SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 5, 1998
UACSC AUTO TRUSTS
(Exact name of registrant as specified in its charter)
NEW YORK
(State or other jurisdiction of incorporation)
333-52101 35-1937340
(Registration Number) (IRS Employer Identification No.)
9240 Bonita Beach Road
Suite 1109-A
Bonita Springs, Florida 34135
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (941) 948-1850
<PAGE>
Item 5. Other Events.
Computational Materials
-----------------------
On November 5, 1998, Computational Materials were distributed to
potential investors in connection with a proposed offering of
asset-backed certificates under Reg. No. 333-52101. Under the proposed
pooling and servicing agreement (the "Proposed Agreement"), UAC
Securitization Corporation ("UACSC") will act as the proposed
depositor and establish the UACSC 1998-D Auto Trust (the "Proposed
Trust") by selling and assigning the proposed trust property to the
trustee in exchange for certificates, each of which represents a
fractional and undivided interest in the Proposed Trust. Pursuant to
the Proposed Agreement, Union Acceptance Corporation will act as
servicer. Such Computational Materials are filed with this Current
Report on Form 8-K on the basis of the position of the Division of
Corporation Finance set forth in Kidder, Peabody Acceptance
Corporation I (available May 20, 1994), Public Securities Association
(available May 27, 1994), Public Securities Association (available
February 17, 1995) and subsequent related no-action letters.
Item 7. Financial Statements and Exhibits.
Exhibit
Number Description
------ -----------
99 Computational Materials
-2-
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized in the City of Bonita Springs, State of
Florida, on November 9, 1998.
UAC SECURITIZATION CORPORATION
as Depositor (Registrant)
/s/ Leeanne Graziani
----------------------------------------
Leeanne Graziani
Vice President, Assistant Treasurer and
Secretary
Computational Materials
UACSC 1998-D Auto Trust
$58,925,000.00 [____]% Class A-1 Money Market Automobile Receivable
Backed Certificates
$60,250,000.00 [____]% Class A-2 Automobile Receivable Backed Certificates
$75,800,000.00 [____]% Class A-3 Automobile Receivable Backed Certificates
$36,450,000.00 [____]% Class A-4 Automobile Receivable Backed Certificates
$44,488,594.18 [____]% Class A-5 Automobile Receivable Backed Certificates
UAC Securitization Corporation
Depositor
Union Acceptance Corporation
Servicer
Computational
Materials
The information contained in the attached computational materials (the
"Information") is preliminary and will be replaced by the prospectus supplement
and accompanying prospectus applicable to the UACSC 1998-D Auto Trust (the
"Offering Documents") and any other information subsequently filed with the
Securities and Exchange Commission. You should make your investment decision
with respect to the securities described in the Information based solely upon
the information contained in the Offering Documents.
These computational materials do not constitute an offer to sell or the
solicitation of an offer to buy and we will not sell the securities in any
jurisdiction in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of such jurisdiction.
The securities may not be sold and no offer to buy will be accepted prior to the
delivery of the Offering Documents relating to the securities. The Information
is preliminary, limited in nature and subject to completion or amendment. We do
not claim that the securities will actually perform as described in any scenario
presented.
The Information has been prepared by the Depositor. None of NationsBanc
Montgomery Securities LLC ("NationsBanc Montgomery"), Bear, Stearns & Co. Inc.
("Bear Stearns" and together with NationsBanc Montgomery, the "Underwriters") or
any of their affiliates make any representation as to the accuracy or
completeness of the Information.
<PAGE>
The Information addresses only certain aspects of the characteristics
of the securities and does not provide a complete assessment of the securities.
As such, the Information may not reflect the impact of all structural
characteristics of the securities. The assumptions underlying the Information,
including structure, Trust property and collateral, may be changed from time to
time to reflect changed circumstances.
The data supporting the Information has been obtained from sources that
the Underwriters believe to be reliable, but the Underwriters do not guarantee
the accuracy of or computations based on such data. The Underwriters and their
affiliates may engage in transactions with the Depositor or its affiliates while
the Information is circulating. The Underwriters may act as principal in
transactions with you, and accordingly, you must determine the appropriateness
for you of such transactions and address any legal, tax, or accounting
considerations applicable to you. The Underwriters shall not be a fiduciary or
advisor, unless they have agreed in writing to receive compensation specifically
to act in such capacities. If you are subject to ERISA, the Information is being
furnished on the condition that it will not form a primary basis for any
investment decision.
Although a registration statement (including a form of prospectus)
relating to the securities described in this Information has been filed with the
Securities and Exchange Commission and is effective, the Offering Documents
relating to the securities described in this Information have not been filed
with the Securities and Exchange Commission. You must refer to the Offering
Documents for definitive information on any matter described in these
computational materials. Your investment decision should be based only on the
data in the Offering Documents. Offering Documents contain data that is current
as of the applicable publication dates and after publication may no longer be
complete or current. The Offering Documents may be updated by information
subsequently filed with the Securities and Exchange Commission.
You may obtain the Offering Documents by contacting the NationsBanc
Montgomery Syndicate Desk at (704) 386-9690 or the Bear Stearns Syndicate Desk
at (212) 272-4955.
<PAGE>
UACSC 1998-D Auto Trust
Computational Materials
Subject to Revision
Dated as of November 5, 1998
SUMMARY OF TERMS
The definitions or references to capitalized terms used in these
materials can be found on the pages indicated in the "Index of Terms" and
"Glossary" beginning on page 25 of these materials.
Issuer
The UACSC 1998-D Auto Trust (the "Trust") will issue the Class A Certificates.
Depositor
UAC Securitization Corporation (the "Depositor") is the depositor of the Trust.
In this capacity, the Depositor will transfer the automobile receivables and
related property to the Trust.
Servicer
Union Acceptance Corporation will act as the servicer of the Trust (in its
capacity as servicer, the "Servicer," otherwise "UAC"). In its role as Servicer,
UAC will receive and apply payments on the automobile receivables, service the
collection of the receivables and direct the trustee to make the appropriate
distributions to the certificateholders. The Servicer will receive a monthly
servicing fee as compensation for its services (the "Monthly Servicing Fee").
Trustee
Harris Trust and Savings Bank.
The Certificates
The Trust will issue automobile receivable backed certificates on or about
November 19, 1998 (the "Closing Date") under the terms of a pooling and
servicing agreement among the Depositor, the Servicer and the Trustee (the
"Pooling and Servicing Agreement"). The "Certificates" will consist of the
following:
o _______% Class A-1 Money Market Automobile Receivable Backed
Certificates in the aggregate principal amount of $58,925,000.00 (the
"Class A-1 Certificates");
o ____% Class A-2 Automobile Receivable Backed Certificates in the
aggregate principal amount of $60,250,000.00 (the "Class A-2
Certificates");
o ____% Class A-3 Automobile Receivable Backed Certificates in the
aggregate principal amount of $75,800,000.00 (the "Class A-3
Certificates");
o ____% Class A-4 Automobile Receivable Backed Certificates in the
aggregate principal amount of $36,450,000.00 (the "Class A-4
Certificates");
<PAGE>
o ____% Class A-5 Automobile Receivable Backed Certificates in the
aggregate principal amount of $44,488,594.18 (the "Class A-5
Certificates"); and
o the Class IC Automobile Receivable Backed Certificate (the "Class IC
Certificate"), which will be issued to the Depositor on the Closing
Date and is not offered for sale in this offering.
Each of the Certificates will represent a fractional and undivided interest in
the Trust. The Trust assets will include:
o a pool of simple and precomputed interest installment sale and
installment loan contracts originated in various states in the United
States of America, secured by new and used automobiles, light trucks
and vans (the "Receivables");
o certain monies due in respect of the Receivables as of and after
October 31, 1998 (the "Cutoff Date");
o security interests in the related vehicles financed through the
Receivables (the "Financed Vehicles");
o funds on deposit in a certificate account and a spread account;
o any proceeds from claims on certain insurance policies relating to the
Financed Vehicles or the related obligors;
o any lender's single interest insurance policy;
o an unconditional and irrevocable insurance policy issued by MBIA
Insurance Corporation guaranteeing payments of principal and interest
on the Class A Certificates (the "Policy"); and
o certain rights under the Pooling and Servicing Agreement.
The Class A Certificates
The term "Class A Certificates" includes the Class A-1 Certificates, the Class
A-2 Certificates, the Class A-3 Certificates, the Class A-4 Certificates and the
Class A-5 Certificates. We refer to the owners of the Class A Certificates in
these materials as the "Class A Certificateholders," and this term includes the
"Class A-1 Certificateholders," the "Class A-2 Certificateholders," the "Class
A-3 Certificateholders," the "Class A-4 Certificateholders" and the "Class A-5
Certificateholders."
Interest
The Trust will distribute interest on the eighth calendar day of each month or,
if such day is not a business day, on the next business day (each, a
"Distribution Date"), beginning December 8, 1998, to holders of record of the
Class A Certificates as of the day before the Distribution Date (the "Record
Date"). However, if Definitive Certificates are issued, the Record Date will be
the last day of the calendar month immediately preceding the calendar month in
which such Distribution Date occurs.
<PAGE>
The applicable pass-through rates for the Class A Certificates are:
o _______% for the Class A-1 Certificates (the "Class A-1 Pass-Through
Rate");
o _______% for the Class A-2 Certificates (the "Class A-2 Pass-Through
Rate");
o _______% for the Class A-3 Certificates (the "Class A-3 Pass-Through
Rate");
o _______% for the Class A-4 Certificates (the "Class A-4 Pass-Through
Rate"); and
o _______% for the Class A-5 Certificates (the "Class A-5 Pass-Through
Rate").
The Class A-5 Pass-Through Rate will be increased by 0.50% per annum after the
Clean-Up Call Date (as described under "--Increase of the Class A-5 Pass-Through
Rate").
Interest on the Class A-1 Certificates will be calculated on the basis of a
360-day year and the actual number of days from the previous Distribution Date
through the day before the related Distribution Date. Interest on all other
classes of Class A Certificates will be calculated on the basis of a 360-day
year consisting of twelve 30-day months. See "Yield and Prepayment
Considerations" in these materials.
Class A-1 Monthly Interest. Generally, the amount of interest distributable to
the Class A-1 Certificateholders on each Distribution Date is the product of
1/360th of the pass-through rate for the Class A-1 Certificates, the number of
days from the previous Distribution Date through the day before the related
Distribution Date and the aggregate outstanding principal balance of the Class
A-1 Certificates on the preceding Distribution Date (after giving effect to all
distributions to Class A Certificateholders on such date).
