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(Back to Main Document) [raiform10q063007.htm]
 
ASSET PURCHASE AGREEMENT

    THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is made as of June 19,
2007, by and among LEAF FUNDING, INC., a Delaware corporation, LEAF FINANCIAL
CORPORATION, a Delaware corporation, and LEAF COMMERCIAL FINANCE CO., LLC, a
Delaware limited liability company (collectively, the “Buyer,” and whose
obligations hereunder shall be joint and several); and PACIFIC CAPITAL BANK,
N.A., a national banking association (“Seller”).  Capitalized terms used, but
not defined, in this Agreement shall have the meaning ascribed thereto in
Appendix A attached hereto.

    WHEREAS, Seller, among other business activities, is engaged in the
Business;

    WHEREAS, Seller desires to sell to Buyer, and Buyer desires to purchase from
Seller, certain of the assets of Seller relating to the Business, on the terms
set forth herein; and

    WHEREAS, Buyer has agreed to assume certain specific liabilities related to
such assets.

    NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby, the
parties hereto agree as follows:

1.           Purchase and Sale.  Upon the terms and subject to the conditions
set forth in this Agreement, on the Closing Date, Seller shall irrevocably sell,
assign, transfer and deliver to Buyer, and Buyer shall purchase, all of Seller’s
right, title and interest in and to all of the following (collectively, the
“Assets”):

(a)           all lease agreements or other contracts for use, conditional sale,
loan or financing entered into or acquired by Seller as part of the Business, as
a lessor, lender or financier, that, are set forth on Schedule 1(a) (which
schedule shall be provided in the form of a read-only computer disc containing a
file identifying all such leases, and a separate file identifying the Performing
Leases) (each a “Lease” and collectively, the “Leases”);

(b)           all right, title and interest that Seller has in the Subject
Equipment, collateral, Related Property or Residual Value with respect to each
Lease (subject, however, to the possessory rights of lessee therein) and any
other collateral that secures the obligation of a lessee under each Lease;
 
(c)           all Contract Files pertaining to each Lease;
 
(d)           the rights of Seller with respect to all lease transactions that
have been approved, but for which no lease has been finally executed as of the
Record Date, as set forth on Schedule 1(d) (which shall be in the form of a
read-only computer disc, and need not be updated as of the Closing Date) (the
“Backlog”);
 

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(e)           all of Seller’s rights under any existing Customer agreement
relating to any Leases or the Backlog;
 
(f)           all of Seller’s intangible rights and property associated
exclusively with the Business (but excluding anything that is also used in any
part of the Seller’s business, other than the Business), including but not
limited to, all trademarks, patents, copyrights, other intellectual property
used exclusively in the Business, going concern value, goodwill, telephone
numbers, facsimile numbers, processes, business and product names (if any),
trade secrets (if any), industrial models, designs, methodologies, technical
information, and know-how relating to the origination and servicing of the
Leases, but excluding (i) trade names, logos, slogans, (ii) licenses to software
that are not by their terms transferable and (iii) telephone numbers, facsimile
numbers and post office boxes other than those listed on Schedule 1(f);
 
(g)           all rights of Seller in guaranties, collateral accounts, security
deposits and other collateral posted by any person in connection with the
Leases;
 
(h)           those items of equipment, furniture, computer hardware and
software, leasehold improvements, fixtures and other tangible personal property
listed on Schedule 1(h);
 
(i)           all books, records and other documents and information related to
the Business or the Assets, including all Customer, prospect, third party
originator and distributor lists, sales literature, price lists, quotes and
bids, promotional programs, product catalogs and brochures, inventory records,
product data, purchase orders and invoices, sales orders and sales order log
books, commission records, Customer information, correspondence (but excluding
any such items that relate to the business of Seller other than the Business,
and excluding any internal analyses by Seller with respect to its decision to
sell the Business) and all personnel records and other records of Seller related
to its employees set forth on Schedule 1(i) to the extent their transfer is
permitted by law;
 
(j)           all insurance benefits related to the Leases and the Subject
Equipment, including rights and proceeds, arising from or relating to the Assets
or Assumed Liabilities prior to the Closing Date, unless expended in accordance
with this Agreement; and
 
(k)           all claims of Seller against third parties relating to the
Business or the Assets, whether choate or inchoate, known or unknown, contingent
or noncontingent, including equipment warranties and those claims set forth on
Schedule 1(k), but excluding any claims for reimbursement of taxes advanced or
tax refunds that relate to periods before the Closing and claims relating to
Excluded Assets and Retained Liabilities.
 
Any other assets not set forth in this Section 1 shall remain the property of
Seller (the “Excluded Assets”).

2.           Assumed Liabilities.  Upon the terms and subject to the conditions
set forth herein, Buyer hereby assumes and agrees to pay, perform, discharge or
otherwise satisfy in accordance with their respective terms, all of the Assumed
Liabilities.  Buyer shall not assume the Retained Liabilities.

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3.           Purchase Price.  The purchase price of the Assets shall be an
amount equal to the sum of (i) 104.7643% of the Net Investment in the Performing
Leases, as of the Record Date, which will be reflected on the Closing Date
Report, (ii) 104.7643% of the Net Investment in any Leases that are originated
between the Record Date and the Closing Date and (iii) accrued interest on the
amounts in (i) and (ii), calculated at the weighted average effective yield of
the Performing Leases from the Record Date to the date of payment, and (iv)
$2,000,000 (the “Purchase Price”).
 

4.           Closing.  The Closing will take place at the offices of Seller’s
counsel at 11355 West Olympic Boulevard, Los Angeles, California, commencing at
10:00 a.m. (local time) on the later of (a) June 22, 2007 or (b) the date that
is five (5) Business Days following the termination of the applicable waiting
period under the HSR Act, unless Buyer and Seller otherwise agree (the “Closing
Date”).

5.           Closing Obligations.

(a)           Deliveries by Seller.  In addition to any other documents to be
delivered under other provisions of this Agreement, at the Closing (unless
otherwise specified below, and except to the extent waived by Buyer), Seller
shall deliver to Buyer:

(i)           the Closing Date Report, to be delivered at least three business
days prior to the Closing Date;
 
(ii)           a Bill of Sale executed by a duly authorized officer of Seller;
 
(iii)           an Interim Servicing Agreement executed by a duly authorized
officer of Seller;
 
(iv)           a bailment agreement (the “Bailment Agreement”) with respect to
the Contract Files, in form acceptable to both parties, executed by a duly
authorized officer of Seller;
 
(v)           a legal opinion of Seller’s counsel in form and substance
reasonably acceptable to Buyer, in the form attached hereto as Exhibit A;
 
(vi)           a good standing certificate for Seller, issued by the United
States Office of the Comptroller of the Currency, dated not more than thirty
(30) days prior to the Closing Date;
 
(vii)           a certificate of the Secretary of Seller certifying, as complete
and accurate as of the Closing Date, attached copies of its Governing Documents
and certifying and attaching all requisite resolutions or actions of Seller
approving the execution and delivery of the Transaction Documents and the
consummation of the Contemplated Transactions and certifying to the incumbency
and signatures of the officers of Seller executing each of the Transaction
Documents;

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(viii)                 a certificate executed by Seller as to the accuracy of
its representations and warranties as of the date of this Agreement and as of
the Closing Date in accordance with Section 6 and as to its compliance with and
performance of its covenants and obligations to be performed or complied with on
or before the Closing Date in accordance with Section 8; and
 
(ix)           such other deeds, bills of sale, assignments, certificates of
title, other instruments of transfer and conveyance and other documents or
certificates as may reasonably be requested by Buyer, each in form and substance
satisfactory to Buyer and its legal counsel and executed by a duly authorized
officer of Seller.
 
(b)           Deliveries by Buyer.  At the Closing, Buyer shall deliver to
Seller (except to the extent waived by Seller):

(i)           an amount in cash equal to (A) the portion of the Purchase Price
described in clauses (i) and (iv) of Section 3(a) and the interest thereon
pursuant to clause (iii) of Section 3(a), plus (B) all property taxes on the
Leases or Subject Equipment that have been advanced by Seller and not yet
collected from the lessees as of the Record Date, less (C) security deposits,
and less (D) any booked but undisbursed lease fundings, and less (E) property
taxes on the Leases or Subject Equipment that have been received from lessees
(or former lessees) as of the Record Date, and not yet remitted, as reflected in
a closing schedule, in the form of Schedule 5(b), and less (F) $62,500, in
payment of Seller’s share of the Hart-Scott-Rodino Act filing fee, as agreed by
the parties, which amount shall be payable by wire transfer to the account that
is identified by Seller to Buyer at least two (2) Business Days prior to the
Closing Date;

(ii)           a certificate of the Secretary of each Buyer certifying, as
complete and accurate as of the date hereof, attached copies of the Certificate
of Incorporation and Bylaws of such Buyer and certifying and attaching all
requisite resolutions or actions of such Buyer’s boards of directors approving
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereunder and certifying to the incumbency and
signatures of the officers of such Buyer executing this Agreement and any other
document required to be delivered by such Buyer hereunder;
 
(iii)           a duly executed copy of the Interim Servicing Agreement;
 
(iv)           the Bailment Agreement, executed by a duly authorized officer of
Buyer;
 
(v)           a good standing certificate for each Buyer, issued by the state in
which each Buyer is incorporated, dated not more than thirty (30) days prior to
the Closing Date; and
 
(vi)           such other documents and instruments as may reasonably be
requested by Seller, each in form and substance satisfactory to Seller and its
legal counsel and executed by a duly authorized officer of Buyer.

