MELLON BANK, N.A.
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
THE FIRST NATIONAL BANK OF CHICAGO
Trustee
on behalf of the Series 1996-1 Holders
SERIES 1996-1 SUPPLEMENT
Dated as of December 1, 1996
to
POOLING AND SERVICING AGREEMENT
Dated as of December 1, 1996
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
Series 1996-1
TABLE OF CONTENTS
PAGE
SECTION 1. Designation ..................................................1
SECTION 2. Definitions ..................................................2
SECTION 3. Servicing Compensation........................................21
SECTION 4. Reassignment and Transfer Terms................................22
SECTION 5. Delivery and Payment for the Investor
Certificates.....................................22
SECTION 6. Depository; Form of Delivery of Investor
Certificates.....................................22
SECTION 7. Article IV of Agreement.......................................22
ARTICLE IV RIGHTS OF HOLDERS AND ALLOCATION AND
APPLICATION OF COLLECTIONS.......................22
SECTION 4.6 Rights of Holders and the Collateral
Interest Holder..................................22
SECTION 4.7 Allocations ................................................23
SECTION 4.8 Determination of Monthly Interest...........................27
SECTION 4.9 Determination of Monthly Principal..........................29
SECTION 4.10 Coverage of Required Amount.................................30
SECTION 4.11 Monthly Payments............................................31
SECTION 4.12 Investor Charge-Offs........................................37
SECTION 4.13 Excess Spread...............................................38
SECTION 4.14 Reallocated Principal Collections...........................40
SECTION 4.15 Shared Principal Collections................................41
SECTION 4.16 Principal Account and Principal Funding
Account..........................................42
SECTION 4.17 Reserve Account.............................................43
SECTION 4.18 Interest Funding Account....................................45
SECTION 4.19 Determination of LIBOR......................................46
SECTION 4.20 Transferor's or Servicer's Failure to Make
a Deposit or Payment.............................47
SECTION 8. Article V of the Agreement....................................47
ARTICLE V DISTRIBUTIONS AND REPORTS TO INVESTOR HOLDERS................47
SECTION 5.1 Distributions................................................47
SECTION 5.2 Monthly Series 1996-1 Holders' Statement.....................49
SECTION 9. Series 1996-1 Pay Out Events..................................49
SECTION 10. Series 1996-1 Termination....................................52
SECTION 12. RESERVED. .................................................52
SECTION 13. RESERVED. .................................................52
SECTION 14. Counterparts.................................................52
SECTION 15. Governing Law................................................52
SECTION 16. Additional Notices...........................................52
SECTION 17. Additional Representations and Warranties of
Servicer.........................................53
SECTION 17. No Petition .................................................53
SECTION 18. Amendments .................................................53
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 1996-1 Holders'
Statement
SCHEDULE 1
Schedule to Exhibit B of the Pooling and Servicing Agreement
with respect to the Investor Certificates
SERIES 1996-1 SUPPLEMENT, dated as of December 1, 1996 (this "Series
Supplement"), by and among MELLON BANK, N.A., a national banking association, 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 THE FIRST NATIONAL BANK OF CHICAGO, a national banking
association, as Trustee under the Pooling and Servicing Agreement dated as of
December 1, 1996 by and among each Servicer, each Back-up Servicer, the
Transferor and Trustee (the "Agreement").
Section 6.9 of the Agreement provides, among other things, that
Transferor and 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
Trustee to Transferor for the execution and redelivery to Trustee for
authentication of one or more Series of Certificates.
Pursuant to this Series Supplement, 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 1996-1
Certificates." The two classes shall be designated the Class A Floating Rate
Asset Backed Certificates, Series 1996-1 (the "Class A Certificates") and the
Class B Floating Rate Asset Backed Certificates, Series 1996-1 (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 1996-1
and have the rights assigned to the Collateral Interest in this Series
Supplement.
(b) Series 1996-1 shall be included in Group One (as defined below).