Monthly Interest for Other Class A Certificates. Generally, the amount of
interest distributable to each class of Class A Certificateholders (other than
the Class A-1 Certificateholders) on each Distribution Date is the product of
one-twelfth of the pass-through rate applicable to such class multiplied by the
aggregate outstanding principal balance of such class as of the preceding
Distribution Date (after giving effect to all distributions to Class A
Certificateholders on such date).
The amount of interest distributable on the first Distribution Date of December
8, 1998 will be based upon the original principal balance of the applicable
class and will accrue from the Closing Date until the day before the first
Distribution Date (and in the case of all of the Class A Certificates other than
the Class A-1 Certificates, assuming that the month of the Closing Date has 30
days).
The amount of interest distributable to Class A Certificateholders on any
Distribution Date constitutes "Monthly Interest."
<PAGE>
Principal
The Trust will distribute principal on each Distribution Date to the Class A
Certificateholders of record as of the Record Date. Generally, the amount of
principal which will be distributed ("Monthly Principal") is equal to the
difference between the aggregate Certificate Balance as of the previous
Distribution Date (after giving effect to any distributions of principal
required to be made on such Distribution Date) and the outstanding balance of
the Receivables (the "Pool Balance") on the last day of the preceding calendar
month.
The aggregate outstanding principal balance of the Class A Certificates as of
the Closing Date is as follows:
o $58,925,000.00 for the Class A-1 Certificates (the "Class A-1
Certificate Balance");
o $60,250,000.00 for the Class A-2 Certificates (the "Class A-2
Certificate Balance");
o $75,800,000.00 for the Class A-3 Certificates (the "Class A-3
Certificate Balance");
o $36,450,000.00 for the Class A-4 Certificates (the "Class A-4
Certificate Balance"); and
o $44,488,594.18 for the Class A-5 Certificates (the "Class A-5
Certificate Balance").
The sum of the Class A-1 Certificate Balance, the Class A-2 Certificate Balance,
the Class A-3 Certificate Balance, the Class A-4 Certificate Balance and the
Class A-5 Certificate Balance will equal the "Certificate Balance".
The outstanding principal amount of any class of Class A Certificates will be
payable in full on the final scheduled Distribution Date applicable to that
class. The final scheduled Distribution Dates of the Class A Certificates are as
follows:
o December 8, 1999, for the Class A-1 Certificates (the "Class A-1 Final
Scheduled Distribution Date");
o October 9, 2001, for the Class A-2 Certificates (the "Class A-2 Final
Scheduled Distribution Date");
o June 9, 2003, for the Class A-3 Certificates (the "Class A-3 Final
Scheduled Distribution Date");
o March 8, 2004, for the Class A-4 Certificates (the "Class A-4 Final
Scheduled Distribution Date"); and
o July 10, 2006, for the Class A-5 Certificates (the "Class A-5 Final
Scheduled Distribution Date").
<PAGE>
Principal will be distributed to the Class A Certificateholders in the order of
the numerical designation of each class of the Class A Certificates, starting
with the Class A-1 Certificates and ending with the Class A-5 Certificates. For
example, no principal will be distributed to the Class A-2 Certificateholders
until the Class A-1 Certificate Balance has been reduced to zero.
Since the rate of payment of principal of each class of Class A Certificates
depends upon the rate of payment of principal (including voluntary prepayments
and defaults) on the Receivables, the final distribution in respect of each
class of Class A Certificates could occur significantly earlier than the
respective final scheduled distribution dates.
Spread Account; Rights of Class IC Certificateholder
The Depositor will establish an account (the "Spread Account") on the Closing
Date for the benefit of the Class A Certificateholders and the Insurer. The
Spread Account will hold the excess, if any, of the collections on the
Receivables over the amounts which the Trust is required to distribute to the
Class A Certificateholders, the Servicer and the Insurer. The amount of funds
available for distribution to Class A Certificateholders on any Distribution
Date ("Available Funds") will consist of funds from the following sources:
(1) payments received from obligors in respect of the Receivables (net of
any amount required to be deposited to the payahead account in respect
of precomputed receivables);
(2) any net withdrawal from the payahead account in respect of precomputed
receivables;
(3) liquidation proceeds received in respect of Receivables;
(4) advances received from the Servicer in respect of interest on certain
delinquent Receivables; and
(5) amounts received in respect of required repurchases or purchases of
Receivables by UAC or the Servicer.
The Trustee will withdraw funds from the Spread Account (up to the amount on
deposit in the account) and then draw on the Policy, if the amount of Available
Funds for any Distribution Date is not sufficient to pay:
(1) the amounts owed to the Servicer (including the Monthly Servicing Fee
and reimbursement for advances made by the Servicer to the Trust), and
(2) the required payments of Monthly Interest and Monthly Principal to the
Class A Certificateholders.
If the amount on deposit in the Spread Account is zero, after any withdrawals
for the benefit of the Class A Certificateholders, and there is a default under
the Policy, any remaining losses on the Receivables will be borne directly pro
rata by you and the other Class A Certificateholders (to the extent of the class
or classes of Class A Certificates which are outstanding at such time). See
"Risk Factors" in these materials. Any amount on deposit in the Spread Account
on any Distribution Date in excess of the Required Spread Amount (after all
other required deposits to and withdrawals from the Spread Account have been
made), will be distributed to the holder of the Class IC Certificate (the "Class
IC Certificateholder"). Any such distribution to the Class IC Certificateholder
will no longer be an asset of the Trust.
<PAGE>
We intend for the amount on deposit in the Spread Account to grow over time to
the Required Spread Amount through the deposit of the excess collections, if
any, on the Receivables. However, we cannot assure you that the amount on
deposit in the Spread Account will actually grow to the Required Spread Amount.
The "Required Spread Amount" with respect to any Distribution Date will equal
the lesser of:
(1) 1.5% of the initial Pool Balance or
(2) the Certificate Balance as of the previous Distribution Date (after
giving effect to all distributions to Class A Certificateholders on
such date).
If the average aggregate yield of the Receivables in excess of losses falls
below the levels set forth in the Insurance and Reimbursement Agreement, entered
into on the Closing Date among the Depositor, Union Acceptance Funding
Corporation ("UAFC"), UAC, in its individual capacity and as Servicer, and the
Insurer (the "Insurance Agreement"), the Required Spread Amount will be
increased to 4.5% of the Pool Balance. During an Event of Default or upon the
occurrence of certain other events described in the Insurance Agreement
generally involving a failure of performance by the Servicer or a material
misrepresentation made by the Servicer under the Pooling and Servicing Agreement
or the Insurance Agreement, the Required Spread Amount will be increased to the
Policy Amount (calculated without any reduction for the amount on deposit in the
Spread Account). Under certain circumstances, the Required Spread Amount may be
reduced without your consent.
The Policy
The Depositor will obtain an irrevocable insurance policy (the "Policy") issued
by MBIA Insurance Corporation for the benefit of the Class A Certificateholders.
Subject to the terms of the Policy, the Insurer will unconditionally and
irrevocably guarantee the payment of Monthly Interest and Monthly Principal up
to the Policy Amount. The Trustee will draw on the Policy, up to the Policy
Amount, if Available Funds and the amount on deposit in the Spread Account
(after paying amounts owed to the Servicer) are not sufficient to fully
distribute Monthly Interest and Monthly Principal.
In addition, the Policy will cover any amount distributed or required to be
distributed by the Trust to Class A Certificateholders that is sought to be
recovered as a voidable preference by a trustee in bankruptcy of UAC, the
Depositor or UAFC pursuant to the United States Bankruptcy Code (11 U.S.C.), as
amended, in accordance with a final nonappealable order of a court having
competent jurisdiction.
Policy Amount
The term "Policy Amount" means with respect to any Distribution Date:
(1) the sum of
(A) the lesser of: (i) the Certificate Balance (after giving effect to
any distribution of Available Funds and any funds withdrawn from
the Spread Account to pay Monthly Principal on such Distribution
Date) and (ii) the Net Principal Policy Amount, plus
(B) Monthly Interest, plus
(C) the Monthly Servicing Fee;
less
<PAGE>
(2) all amounts on deposit in the Spread Account on such Distribution Date
(after giving effect to any funds withdrawn from the Spread Account to
pay Monthly Principal on such Distribution Date).
"Net Principal Policy Amount" means the initial Certificate Balance minus all
amounts previously drawn on the Policy or withdrawn from the Spread Account with
respect to Monthly Principal.
Insurer
MBIA Insurance Corporation is the "Insurer" and will guarantee the payment of
Monthly Interest and Monthly Principal under the terms of the Policy.
Legal Investment
The Class A-1 Certificates will be eligible securities for purchase by money
market funds under Rule 2a-7 of the Investment Company Act of 1940, as amended.
Optional Sale
The Class IC Certificateholder has the right to purchase all of the Receivables
as of the last day of any Collection Period on which the Pool Balance is equal
to or less than 10% of the initial Certificate Balance (the "Optional Sale").
The purchase price applicable to the Optional Sale will be equal to the fair
market value of the Receivables; provided that such amount is equal to or
greater than the sum of:
(1) 100% of the outstanding Certificate Balance,
(2) accrued and unpaid interest on the outstanding Certificate Balance at
the weighted average note rates of the Receivables less any payments
received but not applied to interest or principal and
(3) any amounts due the Insurer.
Increase of the Class A-5 Pass-Through Rate
If the Class IC Certificateholder does not exercise its rights with respect to
the Optional Sale on the first Distribution Date that the Optional Sale is
permitted (the "Clean-Up Call Date"), the Class A-5 Pass-Through Rate will be
increased by 0.50% after the Clean-Up Call Date.
Tax Status
In the opinion of special tax counsel to the Depositor, the Trust will not be
treated as an association taxable as a corporation or as a "publicly traded
partnership" taxable as a corporation. The Trustee and the Certificateholders
will agree to treat the Trust as a partnership for federal income tax purposes.
As a partnership, the Trust will not be subject to federal income tax and the
Certificateholders will be required to report their respective shares of the
Trust's taxable income, deductions and other tax attributes.
<PAGE>
Ratings
On the Closing Date, each class of Class A Certificates must be rated in the
highest applicable category by Moody's Investors Service, Inc. and Standard &
Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. (each a
"Rating Agency" and collectively, the "Rating Agencies"). A security rating is
not a recommendation to buy, sell or hold securities and may be subject to
revision or withdrawal at any time by the assigning rating agency.
ERISA Considerations
The Class A Certificates may be eligible for purchase by employee benefit plans
subject to Title I of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"). Any benefit plan fiduciary considering the purchase of Class
A Certificates should, among other things, consult with experienced legal
counsel in determining whether all required conditions for such purchase have
been satisfied.
