Exhibit 4.3
AIG CREDIT PREMIUM FINANCE MASTER TRUST,
as Issuer
and
BANK ONE, NATIONAL ASSOCIATION,
as Trustee
on behalf of Noteholders
SERIES [___] SUPPLEMENT
Dated as of [___]
to
BASE INDENTURE
Dated as of November 8, 1999
AIG CREDIT PREMIUM FINANCE MASTER TRUST
SERIES [___]
Premium Finance Asset Backed Notes
NY2:\923571\03
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TABLE OF CONTENTS
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PRELIMINARY STATEMENT...................................................................................1
DESIGNATION.............................................................................................1
SECTION 1. Definitions..................................................................................1
SECTION 2. Article 3 of the Base Indenture.............................................................18
ARTICLE 3. INITIAL ISSUANCE ..................................................18
SECTION 3.1 Initial Issuance. .........................................18
SECTION 3. Servicing Compensation......................................................................18
SECTION 4. Cleanup Call................................................................................19
SECTION 5. Delivery and Payment for the Notes..........................................................19
SECTION 6. Form of Delivery of the Notes; Depository; Denominations....................................19
SECTION 7. Article 5 of Base Indenture.................................................................20
ARTICLE 5. ALLOCATION AND APPLICATION OF COLLECTIONS .........................................20
SECTION 5.10. Rights of Noteholders .........................................20
SECTION 5.11. Allocations .........................................20
SECTION 5.12. Determination of Monthly Interest .........................................25
SECTION 5.13. Determination of Monthly Principal .........................................26
SECTION 5.14. Coverage of Required Amount .........................................27
SECTION 5.15. Monthly Payments .........................................28
SECTION 5.16. Investor Charge-Offs .........................................33
SECTION 5.17. Excess Spread and Allocation of funds on deposit in the Yield
Enhancement Account .........................................35
SECTION 5.18. Reallocated Principal Collections .........................................36
SECTION 5.19. Shared Principal Collections .........................................37
SECTION 5.20. Yield Enhancement Account .........................................38
SECTION 5.21. Excess Funding Account .........................................39
SECTION 5.22. Determination of LIBOR .........................................41
SECTION 5.23. Effect of Other Series .........................................42
SECTION 5.24. Seller's or Servicer's Failure to Make a Deposit or Payment..............................42
SECTION 5.25. Excess Receivables .........................................42
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TABLE OF CONTENTS
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SECTION 5.26. Payment of Facility Fees .........................................43
SECTION 8. Article 6 of the Base Indenture.............................................................43
ARTICLE 6. DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS .........................................43
SECTION 6.1. Distributions .........................................43
SECTION 6.2. Monthly Noteholders' Statement .........................................44
SECTION 9. Series [___] Pay Out Events.................................................................47
SECTION 10. Series [___] Termination...................................................................50
SECTION 11. [Reserved].................................................................................50
SECTION 12. [Reserved].................................................................................50
SECTION 13. Counterparts...............................................................................50
SECTION 14. Governing Law..............................................................................50
SECTION 15. Waiver of Trial by Jury....................................................................50
SECTION 16. No Petition................................................................................50
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Exhibit A Form of Class A Note
Exhibit B Form of Class B Note
Exhibit C Form of Class C Note
Exhibit D [RESERVED]
Exhibit E Form of Monthly Noteholders' Statement
Exhibit F Additional Items not included in Form of Monthly Noteholders'
Statement Report
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SERIES [___] SUPPLEMENT, dated as of [___] (as amended, modified,
restated or supplemented from time to time in with the terms hereof, this
"Series Supplement"), by and among AIG CREDIT PREMIUM FINANCE MASTER TRUST, a
Delaware business trust, as Issuer ("Issuer"), and BANK ONE, NATIONAL
ASSOCIATION, a national banking association, as trustee (together with its
successors in trust under the Base Indenture referred to below, the "Trustee")
to the Base Indenture, dated as of November 8, 1999, between the Issuer and the
Trustee (as amended, modified, restated or supplemented from time to time,
exclusive of Series Supplements, the "Base Indenture").
Pursuant to this Series Supplement, the Issuer shall create a new
Series of Notes and shall specify the Principal Terms thereof.
PRELIMINARY STATEMENT
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WHEREAS, Section 2.2 of the Base Indenture provides, among other
things, that Issuer and the Trustee may at any time and from time to time enter
into a series supplement to the Base Indenture for the purpose of authorizing
the issuance of one or more Series of Notes.
NOW, THEREFORE, the parties hereto agree as follows:
DESIGNATION
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(a) There is hereby created a Series of notes to be issued pursuant to
the Base Indenture and this Series Supplement and such Series of notes shall be
designated generally Premium Finance Asset Backed Notes, Series [___]. The Notes
shall be issued in three classes: (i) Series [___] Class A Floating Rate Asset
Backed Notes, which shall be designated generally as the "Class A Notes," (ii)
the Series [___] Class B Floating Rate Asset Backed Notes, which shall be
designated generally as the "Class B Notes" and (iii) the Series [___] Class C
Floating Rate Asset Backed Notes, which shall be designated generally as the
"Class C Notes." The Class A Notes, the Class B Notes and the Class C Notes are
referred to collectively as the "Notes." The Notes shall be issued in minimum
denominations of $100,000 and integral multiples of $1,000 in excess thereof.
(b) Series [___] shall be included in Group One (as defined below).
Series [___] shall not be subordinated to any other Series.
SECTION 1. Definitions.
In the event that any term or provision contained herein shall conflict
with or be inconsistent with any provision contained in the Base Indenture, the
terms and provisions of this Series Supplement shall govern. All Article,
Section or subsection references herein mean Articles, Sections or subsections
of the Base Indenture, except as otherwise provided herein. All capitalized
terms not otherwise defined herein are defined in the Base Indenture. Each
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capitalized term defined herein shall relate only to the Notes and no other
Series of Notes issued by the Trust.
"Additional Amounts" has the meaning specified in the Note Purchase
Agreement.
"Administrative Agent" has the meaning set forth in the Note Purchase
Agreement.
"Aggregate Investor Default Amount" means, with respect to any Monthly
Period, the sum of the Investor Default Amounts in respect of such Monthly
Period.
"AIG" means American International Group, Inc., a Delaware corporation.
"Amortization Commencement Aggregate Funded Amount" means the Aggregate
Investor Interest as of the end of the Revolving Period.
"Annualized Monthly Excess Spread Amount" means, in respect of any
Monthly Period, the percentage calculated by dividing (i) an amount equal to the
sum of (A) the amount that is deposited (or would have been deposited but for
the operation of the third paragraph of subsection 5.4(a)) in the Finance Charge
Account pursuant to subsection 5.11(a)(i) on each day during such Monthly
Period, plus (B) the Available Yield Enhancement Amount for the immediately
succeeding Transfer Date, minus (C) the Aggregate Investor Default Amount for
such Monthly Period, minus (D) the Investor Servicing Fee payable on such
Transfer Date, minus (E) the aggregate amount payable to Noteholders in respect
of interest on the immediately succeeding Payment Date by (ii) the average daily
outstanding principal amount of the Notes for such Monthly Period, and
multiplying the resulting quotient by 12.
"Available Investor Principal Collections" (A) means with respect to
the Notes and any Monthly Period, an amount equal to (i) the Investor Principal
Collections for such Monthly Period, minus (ii) the amount of Reallocated Class
C Principal Collections and Reallocated Class B Principal Collections with
respect to such Monthly Period which pursuant to Section 5.18 are required to
fund the Class A Required Amount (from Reallocated Class C Principal Collections
and Reallocated Class B Principal Collections) and the Class B Required Amount
(from Reallocated Class C Principal Collections and Reallocated Class B
Principal Collections), plus (iii) the amount of Shared Principal Collections
with respect to Group One that are allocated to Series [___] in accordance with
subsections 5.19(a) and (b), and (B) when used with respect to any other Series,
has the meaning specified in the applicable Series Supplement.
"Available Yield Enhancement Amount" means, with respect to any
Transfer Date, the product of (i) 4% and (ii) the product of (A) the Collections
for the related Monthly Period and (B) the Floating Investor Percentage;
provided that in no event shall the Available Yield Enhancement Amount for any
Transfer Date exceed the lesser of (i) sum of Class A Monthly Interest, Class A
Deficiency Amount, Class A Additional Interest, Class B Monthly Interest, Class
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B Prior Period Interest, Class B Deficiency Amount, Class B Additional Interest,
Class C Monthly Interest, Class C Deficiency Amount and Class C Additional
Interest for such Transfer Date and (ii) the aggregate of all amounts otherwise
payable to the Seller on the current Transfer Date.
"Business Day" means, for the purpose of determining LIBOR, any
Business Day (as defined in the Base Indenture) other than a day on which
banking institutions in London, England trading in Dollar deposits in the London
interbank market are authorized or obligated by law or executive order to be
closed; for all other purposes, Business Day has the meaning provided in the
Base Indenture.
"Class A Additional Interest" has the meaning specified in subsection
5.12(a).
"Class A Available Funds" means, with respect to any Monthly Period, an
amount equal to the Class A Floating Allocation of the Collections of Finance
Charge Receivables allocated to the Investor Interest and deposited in the
Finance Charge Account for such Monthly Period (or to be deposited in the
Finance Charge Account on the related Transfer Date with respect to the
preceding Monthly Period pursuant to the third paragraph of subsection 5.4(a).
"Class A Controlled Amortization Period" means, unless a Pay Out Event
has occurred prior thereto, an amortization period commencing on [___] and
continuing through the earliest to occur of (i) the day before a Pay Out
Commencement Date, (ii) the date on which the Class A Notes have been paid in
full, (iii) the date of the discharge of the lien of the Indenture pursuant to
Section 12.1, and (iv) the Series [___] Termination Date.
"Class A Deficiency Amount" has the meaning specified in subsection
5.12(a).
"Class A Fixed Allocation" means, with respect to any Monthly Period
following the Revolving Period, the percentage equivalent (which percentage
shall never exceed 100%) of a fraction, the numerator of which is the Class A
Investor Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is equal to the Investor Interest as of the
close of business on the last day of the Revolving Period.
"Class A Floating Allocation" means, with respect to any Transfer Date,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is equal to the Class A Investor Interest and
the denominator of which is equal to the Investor Interest.
"Class A Initial Investor Interest" means the aggregate initial
principal amount of the Class A Notes, which is $[___].
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"Class A Investor Allocation" means with respect to any Monthly Period,
(a) with respect to Investor Default Amounts and Finance Charge Receivables at
any time and Principal Receivables during the Revolving Period, the Class A
Floating Allocation, and (b) with respect to Principal Receivables during the
Controlled Amortization Period, the Rapid Amortization Period, the Class A Fixed
Allocation.
"Class A Investor Charge-Offs" has the meaning specified in subsection
5.16(a).
"Class A Investor Default Amount" means, with respect to each Transfer
Date, an amount equal to the product of (a) the Aggregate Investor Default
Amount for the related Monthly Period and (b) the Class A Floating Allocation
applicable for such Transfer Date.
"Class A Investor Interest" means, on any date of determination, an
amount equal to (a) the Class A Initial Investor Interest, minus (b) the
aggregate amount of principal payments in respect of an amortization period the
Class A Notes made to Class A Noteholders prior to such date, minus (c) the
aggregate amount of Class A Investor Charge-Offs pursuant to subsection 5.16(a),
plus (d) the aggregate amount of Excess Spread and funds on deposit in the Yield
Enhancement Account allocated and available on all prior Transfer Dates pursuant
to subsection 5.17(b) for the purpose of reimbursing amounts deducted pursuant
to the foregoing clause (c).
"Class A Monthly Interest" means the monthly interest payable in
respect of the Class A Notes as calculated in accordance with subsection
5.12(a).
"Class A Monthly Principal" means the monthly principal payable in
respect of the Class A Notes as calculated in accordance with subsection
5.13(a).
"Class A Note Rate" means, with respect to each Interest Period, a
variable rate equal to 0.40% in excess of LIBOR, as determined on the related
LIBOR Determination Date plus, if the Payout Event described in Section 9.1(q)
herein has occurred, 2% per annum.
"Class A Noteholder" means the Person in whose name a Class A Note is
registered in the Note Register.
"Class A Notes" means any of the notes executed and authenticated by or
on behalf of the Trustee, substantially in the form of Exhibit A hereto. The
outstanding balance of the Class A Notes will at all times equal the Class A
Investor Interest.
"Class A Prior Period Interest" means [___].
"Class A Required Amount" has the meaning specified in subsection
5.14(a).
"Class A Servicing Fee" has the meaning specified in Section 3 hereof.
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"Class B Additional Interest" has the meaning specified in subsection
5.12(b).
"Class B Available Funds" means, with respect to any Monthly Period, an
amount equal to the Class B Floating Allocation of the Collections of Finance
Charge Receivables allocated to the Investor Interest and deposited in the
Finance Charge Account for such Monthly Period (or to be deposited in the
Finance Charge Account on the related Transfer Date with respect to the
preceding Monthly Period pursuant to the third paragraph of subsection 5.4(a)).
"Class B Controlled Amortization Period" means an amortization period
commencing on the Payment Date on which the Class A Notes have been paid in full
and continuing through the earliest to occur of (i) the day before a Pay Out
Commencement Date, (ii) the date on which the Class B Notes have been paid in
full, (iii) the date of the discharge of the lien of the Indenture pursuant to
Section 12.1, and (iv) the Series [___] Termination Date.
"Class B Deficiency Amount" has the meaning specified in subsection
5.12(b).
"Class B Fixed Allocation" means, with respect to any Monthly Period
following the Revolving Period, the percentage equivalent (which percentage
shall never exceed 100%) of a fraction, the numerator of which is the Class B
Investor Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is equal to the Investor Interest as of the
close of business on the last day of the Revolving Period.
"Class B Floating Allocation" means, with respect to any Transfer Date,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is equal to the Class B Investor Interest and
the denominator of which is equal to the Investor Interest.
"Class B Initial Investor Interest" means the aggregate initial
principal amount of the Class B Notes, which is $[___].
"Class B Investor Allocation" means with respect to any Monthly Period,
(a) with respect to Investor Default Amounts and Finance Charge Receivables at
any time or Principal Receivables during the Revolving Period, the Class B
Floating Allocation, and (b) with respect to Principal Receivables during the
Controlled Amortization Period, the Class B Principal Amortization Period or the
Rapid Amortization Period, the Class B Fixed Allocation.
"Class B Investor Charge-Offs" has the meaning specified in subsection
5.16(b).
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"Class B Investor Default Amount" means, with respect to each Transfer
Date, an amount equal to the product of (a) the Aggregate Investor Default
Amount for the related Monthly Period and (b) the Class B Floating Allocation
applicable for such Transfer Date.
"Class B Investor Interest" means, on any date of determination, an
amount equal to (a) the Class B Initial Investor Interest, minus (b) the
aggregate amount of principal payments in respect of an amortization period of
the Class B Notes made to Class B Noteholders prior to such date, minus (c) the
aggregate amount of Class B Investor Charge-Offs for all prior Transfer Dates
pursuant to subsection 5.16(b), minus (d) the amount of the Reallocated Class B
Principal Collections allocated pursuant to subsection 5.18(a) and (b) on all
prior Transfer Dates for which the Class C Investor Interest has not been
reduced, minus (e) an amount equal to the amount by which the Class B Investor
Interest has been reduced on all prior Transfer Dates pursuant to subsection
5.16(a) and plus (f) the aggregate amount of Excess Spread and funds on deposit
in the Yield Enhancement Account allocated and available on all prior Transfer
Dates pursuant to subsection 5.17(d) for the purpose of reimbursing amounts
deducted pursuant to the foregoing clauses (d), (e) and (f).