(c)           Post-Closing Payments.  In addition, if and to the extent that any
Leases are originated between the Record Date and the Closing Date, then no
later than fifteen (15) days after the Closing Date, Buyer shall pay to Seller
an amount in cash equal to the portion of the Purchase Price described in clause
(ii) of Section 3(a) and the interest thereon pursuant to clause (iii) of
Section 3(a).

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6.           Representations and Warranties of Seller.  Seller makes the
representations and warranties to Buyer set forth in this Section 6.  Except as
set forth in the next sentence, these representations and warranties are true
and correct as of the date hereof and shall be true and correct as of the
Closing Date.  Notwithstanding the foregoing, representations and warranties
with respect to the Leases are true and correct as of the date hereof and shall
be true and correct as of (i) the Record Date and (ii) except for such changes
as shall be set forth in amended Schedules to this Agreement (which will be
delivered to the Buyer not later than three (3) Business Days following the
Closing Date) and which will not in the aggregate materially adversely affect
the Assets as a whole or the financial condition, results of operation or
business of the Business, as of the Closing Date.

(a)           Organization.  Seller is a national banking association duly
organized, validly existing and in good standing under the laws of the United
States, with full corporate power and authority to conduct its business as it is
now being conducted, to own or use the properties and assets that it purports to
own or use, and to perform all its obligations under the Leases.  Seller is not
required to be qualified to do business as a foreign corporation under the laws
of any state or other jurisdiction in order to conduct its business.
 
(b)           Authority.  Seller has taken all action necessary to approve the
Transaction Documents and the transactions contemplated thereby.  Seller has all
requisite corporate power and authority and has taken all action necessary in
order to execute, deliver and perform its obligations under the Transaction
Documents.  This Agreement has been duly authorized, executed and delivered and,
prior to the Closing, the other Transaction Documents will have been, duly
authorized and at Closing will be duly executed and delivered by Seller and,
assuming due execution and delivery by Buyer, constitute or (with respect to the
Transaction Documents other than this Agreement) will at Closing constitute, the
legal, valid and binding obligations of Seller, enforceable in accordance their
terms, subject to applicable bankruptcy, reorganization, insolvency, moratorium
or other similar laws affecting creditors’ rights generally.
 
(c)           No Conflict.  Neither the execution and delivery of this Agreement
nor the consummation or performance of any of the transactions contemplated in
the Transaction Documents will, directly or indirectly (with or without notice
or lapse of time):

(i)          breach (A) any provision of any of the Governing Documents of
Seller or (B) any resolution adopted by the board of directors or the
shareholders of Seller;
 
(ii)          give any Governmental Authority or other Person the right to
prevent any of the Contemplated Transactions or to exercise any remedy or obtain
any relief under any Legal Requirement or any order of any Governmental
Authority to which Seller, or any of the Assets, may be subject;
 
(iii)          contravene, conflict with or result in a violation or breach of
any of the terms or requirements of, or give any Governmental Authority the
right to revoke, withdraw, suspend, cancel, terminate or modify, any
Governmental Authorization that is held by Seller or that otherwise relates to
the Assets or to the Business, it being understood that no representation is
being made as to the licensing requirements that may apply to Buyer as owner and
operator of the Business after the Closing;
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(iv)          breach any provision of, or give any Person the right to declare a
default or exercise any remedy under, or to accelerate the maturity or
performance of, or payment under, or to cancel, terminate or modify, any Lease
or any of the Backlog; or
 
(v)          result in the imposition or creation of any Lien upon or with
respect to any of the Assets, other than such equitable Lien as may run in favor
of Buyer as a result of this Agreement.
 
(d)           Title.  Seller owns good and transferable title to all of the
Assets free and clear of any Liens other than those described on Schedule
6(d).  Seller warrants to Buyer that, at the time of Closing, all Assets shall
be free and clear of all Liens, other than, in the case of Subject Equipment,
the Lien of the Leases themselves, and also subject to those other Liens
described on Schedule 6(d).

(e)           Financial Information.  The Closing Date Report will be in
accordance with Seller’s records and will accurately present the net book value
of the Leases as of the Record Date.  In preparing the Closing Date Report,
Seller will not change its accounting practices or methodologies from those used
in the preparation of any previous reports provided to Buyer.  Since May 1,
2007, there has been no material adverse change to the Assets or the Business as
a whole, or the financial conditions or operations of the Business, except (a)
as of the date hereof, as set forth on Schedule 6(e), and (b) as of the Closing
Date, as set forth on an updated Schedule 6(e) delivered at the Closing.

(f)           Taxes.  Other than as set forth on Schedule 6(f), Seller has filed
all United States federal income tax returns and all other tax returns
(including, but not limited to, profits, premium, estimated, excise, sales, use,
occupancy, gross receipts, franchise, ad valorem, severance, capital levy,
production, transfer, withholding, employment, and property taxes) which are
required as of the date hereof to be filed by them, or otherwise obtained
appropriate extensions to file, and has paid all Taxes due pursuant to such
returns or pursuant to any assessment received by Seller, except such Taxes that
are (i) being contested in good faith by appropriate proceedings and (ii) are
set forth on Schedule 6(f) attached hereto.  Seller will file all such tax
returns when due, and pay all Taxes due pursuant to such returns, for all
periods that include the date hereof.  No Tax lien has been filed and, to the
knowledge of Seller, no claim is being asserted with respect to any such Tax,
fee or other charge.

(g)           Approvals.  Other than as set forth on Schedule 6(g), no
authorizations, approvals or consents of, and no filings or registrations with,
any Governmental Authority or any other Person are necessary for the execution,
delivery or performance by Seller of the Transaction Documents or for the
validity or enforceability hereof or thereof.

(h)           Leases.
 
(i)           No Performing Lease as of the date hereof is, nor as of the Record
Date will be a Past Due Lease, a Suspended Lease, or a Lease that is subject to
any pending repossession action or as to which Seller has received a notice of
an event that is, or with notice and/or lapse of time is likely to constitute, a
material default or of any claim by a lessee or guarantor of a right of offset
or counterclaim (as referenced in Section 6(h)(x) and identified on Schedule
6(h)(x)).
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(ii)           Each Lease (other than a Charged-Off Lease) is evidenced by a
written agreement, and there are no material understandings, agreements,
undertakings or arrangements between any of Seller and the lessees or
transferees under any Lease which are not set forth therein or in a written
agreement included in the Contract File relating to such Lease.  The entries
made on Seller’s system and on the Closing Date Report with respect to each
Lease (other than a Charged-Off Lease) are consistent with the Contract Files
relating thereto.  Each such Lease and any Contract Files pertaining thereto
shall be supplied by Seller to Buyer as promptly as possible but in any event at
the Closing Date.
 
(iii)           No payments required to be made under any Lease have been paid
in advance of the due dates thereof except for payments reflected in the amount
of the related Lease receivable as shown in the Records.
 
(iv)           Seller has not acted, or failed to act, in a manner which would
materially alter or reduce any of its rights or benefits under any
manufacturers’ or vendors’ warranties or guarantees relating to property covered
by any Performing Lease.
 
(v)           Seller has properly prepared and filed Financing Statements for
each Lease (other than a Charged-Off Lease) that was over $25,000 at the time of
origination, and each such Financing Statement is current.
 
(vi)           Each Lease (and any related guarantees) is and will continue to
be after the date hereof a valid, binding and enforceable, non-cancelable
obligation of the lessee thereunder (and guarantors thereof, if any) in
accordance with its terms, except as the same may be affected by bankruptcy,
insolvency, reorganization, moratorium and other similar laws affecting the
rights of creditors generally.  Each of such lessees and any guarantor is a bona
fide party thereto and, to the knowledge of Seller, had the requisite legal
capacity to enter into the respective agreements to which it is a party as of
the time it entered into those agreements.
 
(vii)           The property that is the subject of each Performing Lease has
been delivered to the lessee thereunder, and accepted by such lessee.
 
(viii)                 Seller has absolute, complete and indefeasible title to
the property subject to each Performing Lease (or a duly perfected first-lien
security interest in the property subject to such Performing Lease) and all sums
due thereunder, free and clear of any and all Liens or claims of any Person
(other than the lessee under the Performing Lease itself).  The supplier or
vendor of said property has received payment in full for said property.
 
(ix)           Seller is not in material breach of any obligation under any of
the Performing Leases.
 
(x)           Other than as set forth on Schedule 6(h)(x), Seller has received
no notice of any event which is, or with notice and/or lapse of time is likely
to constitute, a material default under any Performing Lease or of any claim by
a lessee or guarantor of a right of offset or counterclaim.
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(xi)           None of the Performing Leases is a Past Due Lease or has a lessee
who is or has been subject to an Insolvency Event.  No Performing Lease that
would otherwise be a Past Due Lease has been restructured, and no agreements to
defer, or change the schedule of, any payments due under any Performing Lease
have been made within such time period.
 
(xii)           Each Performing Lease has a corresponding Contract File, and
each Contract File includes proof of payment (either by copies of canceled
checks or confirmations of wire transfers or by such other evidence, all as
shall be satisfactory to Buyer in its sole discretion) for the Subject Equipment
underlying each Performing Lease.
 
(xiii)                 The descriptions of each Performing Lease set forth on
Schedule 1(a) are, and on the Closing Date Report will be, properly coded with
respect to each of the following items of data: (a) the number of payments
remaining, (b) the periodic payment amount, (c) the security deposit amount, (d)
the end of lease disposition, (e) the Residual Value or the Final Contractual
Payment.
 
