EXECUTION COPY
GE EQUIPMENT MIDTICKET LLC, SERIES 2006-1
Asset Backed Notes
UNDERWRITING AGREEMENT
December 5, 2006
MORGAN STANLEY & CO. INCORPORATED
Acting on behalf of itself and as the Representative of the several
Underwriters named in Schedule I hereto (in either such capacity
sometimes
herein the "Representative")
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
Section 1. Introductory. GE Equipment Midticket LLC, Series 2006-1
(the
"Company"), CEF Equipment Holding, L.L.C. ("CEFEH" or the
"Depositor") and
General Electric Capital Corporation ("GECC") propose to cause the
sale of the
GE Equipment Midticket LLC, Series 2006-1 Asset Backed Notes,
consisting of the
Class A-1 Notes (the "Class A-1 Notes"), the Class A-2 Notes (the
"Class A-2
Notes"), the Class A-3 Notes (the "Class A-3 Notes"), the Class A-4
Notes (the
"Class A-4 Notes"), the Class B Notes (the "Class B Notes") and the
Class C
Notes (the "Class C Notes" and together with the Class A-1 Notes,
the Class A-2
Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B
Notes, the
"Notes"). The Notes will be issued pursuant to an Indenture, dated
as of
December 14, 2006 (the "Indenture"), between the Company and The
Bank of New
York, as indenture trustee (the "Indenture Trustee"). The Notes
will be issued
in an aggregate initial principal amount of $1,053,773,000. The
Notes are being
purchased by the entities specified in Schedule I hereto (each an
"Underwriter,"
and together the "Underwriters").
The Notes will be secured by the Collateral, including without
limitation,
a pool of equipment loans and finance leases secured by
transportation
equipment, industrial equipment, construction equipment, furniture
and fixtures,
maritime assets, technology and telecommunications equipment or
other equipment
and the related security interests in the equipment financed
thereby
(collectively, the "Loans") and certain rights under the Interest
Rate Swap
Agreements, each to be dated December 14, 2006 (the "Interest Rate
Swap
Agreements"), between the Company and General Electric Capital
Services, Inc.
("GECS"). Pursuant to a Loan Sale Agreement, dated as of December
14, 2006 (the
"Loan Sale Agreement"), between the Depositor and GECC, GECC will
sell the Loans
to the Depositor. Pursuant to a Loan Purchase and Sale Agreement,
dated as of
December 14, 2006 (the "Loan Purchase and Sale Agreement"), between
the
Depositor and the Company, the Depositor will sell, transfer and
convey to the
Company, without recourse, all of its right, title and interest in
the Loans.
Pursuant to the
Servicing Agreement, to be dated as of December 14, 2006 (the
"Servicing
Agreement") between GECC, as servicer, and the Company, GECC will
service the
Loans.
Capitalized terms used herein but not otherwise defined shall have
the
meanings set forth in the Indenture.
The Class A-1 Notes shall bear interest at 5.30138% per annum, the
Class
A-2 Notes shall bear interest at 5.10% per annum, the Class A-3
Notes shall bear
interest at One-Month LIBOR plus 0.01% per annum, the Class A-4
Notes shall bear
interest at the then applicable One-Month LIBOR plus 0.03% per
annum, the Class
B Notes shall bear interest at the then applicable One-Month LIBOR
plus 0.15%
per annum and the Class C Notes shall bear interest at the then
applicable
One-Month LIBOR plus 0.32% per annum.
The Depositor has prepared and filed a shelf registration statement
on Form
S-3 (having the registration number 333-132242), including a form
of prospectus
and any supplements or amendments thereto filed prior to the date
hereof, with
the Securities and Exchange Commission (the "Commission") in
accordance with the
provisions of the Securities Act of 1933, as amended (the "Act"),
relating to
the Notes, which registration statement has been declared effective
by the
Commission not more than three years prior to the date hereof. If
any
post-effective amendment to such registration statement has been
filed with
respect thereto, prior to the execution and delivery of this
Underwriting
Agreement, the most recent such amendment has been declared
effective by the
Commission. For purposes of this Underwriting Agreement, "Effective
Time" means
the date and time as of which such registration statement, or the
most recent
post-effective amendment thereto, if any, was declared effective by
the
Commission, and "Effective Date" means the date of the Effective
Time. Such
registration statement, as amended at the Effective Time, including
all material
incorporated by reference therein and including all information (if
any) deemed
to be part of the registration statement at the time of
effectiveness pursuant
to Rule 430B under the Act, is referred to in this Underwriting
Agreement as the
"Registration Statement." The Company proposes to file with the
Commission
pursuant to Rule 424(b) under the Act ("Rule 424(b)") a supplement
(the
"Prospectus Supplement") to the prospectus included in the
Registration
Statement (such prospectus, in the form it appears in the
Registration
Statement, or in the form most recently revised and filed with the
Commission
pursuant to Rule 424(b), is hereinafter referred to as the "Base
Prospectus")
relating to the Notes and the method of distribution thereof. The
Base
Prospectus and the Prospectus Supplement, together with any
amendment thereof or
supplement thereto, are hereinafter referred to as the
"Prospectus."
Prior to the "Time of Sale" (as defined below), the Depositor also
had
prepared a Preliminary Prospectus with respect to the Notes. As
used herein,
"Preliminary Prospectus" means, with respect to any date or time
referred to
herein, the most recent preliminary Prospectus (as amended or
supplemented, if
applicable), which has been prepared and delivered by the Depositor
to the
Representative in accordance with the provisions hereof. As used
herein, "Time
of Sale" means 1:10 p.m. (New York City time) on December 5, 2006
(the time the
first Contract of Sale was entered into as designated by the
Representative).
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Section 2. Representations, Warranties and Covenants of the
Depositor and
GECC.
(a) The Depositor represents and warrants to the Underwriters, as
of the
date hereof, that:
(i) (x) The conditions to the use of a registration statement on
Form
S-3 under the Act, as set forth in the General Instructions to Form
S-3,
and the conditions of Rule 415 under the Act, have been satisfied
with
respect to the Registration Statement. No stop order suspending the
effectiveness of the Registration Statement has been issued, and no
proceeding for that purpose has been instituted or threatened by
the
Commission.
(y) As of the Closing Date (as such term is defined below), the
Registration Statement, the Preliminary Prospectus and the
Prospectus,
except with respect to any modification as to which the
Representative has
been notified, shall be in all substantive respects in the form
furnished
to the Representative or its counsel before such date or, to the
extent not
completed on such date, shall contain only such specific additional
information and other changes (beyond that contained in the latest
Preliminary Prospectus that has previously been furnished to the
Representative) as the Depositor or GECC has advised the
Representative,
before such time, will be included or made therein.
(z) The Registration Statement, as of the Effective Date,
conformed in all material respects to the requirements of the Act
and the
rules and regulations of the Commission thereunder (the "Rules and
Regulations") and of the Trust Indenture Act of 1939; on the date
of this
Underwriting Agreement, the Prospectus conforms, and as of the time
of
filing the Prospectus pursuant to Rule 424(b), the Prospectus will
conform,
in all material respects to the requirements of the Act and the
Rules and
Regulations; the Registration Statement, at the Effective Time, did
not
contain any untrue statement of a material fact or omit to state a
material
fact required to be stated therein or necessary to make the
statements
therein not misleading; and the Prospectus and the Designated
Static Pool
Information (as defined below), taken together, as of its date, and
as of
the time of filing pursuant to Rule 424(b), will not include any
untrue
statement of a material fact required to be stated therein or omit
to state
a material fact necessary to make the statements therein, in the
light of
the circumstances under which they are made, not misleading;
provided, that
the Depositor makes no representations or warranties as to (I) that
part of
the Registration Statement which constitutes the Statements of
Eligibility
of Qualification (Form T-1) of the Indenture Trustee and (II)
anything
contained in or omitted from such Registration Statement or such
Prospectus
in reliance upon and in conformity with written information
furnished to
the Depositor by or on behalf of any Underwriter specifically for
use in
the preparation thereof, which information consists of the
Underwriters'
Information (as defined herein); provided, further, that this
paragraph (z)
makes no representation and warranty as to the Preliminary
Prospectus; the
Preliminary Prospectus is covered by paragraph (aa) below. As used
herein
the term "Designated Static Pool Information" shall mean the static
pool
information referred to in the Preliminary Prospectus and the
Prospectus
under the caption "Static Pool Information" but deemed to be
excluded from
the
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Registration Statement and the Prospectus pursuant to Item 1105(d)
of
Regulation AB issued under the Act.
