WAREHOUSING SERIES SUPPLEMENT
dated as of December 3, 1996
to
SPREAD ACCOUNT AGREEMENT,
dated as of March 25, 1993,
as amended and restated
as of December 3, 1996
among
OLYMPIC FINANCIAL LTD.,
OLYMPIC RECEIVABLES FINANCE CORP.
FINANCIAL SECURITY ASSURANCE INC.
and
NORWEST BANK MINNESOTA, NATIONAL ASSOCIATION,
as Trustee and as Collateral Agent
TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS
Section 1.1. Definitions . . . . . . . . . . . . . . . . . . . . 2
Section 1.2. Rules of Interpretation . . . . . . . . . . . . . . 3
ARTICLE II
SERIES SUPPLEMENTS; THE COLLATERAL
Section 2.1. Series Supplement . . . . . . . . . . . . . . . . . 3
Section 2.2. Grant of Security Interest by OFL and the Seller . 4
ARTICLE III
SPREAD ACCOUNT
Section 3.1. Establishment of Warehousing Series Spread Account. 5
Section 3.2. Release of Funds Upon Repurchase . . . . . . . . . 5
ARTICLE IV
MISCELLANEOUS
Section 4.1. Further Assurances . . . . . . . . . . . . . . . . . 5
Section 4.2. Governing Law . . . . . . . . . . . . . . . . . . . 5
Section 4.3. Counterparts . . . . . . . . . . . . . . . . . . . . 5
Section 4.4. Headings . . . . . . . . . . . . . . . . . . . . . . 5
WAREHOUSING SUPPLEMENT
WAREHOUSING SUPPLEMENT, dated as of December 3, 1996 (the "Warehousing
Supplement"), by and among OLYMPIC FINANCIAL LTD., a Minnesota corporation
("OFL"), OLYMPIC RECEIVABLES FINANCE CORP., a Delaware corporation (the
"Seller"), FINANCIAL SECURITY ASSURANCE INC., a New York stock insurance
company ("Financial Security") and NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, a national banking association, in its capacity as Indenture
Trustee under the Indenture referred to below, for the Noteholders with
respect to the related Series (in each of such capacities, the "Trustee") and
as Collateral Agent hereunder.
R E C I T A L S
1. The parties hereto have previously entered into a Spread Account
Agreement, dated as of March 25, 1993, as amended and restated as of December
3, 1996 (the "Spread Account Agreement"), and, as contemplated by Section
2.02 of the Spread Account Agreement, this Warehousing Series Supplement
constitutes a Series Supplement to the Spread Account Agreement so that
hereafter this Warehousing Series Supplement shall form a part of the Spread
Account Agreement for all purposes thereof, and all references herein and
hereafter to the Spread Account Agreement shall mean the Spread Account
Agreement, as supplemented hereby.
2. Pursuant to the Repurchase Agreement dated as of December 3, 1996
between Arcadia Receivables Conduit Corp., a Delaware corporation (the
"Issuer"), as Buyer, and the Seller (the "Repurchase Agreement"), the Seller
intends to sell from time to time to the Issuer all of its right, title and
interest in and to Receivables and certain other Seller Conveyed Property (as
defined in the Repurchase Agreement).
3. Pursuant to the Indenture between the Issuer and the Trustee (the
"Warehousing Series Indenture"), the Issuer is issuing the Warehousing Notes.
4. The Seller has requested that Financial Security issue the Note Policy
to the Trustee to guarantee payment of the Scheduled Payments (as defined in
such Policy) on each Payment Date in respect of the Warehousing Notes.
5. In partial consideration of the issuance of the Note Policy, the
Seller has agreed that Financial Security shall have certain rights as
Controlling Party, to the extent set forth herein and in the Transaction
Documents.
6. The Seller is a wholly owned special purpose subsidiary of OFL. The
Issuer has agreed to pay the amount earned on the Receivables, net of certain
amounts as set forth in the Servicing Agreement, to the Seller pursuant to
the Repurchase Agreement. The Warehousing Series Insurer Secured Obligations
form part of the consideration to Financial Security for its issuance of the
Note Policy.
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7. In order to secure the performance of the Warehousing Series Secured
Obligations, the Seller have agreed to pledge the Warehousing Series
Collateral as Collateral to the Collateral Agent for the benefit of Financial
Security and for the benefit of the Trustee on behalf of the Noteholders,
upon the terms and conditions set forth herein.