"Class B Monthly Interest" means the monthly interest payable in
respect of the Class B Notes as calculated in accordance with subsection
5.12(b).
"Class B Monthly Principal" means the monthly principal payable in
respect of the Class B Certificates as calculated in accordance with subsection
5.13(b).
"Class B Note Rate" means, with respect to each Interest Period, a
variable rate equal to 0.40% in excess of LIBOR, as determined on the related
LIBOR Determination Date.
"Class B Noteholder" means the Person in whose name a Class B Note is
registered in the Note Register.
"Class B Notes" means any of the notes executed and authenticated by or
on behalf of the Trustee, substantially in the form of Exhibit B hereto. The
outstanding balance of the Class B Notes will at all times equal the Class B
Investor Interest.
"Class B Prior Period Interest" shall mean, with respect to each
Interest Period in which the Class B Notes would have accrued interest on the
outstanding principal balance of the Class B Notes had the outstanding principal
balance of the Class B Notes not been reduced for reasons other than the payment
of principal to the Class B Noteholders, an amount equal to the sum of (a) the
product of (i) the Class B Note Rate in effect during such Interest Period, (ii)
the actual number of days in such Interest Period divided by 360 and (iii) the
amount by which the outstanding principal balance of the Class B Notes was less
than the outstanding principal balance of the Class B Notes during such Interest
Period for reasons other than the payment of principal to the Class B
Noteholders and (b) all unpaid Class B Prior Period Interest from prior Interest
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Periods; provided, however, that Class B Prior Period Interest shall not be
distributed until the Payment Date or Payment Dates following the Transfer Date
on which the Class B Notes have been reimbursed in full for any reductions.
"Class B Required Amount" has the meaning specified in subsection
5.14(b).
"Class B Servicing Fee" has the meaning specified in Section 3 hereof.
"Class C Additional Interest" has the meaning specified in subsection
5.12(c).
"Class C Available Funds" means, with respect to any Monthly Period, an
amount equal to the Class C Floating Allocation of the Collections of Finance
Charge Receivables allocated to the Investor Interest and deposited in the
Finance Charge Account for such Monthly Period (or to be deposited in the
Finance Charge Account on the related Transfer Date with respect to the
preceding Monthly Period pursuant to the third paragraph of subsection 5.4(a)).
"Class C Controlled Amortization Period" means an amortization period
commencing on the Payment Date on which the Class B Notes have been paid in full
and continuing through the earliest to occur of (i) the day before a Pay Out
Commencement Date, (ii) the date on which the Class C Notes have been paid in
full, (iii) the date of the discharge of the lien of the Indenture pursuant to
Section 12.1 and (iv) the Series [___] Termination Date.
"Class C Deficiency Amount" has the meaning specified in subsection
5.12(c).
"Class C Fixed Allocation" means with respect to any Monthly Period
following the Revolving Period, the percentage equivalent (which percentage
shall never exceed 100%) of a fraction, the numerator of which is the Class C
Investor Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is equal to the Investor Interest as of the
close of business on the last day of the Revolving Period.
"Class C Floating Allocation" means, with respect to any Transfer Date,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Class C Investor Interest and the
denominator of which is equal to the Investor Interest.
"Class C Initial Investor Interest" means the aggregate initial
principal amount of the Class C Notes, which is $[___].
"Class C Investor Allocation" means with respect to any Monthly Period,
(a) with respect to Investor Default Amounts and Finance Charge Receivables at
any time or Principal Receivables during the Revolving Period, the Class C
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Floating Allocation, and (b) with respect to Principal Receivables during the
Controlled Amortization Period or the Rapid Amortization Period, the Class C
Fixed Allocation.
"Class C Investor Charge-Offs" has the meaning specified in subsection
5.16(c).
"Class C Investor Default Amount" means, with respect to any Transfer
Date, an amount equal to the product of (a) the Aggregate Investor Default
Amount for the related Monthly Period and (b) the Class C Floating Allocation
applicable for such Transfer Date.
"Class C Investor Interest" means, an amount equal to (a) the Class C
Initial Investor Interest, minus (b) the aggregate amount of principal payments
in respect of an amortization period of the Class C Notes made to the Class C
Noteholders prior to such date, minus (c) the aggregate amount of Class C
Investor Charge-Offs for all prior Transfer Dates pursuant to subsection
5.16(c), minus (d) the amount of Reallocated Principal Collections allocated
pursuant to Section 5.18 on all prior Transfer Dates for which the Class C
Investor Interest was reduced, minus (e) an amount equal to the amount by which
the Class C Investor Interest has been reduced on all prior Transfer Dates
pursuant to Section 5.16, and plus (f) the aggregate amount of Excess Spread and
funds on deposit in the Yield Enhancement Account allocated and available on all
prior Transfer Dates pursuant to subsection 5.17(j) for the purpose of
reimbursing amounts deducted pursuant to the foregoing clauses (c), (d) and (e).
"Class C Monthly Interest" has the meaning specified in subsection
5.12(c).
"Class C Monthly Principal" means the monthly principal distributable
in respect of the Class C Notes as calculated in accordance with subsection
5.13(c).
"Class C Note Rate" means, with respect to each Interest Period, a
variable rate equal to 0.40% in excess of LIBOR, as determined on the related
LIBOR Determination Date.
"Class C Noteholder" means the Person in whose name a Class C Note is
registered in the Note Register.
"Class C Notes" means any of the notes executed and authenticated by or
on behalf of the Trustee, substantially in the form of Exhibit C hereto. The
outstanding balance of the Class C Notes will at all times equal the Class C
Investor Interest.
"Class C Prior Period Interest" shall mean, with respect to each
Interest Period in which the Class C Notes would have accrued interest on the
outstanding principal balance of the Class C Notes had the outstanding principal
balance of the Class C Notes not been reduced for reasons other than the payment
of principal to the Class C Noteholders, an amount equal to the product of (i)
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the Class C Note Rate in effect during such Interest Period, (ii) the actual
number of days in such Interest Period divided by 360 and (iii) the amount by
which the outstanding principal balance of the Class C Notes was less than the
outstanding principal balance of the Class C Notes during such Interest Period
for reasons other than the payment of principal to the Class C Noteholders and
(b) all unpaid Class C Prior Period Interest from prior Interest Periods;
provided, however, that Class C Prior Period Interest shall not be distributed
until the Payment Date or Payment Dates following the Transfer Date on which the
Class C Notes have been reimbursed in full for any reductions.
"Class C Required Amount" has the meaning specified in subsection
5.14(c).
"Class C Servicing Fee" has the meaning specified in Section 3 hereof.
"Closing Date" means [___].
"Code" means the Internal Revenue Code of 1986, as amended.
"Controlled Amortization Amount" means [___].
"Controlled Amortization Period" means any or all of the Class A
Controlled Amortization Period, the Class B Controlled Amortization Period or
the Class C Controlled Amortization Period, as the context may require.
"Controlled Distribution Amount" means, for any Payment Date with
respect to the Controlled Amortization Period, an amount equal to the sum of the
applicable Controlled Amortization Amount for such Payment Date and any Deficit
Controlled Amortization Amount for the immediately preceding Payment Date.
"CP Conduit" means either a Conduit Purchaser or a Committed Purchaser
or their permitted assigns (each as defined in the Note Purchase Agreement), as
applicable.
"Cumulative Series Principal Shortfall" means the sum of the Series
Principal Shortfalls (as such term is defined in each of the related Series
Supplements) for each Series in Group One.
"Decrease" means a Mandatory Decrease or a Voluntary Decrease, as
applicable.
"Deficit Controlled Amortization Amount" means (a) on the first Payment
Date with respect to the Class A Controlled Amortization Period, the Class B
Controlled Amortization Period or the Class C Controlled Amortization Period,
the excess, if any, of the Controlled Amortization Amount for such Payment Date
over the amount distributed from the Payment Account as Class A Monthly
Principal, Class B Monthly Principal or Class C Monthly Principal, as the case
may be, for such Payment Date and (b) on each subsequent Payment Date with
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respect to the Class A Controlled Amortization Period, the Class B Controlled
Amortization Period or the Class C Controlled Amortization Period, the excess,
if any, of the Controlled Distribution Amount for such subsequent Payment Date
over the amount distributed from the Payment Account as Class A Monthly
Principal, Class B Monthly Principal or Class C Monthly Principal, as the case
may be, for such subsequent Payment Date.
"Excess Funding Account" has the meaning specified in Section 5.21(a).
"Excess Insured Concentration Amounts" is defined in clause (i) of the
definition of Excess Receivables Amount.
"Excess Insurer Concentrations Amounts" is defined in clause (ii) of
the definition of Excess Receivables Amounts.
"Excess Receivables Amount" means, as of any date of determination, the
sum of:
(i) the aggregate unpaid principal balance of all Principal
Receivables as of the end of the immediately preceding Monthly Period
having the same Insured but only to the extent such aggregate balance
is in excess of such Insured's Single Insured Concentration Percentage
times the aggregate unpaid principal balance of all Principal
Receivables as of the end of such Monthly Period (such aggregate excess
amounts, the "Excess Insured Concentration Amounts"); and
(ii) the greater of:
(a) the sum, for each Moody's Non-Investment Grade Insurer (including
for this purpose any affiliated Moody's Non-Investment Grade Insurer) of, if
more than 5% of the aggregate unpaid principal balance of all Principal
Receivables as of the end of such Monthly Period arise from Premium Finance
Obligations made to finance premiums due to such insurer (including any such
affiliated insurer), the aggregate unpaid principal balance of such Principal
Receivables but only to the extent in excess of such percentage; and
(b) the sum, for each insurer (including any affiliated insurer), of
the greater of:
(I) if more than 2% of the aggregate unpaid principal balance of all
Principal Receivables as of the end of such Monthly Period arise from Premium
Finance Obligations made to finance premiums due to the same S&P Non-Investment
Grade Insurer (including for this purpose any affiliated S&P Non-Investment
Grade Insurer), the aggregate unpaid principal balance of such Principal
Receivables but only to the extent in excess of such percentage; and
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(II) if more than 4% of the aggregate unpaid principal balance of all
Principal Receivables as of the end of such Monthly Period arise from Premium
Finance Obligations made to finance premiums due to the same S&P Non-AAA Insurer
(including for this purpose any affiliated S&P Non-AAA Insurer), the aggregate
unpaid principal balance of such Principal Receivables but only to the extent in
excess of such percentage (the greater of such aggregate excess amounts in
clauses (a) and (b), the "Excess Insurer Concentration Amounts").
For purposes of making any calculation: pursuant to clause (ii) above,
any amount that would be part of the Excess Receivables Amount under such clause
shall be taken into account only to the extent not already taken into account
under clause (i) above.
"Excess Spread" means, with respect to any Transfer Date, the sum of
the amounts with respect to such Transfer Date, if any, specified pursuant to
subsections 5.15(a)(iv), 5.15(b)(iii), and 5.15(c)(ii), plus the income and
earnings referred to in subsections 5.20(d) and 5.21(c).
"Expected Final Payment Date" means the Payment Date in April, 2006.
"Facility Fee" means all of the fees described in the Fee Letter.
"Facility Termination" means an event whereby a Committed Purchaser (as
defined in the Note Purchase Agreement) holding any of the Notes does not renew
its commitment upon the expiration of such commitment as described in the Note
Purchase Agreement.
"Fee Letter" has the meaning specified in the Note Purchase Agreement.
"Financed Premium Percentage" means, in respect of any Monthly Period,
the ratio (expressed as a percentage) of the aggregate of the portions of
premiums financed or committed to be financed, as of the respective dates of
origination of the related Premium Finance Obligations, of all Additional
Receivables transferred to the Trust during such Monthly Period to the aggregate
of the premiums paid or committed to be paid with respect to such Premium
Finance Obligations.
"Fixed Investor Percentage" means, with respect to any Monthly Period,
the percentage equivalent of a fraction, the numerator of which is the Investor
Interest as of the close of business on the last day of the Revolving Period and
the denominator of which is the greater of (a) the aggregate amount of Principal
Receivables (with respect to Originator Receivables) in the Trust plus the
outstanding balance of the Transferor Certificate determined as of the close of
business on the last day of the prior Monthly Period and (b) the sum of the
numerators used to calculate the respective investor percentages used for
allocations with respect to Principal Receivables for all outstanding Series on
such date of determination.
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"Floating Investor Percentage" means, with respect to any Monthly
Period, the percentage equivalent of a fraction, the numerator of which is the
Investor Interest as of the end of the day on the Payment Date occurring during
such Monthly Period and the denominator of which is the greater of (a) the
aggregate amount of Principal Receivables (with respect to Originator
Receivables) in the Trust plus the outstanding balance of the Transferor
Certificate as of the close of business on the last day of the preceding Monthly
Period ending before the immediately preceding Payment Date minus Principal
Receivables that have been removed from the Trust pursuant to Section 2.07 of
the Sale and Servicing Agreement or from the AIR Trust pursuant to corresponding
provisions of the Pooling and Servicing Agreement and (b) the sum of the
numerators used to calculate the respective investor percentages used for
allocations with respect to Finance Charge Receivables, Investor Default Amounts
or Principal Receivables, as applicable, for all outstanding Series on such date
of determination.
"Group One" means Series [___] and each other Series specified in the
related series supplement to be included in Group One.
"Increase" has the meaning specified in Section 3.1(a).
"Initial Investor Interest" means the aggregate initial principal
amount of the Notes, which is $[___].
"Insurer Insolvency Event" means, with respect to any insurer, the
commencement of an insolvency, receivership or similar proceeding in respect of
such insurer.
"Interest Period" means, with respect to any Payment Date, the period
from and including the Payment Date immediately preceding such Payment Date (or,
in the case of the first Payment Date, from and including the Closing Date) to
but excluding such Payment Date.
"Investor Default Amount" means, with respect to any Monthly Period and
any Receivable under a Premium Finance Obligation that became a Defaulted
Obligation during such Monthly Period, an amount equal to the product of (a) the
unpaid amount (including both principal and accrued unpaid finance charges) of
such Receivable as of the date that such Premium Finance Obligation became a
Defaulted Obligation and (b) the Floating Investor Percentage with respect to
such Monthly Period; provided, however, that the calculation of "Investor
Default Amount" shall in no event give effect to losses in respect of Excess
Insured Concentration Amounts computed pursuant to clause (i) of the definition
of Excess Receivables Amount or losses in respect of Excess Insurer
Concentration Amounts (to the extent relating to an Insurer Insolvency Event)
computed pursuant to clause (ii) of such definition.
"Investor Interest" means, on any date of determination, an amount
equal to the sum of (a) the Class A Investor Interest, (b) the Class B Investor
Interest and (c) the Class C Investor Interest, each as of such date.
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"Investor Percentage" means for any Monthly Period, (a) with respect to
Finance Charge Receivables and Investor Default Amounts at any time and
Principal Receivables during the Revolving Period, the Floating Investor
Percentage and (b) with respect to Principal Receivables during the Controlled
Amortization Period or the Rapid Amortization Period, the Fixed Investor
Percentage.
"Investor Principal Collections" means, with respect to any Monthly
Period, the sum of (a) the aggregate amount deposited into the Principal Account
for such Monthly Period pursuant to subsections 5.11(a)(ii), (iii) and (iv), or
5.11(b)(ii), (iii) and (iv) or 5.11(d)(ii) in each case, as applicable to such
Monthly Period, (b) the aggregate amount to be treated as Investor Principal
Collections pursuant to subsections 5.15(a)(iii), 5.17(a), 5.17(b), 5.17(c),
5.17(d), 5.17(i) and 5.17(j) for such Monthly Period (other than such amount
paid from Reallocated Principal Collections), (c) the aggregate amount of
Collections on deposit in the Excess Funding Account on the related Transfer
Date that are to be deposited in the Principal Account pursuant to subsection
5.11(f) in connection with the refinancing of any Class of Notes, the aggregate
amount deposited in the Payment Account pursuant to Section 11 hereof.