<PAGE>
RISK FACTORS
You should carefully consider the risk factors set forth below as well
as the other investment considerations described in these materials as you
decide whether to purchase the Class A Certificates.
The Certificates Are Obligations
of the Trust Only The Class A Certificates are interests in the
Trust only and do not represent an interest
in or obligation of the Depositor, UAC or any
other party or governmental body. Except for
the Policy, the Class A Certificates have not
been insured or guaranteed by any party or
governmental body.
Spread Account The Trustee will withdraw funds from the
Spread Account, up to the full balance of the
funds on deposit in such account, if the
amount of Available Funds on any Distribution
Date is not sufficient to distribute Monthly
Interest and Monthly Principal (after payment
of the Monthly Servicing Fee) to you.
The amount on deposit in the Spread Account
may increase over time to an amount equal to
the Required Spread Amount. We cannot assure
you that such growth will occur or that the
balance in the Spread Account will always be
sufficient to assure payment in full of
Monthly Interest and Monthly Principal. The
Trustee will withdraw funds from the Spread
Account if the amount of Available Funds
(after paying amounts owed to the Servicer)
is not sufficient to fully distribute Monthly
Interest and Monthly Principal on any
Distribution Date. If the amount on deposit
in the Spread Account is reduced to zero
(after giving effect to all deposits and
withdrawals from the Spread Account), the
Trustee will then draw on the Policy, up to
the Policy Amount, in an amount equal to any
remaining shortfall in respect of Monthly
Interest and Monthly Principal.
Under certain circumstances, the Required
Spread Amount may be reduced without
obtaining the consent of the Trustee or the
Class A Certificateholders. Such a reduction
could affect the amount available to pay
Class A Certificateholders in the event of a
deficiency of Monthly Interest or Monthly
Principal and a default by the Insurer under
the Policy.
<PAGE>
You May Incur a Loss if There is a
Default Under the Policy If the Spread Account is reduced to zero and
the Insurer defaults under the Policy, the
Trust will depend solely on payments on and
proceeds from the Receivables to make
distributions on the Class A Certificates.
The Insurer will default under the Policy if
it fails to pay any required amount to the
Trust when due, for any reason, including the
insolvency of the Insurer.
If the Trust does not have sufficient funds
to fully distribute the required
distributions of Monthly Interest and Monthly
Principal during a default by the Insurer,
distributions on the Class A Certificates
will be made pro rata based on the amounts to
which Class A Certificateholders of each
class are entitled. In such event, you would
incur a loss at that time and you may not
recover your loss from subsequent collections
on the Receivables or from the Insurer. See
"The Receivables Pool -- Delinquencies,
Repossessions and Net Losses" and "--
Delinquency and Credit Loss Experience."
Failure to Maintain Security
Interests in Financed Vehicles Simultaneously with the sale of Receivables,
UAFC will assign to the Depositor, and the
Depositor will assign to the Trust, security
interests in the related Financed Vehicles.
Due to administrative burden and expense,
however, the certificates of title to such
Financed Vehicles will not be amended to
reflect the assignments to either the
Depositor or the Trust. In the absence of
such amendments, the Trust may not have a
perfected security interest in such Financed
Vehicles in some states.
If the Trust does not have a perfected
security interest in a Financed Vehicle, it
may not be able to enforce its rights to
repossess or otherwise collect on such
Financed Vehicle in the event of a default by
the obligor. As such, the Trust may be
adversely affected by such failure. If the
Trust's security interest in a Financed
Vehicle is perfected, the Trust will have a
prior claim over subsequent purchasers of
such Financed Vehicle and holders of
subsequently perfected security interests.
However, the Trust could lose its security
interest or the priority of its security
interest in a Financed Vehicle due to liens
for repairs of such Financed Vehicle or for
taxes unpaid by the related obligor or
through fraud or negligence. Neither UAC nor
the Depositor (or any of their affiliates)
will have any obligation to repurchase a
Receivable in respect of which the Trust
loses its security interest or the priority
of its security interest in the related
Financed Vehicle as the result of any such
mechanic's or tax lien or the fraud or
negligence of a third party occurring after
the date the security interest was conveyed
to the Trust.
<PAGE>
FORMATION OF THE TRUST
The Depositor will establish the Trust by assigning the Trust assets to
the Trustee in exchange for the Certificates. The Depositor will retain the
Class IC Certificate. UAC will be responsible for servicing the Receivables
pursuant to the Pooling and Servicing Agreement and will be compensated for
acting as the Servicer. To facilitate servicing and to minimize administrative
burden and expense, the Servicer will be appointed custodian of the Receivables
by the Trustee. However, the Servicer will not stamp the Receivables to reflect
the sale and assignment of the Receivables to the Trust or make any notation of
the Trust's lien on the certificates of title of the Financed Vehicles. In the
absence of such notation on the certificates of title, the Trustee may not have
perfected security interests in the Financed Vehicles securing the Receivables.
Under the terms of the Pooling and Servicing Agreement, UAC may delegate its
duties as Servicer and custodian; however, any such delegation will not relieve
UAC of its liability and responsibility with respect to such duties.
The Depositor will establish the Spread Account for the benefit of the
Class A Certificateholders and the Insurer and will obtain the Policy. The
Trustee will draw on the Policy, up to the Policy Amount, if Available Funds and
the amount on deposit in the Spread Account (after paying amounts owed to the
Servicer) are not sufficient to fully distribute Monthly Interest and Monthly
Principal. If the Spread Account is reduced to zero and there is a default under
the Policy, the Trust will look only to the obligors on the Receivables and the
proceeds from the repossession and sale of Financed Vehicles that secure
Defaulted Receivables for distributions of interest and principal on the Class A
Certificates. In such event, certain factors, such as the Trustee's not having
perfected security interests in some of the Financed Vehicles, may affect the
Trust's ability to realize on the collateral securing the Receivables, and thus
may reduce the proceeds to be distributed to Class A Certificateholders.
THE RECEIVABLES POOL
The Receivables were selected from the portfolio of UAFC, for purchase
by the Depositor by several criteria, including that each Receivable:
o has an original number of payments of not more than 84
payments and not less than twelve payments (except that
approximately 0.98% of the aggregate principal balance of the
Receivables as of the Cutoff Date consist of Modified
Receivables which have been amended or modified after
origination to provide that the number of payments from the
time of origination to maturity may exceed 84 payments);
o has a remaining maturity of not more than 84 months and not
less than three months;
o provides for level monthly payments that fully amortize the
amount financed over the remaining term and
o has a contract rate of interest (exclusive of prepaid finance
charges) of not less than 4.95%.
The weighted average remaining maturity of the Receivables is
approximately 69 months as of the Cutoff Date.
<PAGE>
Approximately 1.88% of the aggregate principal balance of the
Receivables as of the Cutoff Date were selected from the "non-prime" or "Tier
II" portfolio of UAFC (the "Tier II Receivables").
See "-- Delinquency and Credit Loss Experience."
Approximately 98.64% of the aggregate principal balance of the
Receivables as of the Cutoff Date are simple interest contracts which provide
for equal monthly payments. Approximately 1.36% of the aggregate principal
balance of the Receivables as of the Cutoff Date are precomputed receivables
originated in the State of California. All of such precomputed receivables are
rule of 78's receivables. Approximately 28.28% of the aggregate principal
balance of the Receivables as of the Cutoff Date represent financing of new
vehicles; the remainder of the Receivables represent financing of used vehicles.
Receivables representing more than 10% of the aggregate principal
balance of the Receivables as of the Cutoff Date were originated in metropolitan
areas in the states of North Carolina and Texas. The performance of the
Receivables in the aggregate could be adversely affected in particular by the
development of adverse economic conditions in such metropolitan areas.
Composition of the Receivables as of the Cutoff Date
<TABLE>
<CAPTION>
Weighted
Aggregate Original Average
Number of Principal Principal Contract
Receivables Balance Balance Rate
----------- ------- ------- ----
<S> <C> <C> <C> <C>
New Automobiles and Light-Duty Trucks............ 3,933 $ 71,198,968.22 $ 79,215,451.90 11.92%
Used Automobiles and Light-Duty Trucks........... 14,322 182,718,779.72 199,707,911.32 13.08%
New Vans (1)..................................... 309 6,824,953.56 7,566,495.15 11.89%
Used Vans (1).................................... 1,169 15,170,892.68 17,525,904.72 12.93%
------ --------------- --------------- -----
All Receivables.................................. 19,733 $275,913,594.18 $304,015,763.09 12.74%
====== =============== =============== =====
</TABLE>
<TABLE>
<CAPTION>
Weighted Weighted Percent
Average Average of Aggregate
Remaining Original Principal
Term(2) Term(2) Balance(3)
------- ------- ----------
<S> <C> <C> <C>
New Automobiles and Light-Duty Trucks.......... 73.8mos. 78.0mos. 25.80%
Used Automobiles and Light-Duty Trucks......... 67.2 70.1 66.22
New Vans (1)................................... 75.3 79.5 2.47
Used Vans (1).................................. 67.3 71.7 5.50
---- ---- ------
All Receivables................................ 69.1mos. 72.4mos. 100.00%
==== ==== ======
</TABLE>
(1) References to vans include minivans and van conversions.
(2) Based on scheduled maturity and assuming no prepayments of the Receivables.
(3) Sum may not equal 100% due to rounding.
<PAGE>
Distribution of the Receivables by Remaining Term as of the Cutoff Date
<TABLE>
<CAPTION>
Percent Percent
of Total Aggregate of Aggregate
Remaining Number of Number of Principal Principal
Term Range Receivables Receivables (1) Balance Balance(1)
---------- ----------- --------------- ------- ----------
<S> <C> <C> <C> <C>
1 to 12 months........... 676 3.43% $ 1,406,167.21 0.51%
13 to 24 months........... 2,061 10.44 9,823,208.53 3.56
25 to 36 months........... 647 3.28 4,484,629.00 1.63
37 to 48 months........... 1,201 6.09 11,209,865.26 4.06
49 to 60 months........... 3,457 17.52 44,094,734.65 15.98
61 to 72 months........... 5,637 28.57 89,303,806.37 32.37
73 to 84 months........... 6,054 30.68 115,591,183.16 41.89
------ ------ --------------- ------
Total........... 19,733 100.00% $275,913,594.18 100.00%
====== ====== =============== ======
</TABLE>
(1) Sum may not equal 100% due to rounding.