A G R E E M E N T S
In consideration of the premises, and for other good and valuable
consideration, the adequacy, receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. DEFINITIONS. All terms defined in Section 1.1 of the
Repurchase Agreement shall have the same meaning with respect to this
Warehousing Series Supplement. The following terms shall have the following
respective meanings:
"COLLECTION ACCOUNT SHORTFALL" means, with respect to the Warehousing
Series, (I) with respect to any Distribution Date prior to the occurrence of
an Amortization Event, the excess, if any, of (A) the amount required to be
distributed on such Distribution Date pursuant to priorities (i) through (vi)
of Section 3.6(a) of the Servicing Agreement over (B) Spread Account
Available Funds with respect to the immediately preceding Deficiency Claim
Date and (II) with respect to any Distribution Date following the occurrence
of an Amortization Event, the excess, if any, of (A) the amount required to
be distributed on such Distribution Date pursuant to priorities (i) through
(vi) of Section 3.6(b) of the Servicing Agreement over (B) the Spread Account
Available Funds with respect to such Distribution Date.
"SPREAD ACCOUNT MAXIMUM AMOUNT," with respect to the Warehousing Series
and any Distribution Date:
(i) if no Insurance Agreement Event of Default with respect
to the Warehousing Series has occurred and is continuing and no Capture
Event has occurred and is continuing as of the related Determination Date,
is equal to one percent of the principal balance of the Purchased
Receivables (as defined in the Repurchase Agreement); or
(ii) if (A) an Insurance Agreement Event of Default with
respect to the Warehousing Series has occurred and is continuing, or (B) a
Capture Event has occurred and is continuing as of the related
Determination Date, the Spread Account Maximum Amount shall not be limited.
"WAREHOUSING SERIES COLLATERAL" has the meaning specified in Section
2.3(a) hereof.
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"WAREHOUSING SERIES INDENTURE" means the Indenture, dated as of December
3, 1996 between the Issuer and the Trustee.
"WAREHOUSING SERIES NOTE POLICY" means the financial guaranty insurance
policy issued by Financial Security with respect to the Warehousing Series
Notes.
"WAREHOUSING SERIES NOTES" means the Notes issued pursuant to the
Warehousing Series Indenture.
"WAREHOUSING SERIES REPURCHASE AGREEMENT" means the Repurchase
Agreement, dated December 3, 1996, between the Issuer and the Seller.
"WAREHOUSING SERIES SERVICING AGREEMENT" means the Servicing Agreement,
dated as of December 3, 1996, among OFL, in its individual capacity and as
Servicer, the Issuer, the Seller and the Backup Servicer, the Trustee, the
Collateral Agent and Bank of America National Trust and Savings Association
as Agent, as such agreement may be supplemented, amended or modified from
time to time.
"WAREHOUSING SHORTFALL" means, with respect to the Warehousing Series
and any Distribution Date following the occurrence of an Amortization Event,
the sum of (1) the excess, if any, of (A) the amount required to be
distributed on such Distribution Date pursuant to priorities (i) through
(viii) of Section 3.6(b) of the Servicing Agreement over (B) the Warehousing
Shortfall Available Funds with respect to such Distribution Date.
"WAREHOUSING SUPPLEMENT" means this Warehousing Supplement
which constitutes a Series Supplement to the Spread Account Agreement.
Section 1.2. RULES OF INTERPRETATION. The terms "hereof," "herein,"
"hereto" or "hereunder," unless otherwise modified by more specific
reference, shall refer to this Warehousing Series Supplement. Unless
otherwise indicated in context, the terms "Article," "Section," or "Exhibit"
shall refer to an Article or Section of, or Exhibit to, this Warehousing
Series Supplement. The definition of a term shall include the singular, the
plural, the past, the present, the future, the active and the passive forms
of such term. A term defined herein and used herein preceded by a Series
designation or defined in the Servicing Agreement, shall mean such term as it
relates to the Warehousing Series.
ARTICLE II
SERIES SUPPLEMENTS; THE COLLATERAL
Section 2.1. SERIES SUPPLEMENT. As provided in and subject to the
conditions specified in Section 2.02 of the Spread Account Agreement, the
parties hereto are entering into this Warehousing Series Supplement with
respect to the Warehousing Series.
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Section 2.2. GRANT OF SECURITY INTEREST BY OFL AND THE SELLER.