(aa) The Preliminary Prospectus at the Time of Sale did not, and
at the Closing Date will not, include any untrue statement of a
material
fact or omit to state any 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 (it being understood
that no
representation or warranty is made with respect to the omission of
pricing
and price-dependent information, which information shall of
necessity
appear only in the final Prospectus); provided, that this
representation
and warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information contained in or
omitted
from the Preliminary Prospectus based upon Underwriters'
Information.
(bb) The Preliminary Prospectus and the Designated Static Pool
Information, taken together, at the Time of Sale did not, and at
the
Closing Date will not, include any untrue statement of a material
fact or
omit to state any material fact necessary in order to make the
statements
therein, in light of the circumstances under which they were made,
not
misleading (it being understood that no representation or warranty
is made
with respect to the omission of pricing and price-dependent
information,
which information shall of necessity appear only in the final
Prospectus);
provided, that this representation and warranty shall not apply to
any
statements or omissions made in reliance upon and in conformity
with
information contained in or omitted from either the Preliminary
Prospectus
or the Designated Static Pool Information based upon Underwriters'
Information.
(cc) Other than with respect to the Preliminary Prospectus, the
Prospectus and the Permitted Additional Information (as defined
below), the
Company (including its agents and representatives) has not made,
used,
authorized or approved and will not make, use, authorize or approve
any
"written communication" (as defined in Rule 405 under the Act) that
constitutes an offer to sell or solicitation of any offer to buy
the Notes.
(ii) The Depositor is a limited liability company duly formed,
validly
existing and in good standing under the laws of its state of
formation, and
the Company is a limited liability company, duly formed, validly
existing
and in good standing under the laws of its state of formation, and
each of
the Depositor and the Company has all power and authority necessary
to own
or hold its properties and conduct its business in which it is
engaged as
described in the Prospectus.
(iii) Each of the Company and the Depositor has, and will have, the
requisite power to execute and deliver the Related Documents and
this
Underwriting Agreement to which it is a party, and any other
agreement or
document executed by either of them in connection with the issuance
and
sale of the Notes and this Underwriting Agreement and to perform
their
respective obligations hereunder and thereunder.
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(iv) Each of the Related Documents and this Underwriting Agreement
to
which it is a party has been, or will be, duly and validly
authorized,
executed and delivered by each of the Company and the Depositor,
and
assuming due authorization, execution and delivery thereof by the
other
parties thereto, each of the Related Documents and this
Underwriting
Agreement constitutes, or will constitute on the Closing Date, the
valid,
legal and binding obligation of each of the Company and the
Depositor,
enforceable against each of the Company and the Depositor in
accordance
with its terms, subject to (A) the effect of bankruptcy,
insolvency,
reorganization, moratorium and other similar laws relating to or
affecting
creditors' rights generally, (B) the application of equitable
principles in
any proceeding, whether at law or in equity or (C) public policy
considerations underlying the securities laws, to the extent that
such
public policy considerations limit the enforceability of the
provisions of
this Underwriting Agreement that purport to provide indemnification
for
securities laws liabilities.
(v) The Notes will conform to the description thereof contained in
the
Preliminary Prospectus and the Prospectus and when the Notes are
duly and
validly executed, issued and delivered in accordance with the
Related
Documents, and sold to the Underwriters as provided herein, will
each be
validly issued and outstanding and entitled to the benefits of the
Indenture.