Series 1996-1 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 ad
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" initially means zero and thereafter means,
with respect to any Monthly Period during the Controlled Accumulation Period,
the excess, if any, of the Controlled Deposit Amount for the previous Monthly
Period over the amount deposited into the Principal Funding Account pursuant to
subsection 4.11(e)(i) with respect to the Class A Certificates for the previous
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 Investor Interest and (c) the Collateral Interest.
"Aggregate Investor Default Amount" means, as to any Monthly Period,
the sum of the Investor Default Amounts in respect of such Monthly Period.
"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 (x) subsection 4.11(a)(iii) and
(y) subsection 4.13(c) (to the extent such portions pursuant to subsection
4.13(c) are available to pay the Class B Investor Default Amount), 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 1996-1 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(i) 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.
"Class A Additional Interest" is defined in Section 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
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 Principal
Funding Investment Proceeds arising pursuant to subsection 4.16(b), if any, with
respect to the related Transfer Date and (c) amounts, if any, to be withdrawn
from the Reserve Account which will be deposited into the Finance Charge Account
on the related Transfer Date pursuant to subsections 4.17(b) and 4.17(d) (or
which will be required to be deposited in the Finance Charge Account pursuant to
such subsections on the related Transfer Date (before giving effect to any
permitted netting)).
"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 0.11% 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 Deficiency Amount" is defined in subsection 4.8(a).
"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 $440,000,000.
"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, Finance Charge Collections and Principal Collections
during the Revolving Period, the Class A Floating Allocation, and (b) with
respect to Principal Collections during the Controlled Accumulation Period,
Principal Payment Period or Rapid Amortization Period, the Class A Fixed
Allocation.
"Class A Investor Default Amount" means, as to each Transfer Date, an
amount equal to the product of (a) the Aggregate Investor Default Amount for the
related Monthly Period and (b) the Class A Floating Allocation applicable for
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(b) 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 Required Amount" is defined in subsection 4.10(a).
"Class A Scheduled Payment Date" means the December 2001 Distribution
Date.
"Class A Servicing Fee" is defined in subsection 3(a) 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 less, if the Originators are not the Servicer, the Class
A Servicing Fee for the related Monthly Period MINUS (y) Class A Available Funds
for the related Monthly Period.
"Class B Additional Interest" is defined in subsection 4.8(b).
"Class B Available Funds" means, as to any Monthly Period, an amount
equal to the Class B Floating Allocation of Finance Charge Collections allocated
to the Investor Certificates for such Monthly Period.
"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 0.32% 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 Deficiency Amount" is defined in subsection 4.8(b).
"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 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 $25,000,000.
"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, the Principal Payment 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 Aggregate 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(d) 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 Required Amount" is defined in subsection 4.10(b).
"Class B Scheduled Payment Date" means the January 2002 Distribution
Date.
"Class B Servicing Fee" is defined in subsection 3(a).
"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 less, if the Originators are not the Servicer, the Class
B Servicing Fee for the related Monthly Period MINUS (y) Class B Available Funds
for the related Monthly Period.
"Closing Date" means December 19, 1996.
"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, Principal Payment Period or Rapid Amortization Period, the
Collateral Fixed Allocation.
"Collateral Available Funds" means, as to any Monthly Period, a amount
equal to the Collateral Floating Allocation of Finance Charge Collections
allocated to the Investor Certificates.
"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 Aggregate 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 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 $35,000,000.
"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 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(h), 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 Holder" means the entity so designated in the
Loan Agreement.
"Collateral Interest Servicing Fee" is defined in subsection 3(a) 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.
"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, $48,888,888.89; provided that if the Controlled
Accumulation Period Length is modified pursuant to subsection 4.11(i), (i) the
Controlled Accumulation Amount for each Transfer Date with respect to the
Controlled Accumulation Period shall mean the amount determined in accordance
with Section 4.11(i) on the date on which the Controlled Accumulation Period has
most recently been modified and (ii) the sum of the 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.
"Controlled Accumulation Date" means February 28, 2001.
"Controlled Accumulation Period" means, unless a Pay Out Event shall
have occurred or a Principal Payment Period shall have commenced 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 Principal
Payment Period or Rapid Amortization Period and (b) the Series 1996-1
Termination Date.