(a) In order to secure the performance of the Secured Obligations with
respect to each Series, the Seller (and OFL, to the extent it may have any
rights therein) hereby pledges, assigns, grants, transfers and conveys to the
Collateral Agent, on behalf of and for the benefit of the Secured Parties to
secure the Secured Obligations (as defined in the Spread Account Agreement),
a lien on and security interest in (which lien and security interest is
intended to be prior to all other liens, security interest or other
encumbrances), all of its right, title and interest in and to the following
(all being collectively referred to herein as the "Warehousing Series
Collateral"):
(i) all amounts distributable pursuant to Sections 3.6(a)(x)
and 3.6(b)(x) of the Warehousing Series Servicing Agreement (the
"Receivables Income") and all rights and remedies that the Seller may have
to enforce payment of the Receivables Income whether under the Warehousing
Series Servicing Agreement or otherwise;
(ii) the Warehousing Series Spread Account established pursuant
to Section 3.1 of this Series Supplement and Section 3.01 of the Spread
Account Agreement, and each other account owned by the Seller and maintained
by the Collateral Agent (including, without limitation, all monies, checks,
securities, investments and other documents from time to time held in or
evidencing any such accounts);
(iii) all of the Seller's right, title and interest in and to
investments made with proceeds of the property described in clauses (i) and
(ii) above, or made with amounts on deposit in the Warehousing Series
Spread Account; and
(iv) all distributions, revenues, products, substitutions,
benefits, profits and proceeds, in whatever form, of any of the foregoing.
(b) In order to effectuate the provisions and purposes of this Series
Supplement, including for the purpose of perfecting the security interests
granted hereunder, the Seller represents and warrants that it has, prior to
the execution of this Series Supplement, executed and filed an appropriate
Uniform Commercial Code financing statement in Minnesota sufficient to ensure
that the Collateral Agent, as agent for the Secured Parties, has a first
priority perfected security interest in all Warehousing Series Collateral
which can be perfected by the filing of a financing statement.
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ARTICLE III
SPREAD ACCOUNT
Section 3.1. ESTABLISHMENT OF WAREHOUSING SERIES SPREAD ACCOUNT. On or
prior to the Closing Date relating to the Warehousing Series, the Collateral
Agent shall establish with respect to the Warehousing Series, at its office
or at another depository institution or trust company, an Eligible Account,
designated "Spread Account -- Warehousing Series -- Norwest Bank Minnesota,
National Association, as Collateral Agent for Financial Security Assurance
Inc. and another Secured Party" (the "Warehousing Series Spread Account").
Section 3.2. RELEASE OF FUNDS UPON REPURCHASE. On the Repurchase Date
for any Purchased Receivables in respect of which the Collateral Agent has
received a Notice of Repurchase in the form of Exhibit D to the Repurchase
Agreement for Purchased Recevables with an aggregate principal balance equal
to or greater than $20,000,000 and a corresponding executed reconveyance in
the form of Exhibit E to the Repurchase Agreement pursuant to Section 3(d)
thereof, the Collateral Agent, upon reconveyance of such Purchased
Receivables, shall recalculate the Spread Account Maximum Amount for the
Warehousing Series Spread Account and release funds from the Warehousing
Series Spread Account in excess of the recalculated Spread Account Maximum
Amount to the Seller.
ARTICLE IV
MISCELLANEOUS
Section 4.1. FURTHER ASSURANCES. Each party hereto shall take such
action and deliver such instruments to any other party hereto, in addition to
the actions and instruments specifically provided for herein, as may be
reasonably requested or required to effectuate the purpose or provisions of
this Warehousing Series Supplement or to confirm or perfect any transaction
described or contemplated herein.
SECTION 4.2. GOVERNING LAW. THIS WAREHOUSING SERIES SUPPLEMENT SHALL
BE GOVERNED BY AND CONSTRUED, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED, IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
Section 4.3. COUNTERPARTS. This Warehousing Series Supplement may be
executed in two or more counterparts by the parties hereto, and each such
counterpart shall be considered an original and all such counterparts shall
constitute one and the same instrument.
Section 4.4. HEADINGS. The headings of sections and paragraphs and the
Table of Contents contained in this Warehousing Series Supplement are
provided for convenience only. They form no part of this Warehousing Series
Supplement and shall not affect its construction or interpretation.
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IN WITNESS WHEREOF, the parties hereto have executed this Warehousing
Series Supplement as of the date set forth on the first page hereof.
OLYMPIC FINANCIAL LTD.
By illegible
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Name:
Title:
OLYMPIC RECEIVABLES FINANCE CORP.
By illegible
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Name:
Title:
FINANCIAL SECURITY ASSURANCE INC.
By Xxxxxx X. Xxxxxxxx
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Authorized Officer
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Trustee
By Xxxxxx X. Wraathbert
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Name:
Title:
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Collateral Agent
By Xxxxxx X. Wraathbert
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Name:
Title:
