Exhibit 4.3
[EXECUTION COPY]
MELLON PREMIUM FINANCE LOAN OWNER TRUST
Transferor
AFCO CREDIT CORPORATION
Servicer
AFCO ACCEPTANCE CORPORATION
Servicer
PREMIUM FINANCING SPECIALISTS, INC.
Back-up Servicer
PREMIUM FINANCING SPECIALISTS OF CALIFORNIA, INC.
Back-up Servicer
And
XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION
Trustee
on behalf of the Series 2001-1 Holders
------------------------------
SERIES 2001-1 SUPPLEMENT
Dated as of June 15, 2001
To
AMENDED AND RESTATED
POOLING AND SERVICING AGREEMENT
Dated as of June 15, 2001
------------------------------
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
Series 2001-1
TABLE OF CONTENTS
Page
SECTION 1. Designation.....................................................1
SECTION 2. Definitions.....................................................1
SECTION 3. Servicing Compensation.........................................20
SECTION 4. Reassignment and Transfer Terms................................21
SECTION 5. Delivery and Payment for the Investor Certificates.............21
SECTION 6. Depository; Form of Delivery of Investor Certificates..........21
SECTION 7. Article IV of Agreement........................................21
SECTION 8. Article V of the Agreement.....................................43
SECTION 9. Series 2001-1 Pay Out Events...................................45
SECTION 10. Series 2001-1 Termination......................................47
SECTION 11. Enhancement Concentration Limits...............................47
SECTION 12. [Reserved.]....................................................47
SECTION 13. Application of Proceeds of Issuance of Series 2001-1...........47
SECTION 14. Counterparts...................................................47
SECTION 15. Governing Law..................................................47
SECTION 16. Additional Notices.............................................48
SECTION 17. Additional Representations and Warranties of Servicer..........48
SECTION 18. No Petition....................................................48
SECTION 19. Amendments.....................................................48
SECTION 20. No Liability of Owner Trustee..................................49
EXHIBITS
EXHIBIT A-1 Form of Class A Certificate
EXHIBIT A-2 Form of Class B Certificate
EXHIBIT B Form of Monthly Payment Instructions and
Notification to Trustee
EXHIBIT C Form of Monthly Series 2001-1 Holders'
Statement
SERIES 2001-1 SUPPLEMENT, dated as of June 15, 2001 (this "Series
Supplement"), by and among MELLON PREMIUM FINANCE LOAN OWNER TRUST, a Delaware
business trust, as Transferor, AFCO CREDIT CORPORATION, a New York corporation,
as Servicer, AFCO ACCEPTANCE CORPORATION, a California corporation, as Servicer,
PREMIUM FINANCING SPECIALISTS, INC., a Missouri corporation, as Back-up
Servicer, PREMIUM FINANCING SPECIALISTS OF CALIFORNIA, INC., a California
corporation, as Back-up Servicer, and XXXXX FARGO BANK MINNESOTA, NATIONAL
ASSOCIATION, a national banking association, as Trustee under the Amended and
Restated Pooling and Servicing Agreement, dated as of June 15, 2001(the
"Agreement"), by and among each Servicer, each Back-up Servicer, the Transferor
and the Trustee.
Section 6.9 of the Agreement provides, among other things, that the
Transferor and the Trustee may at any time and from time to time enter into a
supplement to the Agreement for the purpose of authorizing the delivery by the
Trustee to the Transferor for the execution and redelivery to the Trustee for
authentication of one or more Series of Certificates.
Pursuant to this Series Supplement, the Transferor and the Trust shall
create a new Series of Investor Certificates and shall specify the Principal
Terms thereof.
SECTION 1. DESIGNATION. (a) There is hereby created a Series of
Investor Certificates to be issued in two classes pursuant to the Agreement and
this Series Supplement and to be known together as the "Series 2001-1
Certificates." The two classes shall be designated the Class A Floating Rate
Asset Backed Certificates, Series 2001-1 (the "Class A Certificates") and the
Class B Floating Rate Asset Backed Certificates, Series 2001-1 (the "Class B
Certificates"). The Class A Certificates and the Class B Certificates shall be
substantially in the form of Exhibits A-1 and A-2, respectively. In addition,
there is hereby created a third Class which constitutes an uncertificated
interest in the Trust, shall be deemed to be an "Investor Certificate" for all
purposes under the Agreement and this Series Supplement, except as expressly
provided herein, and shall be known as the Collateral Interest, Series 2001-1
and have the rights assigned to the Collateral Interest in this Series
Supplement.
(b) Series 2001-1 shall be included in Group One (as defined below).
Series 2001-1 shall not be subordinated to any other Series.
(c) The Collateral Interest Holder, as holder of an "Investor
Certificate" under the Agreement, shall be entitled to the benefits of the
Agreement and this Series Supplement upon payment by the Collateral Interest
Holder of amounts owing on the Closing Date pursuant to the Loan Agreement (as
defined below). Notwithstanding the foregoing, except as expressly provided
herein, the provisions of Article VI and Article XII of the Agreement relating
to the registration, authentication, delivery, presentation, cancellation and
surrender of Registered Certificates shall not be applicable to the Collateral
Interest.
SECTION 2. DEFINITIONS. If any term or provision contained herein
shall conflict with or be inconsistent with any provision contained in the
Agreement, the terms and provisions of this Series Supplement shall govern.
References to any Article, Section or subsection are references to Articles,
Sections or subsections of the Agreement, except as otherwise expressly
provided. All capitalized terms not otherwise defined herein are defined in the
Agreement, and the interpretive provisions set out in Section 1.2 of the
Agreement apply to this Series Supplement. Each capitalized term defined herein
relates only to the Investor Certificates and no other Series of Certificates
issued by the Trust.
"ACCUMULATION PERIOD" means, solely for the purposes of the definition
of Group One Monthly Principal Payment as such term is defined in each
Supplement relating to Group One, the Controlled Accumulation Period.
"ACCUMULATION SHORTFALL" means, with respect to any Monthly Period
during the Controlled Accumulation Period, the sum of the Class A Accumulation
Shortfall, the Class B Accumulation Shortfall and the Collateral Interest
Accumulation Shortfall, in each case for such Monthly Period.
"ADJUSTED INVESTOR INTEREST" means, on any date of determination, an
amount equal to the sum of (a) the Class A Adjusted Investor Interest and (b)
the Class B Adjusted Investor Interest and (c) the Collateral Interest Adjusted
Investor Interest.
"AVAILABLE INVESTOR PRINCIPAL COLLECTIONS" means, as to any Monthly
Period, an amount equal to (a) the Investor Principal Collections for such
Monthly Period, minus (b) the amount of Reallocated Principal Collections with
respect to such Monthly Period which pursuant to Section 4.14 are required to
fund the Class A Required Amount and the Class B Required Amount (other than any
portions thereof that are applied pursuant to subsection 4.13(b) and subsection
4.13(d) (to the extent such portions pursuant to subsection 4.13(d) are applied
to pay the Class A Investor Default Amount and the Class B Investor Default
Amount, respectively), which shall, without duplication, be included as
Available Investor Principal Collections), plus (c) the amount of Shared
Principal Collections with respect to Group One that are allocated to Series
2001-1 in accordance with subsection 4.15(b).
"AVAILABLE RESERVE ACCOUNT AMOUNT" means, as to any Transfer Date, the
lesser of (a) the amount on deposit in the Reserve Account on such date (after
taking into account any interest and earnings retained in the Reserve Account
pursuant to subsection 4.17(b) on such date, but before giving effect to any
deposit made or to be made pursuant to subsection 4.13(j) to the Reserve Account
on such date) and (b) the Required Reserve Account Amount.
"BASE RATE" means, as to any Monthly Period, the annualized percentage
equivalent of a fraction, the numerator of which is equal to the sum of the
Class A Monthly Interest, the Class B Monthly Interest and the Collateral
Monthly Interest, each for the related Distribution Date, and the Investor
Servicing Fee with respect to such Monthly Period and the denominator of which
is the Investor Interest as of the close of business on the last day of such
Monthly Period.
"BUSINESS DAY" means any day other than a Saturday, a Sunday or a day
on which banking institutions in New York, New York, Minneapolis, Minnesota or
Pittsburgh, Pennsylvania are authorized or obligated by law or executive order
to be closed.
"CLASS A ACCUMULATION SHORTFALL" initially means zero and thereafter
means, with respect to any Monthly Period during the Controlled Accumulation
Period, the excess, if any, of the Class A Controlled Deposit Amount for the
previous Monthly Period over the amount deposited into the Class A Principal
Funding Account pursuant to subsection 4.11(e)(i) with respect to the Class A
Certificates for the previous Monthly Period.
"CLASS A ADDITIONAL INTEREST" is defined in subsection 4.8(a).
"CLASS A ADJUSTED INVESTOR INTEREST" means, on any date of
determination, an amount equal to the Class A Investor Interest minus the Class
A Principal Funding Account Balance on such date of determination.
"CLASS A AVAILABLE FUNDS" means, as to any Monthly Period, an amount
equal to the sum of (a) the Class A Floating Allocation of Finance Charge
Collections allocated to the Investor Certificates for such Monthly Period, (b)
with respect to any Monthly Period during the Controlled Accumulation Period
prior to the payment in full of the Class A Investor Interest, the Class A
Principal Funding Investment Proceeds arising pursuant to subsection 4.16(b), if
any, with respect to the related Transfer Date, (c) amounts, if any, to be
withdrawn from the Reserve Account, deposited into the Finance Charge Account
and treated as Class A Available Funds on the related Transfer Date pursuant to
subsection 4.17(b) and (d) any amounts to be withdrawn from the Reserve Account
pursuant to subsection 4.17(d) to cover the Class A Reserve Draw Amount, if any,
on the related Transfer Date.
"CLASS A CARRY-OVER AMOUNT" is defined in subsection 4.8(d).
"CLASS A CERTIFICATE RATE" means, with respect to each Interest
Period, a per annum rate equal to 0.18% per annum in excess of LIBOR, as
determined on the related LIBOR Determination Date.
"CLASS A CERTIFICATES" is defined in subsection 1(a) of this Series
Supplement.
"CLASS A CONTROLLED ACCUMULATION AMOUNT" means for any Transfer Date
with respect to the Controlled Accumulation Period prior to the payment in full
of the Class A Investor Interest, $50,000,000; provided that if the Controlled
Accumulation Period Length is modified pursuant to subsection 4.11(i), (i) the
Class A Controlled Accumulation Amount for each Transfer Date with respect to
the Controlled Accumulation Period shall mean the amount determined in
accordance with subsection 4.11(i) on the date on which the Controlled
Accumulation Period has most recently been modified and (ii) the sum of the
Class A Controlled Accumulation Amounts for all Transfer Dates with respect to
the modified Controlled Accumulation Period shall not be less than the Class A
Investor Interest.
"CLASS A CONTROLLED DEPOSIT AMOUNT" means, with respect to any
Transfer Date, the lesser of (1) the sum of (a) the Class A Controlled
Accumulation Amount for such Transfer Date and (b) any existing Class A
Accumulation Shortfall, and (2) the Class A Adjusted Investor Interest prior to
any deposits made on such Transfer Date.
"CLASS A COVERED AMOUNT" means an amount, determined as of each
Transfer Date with respect to any Monthly Interest Period, equal to the product
of (a) (i) a fraction, the numerator of which is the actual number of days in
such Monthly Interest Period and the denominator of which is 360, times (ii) the
Class A Certificate Rate for such Monthly Interest Period, and (b) the Class A
Principal Funding Account Balance as of the Record Date preceding such Transfer
Date.
"CLASS A DEFICIENCY AMOUNT" is defined in subsection 4.8(a).
"CLASS A EXCESS PRINCIPAL FUNDING INVESTMENT PROCEEDS" means, with
respect to each Transfer Date relating to the Controlled Accumulation Period,
the amount, if any, by which the Class A Principal Funding Investment Proceeds
for such Transfer Date exceed the Class A Covered Amount determined on such
Transfer Date.
"CLASS A FIXED ALLOCATION" means, for 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, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a fraction,
the numerator of which is the Class A Adjusted Investor Interest as of the close
of business on the last day of the preceding Monthly Period and the denominator
of which is equal to the Adjusted Investor Interest as of the close of business
on such day; provided that, with respect to the first Monthly Period, the Class
A Floating Allocation means the percentage equivalent of a fraction, the
numerator of which is the Class A Initial Investor Interest and the denominator
of which is the Initial Investor Interest.
"CLASS A HOLDER" means the Person in whose name a Class A Certificate
is registered in the Certificate Register.
"CLASS A INITIAL INVESTOR INTEREST" means the aggregate initial
principal amount of the Class A Certificates, which is $450,000,000.
"CLASS A INTEREST FUNDING ACCOUNT" is defined in subsection 4.18(a).
"CLASS A INVESTOR ALLOCATION" means, for any Monthly Period, (a) with
respect to Default Amounts and Finance Charge Collections at any time and
Principal Collections during the Revolving Period, the Class A Floating
Allocation, and (b) with respect to Principal Collections during the Controlled
Accumulation Period or Rapid Amortization Period, the Class A Fixed Allocation.
"CLASS A INVESTOR CHARGE-OFF" is defined in subsection 4.12(a).
"CLASS A INVESTOR DEFAULT AMOUNT" means, as to each Transfer Date, an
amount equal to the product of (a) the Investor Default Amount for the related
Monthly Period and (b) the Class A Floating Allocation applicable for the
related Monthly Period.
"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 made to Class A Holders prior to such
date and minus (c) the excess, if any, of the aggregate amount of Class A
Investor Charge-Offs pursuant to subsection 4.12(a) over Class A Investor
Charge-Offs reimbursed pursuant to subsection 4.13(c) prior to such date of
determination; provided that the Class A Investor Interest may not be reduced
below zero.
"CLASS A MONTHLY INTEREST" is defined in subsection 4.8(a).
"CLASS A MONTHLY PRINCIPAL" is defined in subsection 4.9(a).
"CLASS A OPTIMAL INTEREST" is defined in subsection 4.8(a).
"CLASS A PRINCIPAL FUNDING ACCOUNT" is an account established by the
Trustee as an administrative subaccount of the Principal Funding Account.
"CLASS A PRINCIPAL FUNDING ACCOUNT BALANCE" means, with respect to any
date of determination, the principal amount, if any, on deposit in the Class A
Principal Funding Account on such date of determination.
"CLASS A PRINCIPAL FUNDING INVESTMENT PROCEEDS" means, with respect to
each Transfer Date, the investment earnings on funds in the Class A Principal
Funding Account (net of investment expenses and losses) for the period from and
including the immediately preceding Transfer Date to but excluding such Transfer
Date.
"CLASS A PRINCIPAL FUNDING INVESTMENT SHORTFALL" means, with respect
to each Transfer Date relating to the Controlled Accumulation Period, the
amount, if any, by which the Class A Principal Funding Investment Proceeds for
such Transfer Date are less than the Class A Covered Amount determined as of
such Transfer Date.
"CLASS A REQUIRED AMOUNT" is defined in subsection 4.10(a).
"CLASS A RESERVE DRAW AMOUNT" is defined in subsection 4.17(c).
"CLASS A SCHEDULED PAYMENT DATE" means the June 2004 Distribution
Date.
"CLASS A SERVICING FEE" is defined in Section 3 of this Series
Supplement.
"CLASS A SHORTFALL AMOUNT" means, as of any Distribution Date, an
amount, if positive, equal to (x) Class A Optimal Interest for the related
Monthly Interest Period minus (y) the excess of (i) Class A Available Funds for
the related Monthly Period over (ii) if the Originators are not the Servicer,
the Class A Servicing Fee for the related Monthly Period plus the Class A Unpaid
Trustee Fee, if any, for the related Transfer Date.
"CLASS A UNPAID TRUSTEE FEE" means, for any Transfer Date, an amount
equal to the product of (a) the Investor Unpaid Trustee Fee for such Transfer
Date and (b) the Class A Floating Allocation for the related Monthly Period.
"CLASS B ACCUMULATION SHORTFALL" initially means zero and thereafter
means, with respect to any Monthly Period during the Controlled Accumulation
Period, the excess, if any, of the Class B Controlled Deposit Amount for the
previous Monthly Period over the amount deposited into the Class B Principal
Funding Account pursuant to subsection 4.11(e)(ii) with respect to the Class B
Certificates for the previous Monthly Period.
"CLASS B ADDITIONAL INTEREST" is defined in subsection 4.8(b).
"CLASS B ADJUSTED INVESTOR INTEREST" means, on any date of
determination, an amount equal to the Class B Investor Interest minus the Class
B Principal Funding Account Balance on such date of determination.
"CLASS B AVAILABLE FUNDS" means, as to any Monthly Period, an amount
equal to the sum of (a) the Class B Floating Allocation of Finance Charge
Collections allocated to the Investor Certificates for such Monthly Period, (b)
with respect to any Monthly Period during the Controlled Accumulation Period
prior to the payment in full of the Class B Investor Interest, the Class B
Principal Funding Investment Proceeds arising pursuant to subsection 4.16(b), if
any, with respect to the related Transfer Date, (c) amounts, if any, to be
withdrawn from the Reserve Account, deposited into the Finance Charge Account
and treated as Class B Available Funds on the related Transfer Date pursuant to
subsection 4.17(b) and (d) any amounts to be withdrawn from the Reserve Account
pursuant to subsection 4.17(d) to cover the Class B Reserve Draw Amount, if any,
on the related Transfer Date.