"Controlled Accumulation Period Length" is defined in subsection
4.11(i).
"Controlled Deposit Amount" means, with respect to any Transfer Date,
the sum of (a) the Controlled Accumulation Amount for such Transfer Date and (b)
any existing Accumulation Shortfall.
"Covered Amount" means an amount determined as of each Transfer Date
with respect to any Interest Period as the product of (a) (i) a fraction, the
numerator of which is the actual number of days in such Interest Period and the
denominator of which is 360, times (ii) the Class A Certificate Rate for such
Monthly Period, and (b)the Principal Funding Account Balance as of the Record
Date preceding 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 January 15, 1997 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 Principal Funding Investment Proceeds" means, with respect to
each Transfer Date relating to the Controlled Accumulation Period, the amount,
if any, by which the Principal Funding Investment Proceeds for such Transfer
Date exceed the Covered Amount determined on such Transfer Date.
"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)(iv), 4.11(b)(iii) and 4.11(c)(ii), 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 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 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 1996-1 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 1996-1) which are
in an Amortization Period or Accumulation Period (as such terms are defined in
the related Supplements for all Series in Group One), 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), (b) the Controlled Deposit Amount for
the related Transfer Date for any Series in its 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), (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), (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), (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 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.
"Initial Principal Payment Date" means initially the December 1998
Distribution Date, but will successively be extended to the next Distribution
Date after the then-current Initial Principal Payment Date unless the Transferor
elects, pursuant to Section 11, not to cause such extension to occur; provided,
however, that the Initial Principal Payment Date may not be later than the Class
A Scheduled Payment Date.
"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 (or, if any such day is not a Business Day, the next
succeeding Business Day), and the Class B Scheduled Payment Date, commencing on
the March 17, 1997 Distribution Date.
"Interest Period" means, (a) with respect to the Class A Certificates
and Class B Certificates and 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; and (b) with respect to the
Collateral Interest and any Transfer Date, the Monthly Interest Period ending on
the related Distribution Date.
"Investor Certificates" means the Class A Certificates, the Class B
Certificates and the Collateral Interest.
"Investor Default Amount" means, with respect to any Receivables in
Defaulted Accounts, an amount equal to the product of (a) the Receivables in
Defaulted Accounts and (b) the Floating Investor Percentage on the day such
Receivable became a Receivable in a Defaulted Account.
"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 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, the Principal Payment 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)(iii), and 4.13(a), (b),
(c), (d), (g) and (h) 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 subsection 3(a) of this Series
Supplement.
"LIBOR" means, for any Interest Period, an interest rate per annum
determined by Trustee for each Interest Period in accordance with the provisions
of Section 4.19.
"LIBOR Determination Date" means December 17, 1996 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, the Trustee, and the Collateral Interest Holder are parties, dated as
of December 1, 1996, 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.
"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 (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 Transferor may increase or reduce the
percentage used to determine the Minimum Transferor Interest (but not below 2%)
upon (a) 30 day's prior notice to Trustee, each Rating Agency and any Credit
Enhancement Provider, (b) satisfaction of the Rating Agency Condition, and (c)
delivery to Trustee and each such Credit Enhancement Provider of an Officer's
Certificate stating that 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 first day of such Monthly Period.
"Monthly Period" is defined in the Agreement, except that the first
Monthly Period with respect to the Investor Certificates begins on and includes
the Cut Off Date and ends on and includes December 31, 1996.
"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
1996-1 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.
"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 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 Aggregate 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.
"Principal Account" is defined in subsection 4.16(a).
"Principal Funding Account" is defined in subsection 4.16(a).
"Principal Funding Account Balance" means, with respect to any date of
determination, the principal amount, if any, on deposit in the Principal Funding
Account on such date of determination.
"Principal Funding Investment Proceeds" means, with respect to each
Transfer Date, the investment earnings on funds in the Principal Funding Account
(net of investment expenses ad losses) for the period from and including the
immediately preceding Transfer Date to but excluding such Transfer Date.