(vi) Neither the execution and delivery by the Company or the
Depositor of any Related Document or this Underwriting Agreement to
which
it is a party nor the consummation by the Company or the Depositor
of the
transactions contemplated herein or therein, nor the issuance of
the Notes
by the Company or the public offering thereof as contemplated in
the
Preliminary Prospectus and the Prospectus, will conflict in any
material
respect with or result in a material breach of, or constitute a
material
default (with notice or passage of time or both) under, or result
in the
imposition of any lien, pledge, charge, encumbrance, adverse claim
or other
security interest of any other person (collectively, "Liens") upon
any of
the property or assets of the Company or the Depositor (except as
required
or permitted pursuant thereto or hereto), pursuant to any material
mortgage, indenture, loan agreement, contract or other instrument
to which
the Company or the Depositor is party or by which either of them is
bound,
nor will such action result in any violation of any provisions of
any
applicable law, administrative regulation or administrative or
court
decree, the certificate of formation or limited liability company
agreement
of the Company or the certificate of formation or limited liability
company
agreement of the Depositor.
(vii) Other than as set forth in or contemplated by the Prospectus,
there are no legal or governmental proceedings pending to which the
Depositor or the Company is a party or of which any property or
assets of
the Depositor or the Company are the subject of which, if
determined
adversely to the Depositor or the Company, as applicable, would
individually or in the aggregate have a material adverse effect on
the
business, the financial position, the business prospects, the
operations of
the Depositor or the Company, as applicable, or on the performance
by the
Depositor or the Company, as applicable, of its obligations
hereunder or
under the Related Documents to which it is a party; and, to the
best
knowledge of the Depositor and the Company, no such proceedings are
threatened or contemplated by governmental authorities or
threatened by
others.
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(viii) No consent, approval, authorization or order of, or
registration, filing or declaration with, any court or governmental
agency
or body is required, or will be required, in connection with (i)
the
execution and delivery by the Company or the Depositor of any
Related
Document or this Underwriting Agreement to which it is a party or
the
performance by the Company or the Depositor under any Related
Document or
this Underwriting Agreement to which it is a party or (ii) the
offer, sale
or delivery of the Notes, except such as shall have been obtained
or made,
as the case may be, or will be obtained or made, as the case may
be, prior
to the Closing Date, or will not materially adversely affect the
ability of
the Company or the Depositor to perform its obligations under any
Related
Document or this Underwriting Agreement.
(ix) Each of the Company and the Depositor possesses, and will
possess, all material licenses, certificates, authorities or
permits issued
by the appropriate state, federal or foreign regulatory agencies or
bodies
necessary to conduct the business now conducted by it and as
described in
the Preliminary Prospectus and Prospectus, except to the extent
that the
failure to have such licenses, certificates, authorities or permits
does
not have a material adverse effect on the Notes or the financial
condition
of the Company or the Depositor, and neither the Company nor the
Depositor
has received, nor will have received as of the Closing Date, any
notice of
proceedings relating to the revocation or modification of any such
license,
certificate, authority or permit which, singly or in the aggregate,
if the
subject of an unfavorable decision, ruling or finding, would
materially and
adversely affect the conduct of its business, operations or
financial
condition
(x) Each of the representations and warranties of the Depositor and
the Company set forth in each Related Document is true and correct
in all
material respects.
(xi) Neither the Depositor nor the Company is now, and following
the
issuance of the Notes, neither the Depositor nor the Company will
be, an
"investment company" as such term is defined in the Investment
Company Act
of 1940, as amended.
(xii) The Indenture has been qualified under the Trust Indenture
Act
of 1939, as amended.
(xiii) The Depositor was not, on the date on which the first bona
fide
offer of the Notes sold pursuant to this Underwriting Agreement was
made,
an "ineligible issuer" as defined in Rule 405 under the Act.