<PAGE>
Geographic Distribution of the Receivables as of the Cutoff Date
<TABLE>
<CAPTION>
Percent Percent
of Total Aggregate of Aggregate
Number of Number of Principal Principal
State (1) (2) Receivables Receivables (3) Balance Balance (3)
------------- ----------- --------------- ------- -----------
<S> <C> <C> <C> <C>
Arizona...................... 995 5.04% $ 14,448,221.10 5.24%
California................... 1,256 6.36 19,491,547.02 7.06
Colorado..................... 432 2.19 5,641,752.31 2.04
Florida...................... 1,313 6.65 18,244,004.44 6.61
Georgia...................... 736 3.73 10,535,620.70 3.82
Idaho........................ 23 0.12 328,443.33 0.12
Illinois..................... 1,282 6.50 19,081,819.86 6.92
Indiana...................... 663 3.36 8,629,642.53 3.13
Iowa ........................ 553 2.80 8,228,428.26 2.98
Kansas....................... 221 1.12 3,076,821.82 1.12
Kentucky..................... 151 0.77 2,091,012.82 0.76
Maryland..................... 242 1.23 3,877,827.08 1.41
Massachussetts............... 498 2.52 7,428,316.76 2.69
Michigan..................... 299 1.52 4,689,873.41 1.70
Minnesota.................... 363 1.84 5,095,242.20 1.85
Missouri..................... 594 3.01 7,345,874.45 2.66
Nebraska..................... 136 0.69 2,026,581.84 0.73
Nevada....................... 57 0.29 969,274.95 0.35
New Mexico................... 40 0.20 652,659.82 0.24
North Carolina............... 2,058 10.43 28,185,342.15 10.22
Ohio ........................ 1,493 7.57 16,601,204.18 6.02
Oklahoma..................... 958 4.85 11,185,750.75 4.05
Oregon....................... 64 0.32 1,090,184.79 0.40
Pennsylvania................. 112 0.57 1,567,795.11 0.57
South Carolina............... 659 3.34 10,413,053.85 3.77
South Dakota................. 10 0.05 145,725.38 0.05
Tennessee.................... 467 2.37 7,581,826.85 2.75
Texas........................ 2,498 12.66 35,859,079.85 13.00
Utah ........................ 129 0.65 2,053,790.39 0.74
Virginia..................... 996 5.05 13,065,455.82 4.74
Washington................... 91 0.46 1,663,201.03 0.60
Wisconsin.................... 344 1.74 4,618,219.33 1.67
------ ------ --------------- ------
Total............... 19,733 100.00% $275,913,594.18 100.00%
====== ====== =============== ======
</TABLE>
(1) Based on address of the Dealer selling the related Financed Vehicle.
(2) Receivables originated in Ohio were solicited by Dealers for direct
financing by UAC or the Predecessor. All other Receivables were originated
by Dealers and purchased from such Dealers by UAC or the Predecessor.
(3) Sum may not equal 100% due to rounding.
<PAGE>
Distribution of Receivables by Financed Vehicle Model
Year as of the Cutoff Date
<TABLE>
<CAPTION>
Percent Percent
of Total Aggregate of Aggregate
Model Number of Number of Principal Principal
Year Receivables Receivables(1) Balance Balance(1)
---- ----------- -------------- ------- ----------
<S> <C> <C> <C> <C>
1985 and earlier..................... 13 0.07% $ 94,649.98 0.03%
1986................................. 12 0.06 73,961.65 0.03
1987................................. 19 0.10 107,261.30 0.04
1988................................. 75 0.38 310,305.77 0.11
1989................................. 231 1.17 893,715.71 0.32
1990................................. 633 3.21 3,155,589.15 1.14
1991................................. 981 4.97 5,794,927.90 2.10
1992................................. 1,395 7.07 10,592,973.32 3.84
1993................................. 1,994 10.10 19,183,627.15 6.95
1994................................. 2,678 13.57 28,705,215.19 10.40
1995................................. 2,885 14.62 41,626,456.09 15.09
1996................................. 2,390 12.11 38,945,037.86 14.11
1997................................. 2,187 11.08 37,639,090.87 13.64
1998................................. 3,368 17.07 68,546,862.23 24.84
1999................................. 872 4.42 20,243,920.01 7.34
------ ------ --------------- ------
Total................. 19,733 100.00% $275,913,594.18 100.00%
====== ====== =============== ======
</TABLE>
(1) Sum may not equal 100% due to rounding.
<PAGE>
Distribution of the Receivables by Contract Rate as of the Cutoff Date
<TABLE>
<CAPTION>
Percent Percent
of Total Aggregate of Aggregate
Number of Number of Principal Principal
Contract Rate Range Receivables Receivables(1) Balance Balance(1)
- ------------------- ----------- -------------- ------- ----------
<S> <C> <C> <C> <C>
Less than 7.000%...................... 35 0.18% $ 429,261.50 0.16%
7.000 to 7.999%...................... 90 0.46 1,415,372.88 0.51
8.000 to 8.999%...................... 392 1.99 5,803,930.15 2.10
9.000 to 9.999%...................... 1,023 5.18 13,533,348.31 4.90
10.000 to 10.999%...................... 2,263 11.47 31,142,748.64 11.29
11.000 to 11.999%...................... 3,375 17.10 49,444,890.98 17.92
12.000 to 12.999%...................... 4,510 22.86 67,422,212.30 24.44
13.000 to 13.999%...................... 3,626 18.38 48,872,634.25 17.71
14.000 to 14.999%...................... 1,952 9.89 25,590,427.53 9.27
15.000 to 15.999%...................... 1,018 5.16 13,228,486.39 4.79
16.000 to 16.999%...................... 602 3.05 8,352,059.30 3.03
17.000 to 17.999%...................... 315 1.60 4,299,099.51 1.56
18.000 to 18.999%...................... 440 2.23 5,513,283.49 2.00
19.000 to 19.999%...................... 37 0.19 376,485.23 0.14
20.000 to 20.999%...................... 21 0.11 235,448.42 0.09
21.000 to 21.999%...................... 25 0.13 181,670.94 0.07
22.000 to 22.999%...................... 2 0.01 17,814.42 0.01
23.000 to 23.999%...................... 1 0.01 5,956.08 0.00
24.000 to 24.999%...................... 3 0.02 26,495.24 0.01
25.000 to 25.999%...................... 3 0.02 21,968.62 0.01
------ ------ --------------- ------
Total...................... 19,733 100.00% $275,913,594.18 100.00%
====== ====== =============== ======
</TABLE>
(1) Sum may not equal 100% due to rounding.
<PAGE>
Delinquencies, Repossessions and Net Losses
We have set forth below certain information about the experience of UAC
and its Predecessor relating to delinquencies, repossessions, and net losses on
the prime fixed rate retail automobile, light truck and van receivables serviced
by UAC. We cannot assure you that the delinquency, repossession, and net loss
experience of the Receivables will be comparable to that set forth in the
following tables.
Delinquency Experience (1) (2)
At June 30,
------------------------------------------------
1996 1997
--------------------- ----------------------
(Dollars in thousands)
Number of Number of
Receivables Amount Receivables Amount
----------- ---------- ----------- ----------
Servicing portfolio........ 147,722 $1,548,538 173,693 $1,860,272
------- ---------- ------- ----------
Delinquencies
30-59 days.............. 1,602 $ 17,030 2,487 $ 27,373
60-89 days.............. 694 7,629 1,646 18,931
90 days or more......... 333 3,811 723 8,826
----- ---------- ----- ----------
Total delinquencies........ 2,629 $ 28,470 4,856 $ 55,130
===== ========== ===== ==========
Total delinquencies as a
percent of servicing
portfolio............. 1.78% 1.84% 2.80% 2.96%
<PAGE>
<TABLE>
<CAPTION>
At September 30, At June 30, At September 30,
1997 1998 1998
---------------------- ------------------------- -----------------------
(Dollars in thousands)
Number of Number of Number of
Receivables Amount Receivables Amount Receivables Amount
----------- ---------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Servicing portfolio........ 177,377 $1,896,748 184,003 $1,978,920 194,882 $2,151,695
------- ---------- ------- ---------- ------- ----------
Delinquencies
30-59 days.............. 4,310 $ 45,766 3,179 $ 32,967 3,741 $ 38,040
60-89 days.............. 2,196 25,156 1,907 20,819 1,873 19,652
90 days or more......... 934 11,131 657 6,993 793 7,966
----- ---------- ----- ---------- ----- ----------
Total delinquencies........ 7,440 $ 82,053 5,743 $ 60,779 6,407 $ 65,658
===== ========== ===== ========== ===== ==========
Total delinquencies as a
percent of servicing
portfolio............. 4.19% 4.33% 3.12% 3.07% 3.29% 3.05%
</TABLE>
<PAGE>
Credit Loss Experience (1) (2)
<TABLE>
<CAPTION>
Year ended June 30,
--------------------------------------------- Three Months Ended Year Ended
1996 1997 September 30, 1997 (6) June 30, 1998
--------------------- ---------------------- --------------------- -----------------------
(Dollars in thousands)
Number of Number of Number of Number of
Receivables Amount Receivables Amount Receivables Amount Receivables Amount
----------- ------ ----------- ------ ----------- ------ ----------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Avg. servicing portfolio(3)..132,363 $1,343,770 164,858 $1,759,666 175,920 $1,881,603 179,822 $1,922,977
-------- ---------- ------- ---------- ------- ---------- ------- ----------
Gross charge-offs............ 3,663 $ 40,815 6,280 $ 70,830 2,054 $ 23,056 7,909 $ 87,325
Recoveries (4)............... 19,543 28,511 8,134 33,546
---------- ---------- ---------- ----------
Net losses................... $ 21,272 $ 42,319 $ 14,922 $ 53,779
========== ========== ========== ==========
Gross charge-offs as a % of
avg. servicing
portfolio(5)............ 2.77% 3.04% 3.81% 4.03% 4.67% 4.90% 4.40% 4.54%
Recoveries as a % of gross
charge-offs............. 47.88% 40.25% 35.28% 38.41%
Net losses as a % of avg.
servicing portfolio(5).. 1.58% 2.40% 3.17% 2.80%
</TABLE>
<PAGE>
Three Months Ended
September 30, 1998 (6)
------------------------
Number of
Receivables Amount
----------- ------
Avg. servicing portfolio(3) 190,877 $2,088,163
------- ----------
Gross charge-offs.......... 2,196 $ 23,651
Recoveries (4)............. 9,146
----------
Net losses................. $ 14,505
==========
Gross charge-offs as a % of
avg. servicing
portfolio(5).......... 4.60% 4.53%
Recoveries as a % of gross
charge-offs........... 38.67%
Net losses as a % of avg.
servicing portfolio(5) 2.78%
(1) There is generally no recourse to Dealers under any of the receivables
in the portfolio serviced by UAC or the Predecessor, except to the
extent of representations and warranties made by Dealers in connection
with such receivables.