"Principal Funding Investment Shortfall" means, with respect to each
Transfer Date relating to the Controlled Accumulation Period, the amount, if
any, by which the Principal Funding Investment Proceeds for such Transfer Date
are less than the Covered Amount determined as of such Transfer Date.
"Principal Payment Event" if applicable, shall mean the delivery by
the Servicer of a notice to the Trustee of its election not to extend the
Initial Principal Payment Date in accordance with Section 11.
"Principal Payment Period" means the period beginning on the first day
of the Monthly Period second preceding the Initial Principal Payment Date
following the Transferor's election not to extend such Initial Principal Payment
Date and ending on the earliest to occur of (i) the Rapid Amortization Period,
(ii) the payment in full of the Invested Amount and (iii) the Series 1996-1
Termination Date. The first Transfer Date of the Principal Payment Period shall
be the Transfer Date related to such Initial Principal Payment Date.
"Rapid Amortization Period" means the period commencing on the Pay Out
Commencement Date and ending on the earlier to occur of (a) the Series 1996-1
Termination Date and (b) the termination of the Trust pursuant to Section 12.1.
"Rating Agency" means Moody's and Standard & Poor's.
"Rating Agency Condition" means the notification in writing by each
Rating Agency to Transferor, Servicer and Trustee that an action will not result
in any Rating Agency reducing or withdrawing its then existing rating of the
Class A Certificates or the Class B Certificates.
"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 Servicer (or Transferor, if Back-up Servicer is Servicer).
"Required Collateral Interest" means (a) initially, $35,000,000 and
(b) on any Transfer Date thereafter, 7% of the Class A Adjusted Investor
Interest and the Class B 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 the Collateral
Interest on the prior Transfer Date, after any adjustments to be made on such
date, but not less than $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 with respect to the Investor
Certificates has occurred, the Required Collateral Interest for any Transfer
Date shall (subject to clauses (y) and (z)) equal the Required Collateral
Interest for the Transfer Date immediately preceding such reduction or Pay Out
Event, (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 and (z) the Required Collateral Interest may be
reduced at Transferor's option at any time to a lesser amount if Transferor,
Servicer, the Collateral Interest Holder and Trustee have been provided evidence
that the Rating Agency Condition has been satisfied.
"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 Class A Certificates or (b) any
other amount designated by Transferor; provided that if such designation is of a
lesser amount, Transferor shall (i) provide Servicer, the Collateral Interest
Holder and Trustee with evidence that the Rating Agency Condition has been
satisfied and (ii) deliver to 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 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 1996-1.
"Reserve Account" is defined in subsection 4.17(a).
"Reserve Account Funding Date" means the Transfer Date 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" is defined in subsection 4.17(c).
"Reset Date" means each of (a) a Removal Date on which, 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 and (b) a 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 earliest of (a) the day the Controlled
Accumulation Period commences, (b) the day the Principal Payment Period
commences and (c) the Pay Out Commencement Date.
"Series 1996-1" means the Series of the Mellon Bank Premium Finance
Loan Master Trust represented by the Investor Certificates.
"Series 1996-1 Certificates" means the Class A Certificates and the
Class B Certificates.
"Series 1996-1 Holders" means the holder of record of a Series 1996-1
Certificate.
"Series 1996-1 Pay Out Event" is defined in Section 9 of this Series
Supplement.
"Series 1996-1 Termination Date" means the earliest to occur of (a)
the Distribution Date on which the Investor Interest is paid in full, (b) the
January 2003 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 (l) 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)(iv), 4.11(b)(iii) and 4.11 (c)(ii).
"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 or Principal Payment Period, the sum of (A) the
Controlled Deposit Amount (assuming the Principal Payment Period has not
commenced) for such Transfer Date, (B) on the Transfer Date after the Transfer
Date on which the Class A Adjusted Investor Interest is reduced to zero, the
Class B Invested Amount and (C) the excess, if any, of the Collateral Interest
for such Transfer Date 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, (iii) with respect to any Transfer Date
relating to the Revolving Period, the amount specified in clause (a)(i)(C) above
and (iv) with respect to any Transfer Date relating to any Principal Payment
Period, the amount, if any, that would have been the Controlled Accumulation
Amount for such Distribution Date had the related Principal Payment Event not
occurred, over (b) the Investor Principal Collections minus the Reallocated
Principal Collections (other than any portions thereof that are applied pursuant
to (x) subsection 4.11(a)(iii) and (y) subsection 4.13(c) (to the extent such
portions pursuant to subsection 4.13(c) are available to pay the Class B
Investor Default Amount)) for such Transfer Date.
