Interest Rate Caps. (a) On or prior to the Closing Date, ------------------ the Transferor shall enter into the Class A Interest Rate Cap for the benefit of the Class A Certificateholders and the Class B Interest Rate Cap for the benefit of the Class B Certificateholders. Except as provided below, each of the Class A Interest Rate Cap and the Class B Interest Rate Cap provides that it will terminate on the earlier of the day the outstanding principal balance of the Class A Certificates or the Class B Certificates, as applicable, is reduced to zero and the day following the Stated Series Termination Date. The Transferor does hereby transfer, assign, set-over, and otherwise convey to the Trustee for the benefit of the Class A Certificateholders and the Class B Certificateholders, without recourse, all of its rights under the Class A Interest Rate Cap and the Class B Interest Rate Cap, respectively, and all proceeds thereof. Such property shall constitute Trust Property for all purposes of the Agreement. The foregoing transfer, assignment, set-over and conveyance does not constitute and is not intended to result in a creation or an assumption by the Trust, the Trustee or any Certificateholder of any obligation of the Transferor or any other Person in connection with the Interest Rate Caps or under any agreement or instrument relating thereto. In connection with such transfer, the Transferor agrees to record and file, at its own expense, financing statements (and continuation statements with respect to such financing statements when applicable) with respect to the Interest Rate Caps for the transfer of general intangibles (as defined in the UCC in effect in the Relevant UCC State) meeting the requirements of applicable state law in such manner and in such jurisdictions as are necessary to perfect the foregoing transfer and assignment by the Transferor to the Trustee, and to deliver a file-stamped copy of such financing statements or other evidence of such filings to the Trustee on or prior to the Closing Date. In connection with such transfer, the Transferor agrees to deliver to the Trustee on or prior to the Closing Date an executed copy of each of the Interest Rate Caps. The Transferor hereby grants to the Trustee a security interest in all of the Transferor's rights under the Interest Rate Caps in order to secure the payment of the Class A Certificates and Class B Certificates. This Agreement shall constitute a security agreement under applicable law. The Trustee hereby acknow...
Interest Rate Caps. (a) Either (i) to the extent required by the first sentence of Section 4.02(e)(7), to purchase, deliver to Agent and maintain the Initial Advance Interest Rate Cap or (ii) if the Initial Interest Rate Cap is not required to be purchased, to purchase, deliver to Agent and maintain an interest rate cap (a “Future Advance Interest Rate Cap”) if the LIBOR Rate equals or exceeds, at any time during the applicable six (6) month period (the “Period”) set forth on Schedule 2 hereto, the “trigger rate” for such period set forth on said Schedule 2, which Future Advance Interest Rate Cap shall be in form and substance reasonably acceptable to Agent, shall be with a counterparty reasonably acceptable to Agent, shall cap the LIBOR Rate at the applicable rate set forth on said Schedule 2, and shall have a term of the Period or the balance thereof remaining. At any time that Borrower shall be required to deliver to Agent a Future Advance Interest Rate Cap, Borrower shall also deliver to Agent (1) an Assignment of Interest Rate Cap with respect thereto, (2) a consent by the counterparty thereto to such Assignment of Interest Rate Cap and (3) an opinion, in form and substance, and from counsel, reasonably acceptable to Agent, as to the due authorization, execution and delivery by Borrower and enforceability of, and other customary matters with respect to, the Future Advance Interest Rate Cap and such Assignment of Interest Rate Cap (but not as to any matter with respect to such counterparty (other than the enforceability of such Future Advance Interest Rate Cap against such counterparty)). If Borrower purchases any other interest rate caps, any interest rate management contracts or any “hedge agreements”, Borrower shall make the deliveries referred to in clauses (1), (2) and (3) of the preceding sentence with respect thereto. Notwithstanding anything to the contrary in this Section 7.20, Borrower shall have the right, subject to Agent’s prior reasonable consent to increase the “trigger rates” set forth on said Schedule 2.