(2) The delinquency experience and credit loss experience of the Tier II
Receivables are not included herein but are described on the following
page.
(3) Equals the monthly arithmetic average, and includes receivables sold in
prior securitization transactions.
(4) Recoveries include recoveries on receivables previously charged off,
cash recoveries and unsold repossessed assets carried at fair market
value.
(5) Variation in the size of the portfolio serviced by UAC will affect the
percentages in "Gross charge-offs as a percentage of average servicing
portfolio" and "Net losses as a percentage of average servicing
portfolio."
(6) Percentages are annualized in "Gross charge-offs as a percentage of
average servicing portfolio" and "Net losses as a percentage of average
servicing portfolio" for partial years.
Delinquency and Credit Loss Experience
As indicated in the foregoing delinquency experience table, delinquency
rates for UAC's prime automobile portfolio based upon outstanding balances of
receivables 30 days past due and over decreased to 3.05% at September 30, 1998,
from 3.07% and 4.33% at June 30, 1998 and September 30, 1997, respectively.
<PAGE>
As indicated in the foregoing credit loss experience table, net credit
losses on UAC's prime automobile portfolio totaled approximately $14.5 million
for the quarter ended September 30, 1998, or 2.78% (annualized) of the average
servicing portfolio, compared to $14.9 million, or 3.17% (annualized) for the
quarter ended September 30, 1997. For the year ended June 30, 1998, net credit
losses on UAC's prime automobile portfolio totaled approximately $53.8 million
or 2.80% of the average servicing portfolio.
From September 30, 1997 through September 30, 1998, UAC has experienced
steady improvement in its delinquency and credit loss trends. UAC attributes the
improvement to strategic changes in its origination and collection departments.
The efforts in the origination department include:
o implementing tighter credit standards in March 1997;
o developing quality control procedures that rank a prospective
obligor by credit score and by predetermined debt and income
ratios;
o growing the portfolio with quality obligors through dealer
development and dealer expansion;
o increasing the staff in the origination department; and
o expanding the origination department's hours of service.
The collection department's efforts to improve credit loss performance since
September 30, 1997 include:
o restructuring the collectors to form specialized
sub-departments of collectors for auxiliary functions such as
skip tracing and high risk accounts;
o initiating collection calls earlier in the delinquency process
through the use of a power dialer;
o targeting higher risk obligors through the use of quarterly
updated credit scores; and
o increasing collection efforts on charged-off accounts.
UAC believes that net credit losses were affected by depressed recovery
rates during the quarter ended September 30, 1998. Recoveries as a percentage of
gross charge-offs decreased to 38.67% for the three months ended September 30,
1998, compared to 41.17% for the quarter ended June 30, 1998. On a year to year
comparison, recovery rates improved to 38.67% for the quarter ended September
30, 1998, compared to 35.28% for the quarter ended September 30, 1997. In
response to declining recovery rates, UAC opened a franchised new car dealership
in Indianapolis in July 1998 and is retailing a portion of its repossessed
automobiles through the dealership. UAC anticipates that this method of
disposing of repossessions along with stricter monitoring of the repossession
and resale process should enhance the recovery rate over time. Although the
overall recovery percentage remains below UAC's expectations, recovery rates for
repossessed automobiles sold by UAC's retail operations have been significantly
higher than recovery rates on vehicles sold at auction. However, less than 10%
of all repossessed automobiles sold by UAC during the quarter were sold through
its new retail operation.
<PAGE>
UAC's non-prime lending began in 1994 and was replaced by UAC's "Tier
II" lending on March 1, 1998. The majority of the Tier II Receivables were
originated under UAC's Tier II lending from applications that did not qualify
for credit under UAC's "Tier I" lending. Although it is too early to determine
actual trends with respect to delinquency and credit losses of the Tier II
Receivables, UAC believes that the rate of delinquency and credit loss
associated with the Tier II Receivables will more closely follow the experience
of UAC's non-prime portfolio rather than the prime or Tier I portfolio which is
set forth on the preceding page. At September 30, 1998, UAC's non-prime
servicing portfolio consisted of approximately $67.7 million in receivables and
had a delinquency rate based upon outstanding balances of receivables 30 days
past due and over of 8.14% compared to 8.29% and 8.90% at June 30, 1998 and
September 30, 1997, respectively. For the quarter ended September 30, 1998, the
credit losses on the non-prime portfolio were 8.18% (annualized) of the average
non-prime servicing portfolio, compared to 8.83% (annualized) for the quarter
ended September 30, 1997. As the Tier II Receivables account for approximately
1.88% of the Receivables as of the Cutoff Date, UAC believes that the credit
quality of the Tier II Receivables will not affect the credit quality of the
Receivables as a whole in a materially adverse manner.
UAC's expectations with respect to delinquency and credit loss trends
constitute forward-looking statements and are subject to important factors that
could cause actual results to differ materially from those projected by UAC.
Such factors include, but are not limited to, general economic factors affecting
obligors' abilities to make timely payments on their indebtedness such as
employment status, rates of consumer bankruptcy, consumer debt levels generally
and the interest rates applicable thereto. In addition, credit losses are
affected by UAC's ability to realize on recoveries of repossessed vehicles,
including, but not limited to, the market for used cars at any given time.
WEIGHTED AVERAGE LIFE OF THE CLASS A CERTIFICATES
Because the rate of payment of principal of the Class A Certificates
depends primarily on the rate of payment (including voluntary prepayments and
defaults) of the principal balance of the Receivables, final payment of each
class of Class A Certificates could occur much earlier than the applicable final
scheduled Distribution Date. You will bear the risk of being able to reinvest
early principal payments on the Class A Certificates at yields at least equal to
the yield on your Class A Certificates.
Prepayments on retail installment sale contracts, such as the
Receivables, can be measured relative to a prepayment standard or model. The
model used in these materials is the Absolute Prepayment Model ("ABS"). The ABS
model represents an assumed rate of prepayment each month relative to the
original number of receivables in a pool. The ABS model further assumes that all
of the receivables are the same size, amortize at the same rate and that each
receivable will be paid as scheduled or will be prepaid in full. For example, in
a pool of receivables originally containing 100 receivables, a 1% ABS rate means
that one receivable prepays in full each month. The ABS model, like any
prepayment model, does not claim to be either a historical description of
prepayment experience or a prediction of the anticipated rate of prepayment.
<PAGE>
The tables on pages 19 to 21 have been prepared on the basis of certain
assumptions, including that:
o the Receivables prepay in full at the specified monthly ABS;
o each scheduled payment on the Receivables is made on the last
day of each Collection Period and includes a full month of
interest;
o distributions on the Class A Certificates are paid in cash on
each Distribution Date commencing December 8, 1998 and on the
eighth calendar day of each subsequent month;
o the Closing Date occurs on November 19, 1998;
o no defaults or delinquencies in the payment of any of the
Receivables occur;
o no Receivables are repurchased due to a breach of any
representation or warranty or for any other reason; and
o the Class IC Certificateholder exercises its rights with
respect to the Optional Sale on the first possible
Distribution Date.
The table indicates the projected weighted average life of each class of Class A
Certificates and sets forth the percentage of the initial Certificate Balance of
each class of Class A Certificates that is projected to be outstanding after
each of the Distribution Dates shown at specified ABS percentages. The table
also assumes that the Receivables have been aggregated into five hypothetical
pools with all of the Receivables within each such pool having the
characteristics described below:
<TABLE>
<CAPTION>
Weighted Average Weighted Average
Cutoff Date Weighted Average Remaining Term to Original Term to
Pool Principal Balance Note Rate Maturity (in Months) Maturity (in Months)
---- ----------------- --------- -------------------- --------------------
<S> <C> <C> <C> <C>
1 $ 11,754,443.79 11.860% 19 71
2 14,121,104.77 13.047 43 43
3 42,042,861.22 12.738 59 60
4 86,943,842.40 12.811 70 71
5 121,051,342.00 12.740 80 82
--------------- ------
Total $275,913,594.18 12.740%
=============== ======
</TABLE>
<PAGE>
The information included in the following tables consists of
forward-looking statements and involve risks and uncertainties that could cause
actual results to differ materially from those in the forward-looking
statements. The actual characteristics and performance of the Receivables will
differ from the assumptions used in constructing the following tables on page 19
to 21. We have provided these hypothetical illustrations using the assumptions
listed above to give you a general illustration of how the principal balances of
the Class A Certificates may decline. However, it is highly unlikely that the
Receivables will prepay at a constant ABS until maturity or that all of the
Receivables will prepay at the same ABS. In addition, the diverse terms of
Receivables within each of the five hypothetical pools could produce slower or
faster rates of principal distributions than indicated in the table at the
various specified ABS rates. Any difference between such hypothetical
assumptions, the actual characteristics, performance and prepayment experience
of the Receivables will affect the percentages of initial Certificate Balances
outstanding over time and the weighted average lives of the Class A
Certificates.
================================================================================
Important notice regarding calculation of the weighted average life
and the assumptions upon which the tables on pages 19 to 21 are based
The weighted average life of a Class A Certificate is determined by:
(a) multiplying the amount of each principal payment on the applicable
Class A Certificate by the number of years from the assumed Closing Date to
the related Distribution Date, (b) adding the results, and (c) dividing the
sum by the related initial Certificate Balance of such Class A Certificate.
The tables on pages 19 to 21 have been prepared based on (and should be
read in conjunction with) the assumptions described on pages 17 and 18
(including the assumptions regarding the characteristics and performance of
the Receivables, which will differ from the actual characteristics and
performance of the Receivables).