"Investor Servicing Fee" has the meaning specified in Section 3 hereof.
"Legal Final Payment Date" means [___].
"LIBOR" means, for any Interest Period, the composite London interbank
offered rate for one-month Dollar deposits determined by the Trustee for each
Interest Period in accordance with the provisions of Section 5.22.
"LIBOR Determination Date" means the second Business Day prior to the
commencement of the second and each subsequent Interest Period (and with respect
to the first Interest Period the second Business Day prior to the Closing Date).
"Long-Term Receivables" has the meaning specified in the last paragraph
of Section 9 hereof.
"Mandatory Decrease" has the meaning specified in Section 3.2(a).
"Maximum Yield Enhancement Amount" means, with respect to any Transfer
Date, the amount calculated pursuant to the proviso to the definition of
"Available Yield Enhancement Amount," determined on the assumption that the
Class A Note Rate, the Class B Note Rate and the Class C Note Rate used in
determining Class A Monthly Interest, Class B Monthly Interest and Class C
Monthly Interest, respectively, equals in each case 16% per annum or if then
higher, the highest of the then current Class A Note Rate, Class B Note Rate or
Class C Note Rate.
"Minimum Trust Interest" means for any date of determination an amount
equal to (a) the product of 104% times the greater of (x) the maximum
Amortization Commencement Aggregate Funded Amount of any Series then outstanding
and (y) the Aggregate Investor Interest as of such date minus (b) the Aggregate
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Investor Interest as of such date plus (c) the Excess Receivables Amount as of
such date applied pursuant to Section 5.25.
"Monthly Interest" means, with respect to any Transfer Date, the sum of
(a) the Class A Monthly Interest, the Class A Additional Interest, if any, and
the unpaid Class A Deficiency Amount, if any, (b) the Class B Monthly Interest,
the Class B Additional Interest, if any, and the unpaid Class B Deficiency
Amount, if any, (c) the Class C Monthly Interest, the Class C Additional
Interest, if any, and the Class C Deficiency Amount, if any, each with respect
to such Transfer Date.
"Monthly Payment Rate" means, in respect of any Monthly Period, a
fraction (expressed as a percentage), the numerator of which shall equal the
aggregate Collections received in respect of Principal Receivables and in
Finance Charges on the Originator Receivables and Underlying Receivables during
such Monthly Period and the denominator of which shall equal the aggregate
amount of Originator Receivables and Underlying Receivables at the end of the
preceding Monthly Period.
"Monthly Period" has the meaning specified in the Base Indenture,
except that the first Monthly Period with respect to the Notes shall begin on
and include the first day of the month in which the Closing Date occurs and
shall end on and include [___], 2000.
"Moody's Non-Investment Grade Insurer" means, on any date of
determination, an insurer that as of the end of the immediately preceding
Monthly Period did not have an insurance financial strength rating of at least
investment grade (i.e., Baa3 or higher) by Moody's, unless Moody's shall have
previously notified the Seller in writing (and Seller has notified Noteholders)
that such insurer is not to be deemed a Moody's Non-Investment Grade Insurer
(and shall not have revoked such notification).
"Net Servicing Fee Rate" means (a) so long as AIC, AICCO, IP Finance I,
IP Finance II and IP Funding or any other affiliate thereof are separately or
collectively the Servicer, 0% per annum and (b) otherwise, 0.50% per annum.
"91 Day Delinquency Amount" means, as of any Transfer Date, an amount
equal to the product of (a) the Floating Investor Percentage and (b) the
aggregate outstanding principal amount as of the end of the immediately
preceding Monthly Period of the Premium Finance Obligations relating to
Receivables then in the Trust that are then overdue 91 days or more after
cancellation of the related insurance policies (or, if cancellation was delayed,
whether due to a stay by reason of an Insured's bankruptcy or other reason,
after the date the policy would have been cancelled in the absence of such
delay).
"Noteholder" means (a) with respect to the Class A Notes, the holder of
record of a Class A Note, (b) with respect to the Class B Notes, the holder of
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record of a Class B Note, (c) with respect to the Class C Notes, the holder of
record of a Class C Note and (d) with respect to any Notes, the holder of record
of such Notes.
"Noteholders" means the holder of record of a Note.
"Notes" means the Class A Notes, the Class B Notes and the Class C
Notes.
"Offered Notes" means the Class A Notes and Class B Notes.
"Payment Account" means the account established for the benefit of the
Noteholders pursuant to subsection 5.3(c).
"Payment Date" means[___], 2000 and the fifteenth day of each calendar
month thereafter, or if such fifteenth day is not a Business Day, the next
succeeding Business Day.
"Pay Out Commencement Date" means the date on which a Trust Pay Out
Event is deemed to occur pursuant to Section 9.1 of the Base Indenture or a
Series [___] Pay Out Event is deemed to occur pursuant to Section 9 hereof.
"Pool Factor" means, with respect to the last day of any Monthly
Period, a number carried out to seven decimals representing the ratio of the
Investor Interests as of such day (determined after taking into account any
reduction therein which will occur on the Payment Date following such last day
of such Monthly Period) to the Initial Investor Interests.
"Rapid Amortization Period" means the Amortization Period commencing on
the Pay Out Commencement Date and ending on the earlier to occur of (a) the
Series [___] Termination Date and (b) the discharge of the Indenture of the
Trust pursuant to Section 12.
"Rating Agency" means Moody's and Standard & Poor's.
"Reallocated Class B Principal Collections" means, with respect to any
Transfer Date, Collections of Principal Receivables applied in accordance with
subsections 5.18(a) and (b) in an amount not to exceed the product of (a) the
Class B Investor Allocation with respect to the Monthly Period relating to such
Transfer Date and (b) the Investor Percentage with respect to the Monthly Period
relating to such Transfer Date and (c) the amount of Collections of Principal
Receivables with respect to the Monthly Period relating to such Transfer Date;
provided, however, that such amount shall not exceed the Class B Investor
Interest after giving effect to any Class B Investor Charge-Offs for such
Transfer Date.
"Reallocated Class C Principal Collections" means, with respect to any
Transfer Date, Collections of Principal Receivables applied in accordance with
subsections 5.18(a) and (b) in an amount not to exceed the product of (a) the
Class C Investor Allocation with respect to the Monthly Period relating to such
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Transfer Date and (b) the Investor Percentage with respect to the Monthly Period
relating to such Transfer Date and (c) the amount of Collections of Principal
Receivables with respect to the Monthly Period relating to such Transfer Date;
provided, however, that such amount shall not exceed the Class C Investor
Interest after giving effect to any Class C Investor Charge-Offs for such
Transfer Date.
"Reallocated Principal Collections" means the sum of (a) Reallocated
Class B Principal Collections and (b) Reallocated Class C Principal Collections.
["Reassignment Amount" with respect to a Reassignment Date pursuant to
subsection 2.04(g) of the Sale and Servicing Agreement and Series [___], means
an amount equal to (i) the outstanding balance of the Notes of such Series at
the end of the day immediately preceding the Reassignment Date, less the amount,
if any, previously allocated for payment of principal to such Noteholders on the
related Payment Date in the Monthly Period in which the Reassignment Date
occurs, plus (ii) an amount equal to all interest accrued but unpaid on the
Notes of such Series at the applicable Note Rate for the related Interest Period
through the last day of such Interest Period, less the amount, if any,
previously allocated for payment of interest to the Noteholders of such Series
on the related Payment Date in the Monthly Period in which the Reassignment Date
occurs, plus (without duplication) (iii) the aggregate amount by which the
Investor Interest shall have been reduced other than as a result of principal
payments on the Notes, plus (iv) all Class A Refinance Amounts and Class B
Refinance Amounts (including any amounts accruing as a result of the related
reassignment).]
"Record Date" means for this Series, the day 5 Business Days prior to
the related Payment Date.
"Reference Banks" means four major banks in the London interbank market
selected by the Servicer and identified in an officer's certificate delivered to
the Trustee on the Closing Date or in any subsequent officer's certificate
delivered no later than one Business Day prior to any applicable LIBOR
Determination Date.
"Refinance Date" means the date on which the Notes are redeemed in full
pursuant to Section 11 hereof.
"Revolving Period" means the period from and including the Closing Date
to, but not including, the earliest of (a) the day the Controlled Amortization
Period commences and (b) the Pay Out Commencement Date.
"S&P Non-AAA Insurer" means, on any date of determination, an insurer
that as of the end of the immediately preceding Monthly Period did not have a
claims-paying ability rating at least as high as the then applicable rating
assigned by Standard & Poor's to the Class A Notes (other than any Affiliate of
AIG with a Standard & Poor's rating of at least AA-), unless Standard & Poor's
shall have previously notified the Seller in writing (and the Seller has
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notified Noteholders) that such insurer is not to be deemed an S&P Non-AAA
Insurer (and shall not have revoked such notification).
"S&P Non-Investment Grade Insurer" means, on any date of determination,
an insurer that as of the end of the immediately preceding Monthly Period did
not have a claims-paying ability rating of at least investment grade (i.e., in
one of the top four generic rating categories, irrespective of any plus or
minus) by Standard & Poor's (other than any affiliate of AIG with a Standard &
Poor's qualified solvency rating of at least BBBq), unless Standard & Poor's
shall have previously notified the Seller in writing that such insurer is not to
be deemed an S&P Non-Investment Grade Insurer (and shall not have revoked such
notification).
"Seller" means A.I. Receivables Transfer Corp.
"Series [___]" means the Series of the AIG Premium Finance Loan Master
Trust represented by the Notes.
"Series [___] Pay Out Event" has the meaning specified in Section 9
hereof.
"Series [___] Termination Date" means the earliest to occur of (a) the
Payment Date on which the Notes plus all other amounts due and owing to the
Noteholders, are paid in full, (b) the Legal Final Payment Date and (c) the
Trust Termination Date.
"Series Principal Shortfall" means with respect to the Notes and any
Transfer Date, the excess, if any, of (a) (i) with respect to any Transfer Date
during the Controlled Amortization Period, the applicable Controlled
Distribution Amount for such Transfer Date or (ii) with respect to any Transfer
Date during the Rapid Amortization Period, the Investor Interest over (b) the
Investor Principal Collections less Reallocated Principal Collections for such
Transfer Date.
"Servicer Default" has the meaning specified in section 10.01 of the
Sale and Servicing Agreement.
"Shared Principal Collections" means, with respect to any Transfer
Date, either (a) the amount allocated to the Notes which may be applied to the
"Series Principal Shortfall" with respect to other outstanding Series in Group
One or (b) the amounts allocated to the notes of other Series in Group One which
the applicable Series Supplements for such Series specify are to be treated as
"Shared Principal Collections" and which may be applied to cover the Series
Principal Shortfall with respect to the Notes.
"Single Insured Concentration Percentage" means for a given Insured the
percentage calculated by taking the lesser of (a) 3.00% and (b) the greater of
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(i) 1.00% and (ii) the weighted average remaining installment term of the
Receivables to such Insured, in months, divided by 1200.
"Trust" means the AIG Credit Premium Finance Master Trust, a Delaware
business trust.
"Unconcentrated 240+ Day Delinquency Percentage" means for any date of
determination the percentage calculated by dividing (a) the sum of the
Unconcentrated Insured Amount for each Receivable relating to a Premium Finance
Obligation that is 240 days or more past cancellation or cancellability of the
related insurance policy, by (b) the aggregate unpaid principal balance of all
Receivables.
"Unconcentrated Insured Amount" means for a given Insured the product
of (i) the difference between such Insured's Single Insured Concentration
Percentage and 1.00% (but such difference cannot be less than zero) and (ii) the
aggregate unpaid principal balance of all Receivables.
"Voluntary Decrease" has the meaning specified in Section 3.2(b).
"Yield Enhancement Account" has the meaning specified in subsection
5.20(a).
SECTION 2. Article 3 of the Base Indenture. Article 3 shall be read in
its entirety as follows and shall be applicable only to the Notes:
ARTICLE 3
INITIAL ISSUANCE
SECTION 3.1 Initial Issuance.. Subject to satisfaction of the
conditions precedent set forth herein, (i) on the Closing Date, the Issuer will
issue the Notes in the aggregate initial principal amount equal to the Initial
Investor Interest in accordance with Section 2.2.
SECTION 3. Servicing Compensation. The share of the Servicing Fee
allocable to Series [___] with respect to any Transfer Date (the "Investor
Servicing Fee") shall be equal to the sum of the Class A Servicing Fee, the
Class B Servicing Fee and the Class C Servicing Fee with respect to such date.
The share of the Investor Servicing Fee allocable to the Class A Investor
Interest with respect to any Transfer Date (the "Class A Servicing Fee") shall
be equal to one-twelfth of the product of (i) the Class A Floating Allocation,
(ii) the Net Servicing Fee Rate and (iii) the Investor Interest for the relevant
Interest Period. The share of the Investor Servicing Fee allocable to the Class
B Investor Interest with respect to any Transfer Date (the "Class B Servicing
Fee") shall be equal to one-twelfth of the product of (i) the Class B Floating
Allocation, (ii) the Net Servicing Fee Rate and (iii) the Investor Interest for
the related Interest Period. The share of the Investor Servicing Fee allocable
to the Class C Investor Interest with respect to any Transfer Date (the "Class C
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Servicing Fee") shall be equal to one-twelfth of the product of (i) the Class C
Floating Allocation, (ii) the Net Servicing Fee Rate and (iii) the Investor
Interest for the related Interest Period. Except as specifically provided above,
the Investor Servicing Fee shall be paid by the cash flows from the Trust Estate
allocated to the Issuer or the noteholders of other Series (as provided in the
related series supplements) and in no event shall the Trust, the Trustee or the
Noteholders be liable therefor. The Class A Servicing Fee shall be payable to
the Servicer solely to the extent amounts are available for distribution in
respect thereof pursuant to subsections 5.15(a)(ii) and 5.17(a). The Class B
Servicing Fee shall be payable solely to the extent amounts are available for
distribution in respect thereof pursuant to subsections 5.15(b)(ii) and 5.17(c).
The Class C Servicing Fee shall be payable solely to the extent amounts are
available for distribution in respect thereof pursuant to subsections 5.15(c)(i)
and 5.17(h). The Servicing Fee for the first Monthly Period will be zero.
SECTION 4. Cleanup Call.
(a) The Notes shall be subject to purchase by the Servicer at its
option, in accordance with the terms specified in subsection 12.4(a) on any
Payment Date on or after the Payment Date on which the Investor Interest is
reduced to an amount less than or equal to 10% of the Initial Investor Interest.
(b) The deposit required in connection with any such purchase will be
equal to the sum of (a) the outstanding principal balance of the Notes plus (b)
accrued and unpaid interest on the Notes through the day preceding the Payment
Date on which the purchase occurs, plus (c) the aggregate amount by which the
principal balance of the Notes shall have been reduced for reasons other than
payment of principal to the Noteholders, plus (d) all other Class A Refinance
Amounts and Class B Refinance Amounts (including any amounts accruing as a
result of the application of the proceeds of such purchase), minus (e) the
amounts, if any, on deposit at such Payment Date in the Payment Account for the
payment of principal and interest due the Noteholders.
