum of (A) the yield to maturity implied by
(i) the yields reported, as of 10:00 a.m. (New York City time) on
(a) with respect to an Optional Redemption, the 16th Business Day
preceding the Redemption Date with respect to such Called
Principal and (b) with respect to a Special Redemption, Mandatory
Redemption or an acceleration pursuant to Section 5.02(c) of the
Indenture, the Business Day next preceding the Redemption Date
with respect to such Called Principal, on the display designated
as "Page 678" or "Page 3750" on the Dow Jones Telerate Service
(or such other displays as may replace Page 678 or Page 3750 on
the Dow Jones Telerate Service) for actively traded U.S. Treasury
securities having a maturity nearest to the Remaining Average
Life of such Called Principal as of such Redemption Date, or (ii)
if such yields shall not be reported as of such time or the
yields reported as of such time shall not be ascertainable, the
Treasury Constant Maturity Series yields reported, for the latest
day for which such yields shall have been so reported as of (a)
with respect to an Optional Redemption, the 16th Business Day
preceding the Redemption Date with respect to such Called
Principal and (b) with respect to a Special Redemption, Mandatory
Redemption or an acceleration pursuant to Section 5.02(c) of the
Indenture, the Business Day next preceding the Redemption Date
with respect to such Called Principal, in Federal Reserve
Statistical Release H.15 (519) (or any comparable successor
publication) for actively traded U.S. Treasury securities having
a constant maturity equal to the Remaining Average Life of such
Called Principal as of such Redemption Date and (B) with respect
to an Optional Redemption, 0%, with respect to a Special
Redemption, a Mandatory Redemption pursuant to Section 5.02(b)
hereof and with respect to an acceleration pursuant to Section
5.02(c) of the Indenture, 0.50% and with respect to a Mandatory
Redemption pursuant to Section 5.02(c) hereof, 1.00%. Such
implied yield in (A) above shall be determined, if necessary, by
(a) converting U.S. Treasury bill quotations to bond-equivalent
yields in accordance with accepted financial practice and (b)
interpolating linearly between reported yields.
Remaining Average Life: With respect to the Called
Principal of any Class A Note, the number of years (calculated to
the nearest one-twelfth year) obtained by dividing (i) such
Called Principal into (ii) the sum of the products obtained by
multiplying (a) each Remaining Scheduled Payment of such Called
Principal (but not of interest thereon) by (b) the number of
years (calculated to the nearest one-twelfth year) which will
elapse between (x) with respect to an Optional Redemption, the
15th Business Day prior to the Redemption Date with respect to
such Called Principal and (y) with respect to a Special
Redemption or Mandatory Redemption, the Redemption Date with
respect to such Called Principal and the Amortization Date.
Remaining Scheduled Payments: With respect to the Called
Principal of any Class A Note, all payments of such Called
Principal and interest thereon that would be due on or after the
Redemption Date with respect to such Called Principal if no
payment of such Called Principal were made prior to the
Amortization Date and assuming such Called Principal is paid in
full on the Amortization Date.
Required Reserve Balance: With respect to any Payment Date,
3% of the Class A Initial Note Principal Balance.
Reserve Fund: The Eligible Account established and
maintained with the Trustee pursuant to Section 3.01 hereof.
Series 1997-1 Noteholder: Any Holder of a Series 1997-1
Note.
Series 1997-1 Notes: The Series of Class A Notes and Class
B Notes issued pursuant to this Series 1997-1 Supplement on the
Series Issuance Date and designated "Series 1997-1".
Series 1997-1 Pro Rata Share: With respect to any
Determination Date, a fraction expressed as a percentage, (i) the
numerator of which is the sum of the Class A Note Principal
Balance and the Class B Note Principal Balance and (ii) the
denominator of which is the Note Principal Balance of all Series
or Classes of Notes issued by the Issuer.
Series Issuance Date: April 18, 1997.
Servicing Fee: With respect to each Payment Date, for so
long as the Company is Servicer, an amount equal to one-twelfth
of one percent of the aggregate Stated Value of all Eligible
Receivables that are pledged to the Trustee, calculated as of the
end of the preceding Determination Period.
Special Redemption: A redemption by the Issuer of the
Series 1997-1 Notes pursuant to Section 5.02(a) hereof.
Yield Maintenance Amount: With respect to any Class A Note,
as of the related Redemption Date, a premium equal to the excess,
if any, of the Discounted Value of the Called Principal of such
Series 1997-1 Note over such Called Principal. The Yield
Maintenance Amount shall in no event be less than zero.
Reserve Fund
Reserve Fund. (a) On or before the Closing Date the
Issuer shall establish with the Trustee, an Eligible Account in
the corporate trust department of the Trustee denominated
"Reserve Fund -- Bankers Trust Company, as Trustee in respect of
7.486% Fixed Rate Contract Receivable Collateralized Notes,
Series 1997-1, Class A, and Floating Rate Contract Receivable
Collateralized Notes, Series 1997-1, Class B". The Issuer shall
deposit in such account on or before the Closing Date, and
maintain thereafter, an amount equal to the Required Reserve
Balance. All moneys received by the Trustee pursuant to Sections
9.02(d) or (e) of the Indenture, or otherwise from the Issuer,
for deposit in the Reserve Fund, together with any Eligible
Investments in which such moneys are or will be invested or
reinvested during the term of the Indenture, shall be held by the
Trustee in the Reserve Fund as part of the Trust Estate granted
to secure the Notes, subject to disbursement and withdrawal as
herein provided. Income earned on Eligible Investments held in
the Reserve Fund will not be a part of the Trust Estate and will
be released to the Issuer on any Business Day upon receipt by the
Trustee of an Issuer Request, so long as the amount on deposit in
the Reserve Fund is at least equal to the Required Reserve
Balance.
(b) So long as no Default or Event of Default shall have
occurred and be continuing, all or a portion of any moneys in the
Reserve Fund shall be invested and reinvested by the Trustee at
the Issuer's written direction in one or more Eligible
Investments bearing interest or sold at discount.
Notwithstanding the definition of "Eligible Investments",
investments on which the Paying Agent in its commercial capacity
is the obligor may mature on the Payment Date next succeeding the
date of investment. All income or other gain from investments of
money held in the Reserve Fund shall be deposited by the Trustee
in the Reserve Fund promptly upon receipt, and any loss resulting
from such investments shall be charged to the Reserve Fund.
(c) Unless the Notes have been declared due and payable
pursuant to Section 5.02 of the Indenture, on each Payment Date
the Trustee shall withdraw from the Reserve Fund in accordance
with the Determination Date Statement, and deposit in the
Distribution Account an amount equal to the amount, if any, by
which the Note Interest Payment for such Payment Date exceeds the
amount on deposit in the Distribution Account on such Payment
Date that is available for such payment (before giving effect to
any withdrawal from the Reserve Fund on such date for deposit in
the Distribution Account).
(d) On any Redemption Date on which an Optional Redemption
has been declared by the Issuer, the Trustee shall upon receipt
of an Issuer Order withdraw from the Reserve Fund, to the extent
of funds on deposit therein, and deposit in the Distribution
Account the amount, if any, by which the Redemption Price exceeds
the amount on deposit in the Distribution Account on such
Redemption Date that is available for such payment (before giving
effect to any withdrawal from the Reserve Fund on such date for
deposit in the Distribution Account); provided that on such
Redemption Date the full Redemption Price is paid to the
Outstanding Noteholders.