(xiv)                 Except as set forth on Schedule 6(h)(xiv), the final
payment on each Performing Lease is a contractual obligation and not an optional
payment.
 
(xv)           All payment obligations by any lessee pursuant to each Performing
Lease are due to the Seller, and no payments are due to any third party
originator.  No Performing Lease requires any current or future payment to a
third party originator.
 
It is understood that Buyer’s acquisition of the Charged-Off Leases is on an
as-is, where-is basis.  It is further understood that the sole remedy for any
breach of the representations and warranties with respect to any Lease other
than a Performing Lease shall be monetary damages, and that the aggregate amount
of all such damages shall be limited to a maximum of $200,000 for all such
breaches.
 
(i)           Compliance.  Seller operates the Business in compliance with all
applicable federal and state statutes and all governmental regulations.  There
are no existing violations, orders, claims, citations, penalty assessments,
orders, investigations or proceedings affecting the Assets or the Business.
 
(j)           Litigation.  Except as set forth on Schedule 6(j), there is no
action, suit or proceeding pending or, to the knowledge of any Seller,
threatened against or affecting the Business or all or any portion of the
Assets, in any court or before or by any Governmental Authority.  To the
knowledge of Seller, no event has occurred or circumstance exists that is
reasonably likely to give rise to or serve as a basis for the commencement of
any action, suit or proceeding affecting the Business.  Seller is not in default
with respect to any order of any court, Governmental Authority or agency or
arbitration board or tribunal pertaining to the Business.
 
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(k)           Assignability of Relationships.  Except as set forth on Schedule
6(k), all of Seller’s written Customer relationships with respect to the
Performing Leases are assignable to Buyer without notice to or consent of any
Person.  Seller shall use its Best Efforts to, as promptly as practicable but in
no event later than the Closing Date, obtain consents and give notices, to the
extent that any are required, in order to assign all such Customer relationships
to Buyer at the Closing.
 
(l)           Brokers.  Except for The Alta Group, LLC, whose fee will be paid
by Seller out of the proceeds of the Contemplated Transactions, no Person is
entitled to any finder’s fee, brokerage commission or similar payment by Seller
in connection with or arising out of the Contemplated Transactions.
 
(m)           No Misstatements or Omissions.  These representations and
warranties, the information disclosed in the schedules and exhibits hereto and
the certificates and other documents delivered by Seller pursuant to this
Agreement, when considered together and in light of one another, do not contain
any untrue statement of material fact with respect to the Assets or the Assumed
Liabilities or omit to state a material fact necessary to make the statements
contained herein not misleading.  There is no fact of which Seller is aware with
respect to the Assets or the Assumed Liabilities or the Business that Seller has
not disclosed in writing to Buyer, the existence of which would have a material
adverse effect on the Assets, considered as a whole.
 
(n)           Bulk Sales Compliance.  The sale of the Assets by Seller to Buyer
pursuant to this Agreement will not violate any bulk transfer or any similar
statutory provisions in effect in any applicable jurisdiction.
 
7.           Representations and Warranties of Buyer.  Buyer represents and
warrants to Seller as follows:

(a)           Organization.  Each Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware.  Each
Buyer has full corporate power and authority to execute and deliver the
Transaction Documents and to perform its obligations hereunder and thereunder
and to consummate the transactions contemplated hereby and thereby.
 
(b)           Authority.  Buyer has taken all action necessary to approve the
Transaction Documents and the transactions contemplated thereby.  Buyer has all
requisite corporate power and authority and has taken all action necessary in
order to execute, deliver and perform its obligations under the Transaction
Documents.  This Agreement has been duly authorized, executed and delivered and,
prior to the Closing, the other Transaction Documents will have been, duly
authorized and at Closing will be duly executed and delivered by Buyer and,
assuming due execution and delivery by Seller, constitute or (with respect to
the Transaction Documents other than this Agreement) will at Closing constitute,
the legal, valid and binding obligations of Buyer, enforceable in accordance
their terms, subject to applicable bankruptcy, reorganization, insolvency,
moratorium or other similar laws affecting creditors’ rights generally.
 
(c)           No Breach.  Except as set forth on Schedule 7(c), neither the
execution and delivery of the Transaction Documents, nor compliance with the
terms and provisions thereof, will conflict with or result in a breach of, or
require any consent which has not been obtained as of the date hereof under the
charter or by-laws of either Buyer, or any governmental requirement, or any
agreement or instrument to which either Buyer is a party or by which it is
bound, or constitute a default under any such agreement or instrument.
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(d)           Approvals.  Other than as set forth on Schedule 7(d), no
authorizations, approvals or consents of, and no filings or registrations with,
any Governmental Authority or any other Person are necessary for the execution,
delivery or performance by either Buyer of the Transaction Documents or for the
validity or enforceability thereof.
 
(e)           Previously Approved Agreements.  Buyer shall enter into agreements
with lessees of the Backlog provided such lessees continue to meet all
requirements set forth in the applicable approval letter and such agreement or
lease was approved by Seller in accordance with the Policies and Procedures.
 
(f)           Payment of Purchase Price.  Buyer has access to sufficient funds
with which to pay the Purchase Price on the Closing Date.
 
8.           Covenants of Seller Prior to Closing.
 
(a)           Access and Information.  Between the date of this Agreement and
the Closing Date, and upon reasonable advance notice received from Buyer, Seller
shall (a) afford Buyer reasonable access, during regular business hours, to
Seller’s personnel, properties, and Records for the purpose of preparing for the
transfer, and understanding the Business, and  (b) afford Buyer access to the
InfoLease and Shaw System Data Disks for the purpose of confirming data
ascertained by Buyer during its due diligence; such rights of access to be
exercised in a manner that does not unreasonably interfere with the operations
of Seller and does not violate applicable labor and employment laws; and
(c) otherwise cooperate and assist, to the extent reasonably requested by Buyer,
with Buyer’s understanding of the Business and the Assets.
 
(b)           Operation of the Business of Seller.  Between the date of this
Agreement and the Closing, Seller shall, except as otherwise directed by Buyer
in writing:
 
(i)           conduct the Business only in the Ordinary Course of Business
consistent with the Policies and Procedures;
 
(ii)           use its Best Efforts to preserve intact the current business
organization of the Business, keep available the services of the officers,
employees and agents of the Business and maintain the relations and good will of
the Business with suppliers, Customers, landlords, creditors, employees, agents
and others having business relationships with it (it being understood, however,
that the Seller has heretofore informed some employees of the availability of
positions in other parts of Seller’s business, and to the extent that such
opportunities were communicated prior to May 24, 2007);
 
(iii)           confer with Buyer prior to implementing operational changes of a
material nature with respect to the Business;
 
(iv)           otherwise report periodically to Buyer concerning the status of
the business, operations and finances of the Business;
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(v)           keep in full force and effect, without amendment, all material
rights relating to the Business;
 
(vi)           comply in all material respects with all Legal Requirements and
contractual obligations applicable to the operations of the Business;
 
(vii)           continue in full force and effect all material insurance
coverage pertaining to the Business under its existing policies or substantially
equivalent policies;
 
(viii)                 upon request from time to time, execute and deliver all
documents, make all truthful oaths, testify in any Proceedings and do all other
acts that may be reasonably necessary or desirable in the opinion of Buyer to
consummate the Contemplated Transactions, all without further consideration;
 
(ix)           maintain all books and Records of Seller relating to the Business
in the Ordinary Course of Business; and
 
(x)           notify Buyer prior to initiating any new Lease pertaining to
equipment having a purchase price in excess of $500,000.
 
(c)           Negative Covenant.  Except as otherwise expressly permitted
herein, between the date of this Agreement and the Closing Date, Seller shall
not without the prior written consent of Buyer, (a) take any affirmative action,
or fail to take any reasonable action within its control, as a result of which
any material adverse change, or any event or development which, individually or
together with other such events, could reasonably be expected to result in a
material adverse change in the Assets or the Business; (b) make any modification
to any Lease except in the ordinary course of business, or in any Governmental
Authorization; (c) initiate any new Lease that (i) does not have a credit-risk
rating of five or better pursuant to the Policies and Procedures, or (ii) does
not have an interest yield of seven percent or higher, calculated based on the
cost to originate such Lease and acquire the Subject Equipment; or (d) enter
into any compromise or settlement of any litigation, proceeding or governmental
investigation relating to the Assets, the Business or the Assumed Liabilities.
 
(d)           Required Approvals.  Seller has made, or as promptly as
practicable after the date of this Agreement, Seller shall make all filings
required by Legal Requirements to be made by it in order to consummate the
Contemplated Transactions (including all filings under the HSR Act).  Seller and
Buyer shall cooperate with respect to all filings that Buyer elects to make or,
pursuant to Legal Requirements, shall be required to make in connection with the
Contemplated Transactions, provided, however, that Seller shall not be required
to dispose of or make any change to its business, expend any material funds or
incur any other unreasonable burden in order to comply with this Section
8(d).  Seller also shall cooperate with Buyer in obtaining all necessary
consents (including taking all actions requested by Buyer to cause early
termination of any applicable waiting period under the HSR Act).
 