SECTION 5. Delivery and Payment for the Notes. The Trustee shall
execute, authenticate and deliver the Notes in accordance with Section 2.4 and
Section 6 below.
SECTION 6. Form of Delivery of the Notes; Depository; Denominations.
(a) [The Class A Notes shall be delivered as Registered Notes in
certificated form as provided in Section 2.1. The Class A Notes shall be
registered in the name of the Person specified in the Note Purchase Agreement
and notwithstanding anything to the contrary contained in the Base Indenture,
shall not be transferred, sold or pledged, in whole or in part, other than
pursuant to Section 2.1. The Class B Notes and the Class C Notes shall be
delivered as Registered Notes in certificated form as provided in Section 2.1,
shall be initially registered in the name of the Seller and, notwithstanding
anything to the contrary contained in the Base Indenture, shall not be
transferred, sold or pledged, in whole or in part, other than pursuant to
Section 2.1.]
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(b) [RESERVED].
(c) [RESERVED].
(d) [RESERVED].
(e) The Offered Notes will be issuable in minimum denominations of
$100,000 and integral multiples of $1,000 in excess thereof.
(f) [The holder of a Definitive Note may transfer such Definitive Note,
by surrendering it at (i) the office or agency maintained by the Trustee for
such purpose in The City of New York or (ii) the office of any transfer agent
appointed by the Issuer.]
SECTION 7. Article 5 of Base Indenture. Sections 5.1, 5.2, 5.3, 5.4,
5.5, 5.6, 5.7, 5.8 and 5.9 shall be read in their entirety as provided in the
Base Indenture. Article 5 (except for Sections 5.1, 5.2, 5.3, 5.4, 5.5, 5.6,
5.7, 5.8 and 5.9 thereof) and for purposes of Series [___], the following
provisions shall constitute part of Article 5 of the Indenture and shall be
applicable only to the Notes:
ARTICLE 5
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 5.10 Rights of Noteholders. The Notes shall be secured by the
Trust Estate, consisting of the right to receive, to the extent necessary to
make the required payments with respect to such Notes at the times and in the
amounts specified in this Base Indenture and this Series Supplement, (a) the
Floating Investor Percentage and Fixed Investor Percentage (as applicable from
time to time) of Collections received with respect to the Receivables and (b)
without duplication, funds on deposit in the Collection Account, the Finance
Charge Account, the Principal Account, the Yield Enhancement Account, the Excess
Funding Account and the Payment Account. The Class C Notes shall be subordinate
to the Class A Notes and the Class B Notes to the extent provided herein. The
Class B Notes shall be subordinate to the Class A Notes to the extent provided
herein. The Trust Interest shall not represent any interest in the Collection
Account, the Finance Charge Account, the Principal Account, the Yield
Enhancement Account, the Excess Funding Account or the Payment Account, except
as specifically provided in this Article 5.
SECTION 5.11 Allocations.
(a) Allocations During the Revolving Period. During the Revolving
Period, the Servicer shall, prior to the close of business on the day any
Collections are deposited in the Collection Account, allocate to the Investor
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Interest or the Issuer (as holder of the Trust Interest) and pay or deposit from
the Collection Account the following amounts as set forth below:
(i) Deposit into the Finance Charge Account an amount equal to
the product of (A) the Investor Percentage on the date of receipt of
such Collections and (B) the aggregate amount of Collections received
in respect of Finance Charge Receivables on such date to be applied in
accordance with Section 5.15.
(ii) Deposit into the Principal Account an amount equal to the
product of (A) the Class C Investor Allocation on the date of receipt
of such Collections, (B) the Investor Percentage on the date of receipt
of such Collections and (C) the aggregate amount of Collections
received in respect of Principal Receivables on such date to be applied
first in accordance with Section 5.18 and then in accordance with
subsection 5.15(d).
(iii) Deposit into the Principal Account an amount equal to
the product of (A) the Class B Investor Allocation on the date of
receipt of such Collections, (B) the Investor Percentage on the date of
receipt of such Collections and (C) the aggregate amount of Collections
received in respect of Principal Receivables on such date to be applied
first in accordance with Section 5.18 and then in accordance with
subsection 5.15(d).
(iv) Deposit into the Principal Account an amount equal to the
product of (A) the Class A Investor Allocation on the date of receipt
of such Collections, (B) the Investor Percentage on the date of receipt
of such Collections and (C) the aggregate amount of Collections
received in respect of Principal Receivables on such date to be applied
in accordance with subsection 5.15(d);
(v) Pay to the Issuer, (without duplication) an amount equal
to the excess, if any, of the aggregate amount of Collections received
in respect of Finance Charge Receivables and Principal Receivables on
the date of receipt of such Collections over the sum of (A) the amounts
deposited pursuant to subsections 5.11(a)(i), (ii), (iii) and (iv)
above; (B) the amount required to be deposited in the Yield Enhancement
Account pursuant to subsection 5.20(b); and (C) any amounts required to
be otherwise applied under any comparable provision of any other Series
Supplement; provided, however, that the amount to be paid to the
Issuer, pursuant to this subsection 5.11(a)(v) and any comparable
provision of any other Series Supplement with respect to any such date
shall be paid to the Issuer, only to the extent that the Trust Interest
as of the end of the prior Monthly Period (as adjusted to give effect
to the inclusion in or removal from the Trust of all Receivables
transferred to or from the Trust and/or any reduction or increase in
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any outstanding notes since the end of such prior Monthly Period and on
or prior to the following Payment Date and the application of payments
referred to in subsection 5.4(b) of the Base Indenture) is greater than
the largest required Minimum Trust Interest of any Series outstanding
and otherwise shall be deposited into the Excess Funding Account in
accordance with subsection 5.11(f).
(b) Allocations During the Controlled Amortization Period. During the
Controlled Amortization Period the Servicer shall, prior to the close of
business on the day any Collections are deposited in the Collection Account,
allocate to the Investor Interest or the Issuer (as holder of the Trust
Interest), and pay or deposit from the Collection Account the following amounts
as set forth below:
(i) Deposit into the Finance Charge Account an amount equal to
the product of (A) the Investor Percentage on the date of receipt of
such Collections and (B) the aggregate amount of Collections received
in respect of Finance Charge Receivables on such date to be applied in
accordance with Section 5.15.
(ii) Deposit into the Principal Account an amount equal to the
product of (A) the Class C Investor Allocation on the date of receipt
of such Collections, (B) the Investor Percentage on the date of receipt
of such Collections and (C) the aggregate amount of Collections
received in respect of Principal Receivables on such date to be applied
first in accordance with Section 5.18 and then in accordance with
subsection 5.15(e).
(iii) Deposit into the Principal Account an amount equal to
the product of (A) the Class B Investor Allocation on the date of
receipt of such Collections, (B) the Investor Percentage on the date of
receipt of such Collections and (C) the aggregate amount of Collections
received in respect of Principal Receivables on such date to be applied
first in accordance with Section 5.18 and then in accordance with
subsection 5.15(e).
(iv) Deposit into the Principal Account an amount equal to the
product of (A) the Class A Investor Allocation on the date of receipt
of such Collections, (B) the Investor Percentage on the date of receipt
of such Collections and (C) the aggregate amount of Collections
received in respect of Principal Receivables on such date to be applied
in accordance with subsection 5.15(e).
(v) Pay to the Issuer (without duplication), an amount equal
to the excess, if any, of the aggregate amount of Collections received
in respect of Finance Charge Receivables and Principal Receivables on
the date of receipt of such Collections over the sum of (A) the amounts
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deposited pursuant to subsections 5.11(b)(i), (ii), (iii) and (iv)
above; (B) the amount required to be deposited in the Yield Enhancement
Account pursuant to subsection 5.20(b); and (C) any amounts required to
be otherwise applied under any comparable provision of any other Series
Supplement; provided, however, that the amount to be paid to the
Issuer, pursuant to this subsection 5.11(b)(v) and any comparable
provision of any other Series Supplement with respect to any such date
shall be paid to the Issuer only to the extent that the Trust Interest
as of the end of the prior Monthly Period (as adjusted to give effect
to the inclusion in or removal from the Trust of all Receivables
transferred to or from the Trust and/or any reduction or increases in
any outstanding notes since the end of such prior Monthly Period and on
or prior to the following Payment Date and the application of payments
referred to in subsection 5.4(b) of the Base Indenture) is greater than
the largest required Minimum Trust Interest of any Series outstanding
and otherwise shall be deposited into the Excess Funding Account in
accordance with subsection 5.11(f).
(c) [RESERVED].
(d) Allocations During the Rapid Amortization Period. During the Rapid
Amortization Period, the Servicer shall, prior to the close of business on the
day any Collections are deposited in the Collection Account, allocate to the
Noteholders and pay or deposit from the Collection Account the following amounts
as set forth below:
(i) Deposit into the Finance Charge Account an amount equal to
the product of (A) the Investor Percentage on the date of receipt of
such Collections and (B) the aggregate amount of Collections received
in respect of Finance Charge Receivables on such date to be applied in
accordance with Section 5.15.
(ii) Deposit into the Principal Account an amount equal to the
product of (A) the Investor Percentage on the date of receipt of such
Collections and (B) the aggregate amount of Collections processed in
respect of Principal Receivables on such date; provided, however, that
the amount deposited into the Principal Account pursuant to this
subsection 5.11(d)(ii) shall not exceed the sum of (a) the Investor
Interest as of such date (after taking into account any payments to be
made on the Payment Date relating to such prior Monthly Period and
deposits and any adjustments to be made to the Investor Interest to be
made on the Transfer Date relating to such Monthly Period) and (b) any
Reallocated Principal Collections relating to the Monthly Period in
which such deposit is made.
(iii) Pay to the Issuer, (without duplication) an amount equal
to the excess, if any, of the aggregate amount of Collections received
in respect of Finance Charge Receivables and Principal Receivables on
the date of receipt of such Collections over the sum of (A) the amounts
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deposited pursuant to subsections 5.11(d)(i) and (ii) above; (B) the
amount required to be deposited in the Yield Enhancement Account
pursuant to subsection 5.20(b); and (C) any amounts required to be
otherwise applied under any comparable provision of any other Series
Supplement; provided, however, that the amount to be paid to the
Issuer, pursuant to this subsection 5.11(d)(iii) and any comparable
provision of any other Series Supplement with respect to any such date
shall be paid to the Issuer, only to the extent that the Trust Interest
as of the end of the prior Monthly Period (as adjusted to give effect
to the inclusion in, or removal from, the Trust of all Receivables
transferred to or from the Trust and/or any reduction or increase in
any outstanding notes since the end of such prior Monthly Period and on
or prior to the following Payment Date and the application of payments
referred to in subsection 5.4(b) of the Base Indenture) is greater than
the largest required Minimum Trust Interest of any Series outstanding
and otherwise shall be deposited into the Excess Funding Account in
accordance with subsection 5.11(f).
(e) [RESERVED].
(f) Excess Funding Collections. Any Collections in respect of Principal
Receivables or Finance Charge Receivables not allocated and paid to the Issuer,
because of the limitations contained in subsections 5.11(a)(v), 5.11(b)(v),
5.11(d)(iii), 5.15(d)(ii), 5.15(e)(v) and 5.17(m) shall be deposited in the
Yield Enhancement Account and any other comparable account for any other Series
to the extent required by such subsections and/or subsection 5.20(b) and any
comparable provision of any other Series Supplement, and the remainder shall be
held in the Excess Funding Account and, prior to the commencement of the
Controlled Amortization Period, or the Rapid Amortization Period, shall be paid
(without duplication) to the Issuer, on any subsequent date when, and only to
the extent that the Trust Interest as of the end of the prior Monthly Period (as
adjusted to give effect to the inclusion in or removal from the Trust of all
Receivables transferred to or from the Trust and/or any reduction in any
outstanding notes since the end of such prior Monthly Period and on or prior to
the following Payment Date) is greater than the largest required Minimum Trust
Interest of any Series outstanding; provided, however, that if an Accumulation
Period or an Amortization Period commences with respect to any Series, any funds
on deposit in the Excess Funding Account, shall be released from the Excess
Funding Account, deposited in the Principal Account and treated as Shared
Principal Collections to the extent needed to cover principal payments due to or
for the benefit of such Series.
(g) Notwithstanding the preceding provisions of subsections 5.11(a),
5.11(b) and 5.11(d), the deposits required by such subsections shall be subject
to the third paragraph of subsection 5.4(a) of the Base Indenture. With respect
to any Series of notes, and notwithstanding anything in the Base Indenture or
any Series Supplement to the contrary, whether or not the Servicer is required
to make monthly or daily deposits from the Collection Account into the Finance
Charge Account, the Principal Account or the Excess Funding Account pursuant to
subsections 5.11(a), 5.11(b) and 5.11(d), with respect to any Monthly Period,
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(i) the Servicer will only be required to deposit Collections from the
Collection Account into the Finance Charge Account, the Principal Account or the
Excess Funding Account up to the required amount to be deposited into any such
deposit account or, without duplication, paid on or prior to the related Payment
Date to the noteholders of all Series and (ii) if at any time prior to such
Payment Date the amount of Collections deposited in the Collection Account
exceeds the amount required to be deposited pursuant to clause (i) above, the
Servicer will be permitted to withdraw the excess from the Collection Account
and allocate and pay such excess (without duplication) to the Issuer, in
accordance with subsection 5.4(c) of the Base Indenture.
SECTION 5.12 Determination of Monthly Interest.
(a) The amount of monthly interest payable to the Class A Notes shall
be determined as of each Transfer Date and shall be an amount equal to the
product of (i)(A) a fraction, the numerator of which is the actual number of
days in the related Interest Period and the denominator of which is 360, times
(B) the Class A Note Rate in effect with respect to the related Interest Period,
and (ii) the outstanding principal balance of the Class A Notes during such
Interest Period (the "Class A Monthly Interest"); provided, however, that in
addition to Class A Monthly Interest an amount equal to the sum of (i) the
amount of any unpaid Class A Deficiency Amounts, as defined below, and (ii) an
amount equal to the product of (A) a fraction, the numerator of which is the
actual number of days in the related Interest Period and the denominator of
which is 360, times (B) a rate equal to 2% per annum over the Class A Note Rate
in effect with respect to the related Interest Period, times (C) any Class A
Deficiency Amount from the prior Transfer Date, as defined below (or the portion
thereof which has not theretofore been paid to Class A Noteholders) (such
product, the "Class A Additional Interest") shall also be payable to the Class A
Notes; provided further, that the "Class A Deficiency Amount" for any Transfer
Date shall be equal to the excess, if any, of (x) the sum of the Class A Monthly
Interest, the Class A Additional Interest and the Class A Deficiency Amount as
determined pursuant to the preceding sentence for the prior Interest Period,
over (y) the amount actually paid in respect thereof on the preceding Payment
Date.
(b) The amount of monthly interest payable to the Class B Notes shall
be determined as of each Transfer Date and shall be an amount equal to the
product of (i)(A) a fraction, the numerator of which is the actual number of
days in the related Interest Period and the denominator of which is 360, times
(B) the Class B Note Rate in effect with respect to the related Interest Period,
and (ii) the outstanding principal balance of the Class B Notes during such
Interest Period (the "Class B Monthly Interest"); provided, however, that in
addition to Class B Monthly Interest an amount equal to the sum of (i) the
amount of any unpaid Class B Deficiency Amounts, as defined below, and (ii) an
amount equal to the product of (A) a fraction, the numerator of which is the
actual number of days in the related Interest Period and the denominator of
which is 360, times (B) a rate equal to 2% per annum over the Class B Note Rate
in effect with respect to the related Interest Period, and (C) any Class B
Deficiency Amount from the prior Transfer Date, as defined below (or the portion
thereof which has not theretofore been paid to Class B Noteholders) (such
product, the "Class B Additional Interest") shall also be payable to the Class B
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Notes; provided further, that the "Class B Deficiency Amount" for any Transfer
Date shall be equal to the (x) the sum of the Class B Monthly Interest, the
Class B Additional Interest and the Class B Deficiency Amount as determined
pursuant to the preceding sentence for the prior Interest Period, over (y) the
amount actually paid in respect thereof on the preceding Payment Date.
(c) The amount of monthly interest payable to the Class C Notes shall
be determined as of each Transfer Date and shall be an amount equal to the
product of (i)(A) a fraction, the numerator of which is the actual number of
days in the related Interest Period and the denominator of which is 360, times
(B) the Class C Note Rate in effect with respect to the related Interest Period,
and (ii) the outstanding principal balance of the Class C Notes during such
Interest Period (the "Class C Monthly Interest"); provided, however, that in
addition to Class C Monthly Interest an amount equal to the sum of (i) the
amount of any unpaid Class C Deficiency Amounts, as defined below, and (ii) an
amount equal to the product of (A) a fraction, the numerator of which is the
actual number of days in the related Interest Period and the denominator of
which is 360, times (B) a rate equal to 2% per annum over the Class C Note Rate
in effect with respect to the related Interest Period, and (C) any Class C
Deficiency Amount from the prior Transfer Date, as defined below (or the portion
thereof which has not theretofore been paid to Class C Noteholders) (such
product, the "Class C Additional Interest") shall also be payable to the Class C
Notes; provided further, that the "Class C Deficiency Amount" for any Transfer
Date shall be equal to the (x) the sum of the Class C Monthly Interest, the
Class C Additional Interest and the Class C Deficiency Amount as determined
pursuant to the preceding sentence for the prior Interest Period, over (y) the
amount actually paid in respect thereof on the preceding Payment Date.
SECTION 5.13 Determination of Monthly Principal.
(a) The amount of monthly principal payable from the Principal Account
with respect to the Class A Notes on each Transfer Date ("Class A Monthly
Principal"), beginning with the Transfer Date in the month in which the Class A
Controlled Amortization Period begins or, if earlier, the first Transfer Date
occurring after the Rapid Amortization Period begins, shall be equal to the
least of (i) the Available Investor Principal Collections on deposit in the
Principal Account with respect to such Transfer Date, (ii) for each Transfer
Date occurring during the Class A Controlled Amortization Period, prior to the
payment in full of the Class A Notes, the Controlled Distribution Amount for the
related Payment Date and (iii) the Class A Investor Interest (after taking into
account any adjustments to be made on such Transfer Date pursuant to Section
5.16) on such Transfer Date.
(b) The amount of monthly principal payable from the Principal Account
with respect to the Class B Notes on each Transfer Date (the "Class B Monthly
Principal"), with respect to the Class B Controlled Amortization Period,
beginning with the Transfer Date immediately preceding the Payment Date on which
the Class A Notes will have been paid in full (after taking into account any
payments to be made on the related Payment Date), and during the Rapid
Amortization Period, beginning with the Transfer Date immediately preceding the
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Payment Date on which the Class A Notes will be paid in full (after taking into
account payments to be made on the related Payment Date), shall be an amount
equal to the least of (i) the Available Investor Principal Collections on
deposit in the Principal Account with respect to such Transfer Date (minus the
portion of such Available Investor Principal Collections applied to Class A
Monthly Principal on such Transfer Date) (ii) for each Transfer Date with
respect to the Class B Controlled Amortization Period prior to the payment in
full of the Class B Notes, the Controlled Distribution Amount for the related
Payment Date (minus the portion of such Controlled Distribution Amount applied
to the Class A Monthly Principal on such Transfer Date) and (iii) the Class B
Investor Interest (after taking into account any adjustments to be made on such
Transfer Date pursuant to Sections 5.16 and 5.18) on such Transfer Date.
(c) The amount of monthly principal payable from the Principal Account
with respect to the Class C Notes on each Transfer Date (the "Class C Monthly
Principal"), with respect to the Class C Controlled Amortization Period,
beginning with the Transfer Date immediately preceding the Payment Date on which
the Class B Notes will have been paid in full, and during the Rapid Amortization
Period, beginning with the Transfer Date immediately preceding the Payment Date
on which the Class B Notes will have been paid in full (after taking into
account payments to be made on the related Payment Date), shall be an amount
equal to the least of (i) the Available Investor Principal Collections on
deposit in the Principal Account with respect to such Transfer Date (minus the
portion of such Available Investor Principal Collections applied to Class A
Monthly Principal and Class B Monthly Principal on such Transfer Date), (ii) for
each Transfer Date with respect to the Class C Controlled Amortization Period
prior to the payment in full of the Class C Notes, the Controlled Distribution
Amount for the related Payment Date (minus the portion of such Controlled
Distribution Amount applied to Class A Monthly Principal and Class B Monthly
Principal on such Transfer Date), and (iii) the Class C Investor Interest (after
taking into account any adjustments to be made on such Transfer Date pursuant to
Sections 5.16 and 5.18) on such Transfer Date.
SECTION 5.14 Coverage of Required Amount.
(a) On or before each Transfer Date, the Servicer shall determine the
amount (the "Class A Required Amount"), if any, by which an amount equal to the
sum of (i) the Class A Monthly Interest for such Transfer Date, plus (ii) the
Class A Deficiency Amount, if any, for such Transfer Date, plus (iii) the Class
A Additional Interest, if any, for such Transfer Date, plus (iv) the Class A
Servicing Fee for the prior Monthly Period plus (v) the Class A Servicing Fee,
if any, due but not paid on any prior Transfer Date that will be payable on the
related Payment Date, plus (vi) the Class A Investor Default Amount, if any, for
the prior Monthly Period exceeds the Class A Available Funds for the related
Monthly Period.
(b) On or before each Transfer Date, the Servicer shall determine the
amount (the "Class B Required Amount"), if any, equal to the sum of (i) the
amount, if any, by which the sum of (A) the Class B Monthly Interest for such
Transfer Date, plus (B) the Class B Deficiency Amount, if any, for such Transfer
Date, plus (C) the Class B Additional Interest, if any, for such Transfer Date,
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plus (D) the Class B Servicing Fee for the prior Monthly Period, plus (E) the
Class B Servicing Fee, if any, due but not paid on any prior Transfer Date that
will be payable on the related Payment Date, exceeds the Class B Available Funds
for the related Monthly Period, plus (ii) the Class B Investor Default Amount,
if any, for the prior Monthly Period.
(c) On or before each Transfer Date, the Servicer shall determine the
amount (the "Class C Required Amount"), if any, equal to the sum of (i) the
amount, if any, by which the sum of (A) the Class C Servicing Fee for such
Transfer Date, plus (B) the Class C Servicing Fee, if any, due but not paid on
any prior Transfer Date, exceeds the Class C Available Funds for the related
Monthly Period, plus (ii) Class C Monthly Interest for such Transfer Date, plus
(iii) the Class C Deficiency Amount, if any, for such Transfer Date, plus (iv)
the Class C Additional Interest, if any, for such Transfer Date, plus (v) the
Class C Investor Default Amount, if any, for such Transfer Date.
(d) In the event that the sum of the Class A Required Amount and the
Class B Required Amount for such Transfer Date is greater than zero, the
Servicer shall give written notice to the Trustee of such positive Class A
Required Amount and Class B Required Amount or before such Transfer Date. In the
event that the Class A Required Amount for such Transfer Date is greater than
zero, all or a portion of the Excess Spread and the funds on deposit in the
Yield Enhancement Account with respect to such Transfer Date in an amount equal
to the Class A Required Amount, to the extent available, for such Transfer Date
shall be paid first from the Finance Charge Account and then from the Yield
Enhancement Account on such Transfer Date pursuant to subsection 5.17(a). In the
event that the Class A Required Amount for such Transfer Date exceeds the amount
of Excess Spread and the funds on deposit in the Yield Enhancement Account with
respect to such Transfer Date, the Collections of Principal Receivables
allocable to each Class with respect to the prior Monthly Period shall be
applied as specified in Section 5.18. In the event that the Class B Required
Amount for such Transfer Date is greater than zero, all or a portion of Excess
Spread and the funds on deposit in the Yield Enhancement Account with respect to
such Transfer Date in an amount equal to the Class B Required Amount, to the
extent available, shall be distributed first from the Finance Charge Account and
then from the Yield Enhancement Account on such Transfer Date pursuant to
Section 5.17(c). In the event that the Class B Required Amount for such Transfer
Date exceeds the amount of Excess Spread and funds on deposit in the Yield
Enhancement Account available to fund the Class B Required Amount pursuant to
subsection 5.17(c), the Collections of Principal Receivables allocable to each
Class shall be applied as specified in Section 5.18; provided, however, that the
sum of any payments pursuant to this paragraph shall not exceed the sum of the
Class A Required Amount and the Class B Required Amount.
SECTION 5.15 Monthly Payments. On or before each Transfer Date, the
Servicer shall instruct the Trustee in writing (which writing shall be
substantially in the form of the Monthly Servicer Report, attached as Exhibit C
to the Sale and Servicing Agreement) to withdraw and the Trustee, acting in
accordance with such instructions, shall withdraw on such Transfer Date or the
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related Payment Date, as applicable, to the extent of available funds, the
amounts in respect of the Notes required to be withdrawn from the Finance Charge
Account, the Principal Account, the Excess Funding Account and the Payment
Account as follows:
(a) An amount equal to the Class A Available Funds deposited into the
Finance Charge Account for the related Monthly Period shall be distributed on
each Transfer Date in the following priority:
(i) an amount equal to Class A Monthly Interest for such
Transfer Date, plus the amount of any Class A Deficiency Amount, if
any, for such Transfer Date, plus the amount of any Class A Additional
Interest, if any, for such Transfer Date, shall be deposited by the
Servicer or the Trustee into the Payment Account;
(ii) an amount equal to the Class A Servicing Fee for such
Transfer Date, plus the amount of any Class A Servicing Fee due but not
paid to the Servicer on any prior Transfer Date shall be paid to the
Servicer;
(iii) an amount equal to the Class A Investor Default Amount,
if any, for the preceding Monthly Period shall be treated as a portion
of Investor Principal Collections and deposited into the Principal
Account on such Transfer Date; and
(iv) the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 5.17.
(b) An amount equal to the Class B Available Funds deposited into the
Finance Charge Account for the related Monthly Period will be distributed on
each Transfer Date in the following priority:
(i) an amount equal to the Class B Monthly Interest for such
Transfer Date, plus the amount of any Class B Deficiency Amount, if
any, for such Transfer Date, plus the amount of any Class B Additional
Interest, if any, for such Transfer Date, shall be deposited by the
Servicer or the Trustee into the Payment Account;
(ii) an amount equal to the Class B Servicing Fee for such
Transfer Date, plus the amount of any Class B Servicing Fee due but not
paid to the Servicer on any prior Transfer Date for such Transfer Date
shall be paid to the Servicer; and
(iii) the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 5.17.
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(c) An amount equal to the Class C Available Funds deposited into the
Finance Charge Account for the related Monthly Period shall be distributed on
each Transfer Date in the following priority:
(i) an amount equal to the Class C Servicing Fee for such
Transfer Date, plus the amount of any Class C Servicing Fee due but not
paid to the Servicer on any prior Transfer Date shall be paid to the
Servicer; and
(ii) the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 5.17.
(d) During the Revolving Period, an amount equal to the Available
Investor Principal Collections deposited into the Principal Account for the
related Monthly Period shall be distributed on each Transfer Date in the
following priority:
(i) an amount equal to the lesser of (A) the product of (1) a
fraction, the numerator of which is equal to the Available Investor
Principal Collections for such Transfer Date and the denominator of
which is equal to the sum of the Available Investor Principal
Collections available for sharing as specified in the related Series
Supplement for each Series in Group One and (2) the Cumulative Series
Principal Shortfall, if any, and (B) Available Investor Principal
Collections, shall remain in the Principal Account to be treated as
Shared Principal Collections and applied to Series in Group One other
than this Series [___]; and
(ii) an amount equal to the excess, if any, of (A) the
Available Investor Principal Collections for such Transfer Date over
(B) the applications specified in subsection 5.15(d)(i) above shall be
paid to the Issuer; provided, however, that the amount to be paid to
the Issuer, pursuant to this subsection 5.15(d)(ii) with respect to
such Transfer Date shall be paid to the Issuer, if, and only to the
extent that the Trust Interest as of the end of the prior Monthly
Period (adjusted to give effect to the inclusion in or removal from the
Trust of all Receivables transferred to or from the Trust and/or any
reduction in any outstanding notes since the end of such prior Monthly
Period and on or prior to the following Payment Date and the
application of payments referred to in subsection 5.4(b) of the Base
Indenture) is greater than the largest required Minimum Trust Interest
of any Series outstanding and otherwise shall be deposited into the
Excess Funding Account in accordance with subsection 5.11(f).
(e) During the Controlled Amortization Period, the Class A Principal
Amortization Period, the Class B Principal Amortization Period or the Rapid
Amortization Period, an amount equal to the Available Investor Principal
Collections deposited into the Principal Account for the related Monthly Period
shall be distributed on each Transfer Date in the following priority:
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(i) an amount equal to the Class A Monthly Principal for such
Transfer Date, shall be deposited into the Payment Account;
(ii) for each Payment Date beginning with the Payment Date on
which the Class A Notes are paid in full, after giving effect to the
distribution referred to in clause (i) above, an amount equal to the
Class B Monthly Principal for such Transfer Date shall be deposited
into the Payment Account;
(iii) for each Payment Date beginning with the Payment Date on
which the Class B Notes are paid in full, after giving effect to the
distribution referred to in clauses (i) and (ii) above, an amount equal
to the Class C Monthly Principal for such Transfer Date shall be
deposited into the Payment Account;
(iv) an amount equal to the lesser of (A) the product of (1) a
fraction, the numerator of which is equal to the Available Investor
Principal Collections remaining after the application specified in
subsections 5.15(e)(i), (ii) and (iii) above and the denominator of
which is equal to the sum of the Available Investor Principal
Collections available for sharing as specified in the related Series
Supplement for each Series in Group One and (2) the Cumulative Series
Principal Shortfall, if any, and (B) the Available Investor Principal
Collections remaining after the application specified in subsections
5.15(e)(i), (ii) and (iii) above, shall remain in the Principal Account
to be treated as Shared Principal Collections and applied to Series in
Group One other than this Series [___]; and
(v) an amount equal to the excess, if any, of (A) the
Available Investor Principal Collections for such Transfer Date over
(B) the applications specified in subsections 5.15(e)(i) through (iv)
above shall be paid on such Transfer Date, without duplication, to the
Issuer; provided, however, that the amount to be paid to the Issuer,
pursuant to this subsection 5.15(e)(v) with respect to such Transfer
Date shall be paid to the Issuer, if, and only to the extent that the
Trust Interest as of the end of the prior Monthly Period (after giving
effect to the inclusion in or removal from the Trust of all Receivables
transferred to or from the Trust and/or any reduction or increase in
any outstanding notes since the end of such prior Monthly Period and on
or prior to the following Payment Date and the application of payments
referred to in subsection 5.4(b) of the Base Indenture) is greater than
the largest required Minimum Trust Interest of any Series outstanding
and otherwise shall be deposited into the Excess Funding Account in
accordance with subsection 5.11(f).
(f) [RESERVED].
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(g) [RESERVED].
