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EXHIBIT 5.1
March 27, 1998
Re: Advanta Equipment Receivables Asset-Backed Notes
Ladies and Gentlemen:
We have acted as special counsel to Advanta Business Services Corp., a
Delaware corporation ("Advanta"), Advanta Leasing Receivables Corp. IV ("ALRC
IV") and Advanta Leasing Receivables Corp. V ("ALRC V", and together with
Advanta and ALRC IV, the "Registrants") as to certain matters in connection with
the Advanta Equipment Receivables Asset-Backed Notes (the "Notes") which will
be issued from time to time pursuant to supplements to a Master Facility
Agreement (the "Facility Agreement") dated as of May 1, 1997 among Advanta,
the Obligors' Agent and The Chase Manhattan Bank, as Trustee (the "Trustee").
The assets which will be pledged to the Trustee for the benefit
of holders of the Notes (the "Noteholders") will include a pool of leases
(including, but not limited to, finance leases, true leases and full payout
leases), loans, contracts and promissory notes financing the purchase or lease
of a variety of commercial assets, commercial products or personal property
used exclusively for commercial purposes, all monies paid or payable
thereunder after the related Cut-Off Date, security interests in the underlying
collateral financed thereby, certain bank accounts and the proceeds thereof, the
right to receive certain insurance proceeds and certain other property (the
"Receivables").
Capitalized terms not otherwise defined herein have their
respective meanings as set forth in the Facility Agreement.
As such counsel, we have examined original or certified copies of
the Articles of Incorporation and Bylaws of each of the Registrants, as amended
to date, and the resolutions adopted by the Board of Directors of each of the
Registrants ratifying the execution, delivery and participation in the
transactions contemplated by the Agreements (as hereinafter defined). We have
examined the Facility Agreement, together with the Prospectus (the
"Agreements").
The term "Prospectus" means the prospectus included in the
Registration Statement. The term "Registration Statement" means (i) the
Registration Statement on Form S-1 (No. 333-38575, 333-38575-01 and
333-38575-02), including the exhibits thereto and (ii) any post-effective
amendment filed and declared effective prior to the date of issuance of the
Notes.
We have also examined such other documents, papers, statutes and
authorities as we have deemed necessary as a basis for the opinions hereinafter
set forth. In all such examinations made by us in connection with this opinion,
we have assumed the genuineness of all signatures, the completeness and
authenticity of all records and all documents submitted to us as originals, and
the conformity with the originals of all documents submitted to us as copies
thereof.
As to various matters of fact relevant to the opinions
hereinafter expressed, we have relied upon the representations and warranties
contained in the Agreements and statements and certificates of officers and
representatives of each of the Registrants.
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In rendering the opinions expressed in paragraphs numbered 1 and
2 below, we have assumed, without investigation, that (i) each Receivable will
be enforced in a commercially reasonable manner and (ii) each Receivable has
been duly authorized, executed and delivered by the respective Obligor
thereunder and constitutes the valid and legally binding obligation of such
obligor enforceable against such obligor in accordance with its terms, subject
to standard exceptions.
We also have assumed, without investigation, (a) as to all
parties to the Facility Agreement, the due authorization, execution, and
delivery thereof, and the validity and enforceability thereof against all
parties thereto other than Advanta or the Obligors' Agent, (b) each party has
full power, authority and legal right, under its charter and other governing
documents, corporate and regulatory legislation and the laws of its jurisdiction
of incorporation or organization, to execute and deliver the Facility Agreement
and to carry out the transactions contemplated thereunder, (c) ALRC IV and ALRC
V have the respective rights in the Receivables as contemplated by the
Agreements as of the date hereof, (d) the purchase price for the Notes has been
delivered and received in accordance with the terms of the Underwriting
Agreement and the Facility Agreement, respectively and (e) the Facility
Agreement will be enforced in good faith and in a commercially reasonable
manner.
We have assumed that the Receivables and rights to receive
payment under the Receivables are not subject to any right, lien or interest of
any government or any agency or instrumentality thereof (including without
limitation any federal or state tax lien, or lien arising under Title IV of
ERISA) and that they are not subject to any lien arising by operation of law or
any judicial lien.
We have also assumed that the Notes constitute debt and not
equity for purposes of ERISA and that each employee benefit plan covered by
ERISA, any of whose assets are invested in a Note, is a plan to which an
administrative prohibited transaction exemption is fully available.