(e) On the Stated Maturity of the Notes, a Mandatory
Redemption Date, a Special Redemption Date or an Optional
Redemption Date, the Trustee shall withdraw from the Reserve Fund
and deposit in the Distribution Account the amount, if any, by
which the Note Payment for such Payment Date exceeds the amount
on deposit in the Distribution Account on such Payment Date that
is available for such payment (before giving effect to any
withdrawal from the Reserve Fund on such date for deposit in the
Distribution Account); provided, in the case of Mandatory
Redemption or an Optional Redemption, that on such Payment Date
the full Redemption Price is paid to the Outstanding Noteholders.
Upon the satisfaction and discharge of the Agreement in
accordance with Article Four of the Indenture, upon receipt of an
Issuer Request, the Trustee shall pay or transfer to the Issuer
all money or Eligible Investments then in the Reserve Fund.
IV
Rights of Series 1997-1 Noteholders
and Distribution of Collections
Collection and Distribution of Money. (a) The Class A
Notes shall bear interest from the Closing Date until paid at the
Class A Note Interest Rate. Thirty days of interest shall be due
and payable on each Payment Date (other than the first and, if
applicable, last Payment Date) on the Note Principal Balance of
the Class A Notes, determined as of the Closing Date with respect
to the first Payment Date, and thereafter, the preceding Payment
Date (after giving effect to any principal payment made on such
Notes on such date). Interest will be calculated on the basis of
a 360-day year consisting of twelve 30-day months. If the
amounts available in the Distribution Account and Reserve Fund
are insufficient to pay the amount of interest due and payable on
the Class A Notes on any Payment Date, such shortfall will be
carried forward and added to the amount due on such Class A Notes
on the next Payment Date. Any such amount carried forward will
bear interest, to the extent legally permissible, at a rate per
annum which shall be equal to 200 basis points in excess of the
Class A Note Interest Rate.
(a) The principal of the Class A Notes shall be payable
commencing on the Amortization Date and on each Payment Date
thereafter, to the extent of the amount available after payment
of all interest payable on the Notes, to the extent that funds
remain in the Collection Account as provided in Section 4.02
hereof.
(b) The Class B Notes shall bear interest on the average
daily Class B Note Principal Balance for the related Interest
Period at the Class B Note Interest Rate. Interest on the Class
B Notes shall be payable on each Payment Date for the related
Interest Period. Interest will be calculated on the basis of the
actual number of days elapsed in the Interest Period and a 360-
day year. If the amounts available in the Distribution Account
and the Reserve Fund are insufficient to pay the amount of
interest due and payable on the Class B Notes on any Payment
Date, such shortfall will be carried forward and added to the
amount due on such Class B Notes on the next Payment Date. Any
such amount carried forward will bear interest, to the extent
legally permissible, at a rate per annum which shall be equal to
200 basis points in excess of the Class B Note Interest Rate.
(c) The principal of the Class B Notes shall be payable
commencing on the Amortization Date and on each Payment Date
thereafter, to the extent of the amount available after payment
of all interest payable on the Notes, to the extent that funds
remain in the Collection Account as provided in Section 4.02
hereof. On any Payment Date during the Non-Amortization Period,
the Issuer may designate amounts on deposit in the Collection
Account to pay principal in whole or in part of the Class B
Notes.
(d) Except as otherwise expressly provided herein or in the
Indenture, the Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or
assistance of any fiscal agent or other intermediary, all money
and other property payable to or receivable by the Trustee
pursuant to the Agreement, including all payments due on account
of any of the Receivables pledged to secure the Notes. The
Trustee shall hold all such money and property received by it in
trust for the Holders of the Notes and shall apply it as provided
in the Agreement. Except as otherwise expressly provided in the
Agreement, if any Default occurs in the making of any payment or
performance under the Servicing Agreement, the Trustee may, and
upon the written request of the Required Holders (as evidenced by
the Note Register) shall, take such action as may be appropriate
to enforce such payment or performance, including the institution
and prosecution of appropriate Proceedings. Any such action
shall be without prejudice to any right to claim a Default or
Event of Default under the Agreement and to proceed thereafter as
provided in Article Six of the Indenture.
Distribution Account. (a) Prior to the initial
authentication and delivery of the Notes, the Issuer shall open,
at a depository institution (which may be the Trustee), an
Eligible Account denominated "Distribution Account -- Bankers
Trust Company, as trustee in respect of 7.486% Fixed Rate
Contract Receivable Collateralized Notes, Series 1997-1, Class A
and Floating Rate Contract Receivable Collateralized Notes,
Series 1997-1, Class B". The Distribution Account shall be held
in the corporate trust department of such depositary institution,
in trust and shall relate solely to the Series 1997-1 Notes and
Eligible Investments securing the Series 1997-1 Notes. Funds in
the Distribution Account shall be held as provided in Section
6.06 of the Indenture. The Issuer shall give the Trustee at
least five Business Days' written notice of any change in the
location of the Distribution Account and any related account
identification information. All payments to be made from time to
time to the Holders of Series 1997-1 Notes, out of funds in the
Distribution Account pursuant to this Series 1997-1 Supplement
shall be made by the Trustee as the Paying Agent of the Issuer
or, pursuant to Section 8.10 of the Indenture, by any other
Paying Agent appointed by the Issuer. All moneys deposited from
time to time in the Distribution Account, including the deposits
to be made by the Servicer in the Distribution Account pursuant
to the Servicing Agreement, and all investments made with such
moneys, shall be held by the Trustee as part of the Trust Estate
as herein provided.
(b) So long as no Default or Event of Default shall have
occurred and be continuing, all or a portion of the Distribution
Account shall be invested and reinvested by the Trustee at the
Issuer's written direction in one or more Eligible Investments
bearing interest or sold at discount. All income or other gain
from investment of moneys deposited in the Distribution Account
shall be deposited in the Distribution Account immediately upon
receipt, and any loss resulting from such investment shall be
charged to such Distribution Account. Notwithstanding the
definition of "Eligible Investments", in the case of an Account
maintained with the Paying Agent, Eligible Investments on which
the Paying Agent is the obligor (including repurchase agreements
on which the Paying Agent in its commercial capacity is liable as
principal), may mature on the Payment Date next succeeding the
date of investment.
(c) On each Payment Date during the Non-Amortization
Period, amounts that have been deposited in the Distribution
Account pursuant to Section 9.02(d) of the Indenture will be
distributed as follows:
first, to the payment of all interest due on the Series
1997-1 Notes and any Commitment Fee due to the Purchaser
pursuant to the Class B Note Purchase Agreement;
second, to the payment of principal on any Class B
Notes as is designated by the Issuer;
third, to the payment of all principal due on any Class
A Notes that have been called for redemption; and
fourth, to the payment of any Yield Maintenance Amount
due on any Class A Notes that have been called for
redemption.