"Series Servicing Fee Percentage" means 0.50%.
"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.
"Shortfall Amount" is defined in subsection 4.8(d).
"Special Payment Date" shall mean each Distribution Date with respect
to the Principal Payment Period and 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).
SECTION 3. Servicing Compensation. The share of the Servicing Fee
allocable to Series 1996-1 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
$83,333.33. 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 $73,333.33. 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 Rate 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 $4,166.67. 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 $5,833.33.
Except as specifically provided above, the Servicing Fee shall be paid by the
cash flows from the Trust allocated to Transferor or the certificateholders of
other Series (as provided in the related Supplements) and in no event shall the
Trust, Trustee or the Investor Holders be liable therefor. The Class A Servicing
Fee shall be payable to Servicer solely to the extent amounts are available for
distribution in respect thereof pursuant to subsections 4.11(a)(ii) and 4.13(a).
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)(ii) and 4.13(c). 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(f) or if applicable subsection 4.11(c)(i).
SECTION 4. Reassignment and Transfer Terms. The Investor Certificates
shall be subject to retransfer to Transferor at its option, in accordance with
subsection 12.2(a), 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.
Transferor shall execute and deliver the Series 1996-1 Certificates to 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 1996-1 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 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.
Transferor shall not have any interest in the Collection Account, the Finance
Charge 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, 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 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 Receivables 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 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 Transferor pursuant to this
subsection 4.7(a)(iv)(B) with respect to any Date of
Processing shall be paid to 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, 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 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
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 Transferor pursuant to this subsection
4.7(b)(iv)(B) with respect to any Date of Processing shall
be paid to 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 Principal Payment Period and the Rapid
Amortization Period. During the Principal Payment Period and the Rapid
Amortization Period, 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 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 Transferor pursuant to this
subsection 4.7(c)(ii)(B) with respect to any Date of
Processing shall be paid to 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 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) ("Unallocated
Principal Collections") shall be held in the Excess Funding Account and, prior
to the commencement of the Controlled Accumulation Period, the Principal Payment
Period or the Rapid Amortization Period shall be paid to 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, the Principal
Payment 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 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, 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 or (if
Transferor is not Servicer) Servicer, 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 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 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, Servicer may withdraw from the Collection
Account, the Finance Charge Account or the Principal Account
any amounts inadvertently deposited in the 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 such Monthly Period
less, if the Originators are not the Servicer, the Class A Servicing Fee for
such 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 B Deficiency Amounts, as defined below, 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, plus 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 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
accrued pursuant to this subsection 4.8(a) for the prior Monthly Interest Period
over the amount actually deposited or available to be deposited 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 such Monthly Period less, if the Originators are not the Servicer, the
Class B Servicing Fee for such 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 A Deficiency Amounts, as defined below, 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, plus 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 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 accrued pursuant to
this subsection 4.8(b) as of the prior Monthly Interest Period over the amount
actually deposited or available to be deposited 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 from the Finance
Charge Account with respect to the Collateral Interest on any Transfer Date
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 the purposes of determining Collateral
Monthly Interest only, the Collateral Rate shall not exceed a per annum rate of
1% 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 Section 4.13(k) or (l),
as the case may be, interest shall accrue on such Shortfall Amount at the
applicable Class A or Class B LIBOR 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.
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"),
beginning with the Transfer Date in the month following the month in which the
Controlled Accumulation Period or, if earlier, the Principal Payment Period or
the Rapid Amortization Period, begins, shall be equal to the least of (i) the
Available Investor Principal Collections on deposit in the Principal Account
with respect to such Transfer Date, (ii) for each Transfer Date with respect to
the Controlled Accumulation Period prior to the Class A Scheduled Payment Date,
the Controlled Deposit Amount for such Transfer Date and (iii) the Class A
Adjusted Investor Interest on such Transfer Date prior to any deposit into the
Principal Funding Account to be made on such day.