(e)           Notification.  Between the date of this Agreement and the Closing,
Seller shall promptly notify Buyer in writing if it becomes aware of (a) any
fact or condition that causes or constitutes a breach of any of Seller’s
representations and warranties made as of the date of this Agreement or (b) the
occurrence after the date of this Agreement of any fact or condition that would
or be reasonably likely to (except as expressly contemplated by this Agreement)
cause or constitute a breach of any such representation or warranty had that
representation or warranty been made as of the time of the occurrence of, or
Seller’s discovery of, such fact or condition.  During the same period, Seller
also shall promptly notify Buyer of the occurrence of any breach of any covenant
of Seller in this Section 8 or of the occurrence of any event that may make the
satisfaction of the conditions in Section 10 impossible or unlikely.
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(f)           No Negotiation.  Until such time as this Agreement shall be
terminated pursuant to Section 12, the Seller shall not directly or indirectly
solicit, initiate, encourage or entertain any inquiries or proposals from,
discuss or negotiate with, provide any nonpublic information to or consider the
merits of any inquiries or proposals from any Person (other than Buyer) relating
to any sale, disposition, merger, business combination or other similar
transaction with respect to the Business or the Assets.  Seller shall notify
Buyer of any such inquiry or proposal within twenty-four (24) hours of receipt
or awareness.  It is understood, however, that this Section 8(f) shall not
prohibit Seller or The Alta Group, LLC from communicating with entities that
have executed confidentiality agreements with Seller prior to May 23, 2007 that
the Contemplated Transactions are in process and that they preclude negotiation
with any other potential purchaser.
 
(g)           Best Efforts.  Seller shall use its Best Efforts to cause the
conditions in Sections 10 and 11(c) to be satisfied.
 
9.           Covenants of Buyer Prior to Closing.

(a)           Required Approvals.  Buyer has made or, as promptly as practicable
after the date of this Agreement, shall make, or cause to be made, all filings
required by Legal Requirements (including all filings under the HSR Act) to be
made by it to consummate the Contemplated Transactions.  Buyer also shall
cooperate with Seller with respect to all filings Seller shall be required by
Legal Requirements to make, provided, however, that Buyer shall not be required
to dispose of or make any change to its business, expend any material funds or
incur any other unreasonable burden in order to comply with this Section 9(a).
 
(b)           Best Efforts.  Buyer shall use its Best Efforts to cause the
conditions in Sections 11 and 10(c) to be satisfied.
 
10.           Conditions Precedent of Buyer’s Obligation to Close
Transaction.  Buyer’s obligation to purchase the Assets and to take the other
actions required to be taken by Buyer at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by Buyer, in whole or in part):

(a)           Accuracy of Representations
 
(i)           Each of Seller’s representations and warranties in this Agreement
that does not contain an express materiality qualification shall have been
accurate in all material respects as of the date of this Agreement, and shall be
accurate in all material respects as of the time of the Closing as if then made
(subject, however, to updates in the case of scheduled items).
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(ii)           Each of Seller’s representations and warranties in this Agreement
that contains an express materiality qualification, shall have been accurate in
all respects as of the date of this Agreement, and shall be accurate in all
respects as of the time of the Closing as if then made (subject, however, to
updates in the case of scheduled items).
 
(b)           Seller’s Performance.  All of the covenants and obligations that
Seller is required to perform or to comply with pursuant to this Agreement at or
prior to the Closing (considered collectively), and each of these covenants and
obligations (considered individually), shall have been duly performed and
complied with in all material respects.
 
(c)           Consents.  Each of the consents identified on Schedule 10(c)
attached hereto shall have been obtained and shall be in full force and effect.
 
(d)           Additional Documents.  Seller shall have caused the documents and
instruments required by Section 5(a) and the following documents to be delivered
(or tendered subject only to Closing) to Buyer:
 
(i)           The articles of association and all amendments thereto of Seller,
duly certified as of a recent date by the United States Office of the
Comptroller of the Currency;
 
(ii)           A Contract File for each Lease (which may be held by Seller for
Buyer pursuant to the Bailment Agreement);
 
(iii)           Releases of all Liens on the Assets in favor of any Person other
than Seller, and assignments of all Liens in favor of Seller to Buyer, including
without limitation, all necessary amendments to Financing Statements and
transfer of title in motor vehicles;
 
(iv)           Certificates dated as of a date not earlier than the 30th
business day prior to the Closing as to the good standing of Seller; and
 
(v)           Such other documents as Buyer may reasonably request for the
purpose of: (w) evidencing the accuracy of any of Seller’s representations and
warranties; (x) evidencing the performance by Seller of, or the compliance by
Seller with, any covenant or obligation required to be performed or complied
with by Seller; (y) evidencing the satisfaction of any condition referred to in
this Section 10; or (z) otherwise facilitating the consummation or performance
of any of the Contemplated Transactions.
 
(e)           No Proceedings.  Since the date of this Agreement, there shall not
have been commenced or threatened against Seller or Buyer any Proceeding (a)
involving any challenge to, or seeking damages or other relief in connection
with, any of the Contemplated Transactions or (b) that may have the effect of
preventing, delaying, making illegal, imposing limitations or conditions on or
otherwise interfering with any of the Contemplated Transactions.
 
11.           Conditions Precedent of Seller’s Obligation to Close
Transaction.  Seller’s obligation to sell the Assets and to take the other
actions required to be taken by Seller at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by Seller in whole or in part):
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         (a)           Accuracy of Representations.  All of Buyer’s
representations and warranties in this Agreement (considered collectively), and
each of these representations and warranties (considered individually), shall
have been accurate in all material respects as of the date of this Agreement and
shall be accurate in all material respects as of the time of the Closing as if
then made.
 
(b)           Buyer’s Performance.  All of the covenants and obligations that
Buyer is required to perform or to comply with pursuant to this Agreement at or
prior to the Closing (considered collectively), and each of these covenants and
obligations (considered individually), shall have been performed and complied
with in all material respects.
 
(c)           Consents.  Each of the consents identified in Schedule 11(c) shall
have been obtained and shall be in full force and effect.
 
(d)           Additional Documents.  Buyer shall have caused to be delivered (or
tendered subject only to Closing) to Seller such documents as Seller may
reasonably request for the purpose of: (w) evidencing the accuracy of any of
Buyer’s representations and warranties; (x) evidencing the performance by Buyer
of, or the compliance by Buyer with, any covenant or obligation required to be
performed or complied with by Buyer; (y) evidencing the satisfaction of any
condition referred to in this Section 11; or (z) otherwise facilitating the
consummation or performance of any of the Contemplated Transactions.
 
(e)           No Proceedings.  Since the date of this Agreement, there shall not
have been commenced or threatened against Seller or Buyer any Proceeding (i)
involving any challenge to, or seeking damages or other relief in connection
with, any of the Contemplated Transactions or (ii) that may have the effect of
preventing, delaying, making illegal, imposing limitations or conditions on or
otherwise interfering with any of the Contemplated Transactions.
 
12.           Termination.
 
(a)           Termination Events.  By notice given prior to or at the Closing,
subject to Section 12(b), this Agreement may be terminated as follows:
 
(i)           by Buyer if a material breach of any provision of this Agreement
has been committed by Seller and such breach has not been waived by Buyer or,
prior to notice of termination from Buyer, been cured by Seller;
 
(ii)           by Seller if a material breach of any provision of this Agreement
has been committed by Buyer and such breach has not been waived by Seller or,
prior to notice of termination from Seller, been cured by Buyer;
 
(iii)           by Buyer if any condition in Section 10 has not been satisfied
as of the date specified for Closing in the first sentence of Section 4 or if
satisfaction of such a condition by such date is or becomes impossible (other
than through the failure of Buyer to comply with its obligations under this
Agreement), and Buyer has not waived such condition on or before such date;
 
(iv)           by Seller if any condition in Section 11 has not been satisfied
as of the date specified for Closing in the first sentence of Section 4 or if
satisfaction of such a condition by such date is or becomes impossible (other
than through the failure of Seller to comply with its obligations under this
Agreement), and Seller has not waived such condition on or before such date;
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(v)           by mutual consent of Buyer and Seller;
 
(vi)           by Buyer if the Closing has not occurred on or before July 31,
2007 (or August 31, 2007 in the event the applicable waiting period under the
HSR Act has not expired or been terminated by July 24, 2007), or such later date
as the parties may agree upon, unless the Buyer is in material breach of this
Agreement; or
 
(vii)           by Seller if the Closing has not occurred on or before July 31,
2007 (or August 31, 2007 in the event the applicable waiting period under the
HSR Act has not expired or been terminated by July 24, 2007), or such later date
as the parties may agree upon, unless the Seller is in material breach of this
Agreement.
 
(b)           Effect of Termination.  Each party’s right of termination under
Section 12(a) is in addition to any other rights it may have under this
Agreement or otherwise, and the exercise of such right of termination will not
be an election of remedies.  If this Agreement is terminated pursuant to Section
12(a), all obligations of the parties under this Agreement will terminate,
except that the obligations of the parties in this Section 12(b) and Section 18
(except for those in Section 18(k)) will survive; provided, however, that, if
this Agreement is terminated because of a breach of this Agreement by the
nonterminating party or because one or more of the conditions to the terminating
party’s obligations under this Agreement is not satisfied as a result of the
party’s failure to comply with its obligations under this Agreement, the
terminating party’s right to pursue all legal remedies will survive such
termination unimpaired.
 
13.           Additional Covenants.
 
(a)           Payment of All Taxes Resulting From Sale of Assets by
Parties.  Each party hereto shall pay in a timely manner all Taxes resulting
from or payable in connection with the sale of the Assets pursuant to this
Agreement, to the extent that such Taxes are imposed on such party by Legal
Requirements.
 
(b)           Payment of Other Retained Liabilities.  If the failure to make any
payments with respect to the Retained Liabilities will impair Buyer’s use or
enjoyment of or title to the Assets or conduct of the Business, Buyer may, at
any time after the Closing Date, elect to make all such payments directly (but
shall have no obligation to do so) and Seller shall reimburse Buyer for such
amounts.
 