(d) On each Payment Date during the Amortization Period,
amounts that have been deposited in the Distribution Account
pursuant to Section 9.02(e) of the Indenture will be distributed
as follows:
first, to the payment of all interest due on the Series
1997-1 Notes;
second, to the payment of all principal due on any
Series 1997-1 Notes that have been called for redemption to
be distributed to the Holders thereof on a pro rata basis;
and
third, to the payment (or distribution to the Issuer
for payment) of the Principal Distribution Amount due on the
Series 1997-1 Notes to be distributed to the Holders thereof
on a pro rata basis.
(e) On any Payment Date if amounts on deposit in the
Distribution Account are not sufficient to make any portion of
the Note Interest Payment on such Payment Date, an amount equal
to the amount by which the amount available in the Distribution
Account is less than the Note Interest Payment will be withdrawn
from the Reserve Fund in accordance with the Determination Date
Statement, to pay, to the extent available, all interest payable
on the Series 1997-1 Notes on such Payment Date.
General Provisions Regarding Distribution Account and
Reserve Fund. (a) The Issuer shall not direct the Trustee to
make any investment of any funds in an Account or the Reserve
Fund or to sell any investment held in an Account or the Reserve
Fund except under the following terms and conditions: (i) (A)
each such investment shall be made in the name of the Trustee (in
its capacity as such) or its agents, custodians or nominees (or,
if, as indicated by an Opinion of Independent Counsel delivered
to the Trustee, applicable law provides for perfection of pledges
of an investment not evidenced by a certificate or other
instrument through registration of such pledge on books
maintained by or on behalf of the issuer of such investment, such
pledge may be so registered), (B) the Trustee shall have sole
investment control over such investment, the income thereon and
the proceeds thereof, and (C) any instrument evidencing such
investment shall be delivered directly to the Trustee or its
agent; and (ii) the proceeds of each such sale of an investment
shall be remitted by the purchaser thereof directly to the
Trustee for deposit in the Account or the Reserve Fund in which
such investment was held.
(b) If any amounts are needed for disbursement from an
Account or the Reserve Fund and sufficient uninvested funds are
not available to make such disbursement, in the absence of an
Issuer Order for the liquidation of investments in an amount
sufficient to provide the required funds, the Trustee shall cause
to be sold or otherwise converted to cash a sufficient amount of
the investments in such Account or the Reserve Fund; provided
that such investments shall be sold in arm's-length transactions
for not less than their fair market value; provided, further,
that the Trustee may rely upon the appraisal of an independent
appraiser in determining such fair market value.
(c) The Trustee shall not in any way be held liable by
reason of any insufficiency in any Account or the Reserve Fund
resulting from any loss on any Eligible Investment included
therein except that the Trustee shall remain liable on Eligible
Investments which are obligations of the Trustee in its
commercial capacity.
(d) All investments of funds in an Account or the Reserve
Fund and all sales of Eligible Investments held in an Account or
the Reserve Fund shall, except as otherwise expressly provided in
the Agreement, be made by the Trustee in accordance with an
Issuer Order. Such Issuer Order may prescribe specific actions
(including, without limitation, that such funds shall not be
invested, in which case such funds shall remain deposited in the
Distribution Account or Reserve Fund) or may be a general,
standing order authorizing the Trustee to act within certain
general parameters or to act on written, facsimile or telephonic
instructions (which telephonic instructions shall be confirmed in
writing) of specified personnel or agents of the Issuer.
In the event that:
(i) the Issuer shall have failed to give investment
directions to the Trustee by 12:01 p.m. New York time on any
Business Day authorizing the Trustee to invest the funds
then in an Account or the Reserve Fund,
(ii) a Default or Event of Default shall have occurred
and be continuing but the Series 1997-1 Notes shall not have
been declared due and payable pursuant to Section 5.02 of
the Indenture, or
(iii) an Event of Default shall have occurred and be
continuing, the Series 1997-1 Notes shall have been declared
due and payable pursuant to Section 5.02 of the Indenture,
and amounts collected or receivable from the related Trust
Estate are being applied in accordance with Section 5.06 of
the Indenture, the Trustee shall invest and reinvest the
funds then in each Account or the Reserve Fund to the
fullest extent practicable, but only in one or more Eligible
Investments bearing interest or sold at a discount, upon
written direction by the Issuer. All investments made
pursuant to clause (i) above shall mature on the next
Business Day following the date of such investment, all such
investments made pursuant to clause (ii) above shall mature
no later than the latest maturity date therefor permitted
for Eligible Investments, and all investments made pursuant
to clause (iii) above shall mature no later than the first
date following the date of such investment on which the
Trustee proposes to make a distribution to Series 1997-1
Noteholders pursuant to Section 5.06 of the Indenture.
Determination of LIBOR. (a) On each LIBOR Determination
Date, the Trustee will determine LIBOR on the basis of the rate
for deposits in Eurodollars for a one-month period which appears
on Telerate Page 3750 as of 11:00 a.m., London time, on such
date. If such rate does not appear on Telerate Page 3750, the
rate for that LIBOR Determination Date will be determined on the
basis of the rates at which deposits in Eurodollars are offered
by the Reference Banks at approximately 11:00 a.m., London time,
on that day to prime banks in the London interbank market for a
one-month period. The Trustee will request the principal London
office of each of the Reference Banks to provide a quotation of
its rate. If at least two such quotations are provided, the rate
for that LIBOR Determination Date will be the arithmetic mean of
the quotations. If fewer than two quotations are provided as
requested, the rate for that LIBOR Determination Date will be the
arithmetic mean of the rates quoted by major banks in New York
City, selected by the Issuer, at approximately 11:00 a.m., New
York City time, on that day for loans in Eurodollars to leading
European banks for a one-month period.
(a) On each LIBOR Determination Date, the Trustee shall
send to the Issuer, the Servicer and the Purchaser by facsimile,
notification of the LIBOR Rate for the following Interest Period.
V
Redemption of Series 1997-1 Notes
Optional Redemption. The Class A Notes will be
redeemable in whole on any day on which the Class B Note
Principal Balance is equal to zero, at the option of the Issuer,
at the Redemption Price for an Optional Redemption; provided,
however, that if such day occurs on or after the Amortization
Date, the Redemption Price of such Notes shall not include any
Yield Maintenance Amount.
Section 5.02. Special and Mandatory Redemptions.
(a) Special Redemption. If, on any Determination Date, (i)
the Collateral Value Ratio as set forth in the Determination Date
Statement prepared in accordance with Section 4.02 of the
Servicing Agreement is below 1.00 and the Issuer does not
substitute Receivables or deposit cash into the Collection
Account or reduce the Class B Note Principal Balance such that
the Collateral Value Ratio, as set forth in such Determination
Date Statement, is raised to 1.00 prior to the related Payment
Date and (ii) such ratio was below 1.00 on the previous
Determination Date and the Company did not substitute Receivables
or deposit cash into the Collection Account or reduce the Class B
Note Principal Balance such that the Collateral Value Ratio, as
set forth in the Determination Date Statement for such previous
Determination Date, was raised to 1.00 prior to the current
Determination Date, the Trustee shall promptly give notice that
it will redeem a portion of the Series 1997-1 Notes on the next
Payment Date. The Trustee shall call for a Special Redemption of
the Series 1997-1 Notes in an amount equal to the lesser of
(i)(A) the Outstanding Note Principal Balance minus (B) the sum
of (1) the aggregate Stated Value of the Receivables, less the
aggregate Stated Value of any Excluded Receivables, in each case
valued at the applicable Collateral Value Percentage and (2) the
amount on deposit in the Collection Account and (ii) the
Outstanding Note Principal Balance. The amounts in clauses (A)
and (B)(1) above shall be calculated by the Issuer as of the end
of the Determination Period preceding such Determination Date.