(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") for the Controlled Accumulation Period, beginning
with the Transfer Date after the one on which the Class A Adjusted Investor
Interest is reduced to zero (and for the Principal Payment Period or 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 to be made
on the related Distribution Date), shall be an amount equal to the lesser of (i)
the excess, if any, of (A) the Available Investor Principal Collections on such
Transfer Date over (B) any Class A Monthly Principal on such Transfer Date and
(ii) the Class B Investor Interest (after taking into account any adjustments to
be made on such Transfer Date pursuant to Sections 4.12 and 4.14) on such
Transfer Date.
(c) The amount of monthly principal (the "Collateral Monthly
Principal") distributable from the Principal Account with respect to the
Collateral Interest on each Transfer Date shall be (i) with respect to the
Revolving Period following any reduction of the Required Collateral Interest
pursuant to clause (z) of the proviso in the definition thereof an amount equal
to the lesser of (A) the excess, if any, of the Collateral Interest (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 on such Transfer
Date, and (B) the Available Investor Principal Collections on such Transfer Date
or (ii) with respect to the Controlled Accumulation Period, the Principal
Payment Period or the Rapid Amortization Period an amount equal to the lesser of
(A) the excess, if any, of the Collateral Interest (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 on such Transfer Date, and (B) the
excess, if any, of (1) the Available Investor Principal Collections on such
Transfer Date over (2) the sum of the Class A Monthly Principal and the Class B
Monthly Principal for such Transfer Date.
SECTION 4.10 Coverage of Required Amount. (a) On or before each
Transfer Date, Servicer shall determine the amount (the "Class A Required
Amount"), if any, by which the sum of (i) the Class A Monthly Interest for such
Transfer Date, plus (ii) the Class A Deficiency Amount, if any, for such
Transfer Date, plus (iii) the Class A Additional Interest, if any, for such
Transfer Date, plus (iv) the Class A Servicing Fee for the prior Monthly Period
plus (v) the Class A Servicing Fee, if any, due but not paid on any prior
Transfer Date, plus (vi) 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, 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 Monthly Interest for such
Transfer Date, plus (B) the Class B Deficiency Amount, if any, for such Transfer
Date plus (C) the Class B Additional Interest, if any, for such Transfer Date,
plus (D) the Class B Servicing Fee for the prior Monthly Period plus (E) the
Class B Servicing Fee, if any, due but not paid on any prior Transfer Date,
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 sum of the Class A Required Amount and the Class B Required
Amount for such Transfer Date is greater than zero, Servicer shall give written
notice to 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 shall be distributed from the
Finance Charge Account on such Transfer Date pursuant to subsection
4.13(a). If the Class A Required Amount for such Transfer Date exceeds
the amount of Excess Spread with respect to such Transfer Date, the
Principal Collections allocable to the Collateral Interest and the
Class B Certificates 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 shall be distributed from the Finance Charge Account on
such Transfer Date pursuant to subsection 4.13(c). 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(c), the Principal Collections allocable to the
Collateral Interest (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 each Transfer Date,
Servicer shall instruct Trustee in writing (which writing shall be substantially
in the form of Exhibit B) to withdraw, and Trustee, acting in accordance with
such instructions, shall withdraw on such Transfer Date or the related
Distribution Date, as applicable, 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 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
Servicer or Trustee into the Class A Interest Funding
Account for payment to Class A Holders on the applicable
Payment Date;
(ii) an amount equal to the Class A Servicing Fee for such
Transfer Date, plus any Class A Servicing Fee due but not
paid to Servicer on any prior Transfer Date shall be
distributed to Servicer;
(iii) an amount equal to the Class A Investor Default Amount, if
any, for the preceding Monthly Period shall be treated as a
portion of Investor Principal Collections and deposited into
the Principal Account on such Transfer Date; and
(iv) the balance, if any, shall constitute Excess
Spread and shall be allocated and distributed or deposited
as set forth in Section 4.13.