================================================================================
<PAGE>
<TABLE>
<CAPTION>
Percent of Initial Certificate Balance at Various ABS Percentages (1)
Class A-1 Certificates Class A-2 Certificates
---------------------------------------- -----------------------------------------
Distribution Date 1.0% 1.4% 1.6% 1.8% 2.5% 1.0% 1.4% 1.6% 1.8% 2.5%
- -----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date........ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
1 December, 1998...... 89.8% 87.3% 85.6% 81.1% 64.2% 100.0% 100.0% 100.0% 100.0% 100.0%
2 January, 1999....... 79.6% 74.8% 71.4% 62.9% 48.5% 100.0% 100.0% 100.0% 100.0% 100.0%
3 February, 1999...... 69.5% 62.5% 57.6% 45.3% 32.9% 100.0% 100.0% 100.0% 100.0% 100.0%
4 March, 1999......... 59.5% 50.4% 44.0% 30.4% 17.6% 100.0% 100.0% 100.0% 100.0% 100.0%
5 April, 1999......... 49.5% 38.4% 30.7% 18.3% 2.4% 100.0% 100.0% 100.0% 100.0% 100.0%
6 May, 1999........... 39.7% 26.6% 17.7% 6.3% 0.0% 100.0% 100.0% 100.0% 100.0% 87.8%
7 June, 1999.......... 29.9% 15.0% 4.9% 0.0% 0.0% 100.0% 100.0% 100.0% 94.6% 73.3%
8 July, 1999.......... 20.2% 3.6% 0.0% 0.0% 0.0% 100.0% 100.0% 92.7% 83.1% 59.1%
9 August, 1999........ 10.6% 0.0% 0.0% 0.0% 0.0% 100.0% 92.6% 80.9% 71.8% 45.1%
10 September, 1999..... 1.1% 0.0% 0.0% 0.0% 0.0% 100.0% 81.8% 69.3% 60.6% 31.3%
11 October, 1999....... 0.0% 0.0% 0.0% 0.0% 0.0% 91.8% 71.2% 58.5% 49.5% 17.7%
12 November, 1999...... 0.0% 0.0% 0.0% 0.0% 0.0% 82.7% 60.8% 48.3% 38.6% 4.3%
13 December, 1999...... 0.0% 0.0% 0.0% 0.0% 0.0% 73.6% 50.6% 38.1% 27.8% 0.0%
14 January, 2000....... 0.0% 0.0% 0.0% 0.0% 0.0% 64.6% 40.6% 28.1% 17.1% 0.0%
15 February, 2000...... 0.0% 0.0% 0.0% 0.0% 0.0% 55.8% 30.8% 18.2% 6.6% 0.0%
16 March, 2000......... 0.0% 0.0% 0.0% 0.0% 0.0% 47.0% 21.2% 8.5% 0.0% 0.0%
17 April, 2000......... 0.0% 0.0% 0.0% 0.0% 0.0% 38.3% 11.9% 0.0% 0.0% 0.0%
18 May, 2000........... 0.0% 0.0% 0.0% 0.0% 0.0% 29.7% 2.7% 0.0% 0.0% 0.0%
19 June, 2000.......... 0.0% 0.0% 0.0% 0.0% 0.0% 21.2% 0.0% 0.0% 0.0% 0.0%
20 July, 2000.......... 0.0% 0.0% 0.0% 0.0% 0.0% 13.5% 0.0% 0.0% 0.0% 0.0%
21 August, 2000........ 0.0% 0.0% 0.0% 0.0% 0.0% 5.9% 0.0% 0.0% 0.0% 0.0%
22 September, 2000..... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
23 October, 2000....... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
24 November, 2000...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
25 December, 2000...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
26 January, 2001....... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
27 February, 2001...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
28 March, 2001......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
29 April, 2001......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
30 May, 2001........... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
31 June, 2001.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
32 July, 2001.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
33 August, 2001........ 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
34 September, 2001..... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
35 October, 2001....... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
36 November, 2001...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
37 December, 2001...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
38 January, 2002....... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
39 February, 2002...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
40 March, 2002......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
41 April, 2002......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
42 May, 2002........... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
43 June, 2002.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
44 July, 2002.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
45 August, 2002........ 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
46 September, 2002..... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
47 October, 2002....... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
48 November, 2002...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
49 December, 2002...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
50 January, 2003....... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
51 February, 2003...... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
52 March, 2003......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
53 April, 2003......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
54 May, 2003........... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
55 June, 2003.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
56 July, 2003.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
57 August, 2003........ 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
58 September, 2003..... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Weighted Average Life
(in years) ..... 0.43 0.35 0.31 0.26 0.19 1.32 1.11 1.00 0.93 0.73
</TABLE>
(1) See the important notice on page 18 of these materials regarding
calculation of the weighted average life and the assumptions upon which
these tables are based.
<PAGE>
<TABLE>
<CAPTION>
Percent of Initial Certificate Balance at Various ABS Percentages (1)
Class A-3 Certificates Class A-4 Certificates
---------------------------------------- -----------------------------------------
Distribution Date 1.0% 1.4% 1.6% 1.8% 2.5% 1.0% 1.4% 1.6% 1.8% 2.5%
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Closing Date......... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
1 December, 1998....... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
2 January, 1999........ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
3 February, 1999....... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
4 March, 1999.......... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
5 April, 1999.......... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
6 May, 1999............ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
7 June, 1999........... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
8 July, 1999........... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
9 August, 1999......... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
10 September, 1999...... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
11 October, 1999........ 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
12 November, 1999....... 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
13 December, 1999....... 100.0% 100.0% 100.0% 100.0% 92.9% 100.0% 100.0% 100.0% 100.0% 100.0%
14 January, 2000........ 100.0% 100.0% 100.0% 100.0% 82.6% 100.0% 100.0% 100.0% 100.0% 100.0%
15 February, 2000....... 100.0% 100.0% 100.0% 100.0% 72.5% 100.0% 100.0% 100.0% 100.0% 100.0%
16 March, 2000......... 100.0% 100.0% 100.0% 97.0% 62.5% 100.0% 100.0% 100.0% 100.0% 100.0%
17 April, 2000......... 100.0% 100.0% 99.1% 88.9% 52.7% 100.0% 100.0% 100.0% 100.0% 100.0%
18 May, 2000........... 100.0% 100.0% 91.5% 80.9% 43.1% 100.0% 100.0% 100.0% 100.0% 100.0%
19 June, 2000.......... 100.0% 95.1% 84.1% 73.0% 33.8% 100.0% 100.0% 100.0% 100.0% 100.0%
20 July, 2000.......... 100.0% 88.1% 76.7% 65.3% 24.5% 100.0% 100.0% 100.0% 100.0% 100.0%
21 August, 2000........ 100.0% 81.3% 69.5% 57.6% 15.5% 100.0% 100.0% 100.0% 100.0% 100.0%
22 September, 2000..... 98.6% 74.5% 62.4% 50.1% 6.7% 100.0% 100.0% 100.0% 100.0% 100.0%
23 October, 2000....... 92.6% 67.8% 55.3% 42.8% 0.0% 100.0% 100.0% 100.0% 100.0% 96.1%
24 November, 2000...... 86.7% 61.3% 48.4% 35.5% 0.0% 100.0% 100.0% 100.0% 100.0% 78.6%
25 December, 2000...... 80.8% 54.8% 41.6% 28.4% 0.0% 100.0% 100.0% 100.0% 100.0% 61.6%
26 January, 2001....... 75.0% 48.4% 35.0% 21.5% 0.0% 100.0% 100.0% 100.0% 100.0% 45.0%
27 February, 2001...... 69.2% 42.1% 28.4% 14.6% 0.0% 100.0% 100.0% 100.0% 100.0% 28.8%
28 March, 2001......... 63.5% 35.9% 22.0% 8.0% 0.0% 100.0% 100.0% 100.0% 100.0% 13.1%
29 April, 2001......... 57.9% 29.8% 15.7% 1.4% 0.0% 100.0% 100.0% 100.0% 100.0% 0.0%
30 May, 2001........... 52.3% 23.8% 9.5% 0.0% 0.0% 100.0% 100.0% 100.0% 89.7% 0.0%
31 June, 2001.......... 46.7% 17.9% 3.4% 0.0% 0.0% 100.0% 100.0% 100.0% 76.7% 0.0%
32 July, 2001.......... 41.2% 12.2% 0.0% 0.0% 0.0% 100.0% 100.0% 94.8% 64.0% 0.0%
33 August, 2001........ 35.8% 6.5% 0.0% 0.0% 0.0% 100.0% 100.0% 82.7% 51.7% 0.0%
34 September, 2001..... 30.5% 0.9% 0.0% 0.0% 0.0% 100.0% 100.0% 70.9% 39.7% 0.0%
35 October, 2001....... 25.2% 0.0% 0.0% 0.0% 0.0% 100.0% 90.6% 59.4% 28.0% 0.0%
36 November, 2001...... 20.0% 0.0% 0.0% 0.0% 0.0% 100.0% 79.5% 48.2% 16.7% 0.0%
37 December, 2001...... 14.8% 0.0% 0.0% 0.0% 0.0% 100.0% 68.7% 37.3% 5.7% 0.0%
38 January, 2002....... 9.7% 0.0% 0.0% 0.0% 0.0% 100.0% 58.0% 26.6% 0.0% 0.0%
39 February, 2002...... 4.7% 0.0% 0.0% 0.0% 0.0% 100.0% 47.7% 16.3% 0.0% 0.0%
40 March, 2002......... 0.0% 0.0% 0.0% 0.0% 0.0% 99.6% 37.6% 6.3% 0.0% 0.0%
41 April, 2002......... 0.0% 0.0% 0.0% 0.0% 0.0% 89.4% 27.7% 0.0% 0.0% 0.0%
42 May, 2002........... 0.0% 0.0% 0.0% 0.0% 0.0% 79.5% 18.2% 0.0% 0.0% 0.0%
43 June, 2002.......... 0.0% 0.0% 0.0% 0.0% 0.0% 69.6% 8.8% 0.0% 0.0% 0.0%
44 July, 2002.......... 0.0% 0.0% 0.0% 0.0% 0.0% 60.6% 0.2% 0.0% 0.0% 0.0%
45 August, 2002........ 0.0% 0.0% 0.0% 0.0% 0.0% 51.7% 0.0% 0.0% 0.0% 0.0%
46 September, 2002..... 0.0% 0.0% 0.0% 0.0% 0.0% 43.0% 0.0% 0.0% 0.0% 0.0%
47 October,2002........ 0.0% 0.0% 0.0% 0.0% 0.0% 34.4% 0.0% 0.0% 0.0% 0.0%
48 November, 2002...... 0.0% 0.0% 0.0% 0.0% 0.0% 26.0% 0.0% 0.0% 0.0% 0.0%
49 December, 2002...... 0.0% 0.0% 0.0% 0.0% 0.0% 17.7% 0.0% 0.0% 0.0% 0.0%
50 January, 2003....... 0.0% 0.0% 0.0% 0.0% 0.0% 9.6% 0.0% 0.0% 0.0% 0.0%
51 February, 2003...... 0.0% 0.0% 0.0% 0.0% 0.0% 1.7% 0.0% 0.0% 0.0% 0.0%
52 March, 2003......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
53 April, 2003......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
54 May, 2003........... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
55 June, 2003.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
56 July, 2003.......... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
57 August, 2003........ 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
58 September, 2003..... 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Weighted Average Life
(in years) ..... 2.56 2.17 2.00 1.86 1.46 3.79 3.25 3.00 2.78 2.16
</TABLE>
(1) See the important notice on page 18 of these materials regarding
calculation of the weighted average life and the assumptions upon which
these tables are based.