Such redemption will be at the Redemption Price for a Special
Redemption.
During the period from the Determination Date on which the
Trustee gives notice of a Special Redemption until the succeeding
Payment Date, subject to Section 4.02(c) hereof and Section
9.02(c) of the Indenture, Collections will be retained in the
Collection Account until the amount of funds on deposit therein
is equal to the Redemption Price for such Special Redemption.
If, after the Payment Date on which a Special Redemption is to be
made during the Non-Amortization Period, any portion of the
related Redemption Price has not been paid, funds may not be
withdrawn from the Collection Account to purchase Eligible
Receivables pursuant to Section 4.02(c) hereof until the amount
required for such Special Redemption is on deposit in the
Collection Account and transferred to the Distribution Account.
Any Special Redemption will be paid, to the extent of funds
available in the Collection Account and the Distribution Account,
first to the payment of all amounts owing on the Class B Notes
until the Class B Note Principal Balance is reduced to zero and
second to the payment of all amounts owing on the Class A Notes.
(b) Mandatory Redemption. The Trustee shall as soon as
practicable on any Determination Date promptly give notice of a
Mandatory Redemption of all the Outstanding Series 1997-1 Notes,
based on information contained in the Determination Date
Statement, if:
(i) on the preceding Determination Date, the
Collateral Value Ratio was determined to be less than or
equal to the Mandatory Redemption Level as of the last day
of the second preceding Determination Period and the Company
has not caused the Collateral Value Ratio to be increased
above the Mandatory Redemption Level by substitution of
Receivables or depositing cash into the Collection Account
or reduction of the Class B Note Principal Balance;
(ii) three Special Redemptions (including such current
Determination Date) are required within any consecutive
12-month period; or
(iii) on any Determination Date, (a) the aggregate
Stated Value of all Ineligible Receivables which have been
Ineligible Receivables for more than 30 days exceeds 7% of
the Aggregate Collateral Balance and (b) the Collateral
Value Ratio is less than 1.00.
In the case of clause (i) above, the payment of principal
pursuant to the Mandatory Redemption will be due on the Payment
Date immediately following the Determination Date next succeeding
such notice of a Mandatory Redemption, and in the case of clauses
(ii) or (iii) above, such payment will be due on the Payment Date
next succeeding such notice. Such redemption will be at the
Redemption Price for a Mandatory Redemption. Any Mandatory
Redemption will be paid, to the extent of funds available in the
Collection Account and the Distribution Account, to the Series
1997-1 Noteholders in the proportion that the Note Principal
Balance of each Series 1997-1 Note to be redeemed bears to the
Outstanding Note Principal Balance; provided that if funds
available on such Payment Date in the Collection Account and the
Distribution Account are insufficient therefor, payment of a
Mandatory Redemption may include funds on deposit in the Reserve
Fund; provided, further, that the aggregate of funds available on
such Payment Date in the Collection Account, the Distribution
Account and the Reserve Fund are sufficient to pay in full the
Outstanding Note Principal Balance.
(c) Mandatory Redemption upon Direction of Noteholders. If
on any date of determination the Issuer is prohibited from
purchasing additional Eligible Receivables pursuant to Section
3.03 of the Sale and Purchase Agreements, the Issuer shall give
notice thereof to the Series 1997-1 Noteholders, which notice
shall reference this Section 5.02(c) relating to Mandatory
Redemption. If the Required Holders of the Series 1997-1 Notes
so direct the Trustee in writing, the Trustee shall give notice
of a Mandatory Redemption of all the Outstanding Series 1997-1
Notes. Payment will be due on the Payment Date next succeeding
such direction from the Required Holders of the Series 1997-1
Notes at the Redemption Price for a Mandatory Redemption.
Section 5.03. Notice of Optional Redemption by Issuer.
The Issuer shall give the Trustee and each Class A
Noteholder fifteen Business Days prior written notice of any
Optional Redemption.
All notices of redemption shall state:
(a) the Redemption Date;
(b) the Redemption Price (including any Yield Maintenance
Amount, if applicable);
(c) that interest thereon shall cease to accrue on the date
specified on the notice;
(d) the place where such Series 1997-1 Notes are to be
surrendered (or an indemnity reasonably satisfactory to the
Trustee provided) for payment of the Redemption Price, which
shall be the office or agency of the Trustee to be maintained as
provided herein.
Failure to give notice of redemption, or any defect therein,
to any Holder of any Series 1997-1 Note selected for redemption
shall not impair or affect the validity of the redemption of any
other Series 1997-1 Note.
Section 5.04. Deposit of Redemption Price for Optional,
Special and Mandatory Redemptions.
(a) In the case of an Optional Redemption, on or before the
Payment Date on which such Optional Redemption is to be made, the
Issuer shall deposit in the Distribution Account cash in an
amount sufficient to provide for payment of the Redemption Price
of all of the Class A Notes (unless such payment is to be made
from funds on deposit in the Collection Account, any Lock-box
Account or the Reserve Fund).
(b) In the case of all Special Redemptions and any
Mandatory Redemption, on or before the Payment Date on which a
Special Redemption or Mandatory Redemption is to be made, the
Issuer shall deposit into the Distribution Account cash in an
amount sufficient to provide payment of the Redemption Price for
all of the Series 1997-1 Notes that are to be redeemed on such
Payment Date. If during the Non-Amortization Period any portion
of the amount to be paid on a Payment Date as a Special
Redemption or Mandatory Redemption remains outstanding after such
Payment Date, cash will not be released from the Collection
Account for the purpose of acquiring additional Eligible
Receivables or for the payment of the Series 1997-1 Pro Rata
Share of the Servicing Fee until such unpaid Special Redemption
or Mandatory Redemption Amount is paid or cash therefor is on
deposit in the Distribution Account. Any Special Redemption and
Mandatory Redemption will be paid to the Series 1997-1
Noteholders in the proportion that the Note Principal Balance of
each Series 1997-1 Note to be redeemed bears to the Outstanding
Note Principal Balance.
Section 5.05. Series 1997-1 Notes Payable on Redemption
Date.
Notice of redemption having been given as provided in
Section 5.03 hereof, the Series 1997-1 Notes or portions thereof
so to be redeemed shall, on the applicable Redemption Date,
become due and payable at the Redemption Price and on such
Redemption Date (unless the Issuer shall Default in the payment
of the Redemption Price) such Series 1997-1 Notes (or portion
thereof) shall cease to bear interest as specified in the
Agreement. On or after the Redemption Date, such Series 1997-1
Notes shall be paid by the Issuer at the Redemption Price;
provided, however, that payments due on a Redemption Date which
is also a Payment Date shall be payable to the Holders of such
Series 1997-1 Notes registered as such on the relevant Record
Dates according to their terms.
If any Outstanding Series 1997-1 Note called for Optional
Redemption pursuant to Section 5.01 hereof shall not be so paid
upon surrender thereof for redemption, the principal shall, until
paid, bear interest from the Redemption Date at a per annum rate
equal to 200 basis points in excess of the applicable Note
Interest Rate.