(h) On each Payment Date, the Trustee, acting in accordance with
instructions from the Servicer, shall pay in accordance with subsections 6.1 (a)
and 6.1 (b) from the Payment Account the following amounts (in each case
determined as of the immediately preceding Transfer Date) in the following order
of priority: (i) to the Class A Noteholders from the Payment Account, the amount
deposited into the Payment Account pursuant to subsection 5.15(a)(i) on the
preceding Transfer Date and (ii) to the Class B Noteholders from the Payment
Account, the amount deposited into the Payment Account pursuant to subsection
5.15(b)(i) on the preceding Transfer Date.
(i) On the earlier to occur of (a) the first Payment Date in the Class
A Controlled Amortization Period, (b) the first Payment Date occurring after the
Rapid Amortization Period begins, and on each Payment Date thereafter, the
Trustee, acting in accordance with instructions from the Servicer, shall pay in
accordance with subsections 6.1(a) and 6.1(b) from the Payment Account the
amount so deposited into the Payment Account pursuant to subsections 5.15(e) the
following amounts (in each case determined as of the immediately preceding
Transfer Date) on the related Transfer Date in the following priority:
(i) to the Class A Noteholders from the Payment Account, an
amount equal to the lesser of (A) the amount on deposit in the Payment
Account, (B) the Class A Monthly Principal and (C) the outstanding
balance of the Class A Notes;
(ii) to the Class B Noteholders from the Payment Account,
after giving effect to the distributions referred to in clause (i)
above, an amount equal to the lesser of (A) the amount on deposit in
the Payment Account, (B) the Class B Monthly Principal and (C) the
outstanding balance of the Class B Notes;
(iii) to the Servicer from the Payment Account, after giving
effect to the distributions in clauses (i) and (ii) above, the amount
to be deposited into the Payment Account pursuant to subsection
5.15(c)(i) on the preceding Transfer Date; and
(iv) to the Class C Noteholders from the Payment Account,
after giving effect to the distributions referred to in clause (i),
(ii) and (iii) above, an amount equal to the lesser of (A) the amount
on deposit in the Payment Account, (B) the Class C Monthly Principal
and (C) the outstanding balance of the Class C Notes.
(j) [RESERVED]
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SECTION 5.16 Investor Charge-Offs.
(a) On or before each Transfer Date, the Servicer shall calculate the
Class A Investor Default Amount. If on any Transfer Date, the Class A Investor
Default Amount for such Transfer Date exceeds the sum of the amount to be
distributed with respect thereto pursuant to subsection 5.15(a)(iii) and 5.17(a)
and Section 5.18 with respect to such Monthly Period, the Class C Investor
Interest (after giving effect to reductions for any Class C Investor Charge-Offs
and any Reallocated Principal Collections on such Transfer Date) shall be
reduced by the amount of such excess, but not by more than the lesser of the
Class A Investor Default Amount and the Class C Investor Interest (after giving
effect to reductions for any Class C Investor Charge-Offs and any Reallocated
Principal Collections on such Transfer Date) for such Transfer Date. In the
event that such reduction would cause the Class C Investor Interest to be a
negative number, the Class C Investor Interest shall be reduced to zero, and the
Class B Investor Interest (after giving effect to reductions for any Class B
Investor Charge-Offs and any Reallocated Principal Collections for which the
Class C Investor Interest is not reduced on such Transfer Date) shall be reduced
by the amount by which the Class C Investor Interest would have been reduced
below zero. In the event that such reduction would cause the Class B Investor
Interest to be a negative number, the Class B Investor Interest shall be reduced
to zero, and the Class A Investor Interest shall be reduced (but not below zero)
by the amount by which the Class B Investor Interest would have been reduced
below zero, but not by more than the Class A Investor Default Amount for such
Transfer Date (a "Class A Investor Charge-Off"). The Class A Investor Interest
shall thereafter be reimbursed on any Transfer Date by the amount of Excess
Spread and funds on deposit in the Yield Enhancement Account allocated and
available for such purpose pursuant to subsection 5.17(b).
(b) On or before each Transfer Date, the Servicer shall calculate the
Class B Investor Default Amount. If on any Transfer Date, the Class B Investor
Default Amount for such Transfer Date exceeds the amount of Excess Spread, funds
on deposit in the Yield Enhancement Account and Reallocated Principal
Collections which are allocated and available to fund such amount pursuant to
subsection 5.17(c) and Section 5.18, the Class C Investor Interest (after giving
effect to reductions for any Class C Investor Charge-Offs and any Reallocated
Principal Collections on such Transfer Date and after giving effect to any
adjustments with respect thereto as described in subsection 5.16(a) above) shall
be reduced by the amount of such excess, but not by more than the lesser of the
Class B Investor Default Amount and the Class C Investor Interest (after giving
effect to reductions for any Class C Investor Charge-Offs and any Reallocated
Principal Collections on such Transfer Date and after giving effect to any
adjustments with respect thereto as described in subsection 5.16(a) above) for
such Transfer Date. In the event that such reduction would cause the Class C
Investor Interest to be a negative number, the Class C Investor Interest shall
be reduced to zero and the Class B Investor Interest shall be reduced (but not
below zero) by the amount by which the Class C Investor Interest would have been
reduced below zero, but not by more than the Class B Investor Default Amount for
such Transfer Date (a "Class B Investor Charge-Off"). The Class B Investor
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Interest shall also be reduced (but not below zero) by the amount of Reallocated
Principal Collections in excess of the Class C Investor Interest (after giving
effect to reductions for any Class C Investor Charge-Offs and any Reallocated
Investor Principal Collections on such Transfer Date) allocated thereto pursuant
to Section 5.18 and then by the amount of any portion of the Class B Investor
Interest allocated to the Class A Investor Interest to avoid a reduction in the
Class A Investor Interest pursuant to subsection 5.16(a) above. The Class B
Investor Interest will thereafter be reimbursed (but not to an amount in excess
of the unpaid principal balance of the Class B Notes) on any Transfer Date by
the amount of Excess Spread and funds on deposit in the Yield Enhancement
Account allocated and available for that purpose as described under subsection
5.17(d).
(c) On or before each Transfer Date, the Servicer shall calculate the
Class C Investor Default Amount. If on any Transfer Date, the Class C Investor
Default Amount for such Transfer Date exceeds the amount of Excess Spread and
funds on deposit in the Yield Enhancement Account which are allocated and
available to fund such amount pursuant to subsection 5.17(i), the Class C
Investor Interest shall be reduced by the amount of such excess, but not by more
than the lesser of the Class C Investor Default Amount and the Class C Investor
Interest for such Transfer Date (a "Class C Investor Charge-Off"). The Class C
Investor Interest shall also be reduced (but not below zero) by the amount of
Reallocated Principal Collections allocated thereto pursuant to Section 5.18 and
then by the amount of any portion of the Class C Investor Interest allocated to
the Class A Notes and/or the Class B Notes to avoid a reduction in the Class A
Investor Interest, pursuant to subsection 5.16(a), or the Class B Investor
Interest, pursuant to subsection 5.16(b), respectively. The Class C Investor
Interest shall thereafter deemed to be reimbursed (but not in excess of the
unpaid principal balance of the Class C Notes) on any subsequent Transfer Date
by the amount of the Excess Spread and the funds on deposit in the Yield
Enhancement Account allocated and available for that purpose as described under
subsection 5.17(j).
(d) For purposes of calculating the Investor Default Amount and the
Excess Receivables Amount, the Servicer shall keep records sufficient to track
cumulative losses in respect of Receivables on an Insured-by-Insured basis and
on an insurer-by-insurer basis.
(e) For purposes of calculating the Investor Default Amount the
Servicer shall allocate losses, Recoveries, returned premium, if any, and other
related proceeds between (i) Receivables remaining in the Trust after the
Seller's repurchase of Long-Term Receivables and (ii) Long-Term Receivables in
accordance with Section 9 hereof based on their respective par value at the time
that the related Premium Finance Obligation becomes a Defaulted Obligation.
(f) Except as otherwise expressly provided herein, if losses and
investment expenses attributable to the investment of amounts on deposit in any
Investor Account or any Series Account shall exceed interest and investment
earnings in respect of such amounts during any Monthly Period, the net losses
and expenses shall be allocated between the investor interests of all
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outstanding Series, on the one hand, and the Trust Interest, on the other hand,
in the same proportion that losses in respect of Receivables are so allocated
for such Monthly Period.
SECTION 5.17 Excess Spread and Allocation of funds on deposit in the
Yield Enhancement Account. On or before each Transfer Date, the Trustee acting
pursuant to the Servicer's instructions, shall apply Excess Spread in the
Finance Charge Account and to the extent necessary transfer funds on deposit in
the Yield Enhancement Account (after giving effect to the deposits to be made
therein on such date pursuant to Section 5.20) to the Finance Charge Account
with respect to the related Monthly Period to make the following distributions
on each Transfer Date in the following priority:
(a) an amount equal to the Class A Required Amount, if any, with
respect to such Transfer Date will be used to fund the Class A Required Amount
and be applied in accordance with, and in the priority set forth in, subsection
5.15(a);
(b) an amount equal to the aggregate amount by which the Class A
Investor Interest has been reduced below the Class A Initial Investor Interest
on previous Transfer Dates for reasons other than Decreases and/or the payment
of principal to the Class A Noteholders (but not in excess of the aggregate
amount of such reductions that have not been previously reimbursed) will be
treated as a portion of Investor Principal Collections and deposited into the
Principal Account on such Transfer Date;
(c) [Class A Prior Period Interest]
(d) an amount equal to the Class B Required Amount, if any, with
respect to such Transfer Date will be used to fund the Class B Required Amount
and be applied first in accordance with, and in the priority set forth in,
subsection 5.15(b) and then any remaining amount available to pay the Class B
Investor Default Amount shall be treated as a portion of Investor Principal
Collections and deposited into the Principal Account on such Transfer Date;
(e) an amount equal to the aggregate amount by which the Class B
Investor Interest has been reduced below the Class B Initial Investor Interest
on previous Transfer Dates for reasons other than Decreases and/or the payment
of principal to the Class B Noteholders (but not in excess of the aggregate
amount of such reductions that have not been previously reimbursed) will be
treated as a portion of Investor Principal Collections and deposited into the
Principal Account on such Transfer Date;
(f) [Reserved]
(g) an amount equal to the Class B Prior Period Interest, if any, will
be paid to the Class B Noteholders;
(h) [Reserved]
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(i) an amount equal to the Class C Required Amount, if any, with
respect to such Transfer Date will be used to fund the Class C Required Amount
and be applied first in accordance with, and in the priority set forth in,
subsection 5.15(c) and then any remaining amount available to pay, in order of
priority, the Class C Monthly Interest, the Class C Additional Interest, if any,
and the Class C Deficiency Amount, if any, shall be used to fund such amounts;
(j) an amount equal to the Class C Investor Default Amount, if any, for
the prior Monthly Period will be treated as a portion of Investor Principal
Collections and deposited into the Principal Account on such Transfer Date;
(k) an amount equal to the aggregate amount by which the Class C
Investor Interest has been reduced below the Class C Initial Investor Interest
on previous Transfer Dates for reasons other than Decreases and/or the payment
of principal to the Class C Noteholders (but not in excess of the aggregate
amount of such reductions which have not been previously reimbursed) will be
treated as a portion of Investor Principal Collections and deposited into the
Principal Account on such Transfer Date;
(l) any remaining Excess Spread, after giving effect to the payments
made pursuant to subsections (a) through (j) above, shall be deposited in the
Yield Enhancement Account to the extent necessary to cause the funds therein to
equal the 91 Day Delinquency Amount; and
(m) an amount equal to the Class C Prior Period Interest, if any, will
be paid to the Class C Noteholders;
(n) the balance in the Yield Enhancement Account, if any, in excess of
the 91 Day Delinquency Amount, after giving effect to the payments made pursuant
to subsections (a) through (m) above, shall be paid on such Transfer Date to the
Issuer (but only if a Pay Out Event has not theretofore occurred); provided,
however, that the amount to be paid to the Issuer, pursuant to this subsection
5.17(m) with respect to such date shall be paid only if the Trust Interest as of
the end of the prior Monthly Period (after giving effect to the inclusion in or
removal from the Trust of all Receivables transferred to or from the Trust
and/or any reduction or increase in any outstanding notes since the end of such
prior Monthly Period and on or prior to the following Payment Date and the
application of payments referred to in subsection 5.4(b) of the Base Indenture)
is greater than the largest required Minimum Trust Interest and otherwise shall
be deposited into the Excess Funding Account in accordance with Section 5.11(f).
Funds remaining on deposit in the Yield Enhancement Account under this
subsection 5.17(m) shall be available on the next succeeding Transfer Date for
application, together with any additional amounts required to be deposited
therein on or prior to such Transfer Date as provided elsewhere herein, in
accordance with this Section 5.17.
SECTION 5.18 Reallocated Principal Collections. On or before each
Transfer Date, the Trustee shall withdraw from the Principal Account and apply
Reallocated Principal Collections (applying first all Reallocated Class C
Principal Collections and then all Reallocated Class B Principal Collections, to
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the extent necessary) with respect to such Transfer Date, to make the following
distributions on each Transfer Date in the following priority:
(a) an amount equal to the excess, if any, of (i) the Class A Required
Amount, if any, with respect to such Transfer Date over (ii) the amount of
Excess Spread, together with the amount of funds on deposit in the Yield
Enhancement Account available to cover the Class A Required Amount pursuant to
subsection 5.17(a) on such Transfer Date shall be transferred to the Finance
Charge Account with respect to the related Monthly Period, shall be applied
pursuant to subsections 5.15(a)(i), (ii) and (iii); and
(b) an amount equal to the excess, if any, of (i) the Class B Required
Amount, if any, with respect to such Transfer Date over (ii) the amount of
Excess Spread, together with the amounts of funds on deposit in the Yield
Enhancement Account available to cover the Class B Required Amount pursuant to
subsection 5.17(c) on such Transfer Date shall be transferred to the Finance
Charge Account on such Transfer Date shall be applied first pursuant to
subsections 5.15(b)(i) and (ii) and then pursuant to subsection 5.17(c),
provided that the amount transferred pursuant to this clause (b) shall not
exceed the excess (if any) of (x)the sum of the Class C Investor Interest plus
the Class B investor Interest over (y) the amount described in the clause (a)
above.
(c) On each Transfer Date, the Class C Investor Interest shall be
reduced by the amount of Reallocated Principal Collections for such Transfer
Date. In the event that such reduction would cause the Class C Investor Interest
(after giving effect to any Class C Investor Charge-Offs for such Transfer Date)
to be a negative number, the Class C Investor Interest (after giving effect to
any Class C Investor Charge-Offs for such Transfer Date) shall be reduced to
zero and the Class B Investor Interest shall be reduced (but not below zero)
after giving effect to any Class B Investor Charge-Offs for such Transfer Date
by the amount by which the Class C Investor Interest would have been reduced
below zero.
SECTION 5.19 Shared Principal Collections.
(a) The portion of Shared Principal Collections on deposit in the
Principal Account equal to the amount of Shared Principal Collections allocable
to Series [___] on any Transfer Date shall be treated and applied as an
Available Investor Principal Collection pursuant to Section 5.15 and pursuant to
such Section 5.15 shall be deposited in the Payment Account or distributed to
the Issuer.
(b) Shared Principal Collections allocable to Series [___] with respect
to any Transfer Date means an amount equal to the Series Principal Shortfall, if
any, with respect to Series [___] for such Transfer Date; provided, however,
that if the aggregate amount of Shared Principal Collections for all Series for
such Transfer Date is less than the Cumulative Series Principal Shortfall for
such Transfer Date, then Shared Principal Collections allocable to Series [___]
on such Transfer Date shall equal the product of (i) Shared Principal
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Collections for all Series for such Transfer Date and (ii) a fraction, the
numerator of which is the Series Principal Shortfall with respect to Series
[___] for such Transfer Date and the denominator of which is the aggregate
amount of Cumulative Series Principal Shortfall for all Series for such Transfer
Date.