(c)           Reports and Returns.  Each party hereto shall timely prepare and
file such reports and returns required by Legal Requirements relating to the
Business, with respect to the period of time during which that party owned the
Business.
 
(d)           Assistance in Proceedings.  The parties will cooperate with each
other and their respective counsel in the contest or defense of, and make
available its personnel and provide any testimony and access to its books and
Records in connection with, any Proceeding involving or relating to (a) any
Contemplated Transaction or (b) any action, activity, circumstance, condition,
conduct, event, fact, failure to act, incident, occurrence, plan, practice,
situation, status or transaction involving the Business.
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(e)           Noncompetition, Non-solicitation and Non-disparagement.
 
(i)           Noncompetition.  For a period of five (5) years after the Closing
Date, Seller shall not, other than through an entity with which Seller engages
in a merger or acquisition transaction and that already includes such a business
at the time of the merger or acquisition, anywhere in the United States,
directly or indirectly invest in, own, manage, operate, finance, control,
advise, render services to or guarantee the obligations of any Person engaged in
or planning to become engaged in the third party origination business of
equipment leases or financings of the size and for the equipment of the types
for which Seller, as part of the Business, currently extends leases or
financings (“Competing Business”).  Notwithstanding the foregoing, nothing
herein shall prevent Seller from acquiring, being acquired by or merging with
another business that includes equipment leasing as part of its larger business.
 
(ii)           Nonsolicitation.  For a period of five (5) years after the
Closing Date, Seller shall not:
 
a.    solicit the equipment leasing or equipment financing business of any
Person who is a third-party vendor or broker of such business;
 
b.    cause, induce or attempt to cause or induce a third-party vendor or broker
of equipment leasing business to cease doing business with Buyer, or in any way
interfere with its relationship with Buyer;
 
c.    cause, induce or attempt to cause or induce a third-party vendor or broker
of equipment leasing business who has referred to Seller such business that is
on the books of the Business on the Closing Date, or was on the books of the
Business within the year preceding the Closing Date, to cease doing business
with Buyer, or in any way interfere with its relationship with Buyer; or
 
d.    solicit for employment any employee of Buyer, or any Person set forth on
Schedule 1(i), or in any way interfere with the relationship between Buyer and
any of its employees, or any Person set forth on Schedule 1(i).
 
(iii)           Nondisparagement.  After the Closing Date, Seller will not
disparage the Business, Buyer, Buyer’s business or any of Buyer’s shareholders,
directors, officers, employees or agents.  After the Closing Date, Buyer will
not disparage Seller, Seller’s business or any of Seller’s shareholders,
directors, officers, employees or agents.
 
(iv)           Modification of Covenant.  If a final judgment of a court or
tribunal of competent jurisdiction determines that any term or provision
contained in Section 13(e) is invalid or unenforceable, then the parties agree
that the court or tribunal will have the power to reduce the scope, duration or
geographic area of the term or provision, to delete specific words or phrases or
to replace any invalid or unenforceable term or provision with a term or
provision that is valid and enforceable and that comes closest to expressing the
intention of the invalid or unenforceable term or provision.  This Section
13(e)(iv) will be enforceable as so modified after the expiration of the time
within which the judgment may be appealed.  This Section 13(e)(iv) is reasonable
and necessary to protect and preserve Buyer’s legitimate business interests and
the value of the Assets and to prevent any unfair advantage conferred on
Seller.  The parties hereto acknowledge and agree that any remedy at law for any
breach of the provisions of this Section 13(e)(iv) would be inadequate, and
Seller hereby consents to the granting by any court of an injunction or other
equitable relief, without the necessity of actual monetary loss being proved, in
order that the breach or threatened breach of such provisions may be effectively
restrained.
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(f)           Customer and Other Business Relationships.  After the Closing,
Seller will cooperate with Buyer in its efforts to continue and maintain for the
benefit of Buyer those business relationships of Seller existing prior to the
Closing and relating to the Business, including relationships with Customers,
employees, licensors, suppliers and others, and Seller will satisfy the Retained
Liabilities in a manner that is not detrimental to any of such
relationships.  Seller will refer to Buyer all inquiries relating to the
Leases.  Neither Seller nor any of its officers, employees, agents or
shareholders shall take any action that would tend to diminish the value of the
Assets after the Closing or that would interfere with the business of Buyer to
be engaged in after the Closing.  Except for any third party equipment leasing
or equipment financing origination business in the nature of the Business,
nothing in this section shall require Seller to refer business to Buyer or
preclude Seller from doing business with, or referring business to, other
leasing companies.
 
(g)           Retention and Access to Records.  After the Closing Date, Buyer
shall retain for a period of not less than five (5) years, or such longer period
as is consistent with Buyer’s record-retention policies and practices those
Records of Seller delivered to Buyer.  Buyer also shall provide Seller
reasonable access thereto, during normal business hours and on at least five
days’ prior written notice, to enable them to prepare financial statements or
tax returns or deal with tax audits.  After the Closing Date, Seller shall
provide Buyer reasonable access to Records that are Excluded Assets and pertain
to the Business, if any, during normal business hours and on at least five days’
prior written notice, for any reasonable business purpose specified by Buyer in
such notice.
 
(h)           Access to Premises.  Until the termination of the Interim
Servicing Agreement, Seller shall permit Buyer to access the premises of Seller
to the extent necessary for Buyer to exercise its rights and discharge its
obligations under the Interim Servicing Agreement, subject to the limitations
and restrictions stated in the Interim Servicing Agreement.
 
(i)           Amendments of Financing Statements; Transfer of Motor Vehicle
Title.  Seller shall cooperate reasonably and provide assistance to Buyer to
amend any Financing Statements and transfer title in any motor vehicles that are
the subject of a Lease.
 
(j)           Transfer of Electronic Files.  Seller shall cooperate with Buyer
in the export of any electronic records and data files pertaining to any Leases
from the Seller’s systems to the Buyer’s systems.
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(k)           Further Assurances.  Subject to the proviso in Sections 8(d) and
9(a), the parties shall cooperate reasonably with each other in connection with
any steps required to be taken as part of their respective obligations under
this Agreement, and shall (a) furnish upon request to each other such further
information; (b) execute and deliver to each other such other documents; and (c)
do such other acts and things, all as the other party may reasonably request for
the purpose of carrying out the intent of this Agreement and the Contemplated
Transactions.  If Seller receives any payments on, with respect to or arising
out of the Leases, Seller shall forward such payments to Buyer promptly and no
less frequently than weekly, either by endorsing and delivering the check or by
depositing the check and delivering a bank check or wire transfer in an
equivalent amount.   If Buyer or an Affiliate of Buyer determines that it is
required to prepare audited financial statements with respect to the Business
pursuant to Regulation S-X of the Securities and Exchange Commission, then
Seller shall cooperate with Buyer and provide Buyer with such information as
Buyer shall reasonably request to enable Buyer to prepare such financial
statements.  The cost of preparing such financial statements shall be borne
entirely by Buyer, and Buyer shall reimburse to Seller all out-of-pocket
expenses and such internal costs as Seller reasonably allocates for its
employees’ time and overhead incurred by Seller in providing such cooperation
and information, but as to such internal costs only to the extent that they
exceed $5,000 in the aggregate.
 
(l)           Taxes with Respect to Leases.  Following the Closing, if Buyer
receives any notice of unpaid property, sales or use taxes that were due prior
to the Closing, but are alleged to be unpaid, Buyer shall promptly notify
Seller, and Seller shall have the right and obligation of dealing with the
taxing authority with respect to such allegations, and the obligation to pay
such taxes (including any interest or penalties) if and to the extent that funds
were collected from the lessee to cover such taxes.  If and to the extent such
taxes are owing, but Seller did not collect funds from the lessee to cover such
taxes, Buyer shall cooperate with Seller in collecting such taxes (including any
interest or penalties) from the lessee or causing the lessee to pay such amounts
directly to the taxing authority.  Notwithstanding the foregoing sentence, in
the event the lessee does not pay such amounts to the taxing authority, Seller
shall be liable for the payment of all such amounts owed to such taxing
authority, and Seller shall thereupon be subrogated to the rights of Buyer to
collect such amounts from the lessee.
 
(m)           Notice to Third Parties.  As soon as practicable following the
Closing, Buyer shall file notices in all applicable governmental jurisdictions
in which financing statements or titles are of record with respect to the Leases
or Subject Equipment, as to the change in ownership of such Assets.  It is
understood however, that in some instances this is the date on which the next
tax filings are required to be filed in such jurisdictions.
 
(n)           Assignment of Additional Leases.  If any leases or loans are
funded by Seller in the time period from the day after the Record Date until the
Closing Date, and such leases or loans otherwise meet all of the requirements
set forth in this Agreement for a Lease, then Buyer shall pay Seller 104.7643%
of the Net Investment in such Lease, and immediately upon receipt of such
payment, Seller shall assign such lease or loan to Buyer and such lease or loan
shall become a “Lease” for purposes of this Agreement as if it had been listed
on Schedule 1(a).
 