Section 5.06. Payments Upon Certain Events of Default and
Triggers.
(a) If an Event of Default specified in clause (1), (2),
(8), (9), (10) (as to clause (10), with respect to Sections
5.01(c) and (d) only of the Servicing Agreement) or clauses (3)
or (4), to the extent permitted by law, of Section 5.01 of the
Indenture occurs, the amounts payable on the Class A Notes
pursuant to Section 5.02(b) of the Indenture shall include Yield
Maintenance Amount.
(b) If (a) at the close of business on the date of any
Increase, after giving effect to the Increase and any withdrawals
from the Collection Account, the amount on deposit in the
Collection Account is in excess of $45,000,000, and (b) the
foregoing condition continues for the three Business Days
following such date of Increase, then, on the next following
Business Day (x) the amount by which the amount on deposit in the
Collection Account at the end of the preceding Business Day
exceeded the amount of $45,000,000 shall be paid as a reduction
in principal of the Class B Notes and (y) the Issuer shall pay a
fee of $2,000 to the Class B Noteholders.
VI
Transfer of Notes
Exemption from Securities Act. No transfer of the
Series 1997-1 Notes may be made from the date of issuance of the
Series 1997-1 Notes (other than a transfer as to which the
proposed transferee has provided a representation letter
substantially in the form of Exhibit C hereto) unless the
transferee provides an opinion of counsel satisfactory to the
Trustee (which may be in-house counsel of the transferee) with
respect to the availability of an exemption from the registration
requirements of the Securities Act of 1933, as amended, pursuant
to Section 4(2) under the Securities Act of 1933, as amended.
Further Restrictions on Transfer. Without the consent
of the Company, transfer of the Series 1997-1 Notes may not be
made from the date of issuance of the Series 1997-1 Notes to any
Person domiciled in a country other than the United States of
America or a competitor of the Company or any of its Affiliates.
VII
Miscellaneous Provisions
Amendment. No amendment may be made to this Series
1997-1 Supplement other than as provided in the Agreement.
Governing Law. THE AGREEMENT AND EACH SERIES 1997-1
NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND
TO BE PERFORMED THEREIN.
Counterparts. This Series 1997-1 Supplement may be
executed in two or more counterparts (and by different parties on
separate counterparts), each of which shall be an original, but
all of which together shall constitute one and the same instru
ment.
Ratification of Indenture. As supplemented by this
Series 1997-1 Supplement, the Indenture is in all respects
ratified and confirmed and the Indenture as so supplemented by
this Series 1997-1 Supplement shall be read, taken, and construed
as one and the same instrument.
Cross-references. Cross-references to sections and
subsections correspond to sections and subsections of this Series
1997-1 Supplement except where otherwise indicated.
Issuer Covenant. The Issuer hereby covenants to deliver
all lien searches under the UCC dated a recent date as soon as
possible after the date hereof as required by the Sale and
Purchase Agreement .
Tax Treatment. The Issuer, by entering into this Series
1997-1 Supplement, and each Noteholder, by its acceptance of a
Series 1997-1 Note, agree to treat the Series 1997-1 Notes for
all purposes including federal, state and local income, single
business and franchise tax purposes as indebtedness of the
Issuer.
IN WITNESS WHEREOF, the Issuer and the Trustee have caused
this Series 1997-1 Supplement to be duly executed by their
respective officers as of the day and year first above written.
DYN FUNDING CORPORATION,
Issuer
By:____________________________
Name:
Title:
BANKERS TRUST COMPANY,
Trustee
By:____________________________
Name:
Title:
EXHIBIT A
FORM OF CLASS A NOTE
THE CLASS A NOTES ARE BEING OFFERED AND SOLD IN RELIANCE ON
EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT, THE
INVESTMENT COMPANY ACT AND APPLICABLE STATE SECURITIES LAWS. THE
CLASS A NOTES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT TO (A)
"QUALIFIED INSTITUTIONAL BUYERS" (AS DEFINED IN RULE 144A UNDER
THE ACT ("RULE 144A")) AS PERMITTED UNDER RULE 144A OR (B)
INSTITUTIONAL "ACCREDITED INVESTORS" (AS DEFINED IN RULE
501(A)(1), (2), (3) OR (7) UNDER THE ACT) AND AS PERMITTED UNDER
APPLICABLE STATE SECURITIES LAWS.
THE PRINCIPAL OF THIS CLASS A NOTE IS SUBJECT TO PREPAYMENT
FROM TIME TO TIME WITHOUT SURRENDER OF OR NOTATION ON THIS CLASS
A NOTE. ACCORDINGLY, THE UNPAID PRINCIPAL BALANCE OF THIS CLASS
A NOTE MAY BE LESS THAN THAT SET FORTH BELOW. ANYONE ACQUIRING
THIS CLASS A NOTE MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY
INQUIRY OF THE TRUSTEE. THE RIGHTS OF A HOLDER OF THIS CLASS A
NOTE ARE SUBJECT TO THE PROVISIONS OF THE WITHIN-REFERENCED
AGREEMENT.
DYN FUNDING CORPORATION
7.486% Fixed Rate Contract Receivable Collateralized Note
Series 1997-1, Class A
7.486% Class A Note Class A Initial Note
Interest Rate Principal Amount: $50,000,000
Note No. __ Stated Maturity: October 31, 2002
CUSIP No. 267743 AA 0
Dyn Funding Corporation, a corporation duly organized and
existing under the laws of the State of Delaware (herein referred
to as the "Issuer"), for value received, hereby promises to pay
to ____________________ or registered assigns, in accordance with
the terms of the DynCorp Trade Receivables Master Indenture,
dated April 18, 1997 (the "Indenture"), between the Issuer and
Bankers Trust Company, as trustee (the "Trustee", which term
includes any successor Trustee), as supplemented by the Series
1997-1 Supplement, dated April 18, 1997 (the "Series 1997-1
Supplement"), between the Issuer and the Trustee (the Series
1997-1 Supplement and the Indenture being collectively referred
to herein as the "Agreement"), the principal sum of
____________________ DOLLARS ($__________) as herein described,
and interest on the unpaid amount hereof in the manner
hereinafter described until this Class A Note has been paid in
full.
This Class A Note is one of a duly authorized issue of
Series 1997-1 Notes of the Issuer, designated as the 7.486% Fixed
Rate Contract Receivable Collateralized Notes, Series 1997-1,
Class A (herein referred to as the "Class A Notes"), limited in
aggregate principal amount to $50,000,000 under the Agreement,
subject to the terms, provisions and conditions of the Agreement,
to which Agreement reference is made for a statement of the
respective rights thereunder of the Issuer, the Trustee and the
Holders of the Series 1997-1 Notes, and the terms upon which the
Series 1997-1 Notes are, and are to be, authenticated and
delivered. Also issued under the Agreement are the Floating Rate
Contract Receivable Collateralized Notes, Series 1997-1, Class B.
A summary of certain of the pertinent provisions of the
Agreement is set forth hereinafter. All terms used in this Class
A Note that are not otherwise defined herein shall have the
meanings assigned to them in the Agreement.