"CLASS B CARRY-OVER AMOUNT" is defined in subsection 4.8(d).
"CLASS B CERTIFICATE RATE" means, with respect to any Interest Period,
a per annum rate equal to 0.44% per annum in excess of LIBOR, as determined on
the related LIBOR Determination Date.
"CLASS B CERTIFICATES" is defined in subsection 1(a) of this Series
Supplement.
"CLASS B CONTROLLED ACCUMULATION AMOUNT" means for any Transfer Date
with respect to the Controlled Accumulation Period prior to the payment in full
of the Class B Investor Interest, $2,222,222.22; provided that if the Controlled
Accumulation Period Length is modified pursuant to subsection 4.11(i), (i) the
Class B Controlled Accumulation Amount for each Transfer Date with respect to
the Controlled Accumulation Period shall mean the amount determined in
accordance with subsection 4.11(i) on the date on which the Controlled
Accumulation Period has most recently been modified and (ii) the sum of the
Class B Controlled Accumulation Amounts for all Transfer Dates with respect to
the modified Controlled Accumulation Period shall not be less than the Class B
Investor Interest.
"CLASS B CONTROLLED DEPOSIT AMOUNT" means, with respect to any
Transfer Date, the lesser of (1) the sum of (a) the Class B Controlled
Accumulation Amount for such Transfer Date and (b) any existing Class B
Accumulation Shortfall, and (2) the Class B Adjusted Investor Interest prior to
any deposits made on such Transfer Date.
"CLASS B COVERED AMOUNT" means an amount, determined as of each
Transfer Date with respect to any Monthly Interest Period, equal to the product
of (a)(i) a fraction, the numerator of which is the actual number of days in
such Monthly Interest Period and the denominator of which is 360, times (ii) the
Class B Certificate Rate for such Monthly Interest Period and (b) the Class B
Principal Funding Account Balance as of the Record Date preceding such Transfer
Date.
"CLASS B DEFICIENCY AMOUNT" is defined in subsection 4.8(b).
"CLASS B EXCESS PRINCIPAL FUNDING INVESTMENT PROCEEDS" means, with
respect to each Transfer Date relating to the Controlled Accumulation Period,
the amount, if any, by which the Class B Principal Funding Investment Proceeds
for such Transfer Date exceed the Class B Covered Amount determined on such
Transfer Date.
"CLASS B FIXED ALLOCATION" means, for 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, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a fraction,
the numerator of which is the Class B Adjusted Investor Interest as of the close
of business on the last day of the preceding Monthly Period and the denominator
of which is equal to the Adjusted Investor Interest as of the close of business
on such day; provided that, with respect to the first Monthly Period, the Class
B Floating Allocation means the percentage equivalent of a fraction, the
numerator of which is the Class B Initial Investor Interest and the denominator
of which is the Initial Investor Interest.
"CLASS B HOLDER" means the Person in whose name a Class B Certificate
is registered in the Certificate Register.
"CLASS B INITIAL INVESTOR INTEREST" means the aggregate initial
principal amount of the Class B Certificates, which is $20,000,000.
"CLASS B INTEREST FUNDING ACCOUNT" is defined in subsection 4.18(a).
"CLASS B INVESTOR ALLOCATION" means, for any Monthly Period, (a) with
respect to Default Amounts and Finance Charge Collections at any time and
Principal Collections during the Revolving Period, the Class B Floating
Allocation, and (b) with respect to Principal Collections during the Controlled
Accumulation Period or Rapid Amortization Period, the Class B Fixed Allocation.
"CLASS B INVESTOR CHARGE-OFF" is defined in subsection 4.12(b).
"CLASS B INVESTOR DEFAULT AMOUNT" means, as to each Transfer Date, an
amount equal to the product of (a) the Investor Default Amount for the related
Monthly Period and (b)the Class B Floating Allocation applicable for the related
Monthly Period.
"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 made to Class B Holders prior to such
date, minus (c) the aggregate amount of Class B Investor Charge-Offs for all
prior Transfer Dates pursuant to subsection 4.12(b), minus (d) the amount of the
Reallocated Class B Principal Collections allocated pursuant to subsection
4.14(a) on all prior Transfer Dates for which the Collateral 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 4.12(a) and plus (f) the aggregate amount of Excess Spread allocated
and available on all prior Transfer Dates pursuant to subsection 4.13(e) for the
purpose of reimbursing amounts deducted pursuant to the foregoing clauses (c),
(d) and (e); provided that the Class B Investor Interest may not be reduced
below zero.
"CLASS B MONTHLY INTEREST" is defined in subsection 4.8(b).
"CLASS B MONTHLY PRINCIPAL" is defined in subsection 4.9(b).
"CLASS B OPTIMAL INTEREST" is defined in subsection 4.8(b).
"CLASS B PRINCIPAL FUNDING ACCOUNT" is an account established by the
Trustee as an administrative subaccount of the Principal Funding Account.
"CLASS B PRINCIPAL FUNDING ACCOUNT BALANCE" means, with respect to any
date of determination, the principal amount, if any, on deposit in the Class B
Principal Funding Account on such date of determination.
"CLASS B PRINCIPAL FUNDING INVESTMENT PROCEEDS" means, with respect to
each Transfer Date, the investment earnings on funds in the Class B Principal
Funding Account (net of investment expenses and losses) for the period from and
including the immediately preceding Transfer Date to but excluding such Transfer
Date.
"CLASS B PRINCIPAL FUNDING INVESTMENT SHORTFALL" means, with respect
to each Transfer Date relating to the Controlled Accumulation Period, the
amount, if any, by which the Class B Principal Funding Investment Proceeds for
such Transfer Date are less than the Class B Covered Amount.
"CLASS B REQUIRED AMOUNT" is defined in subsection 4.10(b).
"CLASS B RESERVE DRAW AMOUNT" is defined in subsection 4.17(c).
"CLASS B SCHEDULED PAYMENT DATE" means the June 2004 Distribution
Date.
"CLASS B SERVICING FEE" is defined in Section 3 of this Series
Supplement.
"CLASS B SHORTFALL AMOUNT" means, as of any Distribution Date, an
amount, if positive, equal to (x) Class B Optimal Interest for the related
Monthly Interest Period minus (y) the excess of (i) Class B Available Funds for
the related Monthly Period over (ii) if the Originators are not the Servicer,
the Class B Servicing Fee for the related Monthly Period plus the Class B Unpaid
Trustee Fee, if any, for the related Transfer Date.
"CLASS B UNPAID TRUSTEE FEE" means, for any Transfer Date, an amount
equal to the product of (a) the Investor Unpaid Trustee Fee for such Transfer
Date and (b) the Class B Floating Allocation for the related Monthly Period.
"CLOSING DATE" means June 15, 2001.
"COLLATERAL ALLOCATION" means, for any Monthly Period, (a) with
respect to Default Amounts and Finance Charge Collections at any time and
Principal Collections during the Revolving Period, the Collateral Floating
Allocation, and (b) with respect to Principal Collections during the Controlled
Accumulation Period or Rapid Amortization Period, the Collateral Fixed
Allocation.
"COLLATERAL AVAILABLE FUNDS" means, as to any Monthly Period, an
amount equal to the sum of (a) the Collateral Floating Allocation of Finance
Charge Collections allocated to the Investor Certificates for such Monthly
Period, (b) with respect to any Monthly Period during the Controlled
Accumulation Period prior to the payment in full of the Collateral Interest, the
Collateral Interest Principal Funding Investment Proceeds arising pursuant to
subsection 4.16(b), if any, with respect to the related Transfer Date, (c)
amounts, if any, to be withdrawn from the Reserve Account, deposited into the
Finance Charge Account and treated as Collateral Available Funds on the related
Transfer Date pursuant to subsection 4.17(b) and (d) any amounts to be withdrawn
from the Reserve Account pursuant to subsection 4.17(d) to cover the Collateral
Interest Reserve Draw Amount, if any, on the related Transfer Date.
"COLLATERAL CHARGE-OFF" is defined in subsection 4.12(c).
"COLLATERAL DEFAULT AMOUNT" means, as to any Transfer Date, an amount
equal to the product of (a) the Investor Default Amount for the related Monthly
Period and (b) the Collateral Floating Allocation applicable for the related
Monthly Period.
"COLLATERAL FIXED ALLOCATION" means, for 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 Collateral 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.
"COLLATERAL FLOATING ALLOCATION" means, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a fraction,
the numerator of which is the Collateral Interest Adjusted Investor Interest as
of the close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided that, with respect to the first Monthly
Period, the Collateral Floating Allocation means the percentage equivalent of a
fraction, the numerator of which is the Collateral Initial Interest and the
denominator of which is the Initial Investor Interest.
"COLLATERAL INITIAL INTEREST" means $30,000,000.
"COLLATERAL INTEREST" means, on any date of determination, a
fractional undivided interest in the Trust which shall consist of the right to
receive, to the extent necessary to make the required payments to the Collateral
Interest Holder under this Series Supplement, the portion of Collections
allocable thereto under the Agreement and this Series Supplement, and funds on
deposit in the Collection Account, the Excess Funding Account, the Finance
Charge Account, the Principal Account and the Distribution Account allocable
thereto pursuant to the Agreement and this Series Supplement. On any date, for
purposes of all calculations in the Agreement and this Series Supplement, the
amount of the Collateral Interest shall be an amount equal to (a) the Collateral
Initial Interest, minus (b) the aggregate amount of principal payments made to
the Collateral Interest Holder prior to such date, minus (c) the aggregate
amount of Collateral Charge-Offs for all prior Transfer Dates pursuant to
subsection 4.12(c), minus (d) the amount of Reallocated Principal Collections
allocated pursuant to subsections 4.14(a) and (b) on all prior Transfer Dates,
minus (e) an amount equal to the amount by which the Collateral Interest has
been reduced on all prior Transfer Dates pursuant to subsections 4.12(a) and
(b), and plus (f) the aggregate amount of Excess Spread allocated and available
on all prior Transfer Dates pursuant to subsection 4.13(i), for the purpose of
reimbursing amounts deducted pursuant to the foregoing clauses (c), (d) and (e);
provided that the Collateral Interest may not be reduced below zero.
"COLLATERAL INTEREST ACCUMULATION SHORTFALL" initially means zero and
thereafter means, with respect to any Monthly Period during the Controlled
Accumulation Period, the excess, if any, of the Collateral Interest Controlled
Deposit Amount for the previous Monthly Period over the amount deposited into
the Collateral Interest Principal Funding Account pursuant to subsection
4.11(e)(iii) with respect to the Collateral Interest for the previous Monthly
Period.
"COLLATERAL INTEREST ADJUSTED INVESTOR INTEREST" means, on any date of
determination, an amount equal to the Collateral Interest minus the Collateral
Interest Principal Funding Account Balance on such date of determination.
"COLLATERAL INTEREST CONTROLLED ACCUMULATION AMOUNT" means for any
Transfer Date with respect to the Controlled Accumulation Period prior to the
payment in full of the Collateral Interest, the amount specified in the Loan
Agreement; provided that if the Controlled Accumulation Period Length is
modified pursuant to subsection 4.11(i), (i) the Collateral Interest
Accumulation Amount for each Transfer Date with respect to the Controlled
Accumulation Period shall mean the amount determined in accordance with the Loan
Agreement on the date on which the Controlled Accumulation Period has most
recently been modified and (ii) the sum of the Collateral Interest Controlled
Accumulation Amounts for all Transfer Dates with respect to the modified
Controlled Accumulation Period shall not be less than the Collateral Interest.
"COLLATERAL INTEREST CONTROLLED DEPOSIT AMOUNT" means, with respect to
any Transfer Date, the lesser of (1) the sum of (a) the Collateral Interest
Controlled Accumulation Amount for such Transfer Date and (b) any existing
Collateral Interest Accumulation Shortfall, and (2) the Collateral Interest
Adjusted Investor Interest prior to any deposits made on such Transfer Date.
"COLLATERAL INTEREST COVERED AMOUNT" means an amount, determined as of
each Transfer Date with respect to any Monthly Interest Period, equal to the
product of (a)(i) a fraction, the numerator of which is the actual number of
days in such Monthly Interest Period and the denominator of which is 360, times
(ii) the Collateral Rate for such Monthly Interest Period and (b) the Collateral
Interest Principal Funding Account Balance as of the Record Date preceding such
Transfer Date.
"COLLATERAL INTEREST EXCESS PRINCIPAL FUNDING INVESTMENT PROCEEDS"
means, with respect to each Transfer Date relating to the Controlled
Accumulation Period, the amount, if any, by which the Collateral Interest
Principal Funding Investment Proceeds for such Transfer Date exceed the
Collateral Interest Covered Amount determined on such Transfer Date.
"COLLATERAL INTEREST HOLDER" means the entity so designated in the
Loan Agreement.
"COLLATERAL INTEREST MONTHLY INTEREST FUNDING ACCOUNT" is defined in
subsection 4.18(a).
"COLLATERAL INTEREST PRINCIPAL FUNDING ACCOUNT" is an account
established by the Trustee as an administrative subaccount of the Principal
Funding Account.
"COLLATERAL INTEREST PRINCIPAL FUNDING ACCOUNT BALANCE" means, with
respect to any date of determination, the principal amount, if any, on deposit
in the Collateral Interest Principal Funding Account on such date of
determination.
"COLLATERAL INTEREST PRINCIPAL FUNDING INVESTMENT PROCEEDS" means,
with respect to each Transfer Date, the investment earnings on funds in the
Collateral Interest Principal Funding Account (net of investment expenses and
losses) for the period from and including the immediately preceding Transfer
Date to but excluding such Transfer Date.
"COLLATERAL INTEREST PRINCIPAL FUNDING INVESTMENT SHORTFALL" means,
with respect to each Transfer Date relating to the Controlled Accumulation
Period, the amount, if any, by which the Collateral Interest Principal Funding
Investment Proceeds for such Transfer Date are less than the Collateral Interest
Covered Amount.
"COLLATERAL INTEREST RESERVE DRAW AMOUNT" is defined in subsection
4.17(c).
"COLLATERAL INTEREST SCHEDULED PAYMENT DATE" means the June 2004
Distribution Date.
"COLLATERAL INTEREST SERVICING FEE" is defined in Section 3 of this
Series Supplement.
"COLLATERAL MONTHLY INTEREST" is defined in subsection 4.8(c).
"COLLATERAL MONTHLY PRINCIPAL" is defined in subsection 4.9(c).
"COLLATERAL RATE" means, for any Interest Period, the rate specified
in the Loan Agreement.
"COLLATERAL UNPAID TRUSTEE FEE" for any Transfer Date, an amount equal
to the product of (a) the Investor Unpaid Trustee Fee for such Transfer Date and
(b) the Collateral Floating Allocation for the related Monthly Period.
"CONTROLLED ACCUMULATION DATE" means August 30, 2003.
"CONTROLLED ACCUMULATION PERIOD" means, unless a Pay Out Event shall
have occurred prior thereto, the period commencing at the close of business on
the Controlled Accumulation Date or such later date as is determined in
accordance with subsection 4.11(i) and ending on the first to occur of (a) the
commencement of the Rapid Amortization Period and (b) the Series 2001-1
Termination Date.
"CONTROLLED ACCUMULATION PERIOD LENGTH" is defined in subsection
4.11(i).
"CONTROLLED DEPOSIT AMOUNT" means, for any Transfer Date, the sum of
the Class A Controlled Deposit Amount, the Class B Controlled Deposit Amount and
the Collateral Interest Controlled Deposit Amount, in each case for such
Transfer Date.
"CREDIT ENHANCEMENT" means (a) with respect to the Class A
Certificates, the subordination of the Class B Certificates and the Collateral
Interest, and (b) with respect to the Class B Certificates, the subordination of
the Collateral Interest.
"CREDIT ENHANCEMENT PROVIDER" means the Collateral Interest Holder.
"CUMULATIVE SERIES PRINCIPAL SHORTFALL" means the sum of the Series
Principal Shortfalls (as such term is defined in each of the related
Supplements) for each Series in Group One.
"DAILY PRINCIPAL SHORTFALL" means, on any date of determination, the
excess of the Group One Monthly Principal Payment for the Monthly Period
relating to such date over the month to date amount of Principal Collections for
such Monthly Period allocable to investor certificates of all outstanding Series
in Group One, not subject to reallocation, which are on deposit or to be
deposited in the Principal Account on such date.
"DEFICIENCY AMOUNT" means, at any date of determination, the sum of
the Class A Deficiency Amount and the Class B Deficiency Amount.
"DISTRIBUTION DATE" means July 16, 2001 and the fifteenth day of each
calendar month thereafter, or if such fifteenth day is not a Business Day, the
next succeeding Business Day.