(b) GECC represents and warrants to the Underwriters, as of the
date
hereof, that:
(i) GECC is a corporation, duly organized and validly existing
under
the laws of its state of formation and GECC has all power and
authority
necessary to own or hold its properties and conduct its business in
which
it is engaged as described in the Prospectus.
(ii) GECC has, and will have, the requisite power to execute and
deliver the Related Documents and this Underwriting Agreement to
which it
is a party, and any other agreement or document executed by it in
connection with the issuance and sale of the
6
Notes and this Underwriting Agreement and to perform its
obligations
hereunder and thereunder.
(iii) Each of the Related Documents and this Underwriting Agreement
to
which it is a party has been, or will be, duly and validly
authorized,
executed and delivered by GECC and assuming due authorization,
execution
and delivery thereof by the other parties thereto, each of the
Related
Documents and this Underwriting Agreement constitutes, or will
constitute
on the Closing Date, the valid, legal and binding obligation of
GECC,
enforceable against GECC in accordance with its terms, subject to
(A) the
effect of bankruptcy, insolvency, reorganization, moratorium and
other
similar laws relating to or affecting creditors' rights generally,
(B) the
application of equitable principles in any proceeding, whether at
law or in
equity or (C) public policy considerations underlying the
securities laws,
to the extent that such public policy considerations limit the
enforceability of the provisions of this Underwriting Agreement
that
purport to provide indemnification for securities laws liabilities.
(iv) Neither the execution and delivery by GECC of any Related
Document or this Underwriting Agreement to which it is a party nor
the
consummation by GECC of the transactions contemplated herein or
therein,
nor the public offering thereof as contemplated in the Prospectus
and the
Prospectus Supplement, will conflict in any material respect with
or result
in a material breach of, or constitute a material default (with
notice or
passage of time or both) under, or result in the imposition of any
Liens
upon any of the property or assets of GECC (except as required or
permitted
pursuant thereto or hereto), pursuant to any material mortgage,
indenture,
loan agreement, contract or other instrument to which GECC is party
or by
which it is bound, nor will such action result in any violation of
any
provisions of any applicable law, administrative regulation or
administrative or court decree or the articles on incorporation or
the
by-laws of GECC.
(v) No consent, approval, authorization or order of, or
registration,
filing or declaration with, any court or governmental agency or
body is
required, or will be required, in connection with (i) the execution
and
delivery by GECC of any Related Document or this Underwriting
Agreement to
which it is a party or the performance by GECC under any Related
Document
or this Underwriting Agreement to which it is a party or (ii) the
offer,
sale or delivery of the Notes, except such as shall have been
obtained or
made, as the case may be, or will be obtained or made, as the case
may be,
prior to the Closing Date, or will not materially adversely affect
the
ability of GECC to perform its obligations under any Related
Document or
this Underwriting Agreement.
(vi) GECC possesses, and will possess, all material licenses,
certificates, authorities or permits issued by the appropriate
state,
federal or foreign regulatory agencies or bodies necessary to
conduct the
business now conducted by it and as described in the Preliminary
Prospectus
and Prospectus, except to the extent that the failure to have such
licenses, certificates, authorities or permits does not have a
material
adverse effect on the Notes or the financial condition of GECC, and
GECC
has not received, nor will have received as of the Closing Date,
any notice
of proceedings relating to the revocation or modification of any
such
license, certificate, authority or permit which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling
7
or finding, would materially and adversely affect the conduct of
its
business, operations or financial condition.
(vii) Each of the representations and warranties of GECC set forth
in
each Related Document to which it is a party is true and correct in
all
material respects.
Section 3. Purchase, Sale and Delivery of Notes. (a) On the basis
of the
representations, warranties and agreements contained in this
Underwriting
Agreement, but subject to the terms and conditions set forth in
this
Underwriting Agreement, the Depositor agrees to sell to each
Underwriter,
severally and not jointly, and each Underwriter, severally and not
jointly,
agrees to purchase from the Depositor, the respective original
principal amounts
of the Notes set forth in Schedule I hereto opposite the name of
such
Underwriter, plus any additional original principal amount of Notes
which such
Underwriter may be obligated to purchase pursuant to Section 12
hereof, at the
purchase price therefor set forth in Schedule I hereto.