Each payment of this Class A Note shall be applied first to
the payment of interest accrued and unpaid on this Class A Note
and then, if principal is then payable, to the payment of
principal of this Class A Note.
The interest on this Class A Note and principal of this
Class A Note shall be distributable in lawful money of the United
States in the following manner:
(a) Interest shall be payable on this Class A Note at
the rate of 7.486% per annum (the "Class A Note Interest
Rate"). Thirty days of interest shall be due and payable on
the 30th day of each month or, if such day is not a Business
Day, the next succeeding Business Day (each, a "Payment
Date") commencing on April 30, 1997 on the Class A Note
Principal Balance of the Class A Notes, determined as of the
Closing Date with respect to the first Payment Date, and
thereafter, the preceding Payment Date (after giving effect
to any principal payment made on such Notes on such date).
Interest will be calculated on the basis of a 360-day year
consisting of twelve 30-day months. If the amounts
available in the Distribution Account and the Reserve Fund
are insufficient to pay the amount of interest due and
payable on the Class A Notes on any Payment Date, such
shortfall will be carried forward and added to the amount
due on such Class A Notes on the next Payment Date. Any
such amount carried forward will bear interest, to the
extent legally permissible, at a rate per annum which shall
be equal to 200 basis points in excess of the Class A Note
Interest Rate.
(b) The principal of the Class A Notes shall be
payable commencing on the Amortization Date and each Payment
Date thereafter and otherwise in accordance with the
Agreement, to the extent of the amount available after
payment of all interest payable on the Notes, to the extent
that funds remain in the Collection Account, as provided in
the Agreement. The Holders of the Class A Notes as of the
Record Date in respect of a Payment Date shall be entitled
to the interest accrued and payable and the principal
payable on such Payment Date. Payments of principal to such
Holders shall be made in the proportion that the unpaid
principal balance of the Class A Notes registered in the
name of each such Holder on such Record Date bears to the
aggregate unpaid principal balance of all the Class A Notes
(the "Outstanding Class A Note Principal Balance") on such
Record Date. All payment obligations under a Class A Note
are discharged to the extent such payments are made to the
Holder of record.
The principal and interest to be distributed on any Payment
Date will, as provided in the Agreement, be distributed to the
Person in whose name this Class A Note is registered on the
Record Date for such Payment Date.
Payments on the Class A Notes shall be made by the Trustee
by wire transfer of immediately available funds to the account of
the Person entitled thereto at a bank or other entity having
appropriate facilities therefor if such Person shall have so
notified the Trustee in writing by the Record Date immediately
prior to such Payment Date and is the registered owner of Class A
Notes in the initial aggregate principal amount equal to or in
excess of $500,000. The final installment of principal of and
interest on each Class A Note shall be payable on or before its
Class A Stated Maturity. The Trustee shall notify the Person in
whose name a Class A Note is registered at the close of business
on the twenty-fifth day of the month next preceding the month of
the Payment Date on which the Issuer expects that the final
installment of principal of and interest on such Class A Note
will be paid. Upon payment of the final installment of principal
of and interest on each Class A Note, the Holders will return the
Class A Notes to the Trustee for cancellation.
The Class A Notes may be redeemed, at the option of the
Issuer, on notice as provided in the Agreement, in whole but not
in part, on any Payment Date at a price (the "Redemption Price")
equal to the sum of (i) 100% of the then Outstanding Class A Note
Principal Balance, (ii) accrued and unpaid interest to such
Payment Date and (iii) the applicable Yield Maintenance Amount,
if any. The Class A Notes are additionally subject from time to
time to redemption (i) in part, pursuant to a Special Redemption
and (ii) in whole but not in part, pursuant to a Mandatory
Redemption, respectively, under the limited circumstances set
forth in the Agreement. The price to be paid for Class A Notes
so redeemed will be equal to the applicable Redemption Price.
Upon surrender for registration of transfer of any Class A
Note in certificated form at the office or agency of the Issuer
to be maintained in the United States of America, the Issuer
shall execute, and, upon an Issuer Order, the Trustee shall
authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Class A Notes of any
authorized denominations of a like aggregate principal amount.
Prior to due presentment for registration of transfer of any
Class A Note, the Issuer, the Trustee and any agent of the Issuer
or of the Trustee may treat the Person in whose name any Class A
Note is registered as the owner of such Class A Note for the
purpose of receiving payments of principal and interest on such
Class A Note and for all other purposes whatsoever, (whether or
not such Class A Note is overdue), and neither the Issuer, the
Trustee nor any agent of the Issuer or the Trustee shall be bound
by notice to the contrary.
If an Event of Default as defined in the Indenture shall
occur and be continuing, the principal of all of the Class A
Notes may, and in certain cases shall, become or be declared due
and payable in the manner and with the effect provided in the
Agreement.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the
rights of the Holders of the Class A Notes under the Agreement at
any time by the Issuer and the Trustee with the consent of the
Registered Holders of all Series evidencing 66 2/3% of the
Outstanding Note Principal Balance as of any date of
determination. Any such consent by the Holder of this Class A
Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Class A Note and of any Class A Note
issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof whether or not notation of such consent
is made upon this Class A Note.
The Class A Notes are issuable only in registered
certificated form in minimum denominations of $500,000 and
integral multiples of $100,000 in excess thereof, except that the
Issuer may issue one Class A Note in such denomination as it
deems necessary and appropriate to represent the remainder of the
Outstanding Class A Note Principal Balance as provided in the
Agreement.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Class A Note
shall not be entitled to any benefit under the Agreement, or be
valid or obligatory for any purpose.
THIS CLASS A NOTE AND THE AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH, AND GOVERNED BY,
THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, Dyn Funding Corporation has caused this
Class A Note to be signed by an authorized officer.
DYN FUNDING CORPORATION
By:______________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A Notes referred to in the within
mentioned Agreement.
Date of Authentication: BANKERS TRUST COMPANY
as Trustee
__________
By: ________________________
Name:
Title:
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this Class A Note, shall be construed as though they
were written out in full according to applicable laws or
regulations:
UNIF GIFT MIN ACT--..........Custodian................
(Cust) (Minor)
COM -- as tenants in common Under Uniform Gifts to Minors
ENT -- as tenants by the Act..........................
entireties (State)
TEN -- as joint tenants with
rights of survivorship
and not as tenants in
common
Additional abbreviations may also be used though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers unto ___________________________________________
______________________________________________________________
______________________________________________________________
Please print or typewrite name and address of assignee
the within Class A Note and does hereby irrevocably constitute
and appoint ______________________________________________
Attorney in fact to transfer the said Class A Note on the books
thereof of the within named Corporation, with full power of
substitution in the premises.
Dated: ___________________
______________________________*
Signature Guaranteed:
______________________________
_______________________
NOTICE: The signature to this assignment must correspond with
the name as written upon the face of this Class A Note in every
particular without alteration or enlargement or any change
whatever. The signature must be guaranteed by an institution
which is a member of one of the following recognized Signature
Guaranty Program: (i) The Securities Transfer Agent Medallion
Program (STAMP); (ii) The New York Stock Exchange Medallion
Program (MSP); (iii) The Stock Exchange Medallion Program (SEMP);
or (iv) in such other guarantee program acceptable to the
Trustee.