"EXCESS SPREAD" means, with respect to any Transfer Date, the sum of
(a) the sum of the amounts, if any, with respect to such Transfer Date specified
pursuant to subsections 4.11(a)(v), 4.11(b)(iv) and 4.11(c)(iii), plus (b) the
Excess Finance Charge Collections, if any, allocated to the Investor Interest
pursuant to Section 4.5 for that Transfer Date.
"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 Beginning
of Month Principal Receivables for such Monthly Period and (b) the sum of the
numerators used to calculate the Investor Percentages (as such term is defined
in the Agreement) for allocations with respect to Principal Receivables for all
outstanding Series on such date of determination; provided that with respect to
any Monthly Period in which a Reset Date occurs, the denominator determined
pursuant to clause (a) shall be (i) the aggregate amount of Beginning of Month
Principal Receivables for such Monthly Period for the period from and including
the first day of such Monthly Period to but excluding the Reset Date and (ii)
the aggregate amount of Principal Receivables in the Trust as of the beginning
of the day on the Reset Date (after adjusting for the aggregate amount of
Principal Receivables added to or removed from the Trust on the Reset Date, if
applicable), for the period from and including the Reset Date to and including
the last day of such Monthly Period.
"FLOATING INVESTOR PERCENTAGE" means, with respect to any Monthly
Period, the percentage equivalent of a fraction, the numerator of which is the
Adjusted Investor Interest as of the close of business on the last day of the
preceding Monthly Period (or with respect to the first Monthly Period, the
Initial Investor Interest) and the denominator of which is the greater of (a)
the aggregate amount of Beginning of Month Principal Receivables, and (b) the
sum of the numerators used to calculate the Investor Percentages (as such term
is deemed in the Agreement) for allocations with respect to Finance Charge
Receivables, Default Amounts, Unpaid Trustee Fee or Principal Receivables, as
applicable, for all outstanding Series on such date of determination; provided
that with respect to any Monthly Period in which a Reset Date occurs, the
denominator determined pursuant to clause (a) shall be (i) the aggregate amount
of Beginning of Month Principal Receivables for the period from and including
the first day of the prior Monthly Period to but excluding the Reset Date and
(ii) the aggregate amount of Principal Receivables in the Trust as of the
beginning of the day on the Reset Date (after adjusting for the aggregate amount
of Principal Receivables added to or removed from the Trust on the Reset Date,
if applicable), for the period from and including the Reset Date to and
including the last day of such Monthly Period.
"GROUP ONE" means Series 2001-1 and each other Series specified in the
related Supplement to be included in Group One.
"GROUP ONE MONTHLY PRINCIPAL PAYMENT" means, with respect to any
Monthly Period, for all Series in Group One (including Series 2001-1) which are
in an Amortization Period or Controlled Accumulation Period (as such terms are
defined in the related Supplements for all Series in Group One, if applicable to
such Series), the sum of (a) the Controlled Distribution Amount for the related
Transfer Date for any Series in its Controlled Amortization Period (as such
terms are defined in the related Supplements for all Series in Group One, if
applicable to such Series), (b) the Controlled Deposit Amount for the related
Transfer Date for any Series in its Controlled Accumulation Period, other than
its Rapid Accumulation Period, as applicable (as such terms are defined in the
related Supplements for all Series in Group One, if applicable to such Series),
(c) the Investor Interest as of the end of the prior Monthly Period taking into
effect any payments to be made on the following Distribution Date for any Series
in Group One in its Principal Payment Period, Principal Amortization Period or
Rapid Amortization Period (as such terms are defined in the related Supplements
for all Series in Group One, if applicable to such Series), (d) the Adjusted
Investor Interest as of the end of the prior Monthly Period taking into effect
any payments or deposits to be made on the following Transfer Date and
Distribution Date for any Series in Group One in its Rapid Accumulation Period
(as such terms are defined in the related Supplements for all Series in Group
One, if applicable to such Series), (e) the excess of the Collateral Interest as
of the Transfer Date occurring in such Monthly Period over the Required
Collateral Interest for the related Transfer Date, assuming no Accumulation
Shortfall (as such terms are defined in the related Supplements for all Series
in Group One, if applicable to such Series) and (f) such other amounts as may be
specified in the related Supplements for all Series in Group One.
"INITIAL INVESTOR INTEREST" means $500,000,000.
"INTEREST FUNDING ACCOUNT" shall have the meaning set forth in
subsection 4.18(a).
"INTEREST PAYMENT DATE" shall mean the 15th day of December, March,
June and September, commencing on the September 2001 Distribution Date (or, if
any such day is not a Business Day, the next succeeding Business Day), and the
Class B Scheduled Payment Date.
"INTEREST PERIOD" means, with respect to any Payment Date, the period
from and including the previous Payment Date through the day preceding such
Payment Date, except the initial Interest Period will be the period from and
including the Closing Date through the day preceding the initial Payment Date.
"INVESTOR CERTIFICATES" means the Class A Certificates, the Class B
Certificates and the Collateral Interest.
"INVESTOR DEFAULT AMOUNT" means, for any Monthly Period, an amount
equal to the product of (a) the Default Amount and (b) the Floating Investor
Percentage, in each case, for such Monthly Period.
"INVESTOR HOLDER" means (a) with respect to the Class A Certificates,
the holder of record of a Class A Certificate, (b) with respect to the Class B
Certificates, the holder of record of a Class B Certificate and (c) with respect
to the Collateral Interest, the Collateral Interest Holder.
"INVESTOR INTEREST" means, on any date of determination, a amount
equal to the sum of (a) the Class A Investor Interest, (b) the Class B Investor
Interest and (c) the Collateral Interest, each as of such date.
"INVESTOR PERCENTAGE" means, for any Monthly Period, (a) with respect
to Finance Charge Receivables, Finance Charge Collections, Unpaid Trustee Fee
and Default Amounts at any time and Principal Receivables and Principal
Collections during the Revolving Period, the Floating Investor Percentage and
(b) with respect to Principal Receivables and Principal Collections during the
Controlled Accumulation 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 or required to be
deposited (before giving effect to any permitted netting) into the Principal
Account for such Monthly Period pursuant to subsections 4.7(a)(ii), (iii) and
(iv), 4.7(b)(ii), (iii) and (iv), or 4.7(c)(ii), in each case, as applicable to
such Monthly Period, (b) the aggregate amount to be treated as Investor
Principal Collections pursuant to subsections 4.11(a)(iv), and 4.13(b), (c),
(d), (e), (h) and (i) for such Monthly Period (other than such amount paid from
Reallocated Principal Collections), and (c) the aggregate amount of Unallocated
Principal Collections deposited or required to be deposited on the related
Transfer Date (before giving effect to any permitted netting) into the Principal
Account pursuant to subsection 4.7(d).
"INVESTOR SERVICING FEE" is defined in Section 3 of this Series
Supplement.
"INVESTOR UNPAID TRUSTEE FEE" means, for any Transfer Date, the
product of the Floating Investor Percentage for the related Monthly Period and
the Unpaid Trustee Fee for such Transfer Date.
"LIBOR" means, for any Interest Period, an interest rate per annum
determined by the Trustee for each Interest Period in accordance with the
provisions of Section 4.19.
"LIBOR DETERMINATION DATE" means June 13, 2001 for the initial
Interest Period and the second London Business Day prior to the commencement of
each subsequent Interest Period.
"LOAN AGREEMENT" means the agreement to which the Transferor, each
Servicer, Mellon Bank, the Trustee, and the Collateral Interest Holder are
parties, dated as of June 15, 2001, as amended or modified from time to time.
"LONDON BUSINESS DAY" means any Business Day on which dealings in
deposits in United States dollars are transacted in the London interbank market.
"MELLON BANK" means Mellon Bank, N.A., a national banking association.
"MINIMUM AGGREGATE PRINCIPAL RECEIVABLES" means, as of any date of
determination, an amount equal to the sum of the numerators used to calculate
the Investor Percentage with respect to the allocation of Principal Collections
for each Series outstanding on such date.
"MINIMUM TRANSFEROR INTEREST" means as of any date of determination,
an amount equal to 5% of the sum of (a) the amount of Principal Receivables as
of such date of determination plus (b) the amount on deposit in the Excess
Funding Account on the date of determination; provided that the Transferor may
increase or reduce the percentage used to determine the Minimum Transferor
Interest (but not below 2%) upon (a) 30 day's prior written notice to the
Trustee, each Rating Agency and any Credit Enhancement Provider, (b)
satisfaction of the Rating Agency Condition, and (c) delivery to the Trustee and
each such Credit Enhancement Provider of an Officer's Certificate stating that
the Transferor reasonably believes that such reduction will not, based on the
facts known to such officer at the time of such certification, then or
thereafter cause a Pay Out Event to occur with respect to any Series.
"MONTHLY INTEREST PERIOD" is defined in subsection 4.8(a).
"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 by the Servicer during such Monthly Period and
the denominator of which shall equal the aggregate amount of Principal
Receivables as of the close of business on the fifteenth day of such Monthly
Period (or, if such day is not a Business Day, the immediately succeeding
Business Day).
"MONTHLY PERIOD" is defined in the Agreement, except that, with
respect to Principal Collections, the first Monthly Period for the Investor
Certificates begins on and includes the Closing Date and ends on and includes
June 30, 2001.
"NET PORTFOLIO YIELD" means, with respect to any Monthly Period, the
annualized percentage equivalent of a fraction, the numerator of which is an
amount equal to the sum of (a) the Finance Charge Collections deposited or
required to be deposited (before giving effect to any permitted netting) into
the Finance Charge Account and allocable to the Investor Certificates for such
Monthly Period and (b) the Principal Funding Investment Proceeds deposited or
required to be deposited into the Finance Charge Account on the related Transfer
Date (before giving effect to any permitted netting) related to such Monthly
Period, and (c) the amount of the Reserve Draw Amount (up to the Available
Reserve Account Amount) plus any amounts of interest and earnings described in
Section 4.17, each deposited or required to be deposited into the Finance Charge
Account on the Transfer Date (before giving effect to any permitted netting)
relating to such Monthly Period, after subtracting the Investor Default Amount
for such Monthly Period, and the denominator of which is the Investor Interest
as of the close of business on the last day of such Monthly Period.
"PAYMENT DATE" shall mean any Interest Payment Date and any Special
Payment Date.
"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 Agreement or a Series
2001-1 Pay Out Event is deemed to occur pursuant to Section 9 of this Series
Supplement.
"PORTFOLIO ADJUSTED YIELD" means, with respect to any Transfer Date,
the average of the percentages obtained for each of the three preceding Monthly
Periods by subtracting the Base Rate from the Portfolio Yield for such Monthly
Period and deducting 0.50% from the result for each Monthly Period.
"PRINCIPAL ACCOUNT" is defined in subsection 4.16(a).
"PRINCIPAL FUNDING ACCOUNT" is defined in subsection 4.16(a).
"PRINCIPAL FUNDING INVESTMENT PROCEEDS" means, for any Transfer Date,
the sum of Class A Principal Funding Investment Proceeds, Class B Principal
Funding Investment Proceeds and Collateral Interest Principal Funding Investment
Proceeds, in each case for such Transfer Date.
"RAPID AMORTIZATION PERIOD" means the period commencing on the Pay Out
Commencement Date and ending on the Series 2001-1 Termination Date.
"RATING AGENCY" means Xxxxx'x and Standard & Poor's.
"RATING AGENCY CONDITION" means the notification in writing by each
Rating Agency to the Transferor, the Servicer and the Trustee that an action
will not result in any Rating Agency reducing or withdrawing its then existing
rating of the Class A Certificates, the Class B Certificates or the Collateral
Interest.
"REALLOCATED CLASS B PRINCIPAL COLLECTIONS" means, with respect to any
Transfer Date, Principal Collections applied in accordance with subsection
4.14(a) in an amount not to exceed the product of (a) the Class B Investor
Allocation for the Monthly Period relating to such Transfer Date and (b) the
Investor Percentage for the Monthly Period relating to such Transfer Date and
(c) the amount of Principal Collections for the Monthly Period relating to such
Transfer Date; provided 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 COLLATERAL PRINCIPAL COLLECTIONS" means, with respect to
any Transfer Date, Principal Collections applied in accordance with subsections
4.14(a) and (b) in an amount not to exceed the product of (a) the Collateral
Allocation for the Monthly Period relating to such Transfer Date and (b) the
Investor Percentage for the Monthly Period relating to such Transfer Date and
(c) the amount of Principal Collections for the Monthly Period relating to such
Transfer Date; provided that such amount shall not exceed the Collateral
Interest after giving effect to any Collateral Charge-Offs for such Transfer
Date.
"REALLOCATED PRINCIPAL COLLECTIONS" means the sum of (a) Reallocated
Class B Principal Collections and (b) Reallocated Collateral Principal
Collections.
"REFERENCE BANKS" means four major banks in the London interbank
market selected by the Servicer (or the Transferor, if the Back-up Servicer is
Servicer).
"REMAINING UNPAID TRUSTEE FEE" for any Transfer Date, an amount equal
to any Investor Unpaid Trustee Fee not paid out of Class A Available Funds,
Class B Available Funds or Collateral Available Funds.
"REQUIRED COLLATERAL INTEREST" means (a) initially, $30,000,000 and
(b) on any Transfer Date thereafter, an amount equal to the greater of (i) 6% of
the sum of (x) the Class A Adjusted Investor Interest and the Class B Adjusted
Investor Interest on such Transfer Date (after taking into account deposits into
the Principal Funding Account on such Transfer Date and payments to be made on
the related Distribution Date) and (y) the Collateral Interest on the prior
Transfer Date, after any adjustments to be made on such prior Transfer Date, and
(ii) $15,000,000; provided that (x) if either (i) there is a reduction in the
Collateral Interest pursuant to clause (c), (d) or (e) of the definition of such
term or (ii) a Pay Out Event has occurred, the Required Collateral Interest for
any Transfer Date shall (subject to clause (y)) equal the Required Collateral
Interest for the Transfer Date immediately preceding such reduction or Pay Out
Event and (y) in no event shall the Required Collateral Interest exceed the sum
of the outstanding principal amounts of (i) the Class A Certificates and (ii)
the Class B Certificates, each as of the last day of the Monthly Period
preceding such Transfer Date after taking into account the payments to be made
on the related Distribution Date.
"REQUIRED RESERVE ACCOUNT AMOUNT" means, with respect to any Transfer
Date on or after the Reserve Account Funding Date, an amount equal to (a) 0.50%
of the outstanding principal balance of the Investor Certificates or (b) any
other amount designated by the Transferor; provided that if such designation is
of a lesser amount, the Transferor shall (i) provide the Servicer, the
Collateral Interest Holder and the Trustee with evidence that the Rating Agency
Condition has been satisfied and (ii) deliver to the Trustee a certificate of an
authorized officer to the effect that, based on the facts known to such officer
at such time, in the reasonable belief of the Transferor, such designation will
not cause a Pay Out Event or an event that, after the giving of notice or the
lapse of time, would cause a Pay Out Event to occur with respect to Series
2001-1.
"RESERVE ACCOUNT" is defined in subsection 4.17(a).
"RESERVE ACCOUNT FUNDING DATE" means a Transfer Date selected
by the Servicer which occurs not later than the earliest of: (a) the Transfer
Date with respect to the Monthly Period which commences 3 months prior to the
commencement of the Controlled Accumulation Period; (b) the first Transfer Date
for which the Portfolio Adjusted Yield is less than 1.0%, but in such event the
Reserve Account Funding Date shall not be required to occur earlier than the
Transfer Date with respect to the Monthly Period which commences 12 months prior
to the commencement of the Controlled Accumulation Period; (c) the first
Transfer Date for which the Portfolio Adjusted Yield is less than 1.5%, but in
such event the Reserve Account Funding Date shall not be required to occur
earlier than the Transfer Date with respect to the Monthly Period which
commences 6 months prior to the commencement of the Controlled Accumulation
Period; and (d) the first Transfer Date for which the Portfolio Adjusted Yield
is less than 2.0%, but in such event the Reserve Account Funding Date shall not
be required to occur earlier than the Transfer Date with respect to the Monthly
Period which commences 4 months prior to the commencement of the Controlled
Accumulation Period.
"RESERVE ACCOUNT SURPLUS" means, as of any Transfer Date following the
Reserve Account Funding Date, the amount, if any, by which the amount on deposit
in the Reserve Account exceeds the Required Reserve Account Amount.
"RESERVE DRAW AMOUNT" means, for any Transfer Date, the sum of
the Class A Reserve Draw Amount, the Class B Reserve Draw Amount and the
Collateral Interest Reserve Draw Amount, in each case for such Transfer Date.
"RESET DATE" means (a) any date on which (i) Receivables are removed
from the Trust pursuant to Section 2.6 of the Agreement or (ii) if any Series
has been paid in full, Principal Receivables in an aggregate amount
approximately equal to the initial investor interest of such Series are removed
from the Trust or (b) any date on which there is an increase or decrease in the
Investor Interest under any Variable Interest issued by the Trust.
"REVOLVING PERIOD" means the period from and including the Closing
Date to, but not including, the earlier of (a) the day the Controlled
Accumulation Period commences or the Pay Out Commencement Date.