With respect to matters of fact, we have relied, without
investigation, on, and assumed the accuracy and completeness of, each Officer's
Certificate and the representations of Advanta in the instruments and documents
delivered at the closing. Where matters are stated to be to the best of our
knowledge, or known to us, our investigations consisted of inquiries of Advanta,
ALRC IV and ALRC V, the results of which are reflected in the Officer's
Certificates being furnished to you with this opinion, and we have not made any
investigation as to, and have not independently verified the facts underlying,
such matters nor have we undertaken a search of court dockets in any
jurisdiction.
To the extent that our opinions expressed in paragraphs numbered
1 and 2 below are related to the enforceability of the choice of law provisions
contained in the Facility Agreement, such opinions are based upon our reading of
the provisions of Section 5-1401 of the General Obligations Law of the State of
New York. While we have not found any reported cases construing such statutory
provisions, we believe that a New York court applying such statutory provisions
to the Agreements would give effect to the choice of law provisions set forth
therein.
Statements in this opinion as to the validity, binding effect and
enforceability of agreements, instruments and documents are subject (i) to
limitations as to enforceability imposed by bankruptcy,
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insolvency, moratorium, reorganization and other similar laws of general
application relating to or affecting the enforceability of creditors' rights;
(ii) to general limitations under equitable principles limiting the availability
of equitable remedies; (iii) to the equitable discretion of the court before
which any proceeding therefor may be brought; (iv) as to the enforceability of
any security interest or security agreement, to the limitations of good faith,
fair dealing and commercial reasonableness imposed by the Uniform Commercial
Code of the State of New York, as in effect on the date hereof ("UCC") as to the
remedies set out in such agreements, instruments and documents; and (v) as to
rights to indemnity, limitations that may exist under federal and state laws or
the public policy underlying such laws.
Statements in this opinion as to enforceability are further
qualified by (i) the application of judicial decisions involving statutes or
principles of equity which have held that certain covenants and other provisions
of agreements, including those providing for the acceleration of indebtedness
due under debt instruments upon the occurrence of events therein described, are
unenforceable in circumstances where it can be demonstrated that the enforcement
of such provisions is not reasonably necessary for the protection of the lender;
(ii) the effect of the law of any jurisdiction other than the State of New York
which limits the rate of interest which may be charged or collected; and (iii)
the validity, binding effect or enforceability, under certain circumstances, of
contractual provisions in the Agreements with respect to indemnification or
waiving defenses to obligations where such indemnification or such waivers are
against public policy, or granting self-help or summary remedies.
Based upon and subject to the foregoing, we are of the opinion
that:
1. The Facility Agreement has been duly executed and delivered by
Advanta and constitutes the valid, legal and binding agreement of Advanta,
enforceable against Advanta in accordance with its terms.
2. Assuming the Facility Agreement has been duly executed and
delivered by the parties thereto (other than Advanta), each such agreement
constitutes the valid, legal and binding agreement of Advanta, enforceable
against Advanta in accordance with its terms. The Facility Agreement creates a
valid and enforceable security interest in the Collateral (as defined therein)
pledged thereunder to the Trustee.
3. No consent, approval, authorization or order of, registration
or filing with, or notice to, courts, governmental agency or body or other
tribunal is required under federal laws or the laws of the State of New York,
for the execution, delivery and performance by Advanta of the Facility
Agreement, the offer, issuance, sale or delivery of the Notes, except such which
have been obtained.
4. No consent, approval, authorization or order of, registration
or filing with, or notice to, courts, governmental agency or body or other
tribunal is required under federal laws or the laws of the State of New York,
for the execution, delivery and performance by Advanta of the Facility
Agreement, except such which have been obtained.
5. The Notes have been duly authorized by all requisite action
and, when duly and validly executed by the Trustee and authenticated by the
Trustee in accordance with the Facility Agreement,
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the Notes will be validly issued and outstanding, entitled to the benefits of
the Facility Agreement and will be fully paid and non-assessable.
6. The arrangement pursuant to which the Receivables are held
does not constitute an "investment company" within the meaning of the Investment
Company Act of 1940, as amended.
7. The Facility Agreement has been duly qualified under the Trust
Indenture Act of 1939, as amended.
We are members of the bar of the State of New York and this opinion is
limited to the laws of the State of New York and the Federal laws of the United
States of America.
This opinion is furnished by us as counsel to the Registrants. We hereby
consent to the filing of this opinion as an Exhibit to the Registration
Statement and to the reference to Dewey Ballantine LLP in the Registration
Statement and the related prospectus under the heading "Legal Matters."
Very truly yours,
/s/ Dewey Ballantine LLP