(o)           Allocation of Purchase Price.  Within thirty (30) days from the
Closing Date, Seller and Buyer shall agree in writing on the allocation of the
Assets and Assumed Liabilities (the “Allocation”).  Buyer and Seller agree to
file Internal Revenue Service Form 8594 in accordance with the agreed upon
Allocation and that no position inconsistent with the Allocation shall be taken
by any party hereto before any Governmental Authority.
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               14.           Survival of Representations, Warranties, Covenants
and Agreements.  The representations, warranties, covenants and agreements of
Seller and Buyer contained in this Agreement will survive (a) until the fifth
anniversary of the Closing Date with respect to the representations and
warranties contained in Sections 6 and 7, except for any representations and
warranties related to Taxes, which shall survive until the expiration of the
relevant statute of limitations; (b) until the fifth anniversary of the Closing
Date with respect to Section 13(e); and (c) in the case of all other
representations and warranties and any covenant or agreement to be performed in
whole or in part after the date hereof until the fourth anniversary hereof,
except that any representation, warranty, covenant or agreement that would
otherwise terminate in accordance with clause (c) will continue to survive if a
Claim Notice shall have been timely given on or prior to such termination date,
until the related claim for indemnification has been satisfied or otherwise
resolved.
 
15.           Indemnification.  Seller shall indemnify, defend and hold harmless
Buyer and its officers, directors, employees, agents and Affiliates, and Buyer
shall indemnify, defend and hold harmless Seller and its officers, directors,
employees, agents and Affiliates, from any Loss or Losses arising out of or by
reason of any breach of any of Seller’s, on the one hand, and Buyer’s, on the
other hand, covenants, representations and warranties set forth herein.  In
addition, Seller shall indemnify, defend and hold harmless Buyer and its
officers, directors, employees, agents and Affiliates from any Losses arising
out of the Retained Liabilities or the Excluded Assets.  Buyer shall indemnify,
defend and hold harmless Seller and its officers, directors, employees, agents
and Affiliates from any Losses arising out of the Assumed Liabilities or Assets,
arising out of events occurring after the date hereof.
 
16.           Method of Asserting Claims.  All claims for indemnification by any
indemnified party hereunder will be asserted and resolved as follows:
 
(a)             In the event of any Third Party Claim, the indemnified party
shall deliver written notification thereof to the indemnifying party with
reasonable promptness, enclosing a copy of all papers served, if any, and
specifying the nature of the Third Party Claim, together with the amount or, if
not then reasonably ascertainable, the estimated amount, determined in good
faith, of the Third Party Claim (a “Claim Notice”).  The indemnifying party will
notify the indemnified party as soon as practicable, but in any case within 30
days of receipt of a Claim Notice (the “Dispute Period”), whether the
indemnifying party disputes its liability to the indemnified party and whether
the indemnifying party desires, at its sole cost and expense, to defend the
indemnified party against such Third Party Claim.
 
(b)             If the indemnifying party notifies the indemnified party within
the Dispute Period that the indemnifying party desires to defend the indemnified
party with respect to the Third Party Claim, then the indemnifying party will
have the right to defend, with counsel reasonably satisfactory to the
indemnified party, at the sole cost and expense of the indemnifying party, such
Third Party Claim by all appropriate proceedings, which proceedings will be
vigorously and diligently prosecuted by the indemnifying party to a final
conclusion or will be settled at the discretion of the indemnifying party (but
only with the consent of the indemnified party in the case of any settlement
that provides for any relief other than the payment of monetary damages).

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(c)             If the indemnifying party fails to notify the indemnified party
within the Dispute Period that the indemnifying party desires to defend the
Third Party Claim, or if the indemnifying party gives such notice but fails to
prosecute vigorously and diligently or settle the Third Party Claim, or if the
indemnifying party fails to give any notice whatsoever within the Dispute
Period, then the indemnified party will have the right to defend, at the sole
cost and expense of the indemnifying party, the Third Party Claim by all
appropriate proceedings, which proceedings will be prosecuted by the indemnified
party in a reasonable manner and in good faith or will be settled at the
discretion of the indemnified party.
 
(d)             If the indemnifying party notifies the indemnified party that it
does not dispute its liability to the indemnified party with respect to the
Third Party Claim, the Loss in the amount specified in the Claim Notice will be
conclusively deemed a liability of the indemnifying party and the indemnifying
party shall pay the amount of such Loss to the indemnified party on demand.  If
the indemnifying party has timely disputed its liability with respect to such
claim, the indemnifying party and the indemnified party will proceed in good
faith to negotiate a resolution of such dispute, and if not resolved through
negotiations within a reasonable period of time, such dispute shall be resolved
by litigation in a court of competent jurisdiction.
 
(e)             In the event any indemnified party has a claim against any
indemnifying party that does not involve a Third Party Claim, the indemnified
party shall deliver a Claim Notice with reasonable promptness to the
indemnifying party.  If the indemnifying party notifies the indemnified party
that it does not dispute the claim described in such Claim Notice or fails to
notify the indemnified party within the Dispute Period whether the indemnifying
party disputes the claim, the Loss in the amount specified in the Claim Notice
will be conclusively deemed a liability of the indemnifying party and the
indemnifying party shall pay the amount of such Loss to the indemnified party on
demand.  If the indemnifying party has timely disputed its liability with
respect to such claim, the indemnifying party and the indemnified party will
proceed in good faith to negotiate a resolution of such dispute, and if not
resolved through negotiations within a reasonable period of time, such dispute
shall be resolved by litigation in a court of competent jurisdiction.
 
17.           Notices.                      All notices and other communications
hereunder shall be in writing, hand delivered or sent by express mail service or
via facsimile, to the addresses or facsimile numbers set forth below (or at such
other address as a party may hereafter designate for itself by notice to the
other party as required hereby):
 
If to Buyer:
 
LEAF Financial Corporation
1818 Market Street
Philadelphia, Pennsylvania 19103
Attn:  Crit DeMent
Fax No.: (215) 640-6363
and  Attn:  Miles Herman
Fax No.: (215) 640-6330

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with a copy to:
 
Ledgewood
1900 Market Street
Philadelphia, Pennsylvania  19103
Attn:  J. Baur Whittlesey, Esquire
Fax No.: (215) 735-2513

If to Seller:
 
Pacific Capital Bank, N.A.
1 South Los Carneros Road
Goleta, California 93117
Attn:  Frederick W. Clough, General Counsel
Fax No.:  (805) 882-3856
 
with a copy to:
 
Manatt, Phelps & Phillips, LLP
695 Town Center Drive
Costa Mesa, California 92626
Attn:  Ellen R. Marshall, Esquire
Fax No.:  (714) 371-2550
 

18.           Miscellaneous.
 
(a)           Governing Law.  This Agreement shall be governed by the law of the
State of California, and shall bind and inure to the benefit of the parties
hereto and their respective heirs, executors, administrators, successors,
assigns and personal representatives.
 
(b)           Entire Agreement; Amendments.  This Agreement, and the Transaction
Agreements set forth all of the promises, covenants, agreements, conditions and
undertakings between the parties hereto with respect to the subject matter
hereof, and supersede all prior and contemporaneous agreements and
understandings, inducements or conditions, express or implied, oral or written,
except as contained herein.  This Agreement may not be changed orally but only
by an agreement in writing, duly executed by or on behalf of the party or
parties against whom enforcement of any waiver, change, modification, consent or
discharge is sought.
 
(c)           Binding Effect.  All of the terms and provisions of this Agreement
shall be binding upon, inure to the benefit of, and be enforceable by the
parties and their legal representatives, heirs, successors and permitted
assigns, whether so expressed or not.
 
(d)           Severability.  If any provision of this Agreement or any other
agreement entered into pursuant hereto is contrary to, prohibited by or deemed
invalid under applicable law or regulation, such provision shall be inapplicable
and deemed omitted to the extent so contrary, prohibited or invalid, but the
remainder hereof shall not be invalidated thereby and shall be given full force
and effect so far as possible.  If any provision of this Agreement may be
construed in two or more ways, one of which would render the provision invalid
or otherwise voidable or unenforceable another of which would render the
provision valid and enforceable, such provision shall have the meaning which
renders it valid and enforceable.

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(e)           Captions.  The captions used in this Agreement are for convenience
of reference only and shall not be considered in the interpretation of the
provisions hereof.
 
(f)           No Construction Against Draftsmen.  The parties acknowledge that
this is a negotiated agreement, and that in no event shall the terms hereof be
construed against either party on the basis that such party, or its counsel,
drafted this Agreement.
 
(g)           Expenses.  Except as otherwise provided in this Agreement, each
party hereto shall pay the expenses incurred by or on behalf of such party in
connection with the transactions contemplated by this Agreement, including but
not limited to, expenses in connection with the preparation, authorization,
execution and performance of this Agreement and all fees and expenses of such
party’s brokers, finders, agents, representatives, counsel and
accountants.  Notwithstanding the foregoing, Buyer and Seller will each pay
one-half of the HSR Act filing fee.
 
(h)           Knowledge.  Certain of the representations and warranties in this
Agreement are made “to the knowledge” of Seller.  Such phrase shall mean either
(i) the actual knowledge of any individual set forth on Schedule 18(h); or (ii)
any knowledge which such persons should have known had they acted in the
ordinary course of business.
 
(i)           Assignment.  Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder may be assigned by any party without
the consent of the other parties; provided, however, that Buyer may (a) assign
any or all of its rights and interests hereunder to one or more of its
Affiliates and (b) designate one or more of its Affiliates to perform its
obligations hereunder (in any or all of which cases Buyer nonetheless will
remain responsible for the performance of all of its obligations hereunder), and
(c) make a collateral assignment of its rights hereunder to its lender(s).  In
the event of an assignment or designation pursuant to clauses (a) or (b) of the
prior sentence prior to the Closing Date, any documents to be delivered by
Seller or Buyer pursuant hereto shall be appropriately modified to give effect
to such assignment or designation.
 