"SECOND TIER RECEIVABLES PURCHASE AGREEMENT" means the Second Tier
Receivables Purchase Agreement, dated as of June 15, 2001, by and between Mellon
Bank, N.A., as seller, and Mellon Premium Finance Loan Owner Trust, as
purchaser, as amended or modified from time to time.
"SERIES 1996-1 PRINCIPAL FUNDING ACCOUNT" means the Principal
Funding Account as defined in subsection 4.16(a) of the Series 1996-1
Supplement.
"SERIES 1996-1 SUPPLEMENT" means the Series 1996-1 Supplement, dated
as of December 1, 1996, to the Pooling and Servicing Agreement, dated December
1, 1996, among the Transferor, the Servicer, the Back-up Servicer, and the
Trustee on behalf of the Series 1996-1 Holders, as amended or modified from time
to time.
"SERIES 2001-1" means the Series of the Mellon Bank Premium Finance
Loan Master Trust represented by the Investor Certificates.
"SERIES 2001-1 CERTIFICATES" means the Class A Certificates and the
Class B Certificates.
"SERIES 2001-1 HOLDERS" means the holder of record of a Series 2001-1
Certificate.
"SERIES 2001-1 PAY OUT EVENT" is defined in Section 9 of this Series
Supplement.
"SERIES 2001-1 TERMINATION DATE" means the earliest to occur of (a)
the Distribution Date on which the Investor Interest is paid in full, (b) the
June 2006 Distribution Date and (c) the Trust Termination Date.
"SERIES FINANCE CHARGE SHORTFALL" means, with respect to any Transfer
Date, an amount equal to the excess, if any, of (a) the sum of the amounts
specified in clauses (a) through (n) of Section 4.13 for that Transfer Date over
(b) the sum of the amounts, if any, with respect to such Transfer Date specified
pursuant to subsections 4.11(a)(v), 4.11(b)(iv) and 4.11 (c)(iii).
"SERIES PRINCIPAL SHORTFALL" means, with respect to any Transfer Date,
the excess, if any, of (a)(i) with respect to any Transfer Date relating to the
Controlled Accumulation Period, the sum of (A) the Controlled Deposit Amount for
such Transfer Date and (B) the excess, if any, of the Collateral Interest for
such Transfer Date (prior to any distributions on such Transfer Date and after
taking into account any adjustments to be made on such Transfer Date pursuant to
Sections 4.12 and 4.14) over the Required Collateral Interest for such Transfer
Date, (ii) with respect to any Transfer Date during the Rapid Amortization
Period, the Adjusted Investor Interest and (iii) with respect to any Transfer
Date relating to the Revolving Period, the excess, if any, of the Collateral
Interest for such Transfer Date (prior to any distributions on such Transfer
Date and after taking into account any adjustments to be made on such Transfer
Date pursuant to Sections 4.12 and 4.14) over the Required Collateral Interest
for such Transfer Date, over (b) the Investor Principal Collections minus the
Reallocated Principal Collections (other than any portions thereof that are
applied pursuant to subsections 4.13(b) and 4.13(d), to the extent applied to
pay the Class A Investor Default Amount and the Class B Investor Default Amount,
respectively) for such Transfer Date.
"SERIES SERVICING FEE PERCENTAGE" means .50%.
"SHARED PRINCIPAL COLLECTIONS" means, as the context requires, either
(a) the amount allocated to the Investor Certificates 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 investor certificates of other Series in
Group One which the applicable 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 Investor Certificates.
"SPECIAL PAYMENT DATE" shall mean each Distribution Date with respect
to the Rapid Amortization Period.
"TELERATE PAGE 3750" means the display page currently so designated on
the Dow Xxxxx Telerate Service (or such other page as may replace that page on
that service for the purpose of displaying comparable rates or prices).
"UNALLOCATED PRINCIPAL COLLECTIONS" is defined in subsection 4.7(d).
"UNPAID TRUSTEE FEE" means, to the extent not paid by Mellon Bank
pursuant to the Fee Agreement, for any Transfer Date, an amount equal to one
twelfth of the Trustee's annual fee of $3,500, plus additional expenses of the
Trustee, as specified in such fee agreement, not to exceed $53,500 per annum.
SECTION 3. SERVICING COMPENSATION. The share of the Servicing Fee
allocable to Series 2001-1 with respect to any Transfer Date (the "INVESTOR
SERVICING FEE") shall be equal to one-twelfth of the product of (i) the Series
Servicing Fee Percentage and (ii) the Adjusted Investor Interest as of the last
day of the Monthly Period preceding such Transfer Date; provided that with
respect to the first Transfer Date, the Investor Servicing Fee shall equal
$104,167. 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 equal one-twelfth of the product of (i) the Class A Floating
Allocation, (ii) Series Servicing Fee Percentage and (iii) the Adjusted Investor
Interest as of the last day of the Monthly Period preceding such Transfer Date;
provided that with respect to the first Transfer Date, the Class A Servicing Fee
shall equal $93,750. 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 equal one-twelfth of the product of (i) the Class B
Floating Allocation, (ii) the Series Servicing Fee Percentage and (iii) the
Adjusted Investor Interest as of the last day of the Monthly Period preceding
such Transfer Date; provided that with respect to the first Transfer Date, the
Class B Servicing Fee shall equal $4,167. The share of the Investor Servicing
Fee allocable to the Collateral Interest with respect to any Transfer Date (the
"COLLATERAL INTEREST SERVICING FEE") shall equal one-twelfth of the product of
(i) the Collateral Floating Allocation, (ii) the Series Servicing Fee Percentage
and (iii) the Adjusted Investor Interest as of the last day of the Monthly
Period preceding such Transfer Date; provided that with respect to the first
Transfer Date, the Collateral Interest Servicing Fee shall equal $6,250. Except
as specifically provided above, the Servicing Fee shall be paid by the cash
flows from the Trust allocated to the Transferor or the certificateholders of
other Series (as provided in the related Supplements) and in no event shall the
Trust, the Trustee or the Investor Holders 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
4.11(a)(iii) and 4.13(b). The Class B Servicing Fee shall be payable solely to
the extent amounts are available for distribution in respect thereof pursuant to
subsections 4.11(b)(iii) and 4.13(d). The Collateral Interest Servicing Fee
shall be payable solely to the extent amounts are available for distribution in
respect thereof pursuant to subsection 4.13(g) or if applicable subsection
4.11(c)(ii).
SECTION 4. REASSIGNMENT AND TRANSFER TERMS. The Investor Certificates
shall be subject to retransfer to the Transferor at its option, in accordance
with subsection 12.2(a) of the Agreement, on any Distribution Date on or after
the Distribution Date on which the Investor Interest is reduced to an amount
less than or equal to 5% of the Initial Investor Interest. The deposit required
in connection with any such repurchase shall include the amount, if any, on
deposit in the Principal Funding Account and will be equal to the sum of (a) the
Investor Interest and (b) accrued and unpaid interest on the Investor
Certificates through the day preceding the Distribution Date on which the
repurchase occurs.
SECTION 5. DELIVERY AND PAYMENT FOR THE INVESTOR CERTIFICATES. The
Transferor shall execute and deliver the Series 2001-1 Certificates to the
Trustee for authentication in accordance with Section 6.1. The Trustee shall
deliver such Certificates when authenticated in accordance with Section 6.2.
SECTION 6. DEPOSITORY; FORM OF DELIVERY OF INVESTOR CERTIFICATES. (a)
The Class A Certificates and the Class B Certificates shall be delivered as
Book-Entry Certificates as provided in Sections 6.1 and 6.10.
(b) The Depository for Series 2001-1 shall be The Depository Trust
Company, and the Class A Certificates and Class B Certificates shall be
initially registered in the name of Cede & Co., its nominee.
SECTION 7. ARTICLE IV OF AGREEMENT. Sections 4.1 through 4.5 shall
read in their entirety as provided in the Agreement. Article IV (except for
Sections 4.1 through 4.5 thereof) shall be read in its entirety as follows and
shall be applicable only to the Investor Certificates:
ARTICLE IV
RIGHTS OF HOLDERS AND ALLOCATION AND
APPLICATION OF COLLECTIONS
SECTION 4.6 RIGHTS OF HOLDERS AND THE COLLATERAL INTEREST HOLDER. The
Investor Certificates shall represent undivided interests in the Trust,
consisting of the right to receive, to the extent necessary to make the required
payments with respect to such Investor Certificates at the times and in the
amounts specified in this Agreement, (a) the applicable Investor Percentage of
Collections received with respect to the Receivables and (b) funds on deposit in
the Collection Account, the Finance Charge Account, the Excess Funding Account,
the Principal Account, the Principal Funding Account, the Reserve Account and
the Distribution Account. The Collateral Interest shall be subordinate to the
Class A Certificates and the Class B Certificates to the extent described
herein. The Class B Certificates shall be subordinate to the Class A
Certificates to the extent described herein. The Transferor shall not have any
interest in the Collection Account, the Finance Charge Account, the Excess
Funding Account, the Principal Account, the Principal Funding Account, the
Reserve Account or the Distribution Account, except as specifically provided in
this Article IV.
SECTION 4.7 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 Holders or the Transferor and pay or deposit from the Collection
Account the following amounts as set forth below (subject to Section 4.3):
(i) Allocate to the Investor Holders and deposit into the Finance
Charge Account an amount equal to the product of (A) the Investor
Percentage on the Date of Processing of such Collections and (B) the
Finance Charge Collections on such Date of Processing to be applied in
accordance with Section 4.11.
(ii) Allocate to the Investor Holders and deposit into the Principal
Account an amount equal to the product of (A) the Collateral
Allocation on the Date of Processing of such Collections, (B) the
Investor Percentage on the Date of Processing of such Collections and
(C) the aggregate amount of Principal Collections on such Date of
Processing to be applied first in accordance with Section 4.14 and
then in accordance with subsection 4.11(d).
(iii) Allocate to the Investor Holders and deposit into the Principal
Account an amount equal to the product of (A) the Class B Investor
Allocation on the Date of Processing of such Collections, (B) the
Investor Percentage on the Date of Processing of such Collections and
(C) the aggregate amount of Principal Collections on such Date of
Processing to be applied first in accordance with Section 4.14 and
then in accordance with subsection 4.11(d).
(iv) (A) Allocate to the Investor Holders and deposit into the
Principal Account an amount equal to the product of (1) the Class A
Investor Allocation on the Date of Processing of such Collections, (2)
the Investor Percentage on the Date of Processing of such Collections
and (3) the aggregate amount of Principal Collections on such Date of
Processing; provided that the amount deposited into the Principal
Account pursuant to this subsection 4.7(a)(iv)(A) shall not exceed the
Daily Principal Shortfall, and (B) pay to the Transferor an amount
equal to the excess, if any, identified in the proviso to clause (A)
above; provided that the amount to be paid to the Transferor pursuant
to this subsection 4.7(a)(iv)(B) with respect to any Date of
Processing shall be paid to the Transferor only to the extent that the
Transferor Interest on such Date of Processing is greater than zero
(after giving effect to the inclusion in the Trust of all Receivables
transferred to the Trust on or prior to such Date of Processing and
the application of payments referred to in subsection 4.3(b)) and
otherwise shall be deposited into the Excess Funding Account in
accordance with subsection 4.7(d).
(b) ALLOCATIONS DURING THE CONTROLLED ACCUMULATION PERIOD. During the
Controlled Accumulation 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 Holders or the Transferor and pay or deposit from the
Collection Account the following amounts as set forth below (subject to Section
4.3):
(i) Allocate to the Investor Holders and deposit into the Finance
Charge Account an amount equal to the product of (A) the Investor
Percentage on the Date of Processing of such Collections and (B) the
aggregate amount of Collections processed in respect of Finance Charge
Receivables on such Date of Processing to be applied in accordance
with Section 4.11.
(ii) Allocate to the Investor Holders and deposit into the Principal
Account an amount equal to the product of (A) the Collateral
Allocation on the Date of Processing of such Collections, (B) the
Investor Percentage on the Date of Processing of such Collections and
(C) the aggregate amount of Principal Collections on such Date of
Processing to be applied first in accordance with Section 4.14 and
then in accordance with subsection 4.11(e).
(iii) Allocate to the Investor Holders and deposit into the Principal
Account an amount equal to the product of (A) the Class B Investor
Allocation on the Date of Processing of such Collections, (B) the
Investor Percentage on the Date of Processing of such Collections and
(C) the aggregate amount of Principal Collections on such Date of
Processing to be applied first in accordance with Section 4.14 and
then in accordance with subsection 4.11(e).
(iv) (A) Allocate to the Investor Holders and deposit into the
Principal Account an amount equal to the product of (1) the Class A
Investor Allocation on the Date of Processing of such Collections, (2)
the Investor Percentage on the Date of Processing of such Collections
and (3) the aggregate amount of Principal Collections on such Date of
Processing; provided that the amount deposited into the Principal
Account pursuant to this subsection 4.7(b)(iv)(A) shall not exceed the
Daily Principal Shortfall, and (B) pay to the Transferor an amount
equal to the excess identified in the proviso to clause (A) above, if
any; provided that the amount to be paid to the Transferor pursuant to
this subsection 4.7(b)(iv)(B) with respect to any Date of Processing
shall be paid to the Transferor only to the extent that the Transferor
Interest on such Date of Processing is greater than zero (after giving
effect to the inclusion in the Trust of all Receivables transferred to
the Trust on or prior to such Date of Processing and the application
of payments referred to in subsection 4.3(b)) and otherwise shall be
deposited into the Excess Funding Account in accordance with
subsection 4.7(d).
(c) 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
Investor Holders and pay or deposit from the Collection Account the following
amounts as set forth below (subject to Section 4.3):
(i) Deposit into the Finance Charge Account an amount equal to the
product of (A) the Investor Percentage on the Date of Processing of
such Collections and (B) the aggregate amount of Collections processed
in respect of Finance Charge Receivables on such Date of Processing to
be applied in accordance with Section 4.11.
(ii) (A) Deposit into the Principal Account an amount equal to the
product of (1) the Investor Percentage on the Date of Processing of
such Collections and (2) the aggregate amount of Principal Collections
on such Date of Processing; provided that the aggregate amount
deposited into the Principal Account pursuant to this subsection
4.7(c)(ii)(A) shall not exceed the sum of the Investor Interest as of
the close of business on the last day of the prior Monthly Period
(after taking into account any payments to be made on the Distribution
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 any Reallocated
Principal Collections relating to the Monthly Period in which such
deposit is made and (B) pay to the Transferor an amount equal to the
excess, if any, identified in the proviso to clause (A) above;
provided that the amount to be paid to the Transferor pursuant to this
subsection 4.7(c)(ii)(B) with respect to any Date of Processing shall
be paid to the Transferor only to the extent that the Transferor
Interest on such Date of Processing is greater than zero (after giving
effect to the inclusion in the Trust of all Receivables transferred to
the Trust on or prior to such Date of Processing and the application
of payments referred to in subsection 4.3(b)) and otherwise shall be
deposited into the Excess Funding Account in accordance with
subsection 4.7(d).
(d) EXCESS FUNDING ACCOUNT. Any Principal Collections or Finance
Charge Collections not allocated and paid to the Transferor because of the
limitations contained in subsections 4.7(a)(iv)(B), 4.7(b)(iv)(B) and
4.7(c)(ii)(B) and any amounts allocable to the Investor Certificates deposited
in the Principal Account pursuant to subsection 2.4(d)(iii) of the Agreement
("UNALLOCATED PRINCIPAL COLLECTIONS") shall be held in the Excess Funding
Account and, prior to the commencement of the Controlled Accumulation Period or
the Rapid Amortization Period shall be paid to the Transferor when, and only to
the extent that, the Transferor Interest is greater than zero. For each Transfer
Date with respect to the Controlled Accumulation Period or the Rapid
Amortization Period, any such Unallocated Principal Collections held in the
Excess Funding Account on such Transfer Date shall be included in the Investor
Principal Collections which to the extent available shall be distributed as
Available Investor Principal Collections to be applied pursuant to Section 4.11
on such Transfer Date.
With respect to the Investor Certificates, and notwithstanding
anything in the Agreement or this Series Supplement to the contrary, if at any
time the Servicer is required to make daily deposits from the Collection Account
into the Finance Charge Account or the Principal Account pursuant to subsections
4.7(a), 4.7(b) and 4.7(c) with respect to any Monthly Period:
(i) on or after the related Determination Date, the Servicer may
withdraw from the Finance Charge Account and the Principal Account any
portion of the principal balance held in each such account in excess
of the aggregate amount that will be required to be distributed to
Investor Holders, distributed in accordance with the Loan Agreement or
deposited in the Principal Funding Account from that account (directly
or after deposit into the Distribution Account) on the related
Distribution Date and transfer such funds to the Transferor (except
that any such excess amount held in the Principal Account, and any
portion of such excess amount held in the Finance Charge Account that
would have been treated as a portion of Investor Principal Collections
on the related Transfer Date, shall be transferred to the Transferor
only to the extent that the Transferor Interest on the date of
transfer is greater than zero (after giving effect to the inclusion in
the Trust of all Receivables transferred to the Trust on or prior to
such date and the application of payments referred to in subsection
4.3(b) and otherwise shall be deposited into the Excess Funding
Account in accordance with subsection 4.7(d)); and
(ii) on any date, the Servicer may withdraw from the Collection
Account, the Finance Charge Account or the Principal Account any
amounts inadvertently deposited in such account that should not have
been so deposited.