Interest Rate Caps. (a) The Borrower hereby covenants and agrees that in the event the LIBOR Rate is greater than [*] at any time, it shall, within two Business Days, obtain and deliver to the Administrative/Collateral Agent one or more Interest Rate Caps from qualified Cap Providers in favor of the Administrative/Collateral Agent for the benefit of the Secured Parties having, singly or in the aggregate, an Aggregate Interest Rate Caps Notional Amount not less than the Required Interest Rate Caps Notional Amount, which (1) each shall have a notional principal amount equal to or greater than $5,000,000, (2) may provide for reductions of the Aggregate Interest Rate Caps Notional Amount on each Distribution Date on an amortization schedule for such Aggregate Interest Rate Caps Notional Amount assuming a 0.0 ABS prepayment speed (or such other ABS prepayment speed as may be approved in writing by the Required Lenders and the Rating Agencies) and zero losses, and (3) shall have other terms and conditions and be represented by Cap Agreements otherwise acceptable to the Required Lenders and the Rating Agencies. The Borrower agrees that each Interest Rate Cap shall provide for payments to the Administrative/Collateral Agent and that such payments shall be deposited into the Collection Account. [**CONFIDENTIAL TREATMENT HAS BEEN REQUESTED FOR CERTAIN PORTIONS OF THIS DOCUMENT]
(b) On any Servicer Report Date on which the Minimum Liquidity Amount Test has not been satisfied, the Borrower shall be required to deposit an amount equal to the Cap Funding Reserve Account Requirement into the Cap Funding Reserve Account on such Servicer Report Date; provided, however, that if the Minimum Liquidity Amount Test is subsequently satisfied for any three consecutive Servicer Report Dates following the Servicer Report Date on which the Minimum Liquidity Amount Test failed to be satisfied, all funds then on deposit in the Cap Funding Reserve Account shall be released to the Borrower on the third such Servicer Report Date; provided further, that if the Cap Funding Reserve Account Requirement shall increase on any applicable Servicer Report Date as a result of an increase in the estimated cost of purchasing Interest Rate Caps from qualified Cap Providers, the Borrower shall be required to deposit an amount equal to such additional cost into the Cap Funding Reserve Account on such Servicer Report Date; provided further, that if the Cap Funding Reserve Account Requirement shall decrease on any applicabl...
Interest Rate Caps. The buyer of an interest rate cap pays the seller a premium in return for the right to receive the difference in the interest cost on some notional principal amount any time a specified index of market interest rates rises above a stipulated “cap rate.” The buyer bears no obligation or liability if interest rates fall below the cap rate, however. Thus, a cap resembles an option in that it represents a right rather than an obligation to the buyer. Caps evolved from interest rate guarantees that fixed a maximum level of interest payable on floating-rate loans. The advent of trading in over-the- counter interest rate caps dates back to 1985, when banks began to strip such guarantees from floating-rate notes to sell to the market (Xxxxx 1992). The leveraged buyout boom of the 1980s spurred the evolution of the market for interest rate caps. Firms engaged in leveraged buyouts typically took on large quantities of short-term debt, which made them vulnerable to financial distress in the event of a rise in interest rates. As a result, lenders began requiring such borrowers to buy interest rate caps to reduce the risk of financial distress (Xxxxxxxxx et al. 1991). More recently, trading activity in interest rate caps has declined as the number of new leveraged buyouts has fallen. Figure 3 shows that the total notional principal amount of caps, floors, and collars outstanding at the end of 1991 actually fell to $311 billion from $360 billion at the end of 400 Billions of Dollars 300 200 100 Year-End 1991 Source: Market Survey Highlights, Year End 1991, International Swap Dealers Association, Inc. 1990 (floors and collars are discussed below). An interest rate cap is characterized by: – a notional principal amount upon which interest payments are based; – an interest rate index, typically some specified maturity of LIBOR; – a cap rate, which is equivalent to a strike or exercise price on an option; and – the period of the agreement, including payment dates and interest rate reset dates. Payment schedules for interest rate caps follow conventions in the interest rate swap market. Payment amounts are determined by the value of the index rate on a series of interest rate reset dates. Intervals between interest rate reset dates and scheduled payment dates typically coincide with the term of the interest rate index. Thus, interest rate reset dates for a cap indexed to six- month LIBOR would occur every six months with payments due six months rc Interest Rate later. Cap bu...