(c) Solely for the purpose of determining the amount of Available
Investor Principal Collections to be treated as Shared Principal Collections on
any Transfer Date allocable to other Series in Group One, on each Determination
Date, the Servicer shall determine the Class A Required Amount, Class B Required
Amount, the Class C Required Amount, Excess Spread, the Available Yield
Enhancement Amount and Reallocated Principal Collections as of such
Determination Date for the following Transfer Date.
SECTION 5.20 Yield Enhancement Account.
(a) The Servicer shall establish and maintain with a Qualified
Institution in the name of the Trustee, on behalf of the Trust, for the benefit
of the Noteholders, a segregated account (the "Yield Enhancement Account"),
bearing a designation clearly indicating that the funds deposited therein are
held for the benefit of the Noteholders. The Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the Yield
Enhancement Account and in all proceeds thereof. The Yield Enhancement Account
shall be under the sole dominion and control of the Trustee for the benefit of
the Noteholders. If at any time the institution holding the Yield Enhancement
Account ceases to be a Qualified Institution, the Trustee shall notify each
Rating Agency and within 10 Business Days establish a new Yield Enhancement
Account meeting the conditions specified above with a Qualified Institution, and
shall transfer any cash or any investments to such new Yield Enhancement
Account.
(b) On each Transfer Date, an amount equal to the Available Yield
Enhancement Amount shall be deposited by the Trustee into the Yield Enhancement
Account out of Collections otherwise payable to the Issuer, for the Monthly
Period immediately preceding such Transfer Date. Notwithstanding the preceding
sentence or subsection 5.4(c) or the third paragraph of subsection 5.4(a) of the
Base Indenture, if ART is no longer the Seller or if the AIG Support Agreement
is not in effect, then prior to any payment to the Issuer pursuant to
subsections 5.11(a)(v), 5.11(b)(v) or 5.11(d)(iii) there shall be deposited into
the Yield Enhancement Account on each date amounts allocable to the Notes
otherwise payable to the Issuer, until the amount so deposited equals the
Maximum Yield Enhancement Amount for the next Transfer Date. The Trustee, at the
direction of the Servicer, shall make withdrawals from the Yield Enhancement
Account from time to time, in the amounts and for the purposes set forth in
Section 5.17.
(c) Funds remaining on deposit in the Yield Enhancement Account shall
be invested at the direction of the Seller by the Trustee in Permitted
Investments that will mature so that such funds will be available for withdrawal
on or prior to the following Transfer Date. The Trustee shall:
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(i) hold each Permitted Investment (other than such as are
described in clause (c) of the definition thereof) that constitutes
investment property through a securities intermediary, which securities
intermediary shall agree with the Trustee that (I) such investment
property shall at all times be credited to a securities account of the
Trustee, (II) such securities intermediary shall comply with
entitlement orders originated by the Trustee without the further
consent of any other person or entity, (III) all property credited to
such securities account shall be treated as a financial asset, (IV)
such securities intermediary shall waive any lien on, security interest
in, or right of set-off with respect to any property credited to such
securities account, and (V) such agreement shall be governed by the
laws of the State of New York;
(ii) maintain for the benefit of Noteholders possession or
control of each other Permitted Investment (including any negotiable
instruments, if any, evidencing such Permitted Investments) not
described in clause (i) above (other than such as are described in
clause (c) of the definition thereof); and
(iii) cause each Permitted Investment described in clause (c)
of the definition thereof to be registered in the name of the Trustee
or any of its nominees by the issuer thereof;
provided that no Permitted Investment shall be disposed of prior to its maturity
date. Terms used in clause (i) above that are defined in the New York UCC and
not otherwise defined herein shall have the meaning set forth in the New York
UCC.
(d) Except as otherwise provided in subsection 5.17(m) above, on each
Transfer Date, after giving effect to withdrawals from the Yield Enhancement
Account required by subsection 5.20(b), all amounts remaining on deposit in the
Yield Enhancement Account (excluding interest and earnings (net of losses and
investment expenses, which shall reduce the amounts on deposit therein) accrued
on funds on deposit in the Yield Enhancement Account which shall be treated as
Excess Spread and allocated pursuant to Section 5.17), shall be paid to the
Issuer.
SECTION 5.21 Excess Funding Account.
(a) The Servicer has established and maintained and shall continue to
maintain, with a Qualified Institution, in the name of the Trustee, on behalf of
the Trust, for the benefit of the noteholders of all outstanding Series in Group
One, including the Noteholders, a segregated trust account (the "Excess Funding
Account"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of such noteholders. The Trustee shall possess
all right, title and interest in all funds on deposit from time to time in the
Excess Funding Account and in all proceeds thereof. The Excess Funding Account
shall be under the sole dominion and control of the Trustee for the benefit of
the noteholders of all outstanding Series in Group One, including the
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Noteholders. If at any time the institution holding the Excess Funding Account
ceases to be a Qualified Institution, the Trustee shall notify each Rating
Agency and within 10 Business Days establish a new Excess Funding Account
meeting the conditions specified above with a Qualified Institution, and shall
transfer any cash or any investments to such new Excess Funding Account. The
Trustee, at the direction of the Servicer, shall (i) make withdrawals from the
Excess Funding Account from time to time for the purposes set forth in
subsections 5.11(f), and any comparable provision of any other Series Supplement
and (ii) make deposits into the Excess Funding Account as specified in
subsection 5.11(f) and any comparable provision of any other Series Supplement.
(b) Funds on deposit in the Excess Funding Account shall be invested at
the direction of the Seller by the Trustee in Permitted Investments. Funds on
deposit in the Excess Funding Account on any Transfer Date, after giving effect
to any withdrawals from the Excess Funding Account on such Transfer Date, shall
be invested in such investments that will mature so that such funds will be
available for withdrawal on or prior to the following Transfer Date. The Trustee
shall:
(i) hold each Permitted Investment (other than such as are
described in clause (c) of the definition thereof) that constitutes
investment property through a securities intermediary, which securities
intermediary shall agree with the Trustee that (I) such investment
property shall at all times be credited to a securities account of the
Trustee, (II) such securities intermediary shall comply with
entitlement orders originated by the Trustee without the further
consent of any other person or entity, (III) all property credited to
such securities account shall be treated as a financial asset, (IV)
such securities intermediary shall waive any lien on, security interest
in, or right of set-off with respect to any property credited to such
securities account, and (V) such agreement shall be governed by the
laws of the State of New York;
(ii) maintain for the benefit of the noteholders of all
outstanding Series of Group One, including the Noteholders possession
or control of each other Permitted Investment (including any negotiable
instruments, if any, evidencing such Permitted Investments) not
described in clause (i) above (other than such as are described in
clause (c) of the definition thereof); and
(iii) cause each Permitted Investment described in clause (c)
of the definition thereof to be registered in the name of the Trustee
or any of its nominees by the issuer thereof; provided that no
Permitted Investment shall be disposed of prior to its maturity date.
Terms used in clause (i) above that are defined in the New York UCC and
not otherwise defined herein shall have the meaning set forth in the
New York UCC.
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(c) All interest and earnings (net of losses and investment
expenses) accrued on funds on deposit in the Excess Funding Account to
the extent allocable to this Series shall be treated as Excess Spread
and allocated pursuant to Section 5.17.
SECTION 5.22 Determination of LIBOR.
(a) On each LIBOR Determination Date, the Trustee shall determine LIBOR
on the basis of the rate for Dollar deposits for a period equal to one month
(commencing on the first day of the applicable Interest Period) which appears on
Telerate Page 3750 as of 11:00 A.M. (London time) on such LIBOR Determination
Date (or such other page as may replace that page on the Dow Jones Telerate
Service for the purpose of displaying London interbank offered rates of major
banks).
(b) If on any LIBOR Determination Date such rate does not appear on
Telerate Page 3750 (or such other page), then LIBOR for the applicable Interest
Period shall be determined on the basis of the rates at which Dollar deposits
are offered by the Reference Banks at approximately 11:00 A.M. (London time) on
such LIBOR Determination Date to prime banks in the London interbank market for
a period equal to one month (commencing on the first day of such Interest
Period). The Trustee shall request the principal London office of each of the
Reference Banks to provide a quotation of its rate. If at least two such
quotations are provided, the rate for such Interest Period shall be the
arithmetic mean of such quotations (rounded, if necessary, to the nearest whole
multiple of 0.0625%). If on the LIBOR Determination Date only one or none of the
Reference Banks provides such offered quotations, LIBOR shall be:
(i) the rate per annum (rounded, as aforesaid) that the
Trustee determines to be the arithmetic mean of the offered quotations
that leading banks in the City of New York selected by the Servicer are
quoting at or about 11:00 A.M. (New York time) on such LIBOR
Determination Date to leading European banks for Dollar deposits for a
period equal to one month (commencing on the first day of the
applicable Interest Period); or
(ii) if the banks selected as aforesaid by the Servicer are
not quoting as described in clause (i) above, LIBOR for such Interest
Period will be LIBOR as determined on the previous LIBOR Determination
Date, (or, in the case of the first LIBOR Determination Date, 5.40375%
per annum).
(c) The Class A Note Rate, the Class B Note Rate and the Class C Note
Rate applicable to the then current and the immediately preceding Interest
Periods may be obtained by any Noteholder by telephoning the Trustee at its
Corporate Trust Office at (800) 524-9472 or (312) 407-4660.
(d) On each LIBOR Determination Date prior to 12:00 noon (New York
time), the Trustee shall send to the Servicer, by facsimile, notification of
LIBOR for the following Interest Period.
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SECTION 5.23 Effect of Other Series.
Notwithstanding anything to the contrary contained herein, in the event
that additional Series of notes are issued from time to time in accordance with
Section 2.2, the Excess Funding Account may be retitled in order to reflect the
fact that amounts on deposit therein shall be for the additional benefit of the
holders of such other Series and the amounts to be deposited therein and
withdrawn therefrom may be calculated with reference to such other Series;
provided that no such action or calculation shall adversely affect the interests
of the Noteholders in any material respect.
SECTION 5.24 Seller's or Servicer's Failure to Make a Deposit or
Payment. If the Servicer or the Seller fails to make, or give instructions to
make, any payment, deposit or withdrawal (other than as required by subsections
2.04(d), 2.04(e) and 2.04(f) of the Sale and Servicing Agreement and subsection
12.4(a) and Section 12.1) required to be made or given by the Servicer or
Seller, respectively, at the time specified in the Base Indenture or this Series
Supplement (including applicable grace periods), the Trustee shall make such
payment, deposit or withdrawal from the applicable account without instruction
from the Servicer or Seller. The Trustee shall be required to make any such
payment, deposit or withdrawal hereunder only to the extent that the Trustee has
sufficient information to allow it to determine the amount thereof; provided,
however, that the Trustee shall in all cases be deemed to have sufficient
information to determine the amount of interest payable to the Noteholders on
each Payment Date. The Servicer shall, upon request of the Trustee, promptly
provide the Trustee with all information necessary to allow the Trustee to make
such payment, deposit or withdrawal. Such funds or the proceeds of such
withdrawal shall be applied by the Trustee in the manner in which such payment
or deposit should have been made by the Seller or the Servicer, as the case may
be.
SECTION 5.25 Excess Receivables.
On any date of determination, the Minimum Trust Interest shall be
calculated by adding the Excess Receivables Amount to the amount derived
pursuant to clause (a) of the definition of Minimum Trust Interest unless (i)
prior to such date there shall have been delivered to the Trustee (a) a written
agreement, in form and substance satisfactory to the Rating Agencies, executed
by a Person having a long-term unsecured debt rating of AAA from Standard &
Poor's and Aaa from Moody's pursuant to which such Person shall have
unconditionally agreed to indemnify the Trust for all losses in respect of the
Excess Receivables Amount at any time and (b) written confirmation from each of
the Rating Agencies to the effect that such substitution will not result in such
Rating Agency reducing or withdrawing its rating on any then outstanding Class
of notes of any Series and (ii) the agreement and the rating referred to in
clause (a) above remain in effect on such date of determination and such
agreement provides that it shall continue in effect through at least the end of
the first full Monthly Period following such date of determination. There shall
be deducted from the Excess Receivables Amount, Underlying Receivables in
respect of which an agreement described in this Section 5.25 has been delivered
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to the Trustee for the AIR Trust, but only to the extent that such Underlying
Receivables would have been included in the Excess Receivables Amount but for
this sentence.
SECTION 5.26 Payment of Facility Fees.
If on any Payment Date (a) any Class of Notes is not allocated any
Collections because its investor interest is zero and (b) the related
Noteholders are owed Facility Fees on the amount of Notes that the related CP
Conduits have committed to purchase but have not been able to purchase, then
such Facility Fees shall be paid from amounts otherwise payable to the Issuer.
SECTION 8. Article 6 of the Base Indenture. Article 6 of the Base
Indenture shall read in its entirety as follows and shall be applicable only to
the Noteholders:
ARTICLE 6
DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS
SECTION 6.1 Distributions.
(a) On each Payment Date, the Trustee shall distribute (in accordance
with the Monthly Servicer Report delivered on or before the related Transfer
Date by the Servicer to the Trustee pursuant to subsection 3.04(b) of the Sale
and Servicing Agreement) to each Class A Noteholder of record on the immediately
preceding Record Date (other than as provided in Section 12.5 respecting a final
distribution) such Noteholder's pro rata share (based on the aggregate Investor
Interests represented by Class A Notes held by such Noteholder) of amounts on
deposit in the Payment Account as are payable to the Class A Noteholders
pursuant to Section 5.15 by wire transfer to an account designated by the
Holders of the Class A Notes, except that with respect to Class A Notes
registered in the name of the nominee of a Clearing Agency, such distribution
shall be made in immediately available funds.
(b) On each Payment Date, the Trustee shall distribute (in accordance
with the Monthly Servicer Report delivered on or before the related Transfer
Date by the Servicer to the Trustee pursuant to subsection 3.04(b) of the Sale
and Servicing Agreement) to each Class B Noteholder of record on the immediately
preceding Record Date (other than as provided in Section 12.5 respecting a final
distribution) such Noteholder's pro rata share (based on the aggregate Investor
Interests represented by Class B Notes held by such Noteholder) of amounts on
deposit in the Payment Account as are payable to the Class B Noteholders
pursuant to Section 5.15 by check mailed to each Class B Noteholder (at such
Noteholder's address as it appears in the Note Register) or by wire transfer to
an account designated by the Holders of the Class B Notes, except that with
respect to Class B Notes registered in the name of the nominee of a Clearing
Agency, such distribution shall be made in immediately available funds.
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(c) On each Payment Date, the Trustee shall distribute (in accordance
with the Monthly Servicer Report delivered by the Servicer to the Trustee
pursuant to subsection 3.04(b) of the Sale and Servicing Agreement) to each
Class C Noteholder of record on the immediately preceding Record Date (other
than as provided in Section 12.5 respecting a final distribution) such
Noteholder's pro rata share (based on the aggregate Investor Interests
represented by Class C Notes held by such Noteholder) of amounts on deposit in
the Payment Account as are payable to the Class C Noteholders pursuant to
Section 5.15 by check mailed to each Class C Noteholder (at such Noteholder's
address as it appears in the Note Register).
(d) Notwithstanding anything to the contrary contained in the Base
Indenture or this Series Supplement, if the amount distributable in respect of
principal on any Class of Notes on any Payment Date is less than one dollar,
then no such distribution of principal need be made on such Payment Date.
SECTION 6.2 Monthly Noteholders' Statement.
(a) On or before each Payment Date, the Trustee shall forward to each
Noteholder, with respect to each Noteholder's interest and to each Rating Agency
a statement substantially in the form of Exhibit E to this Series Supplement
prepared by the Servicer and delivered to the Trustee on the preceding
Determination Date and setting forth, among other things, the following
information (which, in the case of subclauses (i), (ii) and (iii) below, shall
be stated on the basis of an original principal amount of $1,000 per Note and,
in the case of subclauses (ix), (x) and (xi) shall be stated on an aggregate
basis and on the basis of an original principal amount of $1,000 per Note):
(i) the total amount distributed to holders of Notes;
(ii) the amount of such distribution allocable to Class A
Monthly Principal, Class B Monthly Principal and Class C Monthly
Principal, respectively;
(iii) the amount of such distribution allocable to Class A
Monthly Interest, Class A Deficiency Amounts, Class A Additional
Interest, Class B Monthly Interest, Class B Deficiency Amounts, Class B
Additional Interest, Class C Monthly Interest, Class C Deficiency
Amounts and Class C Additional Interest, respectively;
(iv) the amount of Collections of Principal Receivables
received during the related Monthly Period and allocated in respect of
the Class A Notes, Class B Notes and Class C Notes, respectively;
(v) the amount of Collections of Finance Charge Receivables
received during the related Monthly Period and allocated in respect of
the Class A Notes, Class B Notes and Class C Notes, respectively;
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(vi) the aggregate amount of Principal Receivables, the
Investor Interest, the Class A Investor Interest, the Class B Investor
Interest, the Class C Investor Interest, the Floating Investor
Percentage, the Class A Floating Allocation, the Class B Floating
Allocation, the Class C Floating Allocation and the Fixed Investor
Percentage with respect to the Principal Receivables in the Trust as of
the end of the preceding Monthly Period;
(vii) the aggregate outstanding balance of Receivables which
were 1-30 days, 31-60 days, 61-90 days, 91-120 days, 121-150 days and
more than 150 days delinquent, respectively, following cancellation of
the related insurance policies in accordance with the Servicer's then
existing Guidelines as of the end of the preceding Monthly Period (or,
if cancellation was delayed, whether due to a stay by reason of an
Insured's bankruptcy or other reason, after the date the policy would
have been cancelled in the absence of such delay);
(viii) the Aggregate Investor Default Amount as of the end of
the preceding Monthly Period and the Class A Investor Default Amount,
the Class B Investor Default Amount and the Class C Investor Default
Amount for the related Transfer Date;
(ix) the aggregate amount of Class A Investor Charge-Offs,
Class B Investor Charge-Offs, Class C Investor Charge-Offs and other
reductions in the absence of principal distributions in the Investor
Interests for such Transfer Date;
(x) the aggregate amount of Class A Investor Charge-Offs,
Class B Investor Charge-Offs, Class C Investor Charge-Offs and other
reductions in the absence of principal distributions in the Investor
Interests deemed to have been reimbursed on such Transfer Date;
(xi) outstanding principal balance of the Class A Notes, the
Class B Notes and the Class C Notes, respectively, as of the end of the
day on the Payment Date;
(xii) [Reserved]
(xiii) the amount of the Class A Servicing Fee, the Class B
Servicing Fee and the Class C Servicing Fee for such Transfer Date;
(xiv) the amount of Reallocated Class C Principal Collections
and Reallocated Class B Principal Collections with respect to such
Payment Date;
(xv) LIBOR for the Interest Period ending on the day before
such Payment Date;
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(xvi) the Pool Factor as of the end of the immediately
preceding Monthly Period;
(xvii) the Available Yield Enhancement Amount, the 91 Day
Delinquency Amount and the amount, if any, of funds required to be
withdrawn from the Yield Enhancement Account for such Transfer Date;
(xviii) the amount of Class A Available Funds, Class B
Available Funds and Class C Available Funds on deposit in the Finance
Charge Account on the related Transfer Date;
(xix) the date on which the Class A Controlled Amortization
Period, the Class B Controlled Amortization Period, the Class C
Controlled Amortization Period and/or the Rapid Amortization Period
commenced;
(xx) [Reserved]
(xxi) the amount of Class A Prior Period Interest Class B
Prior Period Interest and Class C Prior Period Interest accrued on the
Notes;
(xxii) the aggregate outstanding principal amount of Deferred
Payment Obligations as of the end of the prior Monthly Period,
expressed in dollars and as a percentage of the outstanding principal
amount of Receivables in the Trust Estate;
(xxiii) the aggregate outstanding principal amount of
Receivables that have not been funded as of the end of the prior
Monthly Period;
(xxiv) the balance of the Transferor Certificate; and
(xxv) such other items as are set forth in Exhibit F to this
Series Supplement.
(b) Annual Noteholders' Tax Statement. On or before January 31 of each
calendar year, beginning with calendar year 2000, the Trustee shall distribute
to each Person who at any time during the preceding calendar year was a
Noteholder, a statement prepared by the Trustee containing the information
required to be contained in the regular monthly report to Noteholders, as set
forth in subclauses (i), (ii) and (iii) above, aggregated for such calendar year
or the applicable portion thereof during which such Person was a Noteholder,
together with such other customary information (consistent with the treatment of
the Notes as debt) as the Trustee deems necessary or desirable to enable the
Noteholders to prepare their tax returns. Such obligations of the Trustee shall
be deemed to have been satisfied to the extent that substantially comparable
information shall be provided by the Trustee pursuant to any requirements of the
Code as from time to time in effect.
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SECTION 9. Series [___] Pay Out Events. If any one of the following
events (a "Series [___] Pay Out Event") shall occur with respect to the Notes:
(a) failure on the part of any of the Originators, the Issuer or the
Seller to make any payment or deposit required by the terms of the Receivables
Purchase Agreement, the Transferor Certificate Purchase Agreement, the Sale and
Servicing Agreement, the Base Indenture or this Series Supplement, on or before
the date occurring five Business Days after the date such payment or deposit is
required to be made herein or (ii) failure on the part of any of the
Originators, the Issuer or the Seller duly to observe or perform in any material
respect any other covenants or agreements of such entity set forth in the
Receivables Purchase Agreement, the Transferor Certificate Purchase Agreement,
the Sale and Servicing Agreement, the Base Indenture or this Series Supplement,
which failure has a material adverse effect on the Noteholders (which
determination shall be made without reference to whether any funds are available
in the Yield Enhancement Account or by reason of the subordination of any Class
of Notes) and continues unremedied for a period of 60 days after the date on
which written notice of such failure, requiring the same to be remedied, shall
have been given to such entity by the Trustee, or to such entity and the Trustee
by the Holders of Notes evidencing in the aggregate not less than 50% of the
Investor Interests of this Series [___], and continues to affect materially and
adversely the interests of the Noteholders (which determination shall be made
without reference to whether any funds are available in the Yield Enhancement
Account or by reason of the subordination of any Class of Notes) for such
period;
(b) any representation or warranty made by any of the Originators, the
Issuer or the Seller in the Receivables Purchase Agreement, the Transferor
Certificate Purchase Agreement, the Sale and Servicing Agreement, the Base
Indenture or this Series Supplement, or any information contained in a computer
file or microfiche list required to be delivered by such entity pursuant to
Section 2.01 or 2.06 of the Sale and Servicing Agreement (i) shall prove to have
been incorrect in any material respect when made or when delivered, which
continues to be incorrect in any material respect for a period of 60 days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to such entity by the Trustee, or to such entity
and the Trustee by the Holders of Notes evidencing in the aggregate not less
than 50% of the Investor Interests of this Series [___], and (ii) as a result of
which the interests of the Noteholders are materially and adversely affected
(which determination shall be made without reference to whether any funds are
available in the Yield Enhancement Account or by reason of the subordination of
any Class of Notes) and continue to be materially and adversely affected (which
determination shall be made without reference to whether any funds are available
in the Yield Enhancement Account or by reason of the subordination of any Class
of Notes) for such period; provided, however, that a Series [___] Pay Out Event
pursuant to this subsection 9(b) shall not be deemed to have occurred hereunder
if the Seller has accepted reassignment of or paid its portion of principal due
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under the related Receivable, or all of such Receivables, if applicable, during
such period in accordance with the provisions of subsections 2.04(e) or 2.04(f)
of the Sale and Servicing Agreement;
(c) the Trust Interest as of the end of the prior Monthly Period
(adjusted to give effect to the inclusion in or removal from the Trust of all
Receivables transferred to or from the Trust and/or any reduction or increase in
any outstanding notes since the end of such prior Monthly Period and on or prior
to the following Payment Date) does not at least equal the largest required
Minimum Trust Interest of any outstanding Series (adjusted to give effect to any
reduction or increase in any outstanding notes on or prior to the following
Payment Date);
(d) any Servicer Default occurs which would have a material adverse
effect on the Noteholders (which determination shall be made without reference
to whether any funds are available in the Yield Enhancement Account or by reason
of the subordination of the Class B or C Notes);
(e) if the Monthly Payment Rate is less than 6% for three consecutive
Monthly Periods;
(f) if the Financed Premium Percentage exceeds 90% for three
consecutive Monthly Periods;
(g) if the Annualized Monthly Excess Spread Amount is less than 4% for
three consecutive Monthly Periods;
(h) if the Unconcentrated 240+ Day Delinquency Percentage is more than
6% for three consecutive Monthly Periods;
(i) upon an Event of Default;
(j) the Notes have not been paid in full on the Expected Final Payment
Date;
(k) a Pay Out Event occurs under the first Series of term Notes issued
by the Trust, provided that such term Notes are issued within 12 months after
the Closing Date;
(l) an Insolvency Event occurs with respect to AIG;
(m) the Trustee shall fail to have a valid first priority perfected
interest in any portion of the Trust Assets, which has a material adverse effect
on the interests of the Noteholders, and the Issuer shall fail to repurchase
such affected portion of the Trust Assets within one Business Day's notice of
such failure;
(n) an Insolvency Event occurs with respect to any of the Originators,
the Servicer or the Seller;
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(o) the Seller shall become unable for any reason to transfer the
Collections on, or other proceeds of, Originator Receivables to the Issuer in
accordance with the provisions of this Agreement;
(p) the Issuer or the Seller shall have become an "investment company"
required to register or shall have become under the "control" of an "investment
company" required to register under the Investment Company Act of 1940, as
amended; and
(q) AIG shall fail to meet its obligations under the AIG Support
Agreement;
then, in the case of any event described in subsection 9(a), (b), (d) or (m)
hereof, after the applicable grace period set forth in such subsections, a
Series [___] Pay Out Event shall occur on the tenth Business Day thereafter
unless prior to such day Holders of Notes evidencing in the aggregate not less
than 50% of the Investor Interests of this Series [___] shall notify the
Trustee, the Seller and the Servicer in writing that a Series [___] Pay Out
Event should not occur, and in the case of any event described in subsection
9(c), (d), (e), (f), (g), (h), (i), (j), (k), (l), (n), (o), (p) or (q) hereof,
a Series [___] Pay Out Event shall occur without any notice or other action on
the part of the Trustee or the Noteholders immediately upon the occurrence of
such event.
Notwithstanding anything to the contrary in the Base Indenture, no
Series [___] Pay Out Event may be amended, waived or deleted and no new Series
[___] Series Pay Out Event may be added, without the prior consent of the Holder
of a Note Majority of this Series.
Notwithstanding anything to the contrary contained in the Sale and
Servicing Agreement, the Base Indenture or this Series Supplement, upon the
occurrence of a Pay Out Event, if more than 10% of the principal balance of the
Receivables have a remaining term of more than 12 months, the Seller shall,
subject to the requirements of the following sentence, make a payment to the
Trust (i) to purchase from the Trust a sufficient amount of the portion of such
Receivables (with respect to Originator Receivables) and/or (ii) in a sufficient
amount in respect of the portion of such Receivables (with respect to Underlying
Receivables), in each case, that represents all amounts to be paid by the
related Insured after 12 months from the occurrence of such Pay Out Event (the
"Long-Term Receivables") at a price equal to par plus interest accrued to the
time of purchase, such that the percentage of Receivables (the portions of which
have not been purchased or for which a payment has not been made pursuant to
this paragraph) having a remaining term as of the date of purchase of more than
12 months shall be no more than 10% of the principal balance of Receivables
after giving effect to such purchase or payment. If so required to purchase or
make a payment in respect of Long-Term Receivables, the Seller shall select for
purchase or payment, from the group of Long-Term Receivables in the following
priority: Long-Term Receivables relating to (a) Defaulted Premium Finance
Obligations, (b) Premium Finance Obligations which are delinquent in the
priority of the most delinquent Premium Finance Obligations first and (c) any
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other Premium Finance Obligations; provided, however, that if it is not
necessary to purchase or make a payment in respect of all Long-Term Receivables
with respect to any of clauses (a), (b), and (c) above in order for less than
10% of the principal balance of Receivables to have a remaining maturity of less
than 12 months after giving effect to such purchase or payment, (x) larger
Long-Term Receivables will be selected for purchase or payment before smaller
Long-Term Receivables, and (y) Receivables will be selected for repurchase or
payment in a manner that is not adverse to the interests of the Holders of the
Notes. The proceeds of such purchase or payment shall be treated as Collections
of Principal Receivables and Finance Charge Receivables in respect of the
related Receivables.
SECTION 10. Series [___] Termination. Except as otherwise provided in
subsection 12.5(b), the right of the Noteholders to receive payments from the
Trust will terminate on the first Business Day following the Series [___]
Termination Date.
SECTION 11. [Reserved].
SECTION 12. [Reserved].
SECTION 13. Counterparts. This Series Supplement may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all of such counterparts shall together constitute but one and the
same instrument.
SECTION 14. Governing Law. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. EACH OF THE
PARTIES TO THIS SERIES SUPPLEMENT AND EACH NOTEHOLDER HEREBY AGREES TO THE
JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK AND ANY APPELLATE COURT HAVING JURISDICTION TO REVIEW THE JUDGMENTS
THEREOF. EACH OF THE PARTIES AND EACH NOTEHOLDER HEREBY WAIVES ANY OBJECTION
BASED ON FORUM NON CONVENIENS AND ANY OBJECTION TO VENUE OF ANY ACTION
INSTITUTED HEREUNDER IN ANY OF THE AFOREMENTIONED COURTS AND CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH
COURT.
SECTION 15. Waiver of Trial by Jury. To the extent permitted by
applicable law, each of the parties hereto and each of the Noteholders
irrevocably waives all right of trial by jury in any action, proceeding or
counterclaim arising out of or in connection with this Series Supplement or the
Related Documents or any matter arising hereunder or thereunder.
SECTION 16. No Petition The Issuer and the Trustee, by entering into
this Series Supplement and each Noteholder, by accepting a Note hereby covenant
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and agree that they will not at any time institute against the Trust, or join in
any institution against the Trust of, any bankruptcy proceedings under any
United States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Noteholders, the Sale and Servicing Agreement, the
Base Indenture or this Series Supplement.
IN WITNESS WHEREOF, the parties hereto have caused this Supplement to
be duly executed by their respective officers as of the day and year first above
written.
AIG CREDIT PREMIUM FINANCE MASTER TRUST, as
Issuer
By: CHASE MANHATTAN BANK DELAWARE, not
in its individual capacity but
solely as Owner Trustee
By:
----------------------------------------
Name:
Title:
BANK ONE, NATIONAL ASSOCIATION, as Trustee
By:
----------------------------------------
Name:
Title:
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