EXHIBIT B
FORM OF CLASS B NOTE
THE CLASS B NOTES ARE BEING OFFERED AND SOLD IN RELIANCE ON
EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF THE ACT, THE
INVESTMENT COMPANY ACT AND APPLICABLE STATE SECURITIES LAWS. THE
CLASS B NOTES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND
RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT TO (A)
"QUALIFIED INSTITUTIONAL BUYERS" (AS DEFINED IN RULE 144A UNDER
THE ACT ("RULE 144A")) AS PERMITTED UNDER RULE 144A OR (B)
INSTITUTIONAL "ACCREDITED INVESTORS" (AS DEFINED IN RULE
501(A)(1), (2), (3) OR (7) UNDER THE ACT) AND AS PERMITTED UNDER
APPLICABLE STATE SECURITIES LAWS.
THE UNPAID PRINCIPAL BALANCE OF THIS CLASS B NOTE WILL BE AS
SET FORTH ON ATTACHMENT A. ANYONE ACQUIRING THIS CLASS B NOTE
MAY ASCERTAIN ITS CURRENT PRINCIPAL BALANCE BY INQUIRY OF THE
TRUSTEE. THE RIGHTS OF A HOLDER OF THIS CLASS B NOTE ARE SUBJECT
TO THE PROVISIONS OF THE WITHIN-REFERENCED AGREEMENT.
DYN FUNDING CORPORATION
Floating Rate Contract Receivable Collateralized Note
Series 1997-1, Class B
Note No. __ Stated Maturity: October 31, 2002
CUSIP No. 267743 AB 8
Dyn Funding Corporation, a corporation duly organized and
existing under the laws of the State of Delaware (herein referred
to as the "Issuer"), for value received, hereby promises to pay
to ____________________ or registered assigns, in accordance with
the terms of the DynCorp Trade Receivables Master Indenture,
dated April 18, 1997 (the "Indenture"), between the Issuer and
Bankers Trust Company, as trustee (the "Trustee", which term
includes any successor Trustee), as supplemented by the Series
1997-1 Supplement, dated April 18, 1997 (the "Series 1997-1
Supplement"), between the Issuer and the Trustee (the Series
1997-1 Supplement and the Indenture being collectively referred
to herein as the "Agreement"), the principal sum set forth on
Attachment A hereto, which shall not exceed ____________________
DOLLARS ($__________), as shall have been advanced and then be
outstanding hereunder as herein described, and interest on the
unpaid amount hereof in the manner hereinafter described until
this Class B Note has been paid in full. However, principal with
respect to the Class B Notes may be paid earlier or later as
described in the Agreement, and the principal amount of the Class
B Notes may be increased, but not in excess of the Class B
Purchase Limit, from time to time as provided in the Agreement.
This Class B Note is one of a duly authorized issue of
Series 1997-1 Notes of the Issuer, designated as the Floating
Rate Contract Receivable Collateralized Notes, Series 1997-1,
Class B (herein referred to as the "Class B Notes"), limited in
aggregate principal amount to $90,000,000 under the Agreement,
subject to the terms, provisions and conditions of the Agreement,
to which Agreement reference is made for a statement of the
respective rights thereunder of the Issuer, the Trustee and the
Holders of the Series 1997-1 Notes, and the terms upon which the
Series 1997-1 Notes are, and are to be, authenticated and
delivered. Also issued under the Agreement are the 7.486% Fixed
Rate Contract Receivable Collateralized Notes, Series 1997-1,
Class A. A summary of certain of the pertinent provisions of the
Agreement is set forth hereinafter. All terms used in this Class
B Note that are not otherwise defined herein shall have the
meanings assigned to them in the Agreement.
Each payment of this Class B Note shall be applied first to
the payment of interest accrued and unpaid on this Class B Note
and any Commitment Fee due to the Purchaser pursuant to the
Class B Note Purchase Agreement and then, if principal is then
payable, to the payment of principal of this Class B Note.
The interest on this Class B Note and principal of this
Class B Note shall be distributable in lawful money of the United
States in the following manner:
(a) Interest will accrue on the average daily
outstanding Class B Note Principal Balance, if any, from the
Closing Date through April 29, 1997 and with respect to each
Interest Period thereafter, at the rate of 0.70% per annum
above LIBOR (the "Class B Note Interest Rate"), as more
specifically set forth in the Agreement and will be due and
payable on the 30th day of each month or, if such day is not
a Business Day, the next succeeding Business Day commencing
on April 30, 1997 (each, a "Payment Date"). Interest will
be calculated on the basis of the actual number of days
elapsed in a 360-day year. If the amounts available in the
Distribution Account and Reserve Fund are insufficient to
pay the amount of interest due and payable on the Class B
Notes on any Payment Date, such shortfall will be carried
forward and added to the amount due on such Class B Notes on
the next Payment Date. Any such amount carried forward will
bear interest, to the extent legally permissible, at a rate
per annum which shall be equal to 200 basis points in excess
of the Class B Note Interest Rate.
(b) The principal of the Class B Notes shall be
payable commencing on the Amortization Date and each Payment
Date thereafter and otherwise in accordance with the
Agreement, to the extent of the amount available after
payment of all interest payable on the Notes, to the extent
that funds remain in the Collection Account, as provided in
the Agreement. On any Payment Date during the Non-
Amortization Period, the Issuer may designate amounts on
deposit in the Collection Account to pay principal in whole
or in part of the Class B Notes. The Holders of the Class B
Notes as of the Record Date in respect of a Payment Date
shall be entitled to the interest accrued and payable and
the principal payable on such Payment Date. Payments of
principal to such Holders shall be made in the proportion
that the unpaid principal balance of the Class B Notes
registered in the name of each such Holder on such Record
Date bears to the aggregate unpaid principal balance of all
the Class B Notes (the "Outstanding Class B Note Principal
Balance") on such Record Date. All payment obligations
under a Class B Note are discharged to the extent such
payments are made to the Holder of record.
The principal and interest to be distributed on any Payment
Date will, as provided in the Agreement, be distributed to the
Person in whose name this Class B Note is registered on the
Record Date for such Payment Date.
Payments on the Class B Notes shall be made by the Trustee
by wire transfer of immediately available funds to the account of
the Person entitled thereto at a bank or other entity having
appropriate facilities therefor if such Person shall have so
notified the Trustee in writing by the Record Date immediately
prior to such Payment Date and is the registered owner of Class B
Notes in the initial aggregate principal amount equal to or in
excess of $500,000. The final installment of principal of and
interest on each Class B Note shall be payable on or before its
Class B Stated Maturity. The Trustee shall notify the Person in
whose name a Class B Note is registered at the close of business
on the twenty-fifth day of the month next preceding the month of
the Payment Date on which the Issuer expects that the final
installment of principal of and interest on such Class B Note
will be paid. Upon payment of the final installment of principal
of and interest on each Class B Note, the Holders will return the
Class B Notes to the Trustee for cancellation.
The Class B Notes may be paid, in whole or in part from time
to time, at the option of the Issuer, on any Payment Date.
Upon surrender for registration of transfer of any Class B
Note in certificated form at the office or agency of the Issuer
to be maintained in the United States of America, the Issuer
shall execute, and, upon an Issuer Order, the Trustee shall
authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Class B Notes of any
authorized denominations of a like aggregate principal amount.