(j)           Waiver of Jury Trial.  THE PARTIES HERETO WAIVE EACH OF THEIR
RESPECTIVE RIGHTS TO A TRIAL BY JURY FOR ANY CAUSE OF ACTION ARISING UNDER OR
RELATED TO THIS AGREEMENT TO THE EXTENT THAT SUCH A WAIVER IS PERMITTED BY LAW.
 
(k)           Counterparts.  This Agreement may be executed simultaneously in
any number of counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.  Confirmation of
execution by electronic transmission of a facsimile signature page shall be
binding upon any party so confirming.
 

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IN WITNESS WHEREOF, intending to be legally bound hereby, the parties have
executed and delivered this Asset Purchase Agreement as of the date first above
written.

 

 
SELLER:
PACIFIC CAPITAL BANK, N.A.
 

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By:
Its:
 
 
BUYER:
LEAF FINANCIAL CORPORATION
 

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By:
Its:
 
   
LEAF FUNDING, INC.
 

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By:
Its:
   
LEAF COMMERCIAL FINANCE CO., LLC
 

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By:
Its:

 

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Appendix A

 
DEFINITIONS AND RULES OF CONSTRUCTION
 
I.           General.
 
These definitional provisions are intended for use in connection with the
Transaction Documents (as defined herein) and are attached to and made a part of
the Agreement (as defined herein).
 
II.           Defined Terms.
 
Unless the context requires a different meaning, capitalized terms are used in
this Appendix A and in each of the other Transaction Documents (as defined
herein) as follows:
 
“Affiliate” means, with respect to any specified Person, another Person that
directly, or indirectly through one or more intermediaries, controls or is
controlled by or is under common control with the Person specified.  For
purposes of this definition, “control” means the power to direct the management
and policies of a Person, directly or indirectly, whether through ownership of
voting securities, by contract or otherwise; and “controlled” and “controlling”
have meanings correlative to the foregoing.
 
“Agreement” means the Asset Purchase Agreement, dated as of June 20, 2007,
between Buyer and Seller, as amended, supplemented or otherwise modified from
time to time.
 
“Assets” shall have the meaning set forth in Section 1 of the Agreement.
 
“Assumed Liabilities” means the obligations of lessor (or lender, as applicable)
pertaining to the Performing Leases, including without limitation all security
deposits and lessee deposits associated with the Leases appearing on the Closing
Date Report, the obligation to pay property taxes (except as set forth in
Section 13(l) of the Agreement) and to refund any overpayments of taxes, the
obligation to fund the Backlog and the obligation to fund unfunded disbursements
on Leases.
 
“Backlog” shall have the meaning set forth in Section 1(d) of the Agreement.
 
“Bailment Agreement” shall have the meaning set forth in Section 5(a)(iv) of the
Agreement.
 
“Bankruptcy Code” means The Bankruptcy Reform Act of 1978, as amended from time
to time, and as codified as 11 U.S.C. Section 101 et seq.
 
“Best Efforts” means the efforts that a prudent Person desirous of achieving a
result would use in similar circumstances to achieve that result as
expeditiously as possible, provided, however, that a Person required to use Best
Efforts under the Agreement will not be thereby required to take actions that
would result in a material adverse change in the benefits to such Person of the
Agreement and the Contemplated Transactions or to dispose of or make any change
to its business, expend any material funds or incur any other material burden.

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“Bill of Sale” means a bill of sale for all of the Assets in the form of Exhibit
B hereto.
 
“Business” means Seller’s program of equipment leasing and financing in which
transactions are originated through brokers and other third-parties that is
conducted under the trade name “Pacific Capital Bank” or the predecessor trade
name “Santa Barbara Bank & Trust.”
 
“Business Day” means any day other than a Saturday, Sunday or other day on which
commercial banks in the State of California are authorized or required to close.
 
“Charged-Off Leases” means those Leases that have been charged-off on Seller’s
Records prior to the Record Date in accordance with the Policies and Procedures.
 
“Claim Notice” shall have the meaning set forth in Section 16(a) of the
Agreement.
 
“Closing” means the purchase and sale provided for in the Agreement.
 
“Closing Date” shall have the meaning set forth in Section 4 of the Agreement.
 
“Closing Date Report” means the net investment trial balance report (which
schedule shall be provided in the form of a read-only computer disc) prepared in
accordance with Seller’s reporting systems (or other financial report mutually
agreed upon by Seller and Buyer) containing information as of the Record
Date.  The information on the Closing Date Report shall include information
regarding each Lease for each category that is provided on Schedule 1(a) of the
Agreement.
 
“Consent” means any approval, consent, ratification, waiver or other
authorization.
 
“Contemplated Transactions” means all of the transactions contemplated by the
Agreement and the other Transaction Documents.
 
“Contract File” means a file containing each of the following:
 
I.
 
(a)           the sole original signed Lease (which may be in the form of an
equipment finance agreement) and, if applicable, Lease schedule;
 
(b)           an original or copy of a delivery and acceptance for leases (which
may be part of the Contract) for Leases with an original cost greater than
$50,000;
 
(c)           original or copy of an invoice relating to the Subject Equipment;
 

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(d)           evidence of insurance for those Leases that are secured by (i)
vehicles, (ii) Subject Equipment with an original cost greater than $100,000 or
(iii) logging equipment;
 
(e)           copies of all UCC financing statements, as filed (together with
evidence of filing with the appropriate Governmental Authority) for the Subject
Equipment with an original cost greater than $25,000 for finance leases and
loans and in excess of $50,000 on all fair market value leases, as determined by
the information found in the Contract File, or if the equipment is titled, an
original title is present that has the lessee as registered owner and Seller
listed as lienholder; and
 
(f)           in the case of a third party origination Lease, proof of issuance
of payment by the third party originator for the Subject Equipment.
 
II.           In addition, with respect to any Lease, each of the following may
be present in the Contract File, provided, however, that the absence of any item
listed in (a) through (e) below shall not be reported as an exception on any
Contract File schedule:
 
(a)           an original or copy of a personal, corporate or other guaranty
(which may be part of the Lease) as required in the original credit approval;
 
(b)           an original or copy of a corporate resolution and secretary’s
certificate, as appropriate for the transaction;
 
(c)           an original or copy of a bill of sale, in the case of a sale lease
back transaction;
 
(d)           copies of photo identification; and
 
(e)           an original or copy of a landlord or mortgagee waiver.
 
III.           Provided, with respect to any Lease identified as a loan
transaction, the term “Contract File”, unless the document quality checklist
otherwise indicates (by an asterisk or other mark) that additional items shall
be required, means the following:
 
(a)           an original or certified copy of a loan contract or master loan
contract;
 
(b)           an original (if not part of the loan contract) of a term note;
 
(c)           an original or certified copy of a security agreement;
 
(d)           an original or copy of a sale agreement between seller and buyer,
if there is such an agreement with respect to the Lease;
 
(e)           original or copy of an invoice relating to the Subject Equipment;
 
(f)           evidence of insurance for contracts with an original cost of
greater than $100,000;
 
(g)           copies of UCC filings for loans with an original principal balance
greater than $25,000;
 

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(h)           original or copies of titles for all titled equipment with the
user of the titled equipment listed as owner and Seller listed as the secured
party; and
 
(i)           in the case of a third party origination contract, proof of
issuance of payment by the third party originator for the Subject Equipment.
 
IV.           In addition, with respect to any loan, the file may contain each
of the following, which may be noted on the document quality checklist,
provided, however, that the absence of any item listed in (a) through (m) below
shall not be reported as an exception on any Contract File schedule:
 
(a)           an original or faxed copy of a personal, corporate or other
guaranty (which may be part of the Lease) as required in the original credit
approval;
 
(b)           an original or faxed copy of a corporate resolution and secretary
certificate as appropriate for the transaction;
 
(c)           an original or faxed copy of a bill of sale;
 
(d)           an original or faxed copy of an escrow agreement;
 
(e)           copies of photo identification;
 
(f)           copies of lien searches and applicable releases;
 
(g)           an original or copy of a landlord or mortgagee waiver;
 
(h)           a copy of an office lease or sublease;
 
(i)           evidence of insurance coverage with respect to (a) liability
insurance and (b) malpractice insurance;
 
(j)           copies of licenses;
 
(k)           a copy of wire instructions for funding proceeds of the loan;
 
(l)           an original or certified copy of the assignment of office lease;
and
 
(m)           a copy of the site inspection report.
 
“Customer” means any lessee, obligor, third party originator, client, customer,
vendor or supplier, as applicable, in connection with the Assets.
 
“Dispute Period” shall have the meaning set forth in Section 16(a) of the
Agreement.
 
“Dollar” and the symbol “$” each means lawful money of the United States.
 
“Equipment” means “equipment” as such term is defined in the UCC.
 

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“Excluded Assets” shall have the meaning set forth in Section 1 of the
Agreement.
 
“Final Contractual Payment” means a final payment which is a firm, mandatory
payment made by the obligor under such Lease, and such payment is not the
Residual Value.
 
“Financing Statements” means the financing statements covering all property
subject to the Leases necessary to duly perfect a first lien security interest
therein.
 
“Governing Documents” means the certificate of incorporation or articles of
association and bylaws.
 
“Governmental Authority” means any nation or government, any state, city, town,
municipality, county, local or other political subdivision thereof and any
department, commission, board, bureau, instrumentality, agency or other entity
exercising executive, legislative, judicial, taxing, regulatory or
administrative powers or functions of or pertaining to government.
 
“Governmental Authorization” means any permit, license, authorization, plan,
directive, consent order or consent decree of or from any Governmental
Authority.
 