Interest Rate Caps. (a) The Transferor shall obtain Interest Rate Caps in favor of the Trustee for the benefit of the Trust with aggregate Notional Amounts at any time at least equal to the then-outstanding Invested Amount. Each Interest Rate Cap shall provide that (i) the Trust shall not be
Interest Rate Caps. The Borrowers will maintain, with respect to any Eligible Security which bears a fixed rate of interest, at all times on and after the date such Eligible Security is included in the determination of the Revolving Borrowing Base hereunder, LIBOR interest rate cap agreements (a) between a Borrower and any bank or other financial institution whose long-term rating is at least A+ from S&P and A1 from Moody's and whose short-term unsecured debt obligation rating is at least A-1/P-1 by S&P and Moody's, respectively, and is listed on Schedule III hereto, (b) with an initial aggregate notional principal amount not less than the outstanding principal balance at such time and with an amortization schedule setting forth an amount for each month not less than the product of the original face amount of such Eligible Security and the Maximum Advance Percentage for such Eligible Security and such month, (c) with respect to which the Lender Collateral Agent has received an Interest Rate Hedge Assignment Acknowledgment, (d) which is either (I) substantially in the form of Exhibit H or (II) otherwise in form and substance reasonably acceptable to the Required Lenders and the Rating Agency, (e) with a cap strike price equal to or less than the fixed interest rate applicable to such Eligible Security minus the sum of 2.25% and, if such Eligible Security is not rated at least "BBB" or better by S&P and "Baa2" or better by Moody's, the Usage Fee Rate (as defined in the Supplemental Fee Letters) and (f) a copy of which has been delivered to the Administrative Agent, the Agents and the Lender Collateral Agent (each, an "Interest Rate Cap"). The Borrowers shall not, without the prior written consent of the Required Lenders, (i) sell, assign (by operation of law or otherwise), convey, transfer, deliver or otherwise dispose of, any of its rights under the Interest Rate Caps, or create or permit to exist any lien, security interest, option or other charge or encumbrance upon or with respect to any its rights under the Interest Rate Caps, except for the assignment to the Lender Collateral Agent; (ii) cancel or terminate the Interest Rate Cap or consent to or accept any cancellation or termination thereof; (iii) amend, supplement or otherwise modify the Interest Rate Cap or give any consent, waiver or approval thereunder; (iv) waive any default under or breach of the Interest Rate Cap; or (v) take any other action in connection with the Interest Rate Cap which would impair the value of...
Interest Rate Caps. If the long-term unsecured credit rating of any Interest Rate Cap Provider falls below "A2" from Moody's or "A" from S&P, the Transferor shall obtain a substitute Interest Rate Cap from an Eligible Interest Rate Cap Providex xxxxxn ten Business Days of such decline in credit rate unless such Interest Rate Cap Provider provides some form of collateral for its obligations under its Interest Rate Cap acceptable to the Funding Agent. The Transferor will not permit any Interest Rate Cap to be terminated or transferred in whole or in part unless (i) a replacement Interest Rate Cap therefor has been provided as described in the immediately preceding sentence or (ii) with the prior written consent of the Funding Agent, the Transferor terminates such Interest Rate Cap in part and, after giving effect to such partial termination, the notional amount of such Interest Rate Cap equals or exceeds the Aggregate Receivables Balance and, on each Settlement Date thereafter, will be at least equal to the projected Aggregate Receivables Balance as of the related Accounting Date (assuming all remaining Scheduled Payments are made as required and no Prepayments are made).
Interest Rate Caps. The Funding Agent hereby agrees to provide prior written notice of any proposed amendment or termination of any Interest Rate Cap to the Rating Agencies and not to consent to any such amendment or termination without having received confirmation from the Rating Agencies that such amendment or termination will not result in a downgrade or withdrawal of each Rating Agency's then current rating of the Commercial Paper or any other debt securities rated at the request of PARCO. The Interest Rate Cap may not be assigned to another Interest Rate Cap Provider unless that Interest Rate Cap Provider is an Eligible Interest Rate Cap Provider and the Funding Agent has provided prior written notice to the Rating Agencies of such assignment.
Interest Rate Caps. Within ninety (90) days of the Closing Date, ------------------ Borrowers shall enter into interest swap agreements with any Lender (unless Borrowers are able to obtain a better rate from a financial institution which is not a Lender) pursuant to which Borrowers cap the interest rate on LIBOR Based Rate Loans at 8.5% on not less than Twenty Million Dollars ($20,000,000) of Loans outstanding at any time under the Revolving Credit Facility for two years from the date such agreements are entered into by Borrowers, such agreements to be acceptable to Lenders.
Interest Rate Caps. The Transferor will obtain and at all times prior to a date (the "Cap Termination Date") which is twenty-seven months after the later of a Special Termination Date and Termination Date, as each may be extended, maintain one or more interest rate caps (collectively, "Interest Rate Caps"), the notional amounts of which, individually or in the aggregate, shall equal or exceed the outstanding balance of the Net Investments. Pursuant to the Interest Rate Caps, on each Remittance Date on which the LIBOR Cap Rate for a related Collection Period exceeds 7.35%, the Interest Rate Cap Provider will make a payment to the Transferor in an amount equal to the product of (i) such excess, (ii) the notional amount as of such Remittance Date and (iii) the actual number of days in the related Collection Period divided by 360. The Interest Rate Caps will terminate on the Cap Termination Date; provided, however, that the Interest Rate Caps may be terminated at an earlier date if the Transferor has obtained a substitute interest rate cap or entered into an alternative arrangement satisfactory to the Purchaser Agents and each Rating Agency then rating the Commercial Paper of any Purchaser, which in each case will not result in the reduction or withdrawal of the rating of any such Commercial Paper (such substitute interest rate cap, a "Replacement Interest Rate Cap"; such alternative arrangement, a "Qualified Substitute Arrangement").