<PAGE>
<TABLE>
<CAPTION>
Percent of Initial Certificate Balance at Various ABS Percentages (1)
Class A-5 Certificates
-----------------------------------------------------------
Distribution Date 1.0% 1.4% 1.6% 1.8% 2.5%
- ---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Closing Date................... 100.0% 100.0% 100.0% 100.0% 100.0%
1 December, 1998................. 100.0% 100.0% 100.0% 100.0% 100.0%
2 January, 1999.................. 100.0% 100.0% 100.0% 100.0% 100.0%
3 February, 1999................. 100.0% 100.0% 100.0% 100.0% 100.0%
4 March, 1999.................... 100.0% 100.0% 100.0% 100.0% 100.0%
5 April, 1999.................... 100.0% 100.0% 100.0% 100.0% 100.0%
6 May, 1999...................... 100.0% 100.0% 100.0% 100.0% 100.0%
7 June, 1999..................... 100.0% 100.0% 100.0% 100.0% 100.0%
8 July, 1999..................... 100.0% 100.0% 100.0% 100.0% 100.0%
9 August, 1999................... 100.0% 100.0% 100.0% 100.0% 100.0%
10 September, 1999................ 100.0% 100.0% 100.0% 100.0% 100.0%
11 October, 1999.................. 100.0% 100.0% 100.0% 100.0% 100.0%
12 November, 1999................. 100.0% 100.0% 100.0% 100.0% 100.0%
13 December, 1999................. 100.0% 100.0% 100.0% 100.0% 100.0%
14 January, 2000.................. 100.0% 100.0% 100.0% 100.0% 100.0%
15 February, 2000................. 100.0% 100.0% 100.0% 100.0% 100.0%
16 March, 2000.................... 100.0% 100.0% 100.0% 100.0% 100.0%
17 April, 2000.................... 100.0% 100.0% 100.0% 100.0% 100.0%
18 May, 2000...................... 100.0% 100.0% 100.0% 100.0% 100.0%
19 June, 2000..................... 100.0% 100.0% 100.0% 100.0% 100.0%
20 July, 2000..................... 100.0% 100.0% 100.0% 100.0% 100.0%
21 August, 2000................... 100.0% 100.0% 100.0% 100.0% 100.0%
22 September, 2000................ 100.0% 100.0% 100.0% 100.0% 100.0%
23 October, 2000.................. 100.0% 100.0% 100.0% 100.0% 100.0%
24 November, 2000................. 100.0% 100.0% 100.0% 100.0% 100.0%
25 December, 2000................. 100.0% 100.0% 100.0% 100.0% 100.0%
26 January, 2001.................. 100.0% 100.0% 100.0% 100.0% 100.0%
27 February, 2001................. 100.0% 100.0% 100.0% 100.0% 100.0%
28 March, 2001.................... 100.0% 100.0% 100.0% 100.0% 100.0%
29 April, 2001.................... 100.0% 100.0% 100.0% 100.0% 98.3%
30 May, 2001...................... 100.0% 100.0% 100.0% 100.0% 86.2%
31 June, 2001..................... 100.0% 100.0% 100.0% 100.0% 74.5%
32 July, 2001..................... 100.0% 100.0% 100.0% 100.0% 63.1%
33 August, 2001................... 100.0% 100.0% 100.0% 100.0% 0.0%
34 September, 2001................ 100.0% 100.0% 100.0% 100.0% 0.0%
35 October, 2001.................. 100.0% 100.0% 100.0% 100.0% 0.0%
36 November, 2001................. 100.0% 100.0% 100.0% 100.0% 0.0%
37 December, 2001................. 100.0% 100.0% 100.0% 100.0% 0.0%
38 January, 2002.................. 100.0% 100.0% 100.0% 95.9% 0.0%
39 February, 2002................. 100.0% 100.0% 100.0% 87.5% 0.0%
40 March, 2002.................... 100.0% 100.0% 100.0% 79.4% 0.0%
41 April, 2002.................... 100.0% 100.0% 97.2% 71.5% 0.0%
42 May, 2002...................... 100.0% 100.0% 89.5% 64.0% 0.0%
43 June, 2002..................... 100.0% 100.0% 82.1% 0.0% 0.0%
44 July, 2002..................... 100.0% 100.0% 75.2% 0.0% 0.0%
45 August, 2002................... 100.0% 93.3% 68.6% 0.0% 0.0%
46 September, 2002................ 100.0% 86.7% 62.2% 0.0% 0.0%
47 October, 2002.................. 100.0% 80.3% 0.0% 0.0% 0.0%
48 November, 2002................. 100.0% 74.1% 0.0% 0.0% 0.0%
49 December, 2002................. 100.0% 68.1% 0.0% 0.0% 0.0%
50 January, 2003.................. 100.0% 62.3% 0.0% 0.0% 0.0%
51 February, 2003................. 100.0% 0.0% 0.0% 0.0% 0.0%
52 March, 2003.................... 95.0% 0.0% 0.0% 0.0% 0.0%
53 April, 2003.................... 88.8% 0.0% 0.0% 0.0% 0.0%
54 May, 2003...................... 82.7% 0.0% 0.0% 0.0% 0.0%
55 June, 2003..................... 76.7% 0.0% 0.0% 0.0% 0.0%
56 July, 2003..................... 70.9% 0.0% 0.0% 0.0% 0.0%
57 August, 2003................... 65.2% 0.0% 0.0% 0.0% 0.0%
58 September, 2003................ 0.0% 0.0% 0.0% 0.0% 0.0%
Weighted Average Life
(in years) ................ 4.70 4.11 3.78 3.47 2.65
</TABLE>
(1) See the important notice on page 18 of these materials regarding
calculation of the weighted average life and the assumptions upon which
these tables are based.
<PAGE>
YIELD AND PREPAYMENT CONSIDERATIONS
Monthly Interest will be distributed to Class A Certificateholders on
each Distribution Date to the extent of the pass-through rate applied to the
applicable Certificate Balance as of the preceding Distribution Date or the
Closing Date, as applicable (after giving effect to distributions of principal
on such preceding Distribution Date).
Upon a full or partial prepayment on a Receivable, Class A
Certificateholders will receive interest for the full month of such prepayment
either:
(1) through the distribution of interest paid on the Receivables;
(2) from a withdrawal from the Spread Account;
(3) by an advance from the Servicer; or
(4) by a draw on the Policy.
Although the Receivables will have different contract rates, the
contract rate of each Receivable generally will exceed the sum of:
(1) the weighted average of the Class A-1 Pass-Through Rate, the
Class A-2 Pass-Through Rate, the Class A-3 Pass-Through Rate,
the Class A-4 Pass-Through Rate and the Class A-5 Pass-Through
Rate;
(2) the per annum rate used to calculate the Insurance Premium;
and
(3) the per annum rate used to calculate the Monthly Servicing Fee.
However, the contract rate on a small percentage of the Receivables,
will be less than the foregoing sum. Disproportionate rates of prepayments
between Receivables with higher and lower contract rates could affect the
ability of the Trust to distribute Monthly Interest to you.
THE INSURER
MBIA Insurance Corporation (the "Insurer") is the principal operating
subsidiary of MBIA Inc., a New York Stock Exchange listed company (the
"Company"). The Company is not obligated to pay the debts of or claims against
the Insurer. The Insurer is domiciled in the State of New York and licensed to
do business in and subject to regulation under the laws of all 50 states, the
District of Columbia, the Commonwealth of Puerto Rico, the Commonwealth of the
Northern Mariana Islands, the Virgin Islands of the United States and the
Territory of Guam. The Insurer has two European branches, one in the Republic of
France and the other in the Kingdom of Spain. New York has laws prescribing
minimum capital requirements, limiting classes and concentrations of investments
and requiring the approval of policy rates and forms. State laws also regulate
the amount of both the aggregate and individual risks that may be insured, the
payment of dividends by the Insurer, changes in control and transactions among
affiliates. Additionally, the Insurer is required to maintain contingency
reserves on its liabilities in certain amounts and for certain periods of time.
<PAGE>
Effective February 17, 1998, the Company acquired all of the
outstanding stock of Capital Markets Assurance Corporation ("CMAC") through a
merger with its parent CapMAC Holdings Inc. Pursuant to a reinsurance agreement,
CMAC has ceded all of its net insured risks (including any amounts due but
unpaid from third party reinsurers), as well as its unearned premiums and
contingency reserves, to the Insurer. The Company is not obligated to pay the
debts of or claims against CMAC.
The consolidated financial statements of the Insurer, a wholly owned
subsidiary of the Company, and its subsidiaries as of December 31, 1997 and
December 31, 1996 and for each of the three years in the period ended December
31, 1997, prepared in accordance with generally accepted accounting principles
("GAAP"), included in the Annual Report on Form 10-K of the Company for the year
ended December 31, 1997 and the consolidated financial statements of the Insurer
and its subsidiaries as of June 30, 1998 and for the six month periods ending
June 30, 1998 and June 30, 1997 included in the Quarterly Report on Form 10-Q of
the Company for the period ending June 30, 1998, are hereby incorporated by
reference into these materials and shall be deemed to be a part hereof. Any
statement contained in a document incorporated by reference herein shall be
modified or superseded for purposes of these materials to the extent that a
statement contained herein or in any other subsequently filed document which
also is incorporated by reference herein modifies or supersedes such statement.
Any statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of these materials.
All financial statements of the Insurer and its subsidiaries included
in documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Securities Exchange Act of 1934, as amended, subsequent to the date of
these materials and prior to the termination of the offering of the Class A
Certificates shall be deemed to be incorporated by reference into these
materials and to be a part hereof from the respective dates of filing such
documents.
The tables below present selected financial information of the Insurer
determined in accordance with statutory accounting practices prescribed or
permitted by insurance regulatory authorities ("SAP") as well as GAAP:
SAP
----------------------------------------
December 31, June 30,
1997 1998
------------ --------
(Audited) (Unaudited)
(in millions)
Admitted Assets $5,256 $6,048
Liabilities 3,496 3,962
Capital and Surplus 1,760 2,086
GAAP
----------------------------------------
December 31, June 30,
1997 1998
------------ --------
(Audited) (Unaudited)
(in millions)
Assets $5,988 $6,794
Liabilities 2,624 2,977
Shareholder's Equity 3,364 3,817
<PAGE>
Copies of the financial statements of the Insurer incorporated by reference
herein and copies of the Insurer's 1997 year end audited financial statements
prepared in accordance with SAP are available, without charge, from the Insurer.
The address of the Insurer is 113 King Street, Armonk, New York 10504. The
telephone number of the Insurer is (914) 273-4545.