“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
 
“Insolvency Event” means, as to any Person:
 
(a)           (i) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of such Person in an involuntary case
under the Bankruptcy Code or any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, which decree or order is not stayed, or
any other similar relief shall be granted under any applicable federal or state
law, (ii) an involuntary case is commenced against such Person under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect which remains undismissed, undischarged or unbonded for a period of
forty-five (45) days or (iii) such Person shall have a decree or an order for
relief entered with respect to it or commence a voluntary case under the
Bankruptcy Code or any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect; or
 
(b)           such Person shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to all or
substantially all of its property, or a decree or order of a court or agency or
supervisory authority having jurisdiction in the premises for the appointment of
a conservator or receiver or liquidator in any insolvency, readjustment of debt,
marshaling of assets and liabilities or similar proceedings, or for the
winding-up or liquidation of its affairs, shall have been entered against such
Person; or such Person shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make a general assignment for
the benefit of its creditors or voluntarily suspend payment of its obligations.

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“Interim Servicing Agreement” means a servicing agreement in the form annexed to
the Agreement as Exhibit C, pursuant to which, for a period not in excess of 90
days, Seller will service the Leases.
 
“Lease” shall have the meaning set forth in Section 1(a) of the Agreement.
 
“Lease Receivable” means, with respect to any Lease, (i) all “accounts” (as such
term is defined in the UCC, together with all proceeds thereon) created by or
that otherwise arise under such Lease and (ii) all Related Property with respect
to accounts.
 
“Legal Requirements” means, with respect to any Person the certificate of
incorporation or articles of association and by-laws or other organizational or
governing documents of such Person and any law, treaty, rule or regulation, or
determination of any arbitrator or Governmental Authority, in each case
applicable to or binding upon such Person or any of its property or to which
such Person or any of its property is subject, whether federal, state, local,
municipal, foreign, international, multinational or other constitution, law,
ordinance, principle of common law, code, regulation, statute or treaty.
 
“Lien” means any mortgage, deed of trust, pledge, lien (statutory or otherwise),
security interest, lease, easement, title defect, restriction, levy, execution,
seizure, attachment, charge or other encumbrance or security or preferential
arrangement of any nature, including, without limitation, any conditional sale
or title retention arrangement, any capitalized lease and any assignment,
deposit arrangement or financing lease intended as, or having the effect of,
security.
 
“Loss” or “Losses” shall mean a claim, action, cause of action, liability,
obligation or expense, including reasonable attorney fees and expenses.
 
“Net Investment” with respect to a Lease as of any date shall mean the
Unamortized Cost of such Lease as recorded in the accounting records of Seller
and listed on Seller’s report entitled “ls-net-invest” for that date.
 
“Ordinary Course of Business” means action that (i) is generally consistent in
nature, scope and magnitude with the past practices of such Person and is taken
in the ordinary course of the normal, day-to-day operations of such Person;
(ii) does not require authorization by the board of directors or shareholders of
such Person (or by any Person or group of Persons exercising similar authority),
other than the standing authority that has been delegated to the officers or
employees for the conduct of the business, and does not require any other
separate or special authorization of any nature; and (iii) is similar in nature,
scope and magnitude to actions customarily taken, without any separate or
special authorization, in the ordinary course of the normal, day-to-day
operations.
 
“Past Due Lease” means any lease as to which any required payment thereunder is
more than sixty (60) days past due, as of the Record Date.
 
“Performing Lease” means a Lease that is not (i) a Past Due Lease, (ii) a
Suspended Lease, or (iii) a Lease that is subject to any pending repossession
action or that is subject to any pending repossession action or as to which
Seller has received a notice of an event that is, or with notice and/or lapse of
time is likely to constitute, a material default or of any claim by a lessee or
guarantor of a right of offset or counterclaim (as referenced in Section 6(h)(x)
and identified on Schedule 6(h)(x)).

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“Person” means any natural person, corporation, division, business trust, joint
venture, association, limited liability company, partnership, joint stock
company, association, estate, trust, unincorporated organization or Governmental
Authority.
 
“Policies and Procedures” means those policies and procedures of Seller with
respect to the origination, collection and administration of Leases and as set
forth in Seller’s Policies and Procedures Manual on May 4, 2007.
 
“Proceeding” means any suit in equity, action or law or other judicial or
administrative proceeding.
 
“Purchase Price”  has the meaning set forth in Section 3(a) of the Agreement.
 
“Record Date” means the close of business on the date, four Business Days prior
to the Closing Date, unless such other date is mutually agreed upon by Buyer and
Seller.
 
“Records” means the Leases and all other documents, books, records and other
writings and information (including, without limitation, computer programs,
tapes, disks, punch cards, data processing software and related property and
rights, but excluding any credit profiles and rights in any personally
identifiable data of any lessee) maintained with respect to Leases and the
related lessees.
 
“Related Property” means, with respect to any Lease:
 
(a)           all “instruments”, “chattel paper”, “accounts”, “general
intangibles”, “commercial tort claims”, “investment property” and “letter of
credit rights” (as each such term is defined in the UCC) evidencing or arising
under such Lease;
 
(b)           all security interests or liens and property subject thereto from
time to time, if any, purporting to secure payment of such Lease;
 
(c)           all guarantees, indemnities, warranties, insurance (and proceeds
thereof) or other agreements or arrangements of any kind from time to time
supporting or securing payment of such Lease;
 
(d)           all Records related to such Lease;
 
(e)           all service contracts and other contracts and agreements
associated with such Lease; and
 
(f)           all proceeds of any of the foregoing.
 

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“Residual Value” means, with respect to any Lease, the value of the Subject
Equipment to the lessor thereunder at the end of such Lease, as estimated by
Seller at the origination of such Lease in accordance with the Policies and
Procedures.
 
“Retained Liabilities” means any other liabilities of Seller whatsoever not
included in the Assumed Liabilities.
 
“Subject Equipment” means, with respect to any Lease, the Equipment subject to
such Lease.
 
“Subsidiary” means, with respect to any Person (herein referred to as the
“parent”), any corporation, partnership, association or other business entity
(a) of which securities or other ownership interests representing more than 50%
of the equity or more than 50% of the ordinary voting power or more than 50% of
the general partnership interests are, at the time any determination is being
made, owned, controlled or held by the parent or (b) that is, at the time any
determination is being made, otherwise controlled, by the parent or one or more
subsidiaries of the parent or by the parent and one or more subsidiaries of the
parent.
 
“Suspended Lease” means a Lease which is classified as “income non-accrual” on
the records of Seller as of the Record Date, applying the Seller’s Policies and
Procedures.
 
“Tax” means any present or future tax, levy, impost, duty, assessment, charge,
fee, deduction or withholding of any nature and whatever called, by whomsoever,
on whomsoever and wherever imposed, levied, collected, withheld or assessed;
provided, “Tax on the overall net income” of a Person shall be construed as a
reference to a tax imposed by the jurisdiction in which that Person is organized
or in which that Person’s applicable principal office (and/or, in the case of a
Lender, its lending office) is located or in which that Person (and/or, in the
case of a Lender, its lending office) is deemed to be doing business on all or
part of the net income, profits or gains (whether worldwide, or only insofar as
such income, profits or gains are considered to arise in or to relate to a
particular jurisdiction, or otherwise) of that Person (and/or, in the case of a
Lender, its applicable lending office).
 
“Third Party Claim” means any claim or demand in respect of which an
indemnifying party might seek indemnity is asserted against or sought to be
collected from such indemnified party by a third party.
 
“Transaction Documents” means, collectively, the Agreement, including this
Appendix A, the Bill of Sale and the Interim Servicing Agreement.
 
“UCC” means the Uniform Commercial Code as in effect from time to time in the
relevant jurisdiction.
 
“Unamortized Cost” means an amount equal to the contract balance remaining on a
Lease less the unearned income on such Lease.
 
“United States” means the United States of America, its fifty States and the
District of Columbia.
 

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“written” or “in writing” means any form of written communication, including,
without limitation, by means of telex, telecopier device, telegraph, electronic
mail or messaging systems, the Internet or cable.
 
III.           Rules of Construction.
 
Except as otherwise expressly provided herein or in any of the Transaction
Documents or unless the context otherwise clearly requires:
 
(a)           defined terms include, as appropriate, all genders and the plural
as well as the singular;
 
(b)           references to designated articles, Sections and other subdivisions
of a Transaction Document refer to the designated article, Section, or other
subdivision of such Transaction Document as a whole and to all subdivisions of
the designated article, Section or other subdivision;
 
(c)           references to schedules in a particular Transaction Document refer
to the schedules attached to or delivered together with such Transaction
Document;
 
(d)           the words “herein,” “hereof,” “hereto,” “hereunder” and other
words of similar import refer to the Transaction Document in which such
reference is made as a whole and not to any particular article, Section or other
subdivision of such Transaction Document;
 
(e)           any term that relates to a document, statute, rule or regulation
includes any amendments, modifications, supplements or any other changes that
may have occurred since the document, statute, rule or regulation came into
being, including changes that occur after the date of the Transaction Document
in which such reference is made;
 
(f)           the term “including” and all its variations mean “including but
not limited to.” Except when used in conjunction with the word “either,” the
word “or” is always used inclusively (for example, the phrase “A or B” means “A
or B or both,” not “either A or B but not both”); and
 
(g)           in the computation of a period of time from a specified date to a
later specified date or an open-ended period, the word “from” means “from and
including” and the words “to” or “until” mean “to but excluding, and in setting
deadlines or other periods, “by” means “on or before,” and “after” means “from
and after”.
 

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