Prior to due presentment for registration of transfer of any
Class B Note, the Issuer, the Trustee and any agent of the Issuer
or of the Trustee may treat the Person in whose name any Class B
Note is registered as the owner of such Class B Note for the
purpose of receiving payments of principal and interest on such
Class B Note and for all other purposes whatsoever, (whether or
not such Class B Note is overdue), and neither the Issuer, the
Trustee nor any agent of the Issuer or the Trustee shall be bound
by notice to the contrary.
If an Event of Default as defined in the Indenture shall
occur and be continuing, the principal of all of the Class B
Notes may, and in certain cases shall, become or be declared due
and payable in the manner and with the effect provided in the
Agreement.
The Agreement permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the
rights of the Holders of the Class B Notes under the Agreement at
any time by the Issuer and the Trustee with the consent of the
Registered Holders of all Series evidencing 66 2/3% of the
Outstanding Note Principal Balance as of any date of
determination. Any such consent by the Holder of this Class B
Note shall be conclusive and binding upon such Holder and upon
all future Holders of this Class B Note and of any Class B Note
issued upon the registration of transfer hereof or in exchange
hereof or in lieu hereof whether or not notation of such consent
is made upon this Class B Note.
The Class B Notes are issuable only in registered
certificated form in minimum denominations of $500,000 and
integral multiples of $100,000 in excess thereof, except that the
Issuer may issue one Class B Note in such denomination as it
deems necessary and appropriate to represent the remainder of the
Outstanding Class B Note Principal Balance as provided in the
Agreement.
Unless the certificate of authentication hereon has been
executed by the Trustee by manual signature, this Class B Note
shall not be entitled to any benefit under the Agreement, or be
valid or obligatory for any purpose.
THIS CLASS B NOTE AND THE AGREEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH, AND GOVERNED BY,
THE LAWS OF THE STATE OF NEW YORK.
IN WITNESS WHEREOF, Dyn Funding Corporation has caused this
Class B Note to be signed by an authorized officer.
DYN FUNDING CORPORATION
By:______________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Notes referred to in the within
mentioned Agreement.
Date of Authentication: BANKERS TRUST COMPANY
as Trustee
__________, 1997
By: ________________________
Name:
Title:
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this Class B Note, shall be construed as though they
were written out in full according to applicable laws or
regulations:
UNIF GIFT MIN ACT--..........Custodian................
(Cust) (Minor)
COM -- as tenants in common Under Uniform Gifts to Minors
ENT -- as tenants by the Act..........................
entireties (State)
TEN -- as joint tenants with
rights of survivorship
and not as tenants in
common
Additional abbreviations may also be used though not in the above
list.
FORM OF TRANSFER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers unto ___________________________________________
______________________________________________________________
______________________________________________________________
Please print or typewrite name and address of assignee
the within Class B Note and does hereby irrevocably constitute
and appoint ___________________________________________________
Attorney in fact to transfer the said Class B Note on the books
thereof of the within named Corporation, with full power of
substitution in the premises.
Dated: ___________________
______________________________*
Signature Guaranteed:
______________________________
_______________________
NOTICE: The signature to this assignment must correspond with
the name as written upon the face of this Class A Note in every
particular without alteration or enlargement or any change
whatever. The signature must be guaranteed by an institution
which is a member of one of the following recognized Signature
Guaranty Program: (i) The Securities Transfer Agent Medallion
Program (STAMP); (ii) The New York Stock Exchange Medallion
Program (MSP); (iii) The Stock Exchange Medallion Program (SEMP);
or (iv) in such other guarantee program acceptable to the
Trustee.
Attachment A
Date of Principal Interest Principal Interest
Increase Advanced Paid Paid Rate
EXHIBIT C
(1) The Purchaser understands and acknowledges that
the Notes have not been registered under the Act or any
other applicable securities law, and may not be offered,
sold or otherwise transferred except in compliance with the
registration requirements of the Securities Act of 1933, as
amended (the "Act"), or any other applicable law or pursuant
to an exemption therefrom and the conditions for transfer
set forth in paragraph (4) below.
(2) The Purchaser is either:
(a) an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) promulgated
under the Act) ("Accredited Investors"); or
(b) a "Qualified Institutional Buyer" as defined
in Rule 144A promulgated under the Act ("Rule 144A"),
and is aware that any sale of the Notes to it will be
made in reliance on Rule 144A. Such acquisition will
be for its own account or for the account of another
Qualified Institutional Buyer.
(3) Each purchaser of the Notes who is a Qualified
Institutional Buyer or an Accredited Investor as described
in Sections 2(a) and 2(b) above is purchasing the Notes for
its own account, or for one or more investor accounts for
which it is acting as a fiduciary or agent, in each case for
investment, and not with a view to, or for offer or sale in
connection with, any distribution thereof, subject to any
requirement of law that the disposition of its property or
the property of such investor account or accounts to be at
all times within its or their control and subject to its or
their ability to resell the Notes pursuant to Rule 144A, or
other exemption from registration available under the Act.
Such purchaser agrees, on its own behalf and on behalf of
any investor account for which it is purchasing the Notes,
and each subsequent holder of the Notes by its acceptance
thereof will agree, to offer, sell or otherwise transfer
such Notes only (a) pursuant to a registration statement
which has been declared effective under the Act, (b) to a
person it reasonably believes is a Qualified Institutional
Buyer that purchases for its own account or for the account
of a Qualified Institutional Buyer to whom notice is given
that the transfer is being made in reliance on Rule 144A and
with respect to which the purchaser will provide to the Note
Registrar a signed letter containing certain representations
and warranties relating to the proposed transferee and the
restrictions on transfer of the Notes, (c) to an Accredited
Investor that, prior to such transfer, furnishes to the
Registrar a signed letter containing certain representations
and agreements relating to the restrictions on transfer of
the Notes a signed letter containing certain representations
and warranties relating to the proposed transferee and the
restrictions on transfer of the Notes (the form of which
letter may be obtained from the Registrar), (c) to an
Accredited Investor that, prior to such transfer, furnishes
to the Registrar a signed letter containing certain
representations and agreements relating to the restrictions
on transfer of the Notes or (d) pursuant to an exemption
from such registration requirements as confirmed in an
opinion of counsel satisfactory to the Issuer and the Note
Registrar, subject in each of the foregoing cases to any
requirement of law that the disposition of its property or
the property of such investor account or accounts to be at
all times within its or their control.
(4) The Purchaser will be required to certify whether
such purchaser is a "benefit plan investor" as defined in
Section 2510.3-101(f)(2) of the Labor Regulations
promulgated under ERISA, or if such purchaser is an
insurance company licensed to issue contracts of insurance
in any state, whether the source of funds from which its
investment is to be made is the general account of such
insurance company.
(5) It acknowledges that the Issuer and others will
rely upon the truth and accuracy of the foregoing
acknowledgements, representations and agreements and agrees
that, if any of the acknowledgements, representations or
warranties deemed to have been made by its purchase of the
Notes are no longer accurate, it shall promptly notify the
Issuer. If it is acquiring any Notes as a fiduciary or
agent for one or more investor accounts, it represents that
it has sole investment discretion with respect to each such
account and that it has full power to make the foregoing
acknowledgements, representations and agreements on behalf
of each such account.