SECTION 4.8 DETERMINATION OF MONTHLY INTEREST. (a) The amount of
monthly interest distributable from the Finance Charge Account with respect to
the Class A Certificates on any Transfer Date (the "CLASS A MONTHLY INTEREST")
shall equal the lesser of (x) Class A Available Funds for the related Monthly
Period, less the sum of (i) the Class A Unpaid Trustee Fee, if any, for such
Transfer Date and (ii) if the Originators are not the Servicer, the Class A
Servicing Fee for the related Monthly Period and (y) the product of (i)(A) a
fraction, the numerator of which is the actual number of days in the period (the
"MONTHLY INTEREST PERIOD") from (and including) the immediately preceding
Distribution Date (or in the case of the first Distribution Date, the Closing
Date) to (but excluding) the related Distribution Date and the denominator of
which is 360, times (B) the Class A Certificate Rate, times (ii) the outstanding
principal balance of the Class A Certificates determined as of the Record Date
preceding the related Transfer Date (interest computed pursuant to clause (y),
the "CLASS A OPTIMAL INTEREST"); provided that in addition to Class A Monthly
Interest an amount equal to the amount of any unpaid Class A Deficiency Amounts,
as defined below, from prior Monthly Interest Periods, plus an amount equal to
the product of (A)(1) a fraction, the numerator of which is the actual number of
days in the related Monthly Interest Period and the denominator of which is 360,
times (2) the sum of the Class A Certificate Rate in effect with respect to the
related Monthly Period and 2% per annum and (B) 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 Holders) (the "CLASS A ADDITIONAL
INTEREST") shall also be distributable from the Finance Charge Account with
respect to the Class A Certificates on any Transfer Date, and on such Transfer
Date the Trustee shall deposit such funds, to the extent available, into the
Distribution Account. The "CLASS A DEFICIENCY AMOUNT" for any Transfer Date
shall equal the excess, if any, of the aggregate amount distributable pursuant
to this subsection 4.8(a) for the prior Monthly Interest Period over the amount
actually deposited or available to be deposited on such Transfer Date into the
Class A Interest Funding Account for payment to the Class A Holders on the
applicable Payment Date.
(b) The amount of monthly interest distributable from the Finance
Charge Account with respect to the Class B Certificates on any Transfer Date
(the "CLASS B MONTHLY INTEREST") shall equal the lesser of (x) Class B Available
Funds for the related Monthly Period less the sum of (i) the Class B Unpaid
Trustee Fee, if any, for such Transfer Date and (ii) if the Originators are not
the Servicer, the Class B Servicing Fee for the related Monthly Period and (y)
the product of (i)(A) a fraction, the numerator of which is the actual number of
days in the period from (and including) the immediately preceding Distribution
Date (or in the case of the first Distribution Date, the Closing Date) to (but
excluding) the related Distribution Date and the denominator of which is 360,
times (B) the Class B Certificate Rate, times (ii) the outstanding principal
balance of the Class B Certificates determined as of the Record Date preceding
the related Transfer Date (interest computed pursuant to clause (y), the "CLASS
B OPTIMAL INTEREST"); provided that in addition to Class B Monthly Interest an
amount equal to the amount of any unpaid Class B Deficiency Amounts, as defined
below, from prior Monthly Interest Periods, plus an amount equal to the product
of (A) (1) a fraction, the numerator of which is the actual number of days in
the related Monthly Interest Period and the denominator of which is 360 times
(2) the sum of the Class B Certificate Rate in effect with respect to the
related Monthly Period and 2% per annum and (B) 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 Holders) (the "CLASS B ADDITIONAL
INTEREST") shall also be distributable from the Finance Charge Account with
respect to the Class B Certificates on any Transfer Date, and on such Transfer
Date the Trustee shall deposit such funds, to the extent available, into the
Distribution Account. The "CLASS B DEFICIENCY AMOUNT" for any Transfer Date
shall equal the excess, if any, of the aggregate amount distributable pursuant
to this subsection 4.8(b) as of the prior Monthly Interest Period over the
amount actually deposited or available to be deposited on such Transfer Date
into the Class B Interest Funding Account for payment to the Class B Holders on
the applicable Payment Date.
(c) The amount of monthly interest distributable with respect to the
Collateral Interest on any Transfer Date, as set forth in Section 4.13, shall
equal the product of (i)(A) a fraction, the numerator of which is the actual
number of days in the period from (and including) the immediately preceding
Distribution Date (or in the case of the first Distribution Date, the Closing
Date) to (but excluding) the related Distribution Date and the denominator of
which is 360, times (B) the Collateral Rate in effect with respect to the
related Interest Period, times (ii) the Collateral Interest determined as of the
Record Date preceding such Transfer Date (the "COLLATERAL MONTHLY INTEREST");
provided that for purposes of determining Collateral Monthly Interest only, the
Collateral Rate shall not exceed a per annum rate of 2% in excess of LIBOR as
determined on the related LIBOR Determination Date.
(d) In the event a Class A Shortfall Amount or Class B Shortfall
Amount is not paid on any Distribution Date pursuant to subsections 4.13(l) or
(m), as the case may be, interest shall accrue on such Class A Shortfall Amount
or Class B Shortfall Amount, as applicable, at the applicable Class A
Certificate Rate or Class B Certificate Rate plus 2% (such Shortfall Amount plus
interest thereon, compounded monthly, a "CLASS A CARRY-OVER AMOUNT" or "CLASS B
CARRY-OVER AMOUNT", respectively) and shall be payable on the next succeeding
Distribution Date as set forth in subsections 4.13(l) or (m), as applicable.
SECTION 4.9 DETERMINATION OF MONTHLY PRINCIPAL. (a) The amount of
monthly principal distributable from the Principal Account with respect to the
Class A Certificates on each Transfer Date ("CLASS A MONTHLY PRINCIPAL") shall
be equal to (i) during the Controlled Accumulation Period, beginning with the
Transfer Date in the month following the month in which the Controlled
Accumulation Period begins, the least of (x) the Available Investor Principal
Collections on deposit in the Principal Account with respect to such Transfer
Date, (y) the Class A Controlled Deposit Amount for such Transfer Date and (z)
the Class A Adjusted Investor Interest on such Transfer Date, prior to any
deposit into the Class A Principal Funding Account to be made on such day (and
after taking into account any adjustments to be made on such Transfer Date
pursuant to Section 4.12) and (ii) during the Rapid Amortization Period, the
lesser of (x) the Available Investor Principal Collections on deposit in the
Principal Account with respect to such Transfer Date and (y) the Class A
Investor Interest prior to any distributions with respect to such Transfer Date
(and after taking into account any adjustments to be made on such Transfer Date
pursuant to Section 4.12).
(b) The amount of monthly principal distributable from the Principal
Account with respect to the Class B Certificates on each Transfer Date (the
"CLASS B MONTHLY PRINCIPAL") shall be equal to (i) during the Controlled
Accumulation Period, beginning with the Transfer Date in the month following the
month in which the Controlled Accumulation Period begins, the least of (x) the
excess, if any of (A) the Available Investor Principal Collections over (B)
Class A Monthly Principal on such Transfer Date, (y) the Class B Controlled
Deposit Amount for such Transfer Date and (z) the Class B Adjusted Investor
Interest on such Transfer Date, prior to any deposit into the Class B Principal
Funding Account to be made on such date (and after taking into account any
adjustments to be made on such Transfer Date pursuant to Sections 4.12 and 4.14)
and (ii) during the Rapid Amortization Period, beginning with the Transfer Date
on which the Class A Investor Interest is reduced to zero (after giving effect
to payments of Class A Monthly Principal to be made on the related Distribution
Date), the lesser of (x) the excess, if any of (A) the Available Investor
Principal Collections over (B) any Class A Monthly Principal on such Transfer
Date and (y) the Class B Investor Interest on such Transfer Date, prior to any
distributions with respect to such Transfer Date (and after taking into account
any adjustments to be made on such Transfer Date pursuant to Section 4.12 and
4.14).
(c) The amount of monthly principal distributable from the Principal
Account with respect to the Collateral Interest on each Transfer Date (the
"COLLATERAL MONTHLY PRINCIPAL") shall be equal to (i) during the Revolving
Period, an amount equal to the lesser of (x) the excess, if any, of the
Collateral Interest (prior to any distributions to be made on such Transfer Date
and after taking into account any adjustments to be made on such Transfer Date
pursuant to Sections 4.12 and 4.14) over the Required Collateral Interest and
(y) Available Investor Principal Collections, (ii) during the Controlled
Accumulation Period, beginning with the Transfer Date in the month following the
month in which the Controlled Accumulation Period begins, the least of (x) the
excess, if any of (A) the Available Investor Principal Collections over (B) the
sum of (1) the Class A Monthly Principal and (2) the Class B Monthly Principal
on such Transfer Date, (y) the sum of (A) the Collateral Interest Controlled
Deposit Amount for such Transfer Date plus (B) the excess, if any, of the
Collateral Interest for such Transfer Date (prior to any distributions on such
Transfer Date and after taking into account any adjustments to be made pursuant
to Sections 4.12 and 4.14) over the Required Collateral Interest for such
Transfer Date and (z) the Collateral Interest Adjusted Investor Interest on such
Transfer Date, prior to any deposit into the Collateral Interest Principal
Funding Account to be made on such date (and after taking into account any
adjustments to be made on such Transfer Date pursuant to Sections 4.12 and 4.14)
and (iii) during the Rapid Amortization Period, beginning with the Transfer Date
on which both the Class A Investor Interest and the Class B Investor Interest
have been reduced to zero (after giving effect to payments of Class A Monthly
Principal and/or Class B Monthly Principal to be made on the related
Distribution Date), the lesser of (x) the excess, if any of (A) the Available
Investor Principal Collections over (B) the sum of any Class A Monthly Principal
and any Class B Monthly Principal on such Transfer Date and (y) the Collateral
Interest on such Transfer Date, prior to any distributions with respect to such
Transfer Date (and after taking into account any adjustments to be made on such
Transfer Date pursuant to Section 4.12 and 4.14).
SECTION 4.10 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 the sum of (i) the Class A Unpaid Trustee Fee, if
any, for such Transfer Date, (ii) the Class A Monthly Interest for such Transfer
Date, (iii) the Class A Deficiency Amount, if any, for such Transfer Date, (iv)
the Class A Additional Interest, if any, for such Transfer Date, (v) the Class A
Servicing Fee for the prior Monthly Period, (vi) the Class A Servicing Fee, if
any, due but not paid on any prior Transfer Date and (vii) the Class A Investor
Default Amount, if any, for such Transfer Date, exceeds the Class A Available
Funds deposited or available to be deposited for the related Monthly Period.
(b) On or before each Transfer Date, the Servicer shall also 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 Unpaid Trustee Fee, if any,
for such Transfer Date, (B) the Class B Monthly Interest for such Transfer Date,
(C) the Class B Deficiency Amount, if any, for such Transfer Date, (D) the Class
B Additional Interest, if any, for such Transfer Date, (E) the Class B Servicing
Fee for the prior Monthly Period and (F) the Class B Servicing Fee, if any, due
but not paid on any prior Transfer Date, exceeds the Class B Available Funds
deposited or available to be deposited for the related Monthly Period plus (ii)
the Class B Investor Default Amount, if any, for the prior Monthly Period.
(c) If the Class A Required Amount or 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 or Class B Required
Amount on or before such Transfer Date. In addition:
(i) If the Class A Required Amount for such Transfer Date is greater
than zero, all or a portion of the Excess Spread with respect to such
Transfer Date in an amount equal to the Class A Required Amount, to
the extent available, for such Transfer Date after application of
Excess Spread pursuant to subsection 4.13(a), shall be distributed
from the Finance Charge Account on such Transfer Date pursuant to
subsection 4.13(b). If the Class A Required Amount for such Transfer
Date exceeds the amount of Excess Spread available to fund the Class A
Required Amount pursuant to subsection 4.13(b), the Principal
Collections allocable to the Collateral Interest and the Class B
Investor Interest with respect to the prior Monthly Period shall be
applied as specified in Section 4.14.
(ii) If the Class B Required Amount for such Transfer Date is greater
than zero, all or a portion of the Excess Spread with respect to such
Transfer Date in an amount equal to the Class B Required Amount, to
the extent available, for such Transfer Date, after application of
Excess Spread pursuant to subsections 4.13(a), (b) and (c), shall be
distributed from the Finance Charge Account on such Transfer Date
pursuant to subsection 4.13(d). If the Class B Required Amount for
such Transfer Date exceeds the amount of Excess Spread available to
fund the Class B Required Amount pursuant to subsection 4.13(d), the
Principal Collections allocable to the Collateral Interest with
respect to the prior Monthly Period (after application to the Class A
Required Amount) shall be applied as specified in Section 4.14;
provided 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 4.11 MONTHLY PAYMENTS. On or before the second Business Day
prior to each Transfer Date, the Servicer shall instruct the Trustee in writing
(which writing shall be substantially in the form of Exhibit B) to withdraw, and
on such Transfer Date or the related Distribution Date, as applicable, the
Trustee, acting in accordance with such instructions, shall withdraw, to the
extent of available funds, the amounts required to be withdrawn from the Finance
Charge Account, the Principal Account and the Principal Funding Account as
follows:
(a) An amount equal to the Class A Available Funds for the related
Monthly Period will be distributed or deposited on each Transfer Date, to the
extent available, in the following priority:
(i) an amount equal to the Class A Unpaid Trustee Fee shall be
distributed to the Trustee;
(ii) an amount equal to Class A Monthly Interest, plus any Class A
Deficiency Amount, plus any Class A Additional Interest (in each case
for such Transfer Date) shall be deposited by the Servicer or the
Trustee into the Class A Interest Funding Account for payment to Class
A Holders on the applicable Payment Date;
(iii) an amount equal to the Class A Servicing Fee for such Transfer
Date, plus any Class A Servicing Fee due but not paid to the Servicer
on any prior Transfer Date shall be distributed to the Servicer;
(iv) 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
(v) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed or deposited as set forth in Section 4.13.
If the Back-up Servicer is the Servicer, the amounts described in
clause (iii) of this subsection 4.11(a) shall be paid prior to the amounts
described in clause (ii) of this subsection 4.11(a).
(b) An amount equal to the Class B Available Funds for the related
Monthly Period will be distributed or deposited on each Transfer Date, to the
extent available, in the following priority:
(i) an amount equal to the Class B Unpaid Trustee Fee shall be
distributed to the Trustee;
(ii) an amount equal to the Class B Monthly Interest, plus any Class B
Deficiency Amount, plus any Class B Additional Interest (in each case
for such Transfer Date) shall be deposited by the Servicer or the
Trustee into the Class B Interest Funding Account for payment to the
Class B Holders on the applicable Payment Date;
(iii) an amount equal to the Class B Servicing Fee for such Transfer
Date, plus any Class B Servicing Fee due but not paid to the Servicer
on any prior Transfer Date shall be distributed to the Servicer; and
(iv) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed or deposited as set forth in Section 4.13.
If the Back-up Servicer is the Servicer, the amounts described in
clause (iii) of this subsection 4.11(b) shall be paid prior to the amounts
described in clause (ii) of this subsection 4.11(b).
(c) An amount equal to the Collateral Available Funds for the related
Monthly Period will be distributed or deposited on each Transfer Date, to the
extent available, in the following priority:
(i) an amount equal to the Collateral Unpaid Trustee Fee shall be
distributed to the Trustee;
(ii) if the Originators are no longer the Servicer, an amount equal to
the Collateral Interest Servicing Fee for such Transfer Date, plus any
Collateral Interest Servicing Fee due but not paid to the Servicer on
any prior Transfer Date shall be distributed to the Servicer; and
(iii) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed or deposited as set forth in Section 4.13.
(d) During the Revolving Period, an amount equal to the Available
Investor Principal Collections for the related Monthly Period will be
distributed on each Transfer Date, to the extent available, in the following
priority:
(i) an amount equal to the Collateral Monthly Principal for such
Transfer Date shall be distributed to the Collateral Interest Holder
in accordance with the Loan Agreement;
(ii) 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
subsection 4.11(d)(i) 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 and (B) such
remaining 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 2001-1; and
(iii) 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 4.11(d)(i) and (ii) above shall
be paid to the Transferor; provided that the amount to be paid to the
Transferor pursuant to this subsection 4.11(d)(iii) with respect to
such Transfer Date shall be paid to the Transferor only to the extent
that the Transferor Interest on such Transfer Date is greater than
zero (after giving effect to the inclusion in the Trust of all
Receivables transferred to the Trust on or prior to such Transfer Date
and the application of payments referred to in subsection 4.3(b)) and
otherwise shall be deposited into the Excess Funding Account in
accordance with subsection 4.7(d).
(e) During the Controlled Accumulation Period or the Rapid
Amortization Period, an amount equal to the Available Investor Principal
Collections for the related Monthly Period will be distributed on each Transfer
Date, to the extent available, in the following priority:
(i) an amount equal to the Class A Monthly Principal for such Transfer
Date shall be (A) during the Controlled Accumulation Period, deposited
into the Class A Principal Funding Account, and (B) during the Rapid
Amortization Period, deposited into the Distribution Account;
(ii) after giving effect to the distribution referred to in clause
(i), an amount equal to the Class B Monthly Principal for such
Transfer Date, shall be (A) during the Controlled Accumulation Period,
deposited into the Class B Principal Funding Account and (B) during
the Rapid Amortization Period, deposited into the Distribution
Account;
(iii) after giving effect to the distributions referred to in clauses
(i) and (ii), an amount equal to the Collateral Monthly Principal for
such Transfer Date, shall be (A) during the Controlled Accumulation
Period, first distributed to the Collateral Interest Holder in
accordance with the Loan Agreement, in an amount equal to the excess,
if any, of the Collateral Interest (prior to any distributions on such
Transfer Date and after taking into account any adjustments to be made
on such Transfer Date pursuant to Sections 4.12 and 4.14) over the
Required Collateral Interest for such Transfer Date and second, the
remainder deposited into the Collateral Interest Principal Funding
Account and (B) during the Rapid Amortization Period, deposited into
the Distribution 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 4.11(e)(i), (ii) and (iii) and the denominator of which is
equal to the sum of the Available Investor Principal Collections
available for sharing as specified in the related Supplement for each
Series in Group One and (2) the Cumulative Series Principal Shortfall
and (B) such remaining 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
2001-1; and
(v) an amount equal to the excess, if any, of (A) the Available
Investor Principal Collections over (B) the applications specified in
subsections 4.11(e)(i) through (iv) shall be paid to the Transferor;
provided that the amount to be paid to the Transferor pursuant to this
subsection 4.11(e)(v) with respect to such Transfer Date shall be paid
to the Transferor only to the extent that the Transferor Interest on
such Transfer Date is greater than zero (after giving effect to the
inclusion in the Trust of all Receivables transferred to the Trust on
or prior to such Transfer Date and the application of payments
referred to in subsection 4.3(b)) and otherwise shall be deposited
into the Excess Funding Account in accordance with subsection 4.7(d).
(f) On the earlier to occur of (i) the first Transfer Date with
respect to the Rapid Amortization Period and (ii) the Transfer Date immediately
preceding the Class A Scheduled Payment Date, the Trustee, acting in accordance
with instructions from the Servicer, shall withdraw from the Principal Funding
Account and deposit in the Distribution Account the amount on deposit in the
Principal Funding Account.
(g) On each Payment Date, the Trustee, acting in accordance with
instructions from the Servicer, shall pay in accordance with Section 5.1, (a) to
the Class A Holders, the amount on deposit in the Class A Interest Funding
Account on the related Transfer Date, (b) to the Class B Holders from the Class
B Interest Funding Account, the amount on deposit in the Class B Interest
Funding Account on the related Transfer Date and (c) to the Collateral Interest
Holder, the amount on deposit in the Collateral Interest Funding Account on the
related Transfer Date.
(h) On the earlier to occur of (i) the first Special Payment Date with
respect to the Rapid Amortization Period and (ii) the Class A Scheduled Payment
Date and on each Payment Date thereafter, the Trustee, acting in accordance with
instructions from the Servicer, shall pay in accordance with Section 5.1 from
the Distribution Account the amount so deposited into the Distribution Account
pursuant to subsections 4.11(e) and (f) on the related Transfer Date in the
following priority:
(i) an amount equal to the lesser of such amount on deposit in the
Distribution Account and the Class A Investor Interest shall be paid
to the Class A Holders;
(ii) for each Special Payment Date with respect to the Rapid
Amortization Period and on the Class B Scheduled Payment Date, after
giving effect to the distributions referred to in clause (i) above, an
amount equal to the lesser of such amount on deposit in the
Distribution Account and the Class B Investor Interest shall be paid
to the Class B Holders; and
(iii) for each Special Payment Date with respect to the Rapid
Amortization Period and on the Collateral Interest Scheduled Payment
Date, after giving effect to the distributions referred to in clauses
(i) and (ii) above, an amount equal to the lesser of such amount on
deposit in the Distribution Account and the Collateral Interest shall
be paid to the Collateral Interest Holder.
(i) The Controlled Accumulation Period is scheduled to commence at the
close of business on the Controlled Accumulation Date; provided that if the
Controlled Accumulation Period Length (determined as described below) on any
Determination Date on or after the Determination Date preceding the September
2003 Monthly Period is less than nine months, upon written notice to the
Trustee, the Transferor and each Rating Agency, the Servicer, at its option, may
elect to modify the date on which the Controlled Accumulation Period actually
commences to the first day of the month that is a number of months at least
equal to the Controlled Accumulation Period Length (so that, as a result of such
election, the number of Monthly Periods in the Controlled Accumulation Period
will at least equal the Controlled Accumulation Period Length); provided that
(i) the length of the Controlled Accumulation Period will not be less than six
months; (ii) such determination of the Controlled Accumulation Period Length
shall be made on each Determination Date on and after the Determination Date
preceding the September 2003 Monthly Period but prior to the commencement of the
Controlled Accumulation Period, and any election to shorten the Controlled
Accumulation Period shall be subject to the subsequent lengthening of the
Controlled Accumulation Period to the Controlled Accumulation Period Length
determined on any subsequent Determination Date, but the Controlled Accumulation
Period shall in no event commence prior to the Controlled Accumulation Date, and
(iii) notwithstanding any other provision of this Series Supplement to the
contrary, no election to postpone the commencement of the Controlled
Accumulation Period shall be made after a Pay Out Event shall have occurred and
be continuing with respect to any other Series. The "CONTROLLED ACCUMULATION
PERIOD LENGTH" will mean a number of months such that the amount available for
distribution of principal first, on the Class A Certificates on the Class A
Scheduled Payment Date, second, on the Class B Certificates on the Class B
Scheduled Payment Date, and third, on the Collateral Interest on the Collateral
Interest Scheduled Payment Date is expected to equal or exceed the Class A
Investor Interest, the Class B Investor Interest and the Collateral Interest,
respectively, assuming for this purpose that (1) the payment rate with respect
to Principal Collections remains constant at the lowest level of such payment
rate during the nine preceding Monthly Periods (or such lower payment rate as
the Servicer may select), (2) the total amount of Principal Receivables in the
Trust (and the principal amount on deposit in the Excess Funding Account, if
any) remains constant at the level on such date of determination, (3) no Pay Out
Event with respect to any Series will subsequently occur and (4) no additional
Series (other than any Series being issued on such date of determination) will
be subsequently issued. Any notice by the Servicer electing to modify the
commencement of the Controlled Accumulation Period pursuant to this clause (i)
shall specify (i) the Controlled Accumulation Period Length, (ii) the
commencement date of the Controlled Accumulation Period and (iii) the Class A
Controlled Accumulation Amount, the Class B Controlled Accumulation Amount, and
the Collateral Interest Controlled Accumulation Amount with respect to each
Monthly Period during the Controlled Accumulation Period.
SECTION 4.12 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 the related Monthly
Period exceeds the sum of the amount allocated with respect thereto pursuant to
subsection 4.11(a)(iv), subsection 4.13(b) and Section 4.14 with respect to such
Monthly Period, the Collateral Interest (after giving effect to reductions for
any Collateral Charge-Offs and any Reallocated Principal Collections on such
Transfer Date) will be reduced by the amount of such excess, but not by more
than the lesser of the Class A Investor Default Amount and the Collateral
Interest (after giving effect to reductions for any Collateral Charge-Offs and
any Reallocated Principal Collections on such Transfer Date) for such Transfer
Date. If reduction for such excess would have caused the Collateral Interest to
be a negative number, the Collateral Interest will 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 Class B Principal Collections on such
Transfer Date) will be reduced by the amount by which the Collateral Interest
would have been reduced below zero. If such reduction would cause the Class B
Investor Interest to be a negative number, the Class B Investor Interest will be
reduced to zero, and the Class A Investor Interest will be reduced 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"). If the Class A Investor Interest has been
reduced by the amount of any Class A Investor Charge-Offs, it will be reimbursed
on any Transfer Date thereafter (but not by an amount in excess of the aggregate
Class A Investor Charge-Offs) by the amount of Excess Spread allocated and
available for such purpose pursuant to subsection 4.13(c).
(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 the related Monthly Period exceeds the amount of Excess
Spread and Reallocated Collateral Principal Collections which are allocated and
available to fund such amount pursuant to subsection 4.13(d) and Section 4.14,
the Collateral Interest (after giving effect to reductions for any Collateral
Charge-Offs and any Reallocated Principal Collections on such Transfer Date and
any adjustments with respect thereto as described in Section 4.12(a)) will be
reduced by the amount of such excess, but not by more than the lesser of the
Class B Investor Default Amount and the Collateral Interest (after giving effect
to reductions for any Collateral Charge-Offs and any Reallocated Principal
Collections on such Transfer Date and any adjustments with respect thereto as
described in subsection 4.12(a)) for such Transfer Date. If reduction for such
excess would have caused the Collateral Interest to be a negative number, the
Collateral Interest shall be reduced to zero and the Class B Investor Interest
shall be reduced by the amount by which the Collateral 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
Interest will also be reduced by the amount of Reallocated Class B Principal
Collections in excess of the Collateral Interest pursuant to Section 4.14 and
the amount of any portion of the Class B Investor Interest allocated to the
Class A Certificates to avoid a reduction in the Class A Investor Interest
pursuant to subsection 4.12(a). 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 Certificates) on any Transfer Date by the amount of Excess Spread
allocated and available for that purpose as described under subsection 4.13(e).
(c) On or before each Transfer Date, the Servicer shall calculate the
Collateral Default Amount. If on any Transfer Date, the Collateral Default
Amount for the prior Monthly Period exceeds the amount of Excess Spread which is
allocated and available to fund such amount pursuant to subsection 4.13(h), the
Collateral Interest will be reduced by the amount of such excess but not by more
than the lesser of the Collateral Default Amount and the Collateral Interest for
such Transfer Date (a "COLLATERAL CHARGE-OFF"). The Collateral Interest will
also be reduced by the amount of Reallocated Principal Collections pursuant to
Section 4.14 and the amount of any portion of the Collateral Interest allocated
to the Class A Certificates or the Class B Certificates to avoid a reduction in
the Class A Investor Interest, pursuant to subsection 4.12(a), or the Class B
Investor Interest, pursuant to subsection 4.12(b), respectively. The Collateral
Interest will thereafter be reimbursed on any Transfer Date by the amount of the
Excess Spread allocated and available for that purpose as described under
subsection 4.13(i).
SECTION 4.13 EXCESS SPREAD. On or before the second Business Day prior
to each Transfer Date, the Servicer shall instruct the Trustee in writing (which
writing shall be substantially in the form of Exhibit B) to apply, and the
Trustee, acting in accordance with such instructions shall apply, Excess Spread
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 Remaining Unpaid Trustee Fee, if any, shall
be distributed to the Trustee;
(b) an amount equal to the Class A Required Amount, if any, with
respect to such Transfer Date will be used to fund amounts comprising the Class
A Required Amount not paid pursuant to subsection 4.11(a) and be applied in
accordance with, and in the priority set forth in, subsection 4.11(a);
(c) an amount equal to the aggregate amount of Class A Investor
Charge-Offs 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;
(d) an amount equal to the Class B Required Amount, if any, with
respect to such Transfer Date will be used to fund amounts comprising the Class
B Required Amount not paid pursuant to subsection 4.11(b) and be applied first
in accordance with, and in the priority set forth in, subsection 4.11(b) and
then any remaining amount available to pay the Class B Investor Default Amount
for the prior Monthly Period 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 initial Class B Investor Interest
for reasons other than the payment of principal to the Class B Holders (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;
(f) an amount equal to the Collateral Monthly Interest plus the amount
of any past due Collateral Monthly Interest for such Transfer Date will be
deposited into the Collateral Interest Monthly Interest Funding Account, for
distribution to the Collateral Interest Holder on the applicable Payment Date;
(g) if the Originators are the Servicer, an amount equal to the
aggregate amount of accrued but unpaid Collateral Interest Servicing Fees will
be paid to the Servicer;
(h) an amount equal to the Collateral 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;
(i) an amount equal to the aggregate amount by which the Collateral
Interest has been reduced below the Required Collateral Interest for reasons
other than the payment of principal to the Collateral Interest Holder (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;
(j) on each Transfer Date from and after the Reserve Account Funding
Date, but prior to the date on which the Reserve Account terminates as described
in subsection 4.17(f), an amount up to the excess, if any, of the Required
Reserve Account Amount over the Available Reserve Account Amount shall be
deposited into the Reserve Account;
(k) an amount equal to all other amounts due under the Loan Agreement
(to the extent payable from "AVAILABLE NON-PRINCIPAL FUNDS," as defined therein)
shall be distributed in accordance with the Loan Agreement;
(l) an amount equal to the sum of (x) any Class A Shortfall Amount for
the current Distribution Date and (y) any accrued and unpaid Class A Carry-Over
Amount from a prior Distribution Date shall be deposited by the Servicer or the
Trustee in the Class A Interest Funding Account for payment to the Class A
Holders on the applicable Payment Date;
(m) an amount equal to the sum of (x) any Class B Shortfall Amount for
the current Distribution Date and (y) any accrued and unpaid Class B Carry-Over
Amount from a prior Distribution Date shall be deposited by the Servicer or the
Trustee into the Class B Interest Funding Account for payment to the Class B
Holders on the applicable Payment Date;
(n) the Investor Percentage of any remaining amounts owed to the
Trustee, if any, pursuant to the Fee Agreement in excess of the Unpaid Trustee
Fee, to the extent not paid by the Transferor; and
(o) the balance, if any, after giving effect to the payments made
pursuant to clauses (a) through (n) shall constitute "EXCESS FINANCE CHARGE
COLLECTIONS" to be applied with respect to other Series in accordance with
Section 4.5 of the Agreement.
SECTION 4.14 REALLOCATED PRINCIPAL COLLECTIONS. On or before the
second Business Day prior to each Transfer Date, the Servicer shall instruct the
Trustee in writing (which writing shall be substantially in the form of Exhibit
B) to, and the Trustee in accordance with such instructions shall, withdraw from
the Principal Account and apply Reallocated Principal Collections (applying all
Reallocated Collateral Principal Collections in accordance with subsections
4.14(a) and (b) prior to applying any Reallocated Class B Principal Collections
in accordance with subsection 4.14(a) for any amounts still owing after the
application of Reallocated Collateral Principal Collections) 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 with respect to the related Monthly Period allocated and available
to pay the Class A Required Amount pursuant to subsection 4.13(b) on such
Transfer Date, shall be applied in the manner set forth in subsection 4.13(b)
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 with respect to the related Monthly Period allocated and available
to pay the Class B Required Amount pursuant to subsection 4.13(d) on such
Transfer Date shall be applied in the manner set forth in subsection 4.13(d).
On each Transfer Date, the Collateral Interest shall be reduced by the
amount of Reallocated Collateral Principal Collections and by the amount of
Reallocated Class B Principal Collections for such Transfer Date. If such
reduction would cause the Collateral Interest (after giving effect to any
Collateral Charge-Offs for such Transfer Date) to be a negative number, the
Collateral Interest (after giving effect to any Collateral Charge-Offs for such
Transfer Date) shall be reduced to zero and the Class B Investor Interest shall
be reduced by the amount by which the Collateral Interest would have been
reduced below zero. If the reallocation of Reallocated Principal Collections
would cause the Class B Investor Interest (after giving effect to any Class B
Investor Charge-Offs for such Transfer Date) to be a negative number on any
Transfer Date, Reallocated Principal Collections shall be reallocated on such
Transfer Date in an aggregate amount not to exceed the amount which would cause
the Class B Investor Interest (after giving effect to any Class B Investor
Charge-Offs for such Transfer Date) to be reduced to zero.
SECTION 4.15 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 2001-1 on any Transfer Date
shall be applied as Available Investor Principal Collections pursuant to Section
4.11 and pursuant to such Section 4.11 shall be deposited in the Distribution
Account or distributed in accordance with the Loan Agreement.
(b) Shared Principal Collections allocable to Series 2001-1 with
respect to any Transfer Date means an amount equal to the Series Principal
Shortfall, if any, with respect to Series 2001-1 for such Transfer Date;
provided 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 2001-1 on such Transfer Date shall equal the product of (i) Shared
Principal 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
2001-1 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, Excess Spread and Reallocated Principal Collections as of such
Determination Date for the following Transfer Date.
SECTION 4.16 PRINCIPAL ACCOUNT AND PRINCIPAL FUNDING ACCOUNT. (a) The
Trustee shall establish and maintain in the name of the Trust, on behalf of the
Trust, for the benefit of the Investor Holders, two segregated trust accounts
(the "PRINCIPAL ACCOUNT" and the "PRINCIPAL FUNDING ACCOUNT"), bearing a
designation clearly indicating that the funds deposited therein are held for the
benefit of the Investor Holders or establish and maintain the Principal Account
and the Principal Funding Account with a Qualified Institution. The Trustee
shall possess all right, title and interest in all funds on deposit from time to
time in the Principal Account and the Principal Funding Account and in all
proceeds thereof. The Principal Account and the Principal Funding Account shall
be under the sole dominion and control of the Trustee for the benefit of the
Investor Holders. If at any time a Qualified Institution holding the Principal
Account and the Principal Funding Account ceases to be a Qualified Institution,
the Transferor shall notify the Trustee and the Collateral Interest Holder, and
the Trustee upon being notified (or the Servicer on its behalf) shall, within 10
Business Days, establish a new Principal Account and a new Principal Funding
Account meeting the conditions specified above, and shall transfer any cash or
any investments to such new Principal Account and Principal Funding Account. The
Trustee shall establish the Class A Principal Funding Account, the Class B
Principal Funding Account, and the Collateral Interest Principal Funding Account
as administrative subaccounts of the Principal Funding Account. The Trustee, at
the direction of the Servicer, shall (i) make withdrawals from the Principal
Account, the Class A Principal Funding Account, the Class B Principal Funding
Account and the Collateral Interest Principal Funding Account from time to time,
in the amounts and for the purpose set forth in this Series Supplement, and (ii)
on each Transfer Date (from and after the commencement of the Controlled
Accumulation Period) prior to termination of the Class A Principal Funding
Account, the Class B Principal Funding Account and the Collateral Interest
Principal Funding Account make deposits into such accounts in the amounts
specified in, and otherwise in accordance with, subsection 4.11(e).
(b) Funds on deposit in the Principal Account, the Class A Principal
Funding Account, the Class B Principal Funding Account, and the Collateral
Interest Principal Funding Account shall be invested by the Trustee in Permitted
Investments only upon and in accordance with the written directions of the
Servicer. Funds on deposit in the Class A Principal Funding Account, the Class B
Principal Funding Account and the Collateral Interest Principal Funding Account
on any Transfer Date, after giving effect to any withdrawals from such accounts
on such Transfer Date, shall be invested in such 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 maintain for the benefit of the
Investor Holders possession of the negotiable instruments or securities, if any,
evidencing such Permitted Investments. No Permitted Investment shall be disposed
of prior to its maturity.
On the Transfer Date occurring in the month following the commencement
of the Controlled Accumulation Period and on each Transfer Date thereafter with
respect to the Controlled Accumulation Period, the Trustee, acting at the
Servicer's direction given on or before such Transfer Date, shall transfer (i)
from the Class A Principal Funding Account to the Finance Charge Account, the
Class A Principal Funding Investment Proceeds on deposit in the Class A
Principal Funding Account, but not in excess of the Class A Covered Amount, for
application as Class A Available Funds applied pursuant to subsection 4.11(a);
(ii) from the Class B Principal Funding Account to the Finance Charge Account,
the Class B Principal Funding Investment Proceeds on deposit in the Class B
Principal Funding Account, but not in excess of the Class B Covered Amount, for
application as Class B Available Funds applied pursuant to 4.11(b); and (iii)
from the Collateral Interest Principal Funding Account to the Finance Charge
Account, the Collateral Interest Principal Funding Investment Proceeds on
deposit in the Collateral Interest Principal Funding Account, but not in excess
of the Collateral Interest Covered Amount, for application as Collateral
Available Funds applied pursuant to 4.11(c).
Any Class A Excess Principal Funding Investment Proceeds, Class B
Excess Principal Funding Investment Proceeds, and Collateral Interest Excess
Principal Funding Investment Proceeds shall be paid to the Transferor on each
Transfer Date. An amount equal to any Class A Principal Funding Investment
Shortfall, any Class B Principal Funding Investment Shortfall, and Collateral
Interest Principal Funding Investment Shortfall will be deposited in the Finance
Charge Account on each Transfer Date from the Reserve Account to the extent
funds are available pursuant to subsection 4.17(d). Class A Principal Funding
Investment Proceeds, Class B Principal Funding Investment Proceeds, and
Collateral Interest Principal Funding Investment Proceeds (including, in each
case, reinvested interest) shall not be considered part of the amounts on
deposit in the Class A Principal Funding Account, the Class B Principal Funding
Account or the Collateral Interest Principal Funding Account, as the case may
be, for purposes of this Series Supplement.
SECTION 4.17 RESERVE ACCOUNT. (a) The Trustee shall establish and
maintain in the name of the Trust, on behalf of the Trust, for the benefit of
the Investor Holders, a segregated trust account (the "RESERVE ACCOUNT"),
bearing a designation clearly indicating that the funds deposited therein are
held for the benefit of the Investor Holders or establish and maintain the
Reserve Account with a Qualified Institution. The Trustee shall possess all
right, title and interest in all funds on deposit from time to time in the
Reserve Account and in all proceeds thereof. The Reserve Account shall be under
the sole dominion and control of the Trustee for the benefit of the Investor
Holders. If at any time a Qualified Institution holding the Reserve Account
ceases to be a Qualified Institution, the Transferor shall notify the Trustee,
each Rating Agency and the Collateral Interest Holder, and the Trustee upon
being notified (or the Servicer on its behalf) shall, within 10 Business Days,
establish a new Reserve Account meeting the conditions specified above, and
shall transfer any cash or investments to such new Reserve Account. The Trustee,
at the direction of the Servicer, shall (i) make withdrawals from the Reserve
Account from time to time in an amount up to the Available Reserve Account
Amount at such time, for the purposes set forth in this Series Supplement, and
(ii) on each Transfer Date (from and after the Reserve Account Funding Date)
prior to termination of the Reserve Account make a deposit into the Reserve
Account in the amount specified in, and otherwise in accordance with, subsection
4.13(j).
(b) Funds on deposit in the Reserve Account shall be invested by the
Trustee in Permitted Investments only upon and in accordance with the written
directions of the Servicer. Funds on deposit in the Reserve Account on any
Transfer Date, after giving effect to any withdrawals from the Reserve Account
on such Transfer Date, shall be invested in such 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 maintain for the benefit of the
Investor Holders possession of the negotiable instruments or securities, if any,
evidencing such Permitted Investments. No Permitted Investment shall be disposed
of prior to its maturity. On each Transfer Date, all interest and earnings (net
of losses and investment expenses) accrued since the preceding Transfer Date on
funds on deposit in the Reserve Account shall be retained in the Reserve Account
(to the extent that the Available Reserve Account Amount is less than the
Required Reserve Account Amount) and the balance, if any, shall be deposited
into the Finance Charge Account and included in Class A Available Funds for such
Transfer Date. Such funds shall be allocated between the Class A Investor
Interest, the Class B Investor Interest and the Collateral Interest, and treated
as Class A Available Funds, Class B Available Funds or Collateral Available
Funds of such Transfer Date based on the percentage of the outstanding principal
balance of the Series 2001-1 Certificates represented by the Class A
Certificates, the Class B Certificates and the Collateral Interest,
respectively, on such Transfer Date. For purposes of determining the
availability of funds or the balance in the Reserve Account for any reason under
this Series Supplement, except as otherwise provided in the preceding sentence,
investment earnings on such funds shall be deemed not to be available or on
deposit.
(c) On or before each Transfer Date with respect to the Controlled
Accumulation Period and on or before the first Transfer Date with respect to the
Rapid Amortization Period, the Servicer shall calculate (i) prior to the payment
in full of the Class A Investor Interest, the "CLASS A RESERVE DRAW AMOUNT",
which shall be equal to the Class A Principal Funding Investment Shortfall with
respect to such Transfer Date less, in each case, the funds deposited into the
Finance Charge Account on such Transfer Date pursuant to subsection 4.17(b) that
are included in Class A Available Funds for such Transfer Date; (ii) prior to
the payment in full of the Class B Investor Interest, the "CLASS B RESERVE DRAW
AMOUNT", which shall be equal to the Class B Principal Funding Investment
Shortfall with respect to such Transfer Date less, in each case, the amount of
funds deposited into the Finance Charge Account on such Transfer Date pursuant
to subsection 4.17(b) that are included in Class B Available Funds for such
Transfer Date; and (c) prior to the payment in full of the Collateral Interest,
the "COLLATERAL INTEREST RESERVE DRAW AMOUNT", which shall be equal to the
Collateral Interest Principal Funding Investment Shortfall with respect to such
Transfer Date less, in each case, the amount of funds deposited into the Finance
Charge Account on such Transfer Date pursuant to subsection 4.17(b) that are
included in Collateral Available Funds for such Transfer Date.
(d) On each Transfer Date, first, the Class A Reserve Draw Amount, if
any, up to the Available Reserve Account Amount, second, following withdrawal of
the Class A Reserve Draw Amount, the Class B Reserve Draw Amount, if any, up to
any remaining Available Reserve Account Amount, and third following withdrawal
of the Class A Reserve Draw Amount and the Class B Reserve Draw Amount, the
Collateral Interest Reserve Draw Amount, if any, up to any remaining Available
Reserve Account Amount shall be withdrawn from the Reserve Account on such
Transfer Date by the Trustee (acting in accordance with the instructions of the
Servicer), deposited into the Finance Charge Account and included in Class A
Available Funds, Class B Available Funds and Collateral Available Funds,
respectively, for such Transfer Date.
(e) If the Reserve Account Surplus on any Transfer Date, after giving
effect to all deposits to and withdrawals from the Reserve Account with respect
to such Transfer Date, is greater than zero, the Trustee, acting in accordance
with the instructions of the Servicer, shall withdraw from the Reserve Account,
and pay, in accordance with the Loan Agreement, an amount equal to such Reserve
Account Surplus.
(f) Upon the earliest to occur of (i) the termination of the Trust
pursuant to Article XII, (ii) the first Transfer Date relating to the Rapid
Amortization Period and (iii) the Transfer Date immediately preceding the
Collateral Interest Scheduled Payment Date, the Trustee, acting in accordance
with the instructions of the Servicer, after the prior payment of all amounts
owing to the Series 2001-1 Holders that are payable from the Reserve Account as
provided herein, shall withdraw from the Reserve Account and pay, in accordance
with the Loan Agreement, all amounts, if any, on deposit in the Reserve Account,
and the Reserve Account shall be deemed to have terminated for purposes of this
Series Supplement.
SECTION 4.18 INTEREST FUNDING ACCOUNT. (a) The Trustee shall establish
and maintain in the name of the Trust, on behalf of the Trust, for the benefit
of the Investor Holders, a segregated trust account (the "INTEREST FUNDING
ACCOUNT"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Investor Holders or establish and
maintain the Interest Funding Account with a Qualified Institution. The Interest
Funding Account shall be divided into three administrative subaccounts, the
Class A Interest Funding Account (the "CLASS A INTEREST FUNDING ACCOUNT"), the
Class B Interest Funding Account (the "CLASS B INTEREST FUNDING ACCOUNT") and
the Collateral Interest Monthly Interest Funding Account (the "COLLATERAL
INTEREST MONTHLY INTEREST FUNDING ACCOUNT"). The Trustee shall possess all
right, title and interest in all funds on deposit from time to time in the
Interest Funding Account and in all proceeds thereof. The Interest Funding
Account shall be under the sole dominion and control of the Trustee for the
benefit of the Investor Holders. If at any time a Qualified Institution holding
the Interest Funding Account ceases to be a Qualified Institution, the
Transferor shall notify the Trustee, and the Trustee upon being notified (or the
Servicer on its behalf) shall, within 10 Business Days, establish a new Interest
Funding Account meeting the conditions specified above, and shall transfer any
cash or any investments to such Interest Funding Account. The Trustee, at the
direction of the Servicer, shall make withdrawals from the Interest Funding
Account and the relevant subaccount from time to time, in the amounts and for
the purposes set forth in this Series Supplement.
(b) Funds on deposit in the Interest Funding Account shall be invested
by the Trustee in Permitted Investments only upon and in accordance with the
written directions of the Servicer, provided, however, that in the absence of
such written directions, the Trustee shall invest such funds in Permitted
Investments set forth in clause (v) of the definition thereof. Funds on deposit
in the Interest Funding Account on any Transfer Date, after giving effect to any
withdrawals from the Interest Funding Account on such Transfer Date, shall be
invested in such 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 maintain for the benefit of the Investor Holders possession of the
negotiable instruments or securities, if any, evidencing such Permitted
Investments. No Permitted Investment shall be disposed of prior to its maturity.
(c) On each Distribution Date, the Servicer shall direct the Trustee
in writing to withdraw from the Interest Funding Account and pay to the
Transferor all interest and other investment income (net of losses and
investment expenses) on funds on deposit in the Interest Funding Account.
(d) Reinvested interest and other investment income on funds deposited
in the Interest Funding Account shall not be considered to be principal amounts
on deposit therein for purposes of this Series Supplement.
SECTION 4.19 DETERMINATION OF LIBOR. (a) On each LIBOR Determination
Date, the Trustee will determine LIBOR on the basis of the rate for deposits in
United States dollars for a period equal to the relevant Interest Period
(commencing on the first day of such Interest Period) which appears on Telerate
Page 3750 as of 11:00 a.m., London time, on such date. If such rate does not
appear on Telerate Page 3750, the rate for that LIBOR Determination Date will be
determined on the basis of the rates at which deposits in United States dollars
are offered by the Reference Banks at approximately 11:00 am., London time, on
that day to prime banks in the London interbank market for a period equal to the
relevant Interest Period (commencing on the first day of such Interest Period).
The Trustee will 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 that LIBOR Determination Date will be the arithmetic mean
of the quotations. If fewer than two quotations are provided as requested, the
rate for that LIBOR Determination Date will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Servicer, at
approximately 11:00 a.m., New York City time, on that day for loans in United
States dollars to leading European banks for a period equal to the relevant
Interest Period (commencing on the first day of such Interest Period).
(b) The Class A Certificate Rate and Class B Certificate Rate
applicable to the then current and the immediately preceding Interest Periods
may be obtained by any Investor Holder by telephoning the Trustee at its
Corporate Trust Office.
(c) On each LIBOR Determination Date prior to 12:00 noon New York City
time, the Trustee shall send to the Servicer by facsimile, notification of LIBOR
for the following Interest Period.
SECTION 4.20 TRANSFEROR'S OR SERVICER'S FAILURE TO MAKE A DEPOSIT OR
PAYMENT. If the Servicer or the Transferor fails to make, or give instructions
to make, any payment or deposit (other than as required by subsection 2.4(d) and
(e) and 12.2(a) or Section 10.2 and 12.1) required to be made or given by the
Servicer or the Transferor, respectively, at the time specified in the Agreement
or this Series Supplement (including applicable grace periods), the Trustee
shall make such payment or deposit from the applicable Investor Account without
instruction from the Servicer or the Transferor. 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 amounts
thereof; provided, however, that, absent appropriate instructions from the
Servicer or the Transferor, as applicable, the Trustee shall in all cases only
be deemed to have sufficient information to determine the amount of interest
payable to the Series 2001-1 Holders on each Distribution Date. The Trustee
shall promptly following failure by either the Servicer or the Transferor to
provide any such instructions within the time specified pursuant to the
Agreement or this Series Supplement (including applicable grace periods), use
its reasonable efforts to contact the Servicer or the Transferor, as applicable
to request receipt of any such instructions. 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 Transferor or the
Servicer, as the case may be.
SECTION 8. ARTICLE V OF THE AGREEMENT. Article V of the Agreement
shall read in its entirety as follows and shall be applicable only to the
Investor Holders:
ARTICLE V
DISTRIBUTIONS AND REPORTS TO INVESTOR HOLDERS
SECTION 5.1 DISTRIBUTIONS. (a) On each Payment Date, the Trustee shall
distribute (in accordance with the certificate delivered on or before the
related Transfer Date by the Servicer to the Trustee pursuant to subsection
3.4(b)) to each Class A Holder of record on the immediately preceding Record
Date (other than as provided in subsection 2.4(e) or Section 12.3 respecting a
final distribution) such Holder's pro rata share (based on the aggregate
Undivided Interests represented by Class A Certificates held by such Holder) of
amounts on deposit in the Class A Interest Funding Account as are payable to the
Class A Holders pursuant to Section 4.11(a)(ii) and 4.11(g) by check mailed to
each Class A Holder (at such Holder's address as it appears in the Certificate
Register), except that with respect to Class A Certificates registered in the
name of the nominee of a Clearing Agency, such distribution shall be made in
immediately available funds.
(b) On any Special Payment Date and on the Class A Scheduled Payment
Date, the Trustee shall distribute (in accordance with the certificate delivered
on or before the related Transfer Date by the Servicer to the Trustee pursuant
to subsection 3.4(b)) to each Class A Holder of record on the immediately
preceding Record Date (other than as provided in subsection 2.4(e) or Section
12.3 respecting a final distribution) such Holder's pro rata share (based on the
aggregate Undivided Interests represented by Class A Certificates held by such
Holder) of amounts on deposit in the Distribution Account as are payable to the
Class A Holders pursuant to Section 4.11(e), 4.11(f) and 4.11(h)(i) by check
mailed to each Class A Holder (at such Holder's address as it appears in the
Certificate Register), except that with respect to Class A Certificates
registered in the name of the nominee of a Clearing Agency, such distribution
shall be made in immediately available funds.
(c) On each Payment Date, the Trustee shall distribute (in accordance
with the certificate delivered on or before the related Transfer Date by the
Servicer to the Trustee pursuant to subsection 3.4(b) to each Class B Holder of
record on the immediately preceding Record Date (other than as provided in
subsection 2.4(e) or Section 12.3 respecting a final distribution) such Holder's
pro rata share (based on the aggregate Undivided Interests represented by Class
B Certificates held by such Holder) of amounts on deposit in the Class B
Interest Funding Account as are payable to the Class B Holders pursuant to
Section 4.11(b)(ii) and 4.11(g) by check mailed to each Class B Holder (at such
Holder's address as it appears in the Certificate Register), except that with
respect to Class B Certificates registered in the name of the nominee of a
Clearing Agency, such distribution shall be made in immediately available funds.
(d) On any Special Payment Date and on the Class B Scheduled Payment
Date, the Trustee shall distribute (in accordance with the certificate delivered
on or before the related Transfer Date by the Servicer to the Trustee pursuant
to subsection 3.4(b)) to each Class B Holder of record on the immediately
preceding Record Date (other than as provided in subsection 2.4(e) or Section
12.3 respecting a final distribution) such Holder's pro rata share (based on the
aggregate Undivided Interests represented by Class B Certificates held by such
Holder) of amounts on deposit in the Distribution Account as are payable to the
Class B Holders pursuant to Section 4.11(e), 4.11(f) and 4.11(h)(ii) by check
mailed to each Class B Holder (at such Holder's address as it appears in the
Certificate Register), except that with respect to Class B Certificates
registered in the name of the nominee of a Clearing Agency, such distribution
shall be made in immediately available funds.
(e) On each Payment Date, the Trustee shall distribute (in accordance
with the certificate delivered on or before the related Transfer Date by the
Servicer to the Trustee pursuant to subsection 3.4(b)) to the Collateral
Interest Holder, in accordance with the procedures set forth in the Loan
Agreement, amounts on deposit in the Collateral Interest Funding Account as are
payable pursuant to Sections 4.13(f) and 4.11(g).
(f) On any Special Payment Date and on the Collateral Interest
Scheduled Payment Date, the Trustee shall distribute (in accordance with the
certificate delivered on or before the related Transfer Date by the Servicer to
the Trustee pursuant to subsection 3.4(b)) to the Collateral Interest Holder, in
accordance with the procedures set forth in the Loan Agreement, amounts on
deposit in the Distribution Account as are payable to the Collateral Interest
Holder pursuant to Sections 4.11(e)(iii), 4.11(f) and 4.11(h)(iii).
SECTION 5.2 INVESTOR HOLDERS' STATEMENTS. (a) Monthly Holders'
Statement. On or before each Distribution Date, the Trustee shall forward to
each Series 2001-1 Holder, each Rating Agency and the Collateral Interest Holder
or, with the prior consent of any such party, make available electronically to
such consenting party a statement substantially in the form of Exhibit C
prepared by the Servicer and delivered to the Trustee; provided, however, that
the Trustee shall have no obligation to provide such statement until it has
received the requisite statement from the Servicer.
(b) ANNUAL HOLDERS' TAX STATEMENT. On or before January 31 of each
calendar year, beginning with calendar year 2002, the Trustee shall distribute
to each Person who at any time during the preceding calendar year was a Series
2001-1 Holder, and to the Collateral Interest Holder, or, with the prior consent
of any such Person, make available electronically to such Person, a statement
prepared by the Servicer containing the following information:
(i) the amount of the current distribution allocable to Class A
Monthly Principal, Class B Monthly Principal and Collateral Monthly
Principal, respectively; and
(ii) the amount of the current 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 and Collateral Monthly Interest, and any accrued
and unpaid Collateral Monthly Interest, respectively.
Such information shall be aggregated for such calendar year or the applicable
portion thereof during which such Person was a Series 2001-1 Holder, together
with such other customary information (consistent with the treatment of the
Certificates as debt) as the Trustee or the Servicer (or the Transferor, if the
Back-up Servicer is the Servicer) deems necessary or desirable to enable the
Series 2001-1 Holders 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 Internal Revenue Code.
(c) The Trustee may make available to each Series 2001-1 Holder, each
Rating Agency and the Collateral Interest Holder, via the Trustee's Internet
Website, the statements referred to in Section 5.2(a) and (b) hereof on or
before the date such statement is required thereunder and, with the consent or
at the direction of the Transferor, such other information regarding the Series
2001-1 Certificates and/or the Receivables as the Trustee may have in its
possession, provided, however, that without the prior consent of such party, the
availability of such website shall not release the Trustee from its obligation
pursuant to subsections 5.2(a) or 5.2(b) hereof to provide such information
directly to such party. The Trustee will make no representation or warranties as
to the accuracy or completeness of such documents and will assume no
responsibility therefor.
The Trustee's Internet Website shall be initially located at
"xxx.XXXXxx.xxx" or at such other address as shall be specified by the Trustee
from time to time in writing to each Series 2001-1 Holder, each Rating Agency
and the Collateral Interest Holder. In connection with providing access to the
Trustee's Internet Website, the Trustee may require registration and the
acceptance of a disclaimer.
SECTION 9. SERIES 2001-1 PAY OUT EVENTS. If any one of the following
events shall occur with respect to the Investor Certificates:
(a) failure on the part of the Transferor (i) to make any payment or
deposit required by the terms of (A) the Agreement or (B) this Series
Supplement, on or before the date occurring five days after the date such
payment or deposit is required to be made herein or (ii) duly to observe or
perform in any material respect any covenants or agreements of the Transferor
set forth in the Agreement or this Series Supplement, which failure has a
material adverse effect on the Series 2001-1 Holders (which determination shall
be made without reference to whether any funds are available under the
Collateral Interest) and which 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 the Transferor by the Trustee, or to the
Transferor and the Trustee by the Holders of Investor Certificates evidencing
Undivided Interests aggregating not less than 50% of the Investor Interest, and
continues to affect materially and adversely the interests of the Series 2001-1
Holders (which determination shall be made without reference to whether any
funds are available under the Collateral Interest) for such period;
(b) any representation or warranty made by the Transferor in the
Agreement or this Series Supplement, or any information contained in a
Receivable Schedule required to be delivered by the Transferor pursuant to
Section 2.1, (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 the Transferor by
the Trustee, or to the Transferor and the Trustee by the Holders of Investor
Certificates evidencing Undivided Interests aggregating not less than 50% of the
Investor Interest and (ii) as a result of which the interests of the Series
2001-1 Holders are materially and adversely affected (which determination shall
be made without reference to whether any funds are available under the
Collateral Interest) and continue to be materially and adversely affected for
such period; provided that a Series 2001-1 Pay Out Event pursuant to this
subsection 9(b) shall not be deemed to have occurred hereunder if the Transferor
has accepted reassignment of the related Receivable, or all of such Receivables,
if applicable, during such period in accordance with the provisions of the
Agreement;
(c) the average Net Portfolio Yield for any three consecutive Monthly
Periods is reduced to a rate which is less than the average Base Rate for such
period;
(d) during any 10 consecutive days (i) the average Transferor Interest
is below the Minimum Transferor Interest for the same period or (ii) the sum of
(x) Principal Receivables and (y) the principal amount on deposit in the Excess
Funding Account is less than the Minimum Aggregate Principal Receivables for the
same period;
(e) an Originator shall fail to convey Additional Receivables to
Mellon Bank as required by the First Tier Receivables Purchase Agreement, Mellon
Bank shall fail to convey Additional Receivables to the Transferor as required
by the Second Tier Receivables Purchase Agreement or the Transferor shall fail
to convey Additional Receivables to the Trust, as required by Section 2.1(b);
(f) any Servicer Default shall occur which would have a material
adverse effect on the Series 2001-1 Holders;
(g) the Class A Investor Interest shall not be paid in full on the
Class A Scheduled Payment Date, the Class B Investor Interest shall not be paid
in full on the Class B Scheduled Payment Date or the Collateral Interest shall
not be paid in full on the Collateral Interest Scheduled Payment Date;
(h) the Monthly Payment Rate averaged for three consecutive Monthly
Periods is less than 12%; or
(i) for a period of three consecutive Determination Dates, (i) there
exists an Excess Obligor Concentration Amount, (ii) there exists an Excess
Insurer Concentration Amount, (iii) there exists an Excess Xxxxxxxxx Xxxx 0
Xxxxxxx Xxxxxxxxxxxxx Xxxxxx, (xx) the Aggregate Top Tier 3 Insurer Percentage
is greater than the Maximum Aggregate Top Tier 3 Insurer Percentage or (v) the
Aggregate Top Tier 2 Insurer Percentage is greater than the Maximum Aggregate
Top Tier 2 Insurer Percentage;
then, in the case of any event described in subsection 9(a), (b) or (f) hereof,
after the applicable grace period, if any, set forth in such subsections, either
the Trustee or Holders of Series 2001-1 Certificates (including, for this
purpose, the Collateral Interest Holder) evidencing Undivided Interests
aggregating not less than 50% of the Investor Interest by notice then given in
writing to the Transferor and the Servicer (and to the Trustee if given by the
Holders) may declare that a pay out event (a "SERIES 2001-1 PAY OUT EVENT") has
occurred as of the date of such notice, and in the case of any event described
in subsection 9(c), (d), (e), (g), (h) or (i) hereof, a Series 2001-1 Pay Out
Event shall occur without any notice or other action on the part of the Trustee
or the Investor Holders immediately upon the occurrence of such event. The
Series 2001-1 Pay Out Events described in subsection 9(i) may be amended by the
Transferor, the Trustee, the Servicer and the Back-up Servicer at any time with
the consent of the Collateral Interest Holder, but without the consent of the
Holders if the Rating Agency Condition has been satisfied with respect to such
amendment.
SECTION 10. SERIES 2001-1 TERMINATION. The right of the Investor
Holders to receive payments from the Trust will terminate on the first Business
Day following the Series 2001-1 Termination Date.
SECTION 11. ENHANCEMENT CONCENTRATION LIMITS. A Concentration Limit
Breach pursuant to Section 2.6 of the Agreement shall include Sections 5.08(v),
5.12 and 6.01(j) of the Loan Agreement. This Section 11 may be amended by the
Transferor, the Trustee and the Servicer at any time with the consent of the
Collateral Interest Holder, but without the consent of the Holders.
SECTION 12. [Reserved.]
SECTION 13. APPLICATION OF PROCEEDS OF ISSUANCE OF SERIES 2001-1. On
the Closing Date, Bank One, N.A. (formerly First National Bank of Chicago), as
Trustee with respect to the Series 1996-1 Supplement, based on written
instructions from Mellon Bank, N.A., (i) shall deposit such proceeds of the
issuance of the Series 2001-1 Certificates as are specified in such instructions
into the Series 1996-1 Principal Funding Account pursuant to Section 4.11(f) of
the Series 1996-1 Supplement and transfer them to the Distribution Account for
application on the Closing Date to the payment of the Series 1996-1 Certificates
pursuant to subsection 4.11(h) of the Series 1996-1 Supplement and (ii) upon
repayment in full of Series 1996-1, shall apply any remaining amounts in any
accounts maintained by it pursuant to the 1996-1 Series Supplement as specified
in such instructions.
SECTION 14. 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 15. 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.
SECTION 16. ADDITIONAL NOTICES. The Transferor shall notify the
Collateral Interest Holder and the Rating Agencies promptly after becoming aware
of any Lien on any Receivable other than the conveyances under the Agreement.
The Transferor shall notify the Collateral Interest Holder of any merger,
consolidation, assumption or transfer referred to in Section 7.2.
SECTION 17. ADDITIONAL REPRESENTATIONS AND WARRANTIES OF SERVICER.
AFCO Acceptance and AFCO Credit, as initial Servicer, hereby makes, and any
Successor Servicer by its appointment under the Agreement shall make the
following representations and warranties:
(a) ALL CONSENTS. All authorizations, consents, orders or approvals of
or registrations or declarations with any Governmental Authority required to be
obtained, effected or given by the Servicer in connection with the execution and
delivery of this Series Supplement by the Servicer and the performance of the
transactions contemplated by this Series Supplement by the Servicer, have been
duly obtained, effected or given and are in full force and effect.
(b) RESCISSION OR CANCELLATION. The Servicer shall not permit any
rescission or cancellation of any Receivable except as ordered by a court of
competent jurisdiction or other Governmental Authority or in accordance with the
normal operating procedures of the Servicer.
SECTION 18. NO PETITION. The Transferor (with respect to the Trust),
the Servicer, the Back-up Servicer and the Trustee, by entering into this Series
Supplement and each Holder, by accepting a Series 2001-1 Certificate hereby
covenant and agree that they will not, for one year and one day following the
Trust Termination Date, institute against the Trust or the Transferor, or join
in any institution against the Trust or the Transferor of, any bankruptcy
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Investor Holders, the
Agreement or this Series Supplement.
SECTION 19. AMENDMENTS. Subject to Sections 9 and 11, this Series
Supplement may be amended pursuant to Section 13.1 of the Agreement. This Series
Supplement may also be amended by the Transferor without the consent of the
Servicer, the Back-up Servicer, the Trustee or any Investor Holder if the
Transferor provides the Trustee with: (i) an Opinion of Counsel to the effect
that such amendment or modification (I) would (A) reduce the risk that the Trust
would be treated as taxable as a publicly traded partnership pursuant to
Internal Revenue Code section 7704 or (B) permit the Trust or a relevant portion
thereof to be treated as a "financial asset securitization investment trust" and
(C) in either case, (1) would not cause the Trust to be classified, for Federal
income tax purposes, as an association (or publicly traded partnership) taxable
as a corporation and (2) would not cause or constitute an event in which gain or
loss would be recognized by any Investor Holder, and (II) complies with all
requirements of the Agreement; and (ii) a certificate that such amendment or
modification would not materially and adversely affect any Investor Holder;
provided that no such amendment shall be deemed effective without the Trustee's
consent, if the Trustee's rights, duties and obligations hereunder are thereby
modified. Promptly after the execution of any such amendment (other than an
amendment pursuant to subsection 13.1(a) of the Agreement), the Trustee shall
furnish notification of the substance of such amendment to each Rating Agency
and to the Collateral Interest Holder. Notwithstanding anything to the contrary
contained in this Section 19, the provisions of this Series Supplement which
affect the rights or obligations of the Back-up Servicer may only be amended
with the further written consent of the Back-up Servicer.
SECTION 20. NO LIABILITY OF OWNER TRUSTEE. It is expressly understood
and agreed by the parties hereto that (i) this Series Supplement has been
executed and delivered on behalf of the Transferor by Chase Manhattan Bank USA,
National Association, not in its individual capacity, but solely as owner
trustee of the Transferor, in the exercise of the powers and authority vested in
it pursuant to the Trust Agreement, (ii) each of the representations,
undertakings and agreements made herein by the Transferor is not made or
intended as a personal representation, undertaking or agreement by Chase
Manhattan Bank USA, National Association, but is made and intended for the
purpose of binding only the Transferor and (iii) under no circumstances shall
Chase Manhattan Bank USA, National Association be liable for the payment of any
indebtedness or expenses of the Transferor or for the breach or failure of any
obligation, representation, warranty or covenant made or undertaken by the
Transferor under this Series Supplement, the Agreement, any other Supplement or
the Second Tier Receivables Purchase Agreement.
IN WITNESS WHEREOF, the Transferor, the Servicer, the Back-up Servicer
and the Trustee have caused this Series 2001-1 Supplement to be duly executed by
their respective officers as of the day and year first above written.
MELLON PREMIUM FINANCE LOAN OWNER TRUST, Transferor
By: MELLON BANK, N.A., not in its individual
capacity, but solely as administrator
By: Xxxxxx X. Xxxxxxx
By: /s/ Xxx X. Au
--------------------------
Name: Xxx X. Au
Title: Attorney-in-Fact
AFCO CREDIT CORPORATION, Servicer
By: /s/ Xxxxx X. Xxxxx
------------------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
AFCO ACCEPTANCE CORPORATION, Servicer
By: /s/ Xxxxx X. Xxxxx
------------------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
PREMIUM FINANCING SPECIALISTS, INC.
Back-up Servicer
By: /s/ Xxxxxx X. Xxxxxxxxxxx
------------------------------------------------
Name: Xxxxxx X. Xxxxxxxxxxx
Title: President
PREMIUM FINANCING SPECIALISTS OF
CALIFORNIA, INC., Back-up Servicer
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, the Trustee
By: /s/ Xxx Xxxxx
------------------------------------------------
Name: Xxx Xxxxx
Title: Assistant Vice President
EXHIBIT A-1
[FORM OF CLASS A CERTIFICATE]
[AVAILABLE UPON REQUEST]
EXHIBIT A-2
[FORM OF CLASS B CERTIFICATE]
[AVAILABLE UPON REQUEST]
EXHIBIT B
[FORM OF MONTHLY PAYMENT INSTRUCTIONS AND NOTIFICATION TO TRUSTEE]
[AVAILABLE UPON REQUEST]
EXHIBIT C
[FORM OF MONTLY SERIES 2001-1 HOLDERS' STATEMENT]
[AVAILABLE UPON REQUEST]