(b) Against payment of the purchase price specified in Schedule I
hereto in
same day funds drawn to the order of the Depositor (or paid by such
other manner
as may be agreed upon by the Depositor and the Representative), the
Depositor
will deliver the Notes to the Underwriters at the offices of Mayer,
Brown Rowe &
Maw LLP, 1675 Broadway, New York, New York 10019 on December 14,
2006, or at
such other place and time as the Representative and the Depositor
shall agree
upon, each such time being herein referred to as a "Closing Date."
The Notes
will initially be maintained through the facilities of The
Depository Trust
Company, as indicated in the Prospectus Supplement.
Section 4. Public Offering of Notes. (a) Each Underwriter agrees
that all
offers, solicitations and sales shall be made in compliance with
all applicable
securities laws and regulations. Furthermore, such Underwriter
shall comply with
all applicable securities laws and regulations in connection with
the use of
Free Writing Prospectuses, including but not limited to Rules 164
and 433 of the
Act.
(b) It is understood by the parties hereto that the Underwriters
shall
offer and/or solicit offers for the Notes for sale to the public
(which may
include selected dealers), as set forth in the Preliminary
Prospectus and the
Prospectus.
Section 5. Covenants of the Depositor. The Depositor covenants and
agrees
with each Underwriter:
(a) The Depositor shall prepare a Prospectus Supplement setting
forth the
amount of Notes and the terms thereof not otherwise specified in
the Base
Prospectus, the price at which the Notes are to be purchased by the
Underwriters
from the Depositor, either the initial public offering price or the
method by
which the price at which the Notes are to be sold will be
determined, the
selling concessions and reallowances, if any, and such other
information as the
Representative and the Depositor deem appropriate in connection
with the
offering of the Notes; provided, however, that each of the Company
and the
Depositor shall make no amendment or supplement to the Registration
Statement
affecting or relating to any material extent to the Notes, and
shall make no
amendment or supplement to the Prospectus or the Prospectus
Supplement relating
to the Notes without furnishing the Representative with a copy of
the proposed
form
8
thereof and providing the Representative with a reasonable
opportunity to review
the same, and shall not file with the Commission any such amendment
or
supplement to which the Representative shall reasonably object;
and, provided
further, that each of the Company and the Depositor shall advise
the
Representative, promptly after it receives notice thereof, of the
time when any
amendment to the Registration Statement has been filed or becomes
effective or
any supplement to the Prospectus or any amended Prospectus has been
filed or
mailed for filing, of the issuance of any stop order by the
Commission, of the
suspension of the qualification of the Notes for offering or sale
in any
jurisdiction, of the initiation or threatening of any proceeding
for any such
purpose, or of any request by the Commission for the amending or
supplementing
of the Registration Statement, or the Prospectus or for additional
information;
and, in the event of the issuance of any such stop order or of any
order
preventing or suspending the use of the Prospectus Supplement
relating to the
Notes or suspending any such qualification, promptly shall use its
best efforts
to obtain its withdrawal.
(b) The Depositor shall endeavor to arrange for the qualification
of the
Notes for sale under the laws of such jurisdictions as the
Underwriters may
reasonably designate and to maintain such qualification in effect
so long as
required for the initial sale of the Notes; provided, however, that
the
Depositor shall not be required to qualify to do business in any
jurisdiction
where it is not now so qualified or to take any action that would
subject it to
general or unlimited service of process in any jurisdiction where
it is not now
so subject.
(c) The Depositor shall furnish the Underwriters copies of each
related
Preliminary Prospectus, the Prospectus, and all amendments and
supplements to
such documents, in each case as soon as available and in such
quantities as the
Underwriters may from time to time reasonably request; and, if the
delivery of a
Prospectus shall be at the time required by law in connection with
sales of the
Notes and either (i) any event shall have occurred as a result of
which the
Prospectus or Prospectus Supplement would include