The Insurer does not accept any responsibility for the accuracy or
completeness of these materials or any information or disclosure contained
herein, or omitted herefrom, other than with respect to the accuracy of the
information regarding the Insurer set forth under the heading "The Insurer."
Additionally, the Insurer makes no representation regarding the Class A
Certificates or the advisability of investing in the Class A Certificates.
The Policy is not covered by the Property/Casualty Insurance Security
Fund specified in Article 76 of the New York Insurance Law.
Moody's Investors Service, Inc. rates the claims paying ability of the
Insurer "Aaa."
Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc. rates the claims paying ability of the Insurer "AAA."
Fitch IBCA, Inc. (formerly known as Fitch Investors Service, L.P.)
rates the claims paying ability of the Insurer "AAA."
Each rating of the Insurer should be evaluated independently. The
ratings reflect the respective rating agency's current assessment of the
creditworthiness of the Insurer and its ability to pay claims on its policies of
insurance. Any further explanation as to the significance of the above ratings
may be obtained only from the applicable rating agency.
The above ratings are not recommendations to buy, sell or hold the
securities, and such ratings may be subject to revision or withdrawal at any
time by the rating agencies. Any downward revision or withdrawal of any of the
above ratings may have an adverse effect on the market price of the securities.
The Insurer does not guaranty the market price of the securities nor does it
guaranty that the ratings on the securities will not be revised or withdrawn.
<PAGE>
INDEX OF TERMS
We have listed below the terms used in these materials and the pages
where definitions of the terms can be found. The "Glossary" follows this "Index
of Terms."
ABS................................................................ 17
Available Funds.................................................... 5
Certificates....................................................... 3
Certificate Balance................................................ 5
Class A Certificates............................................... 4
Class A Certificateholders......................................... 4
Class A-1 Certificate Balance...................................... 5
Class A-1 Certificateholders....................................... 4
Class A-1 Certificates............................................. 3
Class A-1 Final Scheduled Distribution Date........................ 5
Class A-1 Monthly Interest......................................... Glossary
Class A-1 Pass-Through Rate........................................ 4
Class A-2 Certificate Balance...................................... 5
Class A-2 Certificateholders....................................... 4
Class A-2 Certificates............................................. 3
Class A-2 Final Scheduled Distribution Date........................ 5
Class A-2 Monthly Interest......................................... Glossary
Class A-2 Pass-Through Rate........................................ 4
Class A-3 Certificate Balance...................................... 5
Class A-3 Certificateholders....................................... 4
Class A-3 Certificates............................................. 3
Class A-3 Final Scheduled Distribution ............................ 5
Class A-3 Monthly Interest......................................... Glossary
Class A-3 Pass-Through Rate........................................ 4
Class A-4 Certificate Balance...................................... 5
Class A-4 Certificateholders....................................... 4
Class A-4 Certificates............................................. 3
Class A-4 Final Scheduled Distribution Date........................ 5
Class A-4 Monthly Interest......................................... Glossary
Class A-4 Pass-Through Rate........................................ 4
Class A-5 Certificate Balance...................................... 5
Class A-5 Certificateholders....................................... 4
Class A-5 Certificates............................................. 3
Class A-5 Final Scheduled Distribution Date........................ 5
Class A-5 Monthly Interest......................................... Glossary
Class A-5 Pass-Through Rate........................................ 4
Class IC Certificate............................................... 3
Class IC Certificateholder......................................... 6
Clean-Up Call Date................................................. 7
Closing Date....................................................... 3
CMAC............................................................... 22
Collection Period.................................................. Glossary
Company............................................................ 22
Cutoff Date........................................................ 3
Defaulted Receivable............................................... Glossary
Depositor.......................................................... 3
Distribution Date.................................................. 4
ERISA.............................................................. 8
Financed Vehicles.................................................. 3
GAAP............................................................... 22
Information........................................................ 1
Insurance Premium.................................................. Glossary
Insurance Agreement................................................ 6
Insurer............................................................ 7, 22
Issuer............................................................. 3
Modified Receivables............................................... Glossary
Monthly Interest...................................................5, Glossary
Monthly Principal..................................................5, Glossary
Monthly Servicing Fee.............................................. 3
Net Principal Policy Amount........................................ 7
Optional Sale...................................................... 7
Policy............................................................. 4, 6
Policy Amount...................................................... 7
Pool Balance....................................................... 5
Pooling and Servicing Agreement.................................... 3
Predecessor........................................................ Glossary
Rating Agency or Rating Agencies................................... 8
Receivables........................................................ 3
Record Date........................................................ 4
Required Spread Amount............................................. 6
SAP................................................................ 23
Servicer........................................................... 3
Spread Account..................................................... 5
Tier II Receivables................................................ 11
Trust .......................................................... 3
Trustee............................................................ 3
UAC................................................................ 3
UAFC............................................................... 6
Underwriters ..................................................... 2
<PAGE>
GLOSSARY
We have listed below the definitions of certain terms used in these
materials and the pages where definitions of other terms can be found are listed
in the preceding "Index of Terms."
Class A-1 Monthly Interest.........(1) for the first Distribution Date, the
product of the following: (one-three hundred
sixtieth (1/360th) of the Class A-1
Pass-Through Rate) multiplied by (the number
of days from the Closing Date through the day
before the first Distribution Date)
multiplied by the Class A-1 Certificate
Balance at the Closing Date
(2) for any subsequent Distribution Date,
one-three hundred sixtieth (1/360th) of the
product of the Class A-1 Pass-Through Rate,
the actual number of days from the previous
Distribution Date through the day before the
related Distribution Date and the Class A-1
Certificate Balance as of the immediately
preceding Distribution Date (after giving
effect to any distribution of Monthly
Principal made on such immediately preceding
Distribution Date).
Class A-2 Monthly Interest.........(1) for the first Distribution Date, the
product of the following: (one twelfth of the
Class A-2 Pass-Through Rate) multiplied by
(the number of days from the Closing Date
(assuming the month of the Closing Date has
30 days) through the day before the first
Distribution Date divided by 30) multiplied
by the Class A-2 Certificate Balance at the
Closing Date
(2) for any subsequent Distribution Date,
one-twelfth of the product of the Class A-2
Pass-Through Rate and the Class A-2
Certificate Balance as of the immediately
preceding Distribution Date (after giving
effect to any distribution of Monthly
Principal made on such immediately preceding
Distribution Date).
Class A-3 Monthly Interest.........(1) for the first Distribution Date, the
product of the following: (one twelfth of the
Class A-3 Pass-Through Rate) multiplied by
(the number of days from the Closing Date
(assuming the month of the Closing Date has
30 days) through the day before the first
Distribution Date divided by 30) multiplied
by the Class A-3 Certificate Balance at the
Closing Date
(2) for any subsequent Distribution Date,
one-twelfth of the product of the Class A-3
Pass-Through Rate and the Class A-3
Certificate Balance as of the immediately
preceding Distribution Date (after giving
effect to any distribution of Monthly
Principal made on such immediately preceding
Distribution Date).
Class A-4 Monthly Interest.........(1) for the first Distribution Date, the
product of the following: (one twelfth of the
Class A-4 Pass-Through Rate) multiplied by
(the number of days from the Closing Date
(assuming the month of the Closing Date has
30 days) through the day before the first
Distribution Date divided by 30) multiplied
by the Class A-4 Certificate Balance at the
Closing Date
(2) for any subsequent Distribution Date,
one-twelfth of the product of the Class A-4
Pass-Through Rate and the Class A-4
Certificate Balance as of the immediately
preceding Distribution Date (after giving
effect to any distribution of Monthly
Principal made on such immediately preceding
Distribution Date).
Class A-5 Monthly Interest.........(1) for the first Distribution Date, the
product of the following: (one twelfth of the
Class A-5 Pass-Through Rate) multiplied by
(the number of days from the Closing Date
(assuming the month of the Closing Date has
30 days) through the day before the first
Distribution Date divided by 30) multiplied
by the Class A-5 Certificate Balance at the
Closing Date
(2) for any subsequent Distribution Date,
one-twelfth of the product of the Class A-5
Pass-Through Rate (as adjusted after the
Clean-Up Call Date) and the Class A-5
Certificate Balance as of the immediately
preceding Distribution Date (after giving
effect to any distribution of Monthly
Principal made on such immediately preceding
Distribution Date).
Collection Period..................(1) for the first Distribution Date, the
period from the day after the Cutoff Date to
November 30, 1998
(2) for each subsequent Distribution Date,
the preceding calendar month, until the Trust
terminates.
Defaulted Receivable...............for any Collection Period, a Receivable as to
which any of the following has occurred: (1)
any payment, or part thereof, in excess of
$10 is 120 days or more delinquent as of the
last day of such Collection Period; (2) the
Financed Vehicle that secures the Receivable
has been repossessed; or (3) the Receivable
has been determined to be uncollectable in
accordance with the Servicer's customary
practices on or prior to the last day of such
Collection Period; provided, however, that
any Receivable which the Depositor or the
Servicer is obligated to repurchase or
purchase pursuant to the Pooling and
Servicing Agreement shall be deemed not to be
a Defaulted Receivable.
Insurance Premium..................for any Distribution Date, one-twelfth of the
product of the Policy per annum fee rate set
forth in the Insurance Agreement and the
Certificate Balance calculated as of the last
day of the Collection Period to which such
Distribution Date relates and payable monthly
in arrears.
Modified Receivables...............Receivables which have been modified from the
terms of the original contract to provide a
different monthly payment, a different
interest rate and/or a longer term to
maturity.
Monthly Interest...................for any Distribution Date, the sum of Class
A-1 Monthly Interest, Class A-2 Monthly
Interest, Class A-3 Monthly Interest, Class
A-4 Monthly Interest and Class A-5 Monthly
Interest.
Monthly Principal..................for any Distribution Date, the amount
necessary to reduce the Certificate Balance
as of the prior Distribution Date (after
giving effect to the distribution of Monthly
Principal on such date) (or as of the Closing
Date in the case of the first Distribution
Date) to the aggregate unpaid principal
balance of the Receivables on the last day of
the related Collection Period; provided,
however, that Monthly Principal on the final
scheduled Distribution Date for each class of
Class A Certificates will be increased by the
amount, if any, which is necessary to reduce
the Certificate Balance of such class to zero
on such date. For the purpose of determining
Monthly Principal, the unpaid principal
balance of a defaulted receivable or a
purchased receivable is deemed to be zero on
and after the last day of the Collection
Period in which such Receivable became a
Defaulted Receivable or a Purchased
Receivable.
Predecessor........................Union Federal Savings Bank of Indianapolis.