If the Back-up Servicer is the Servicer, the amounts described in
clause (ii) of this subsection 4.11(a) shall be paid prior to the amounts
described in clause (i) 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 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 Servicer or Trustee into the Class B Interest
Funding Account for payment to the Class B Holders on the
applicable Payment Date;
(ii) an amount equal to the Class B Servicing Fee for such
Transfer Date, plus any Class B Servicing Fee due but not
paid to Servicer on any prior Transfer Date for such
Transfer Date shall be distributed to 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.
If the Back-up Servicer is Servicer, the amounts described in clause
(ii) of this subsection 4.11(b) shall be paid prior to the amounts described in
clause (i) 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) if the Originators are no longer 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 Servicer on any prior Transfer Date shall be
distributed to Servicer;
(ii) 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 1996- 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 Transferor; provided that the
amount to be paid to Transferor pursuant to this subsection
4.11(d)(iii) with respect to such Transfer Date shall be
paid to 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, the Principal Payment
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 Principal Funding
Account, and (B) during the Principal Payment Period or 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, shall be deposited into the Distribution Account;
(iii) for each Transfer Date (other than the Transfer Date
immediately preceding the Series 1996-1 Termination Date, in
which case on the Series 1996-1 Termination Date) after
giving effect to the distribution referred to in clauses (i)
and (ii), an amount equal to Collateral Monthly Principal
shall be distributed to the Collateral Interest Holder in
accordance with the Loan Agreement;
(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 1996- 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 Transferor; provided that the amount to be paid to
Transferor pursuant to this subsection 4.11(e)(v) with
respect to such Transfer Date shall be paid to 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 Principal Payment Period or the Rapid Amortization Period and
(ii) the Transfer Date immediately preceding the Class A Scheduled Payment Date,
Trustee, acting in accordance with instructions from 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, Trustee shall pay in accordance with Section
5.1 to the Class A Holders from the Class A Interest Funding Account, the amount
deposited into the Class A Interest Funding Account pursuant to subsection
4.11(a)(i) on the preceding Transfer Date and (b) to the Class B Holders from
the Class B Interest Funding Account, the amount deposited into the Class B
Interest Funding Account pursuant to subsection 4.11(b)(i) on the preceding
Transfer Date.
(h) On the earlier to occur of (i) the first Special Payment Date with
respect to the Principal Payment Period or the Rapid Amortization Period and
(ii) the Class A Scheduled Payment Date and on each Payment Date thereafter,
Trustee, acting in accordance with instructions from 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; and
(ii) for each Special Payment Date with respect to the Principal
Payment Period or 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.
(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 March
2001 Monthly Period is less than nine months, upon written
notice to Trustee, Transferor and each Rating Agency,
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
prior to the month in which the Class A Scheduled Payment
Date occurs 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 one
month; (ii) such determination of the Controlled
Accumulation Period Length shall be made on each
Determination Date on and after the Determination Date
preceding the March 2001 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
on the Class A Certificates on the Class A Scheduled Payment
Date is expected to equal or exceed the Class A Investor
Interest, 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
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 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
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, Servicer shall calculate the Class A Investor Default Amount. If on any
Transfer Date, the Class A Investor Default Amount for the prior Monthly Period
exceeds the sum of the amount allocated with respect thereto pursuant to
subsection 4.11(a)(iii), subsection 4.13(a) 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 such reduction would cause 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 (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(b).
(b) On or before each Transfer Date, Servicer shall calculate the
Class B Investor Default Amount. If on any Transfer Date, the Class B Investor
Default Amount for the prior 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(c) 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 such reduction would
cause 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(d).
(c) On or before each Transfer Date, 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(g), 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(h).
SECTION 4.13 Excess Spread. On or before each Transfer Date, Servicer
shall instruct Trustee in writing (which writing shall be substantially in the
form of Exhibit B) to apply, and 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 Class A Required Amount, if any, with
respect to such Transfer Date will be used to fund the Class A
Required Amount and be applied in accordance with, and in the priority
set forth in, subsection 4.11(a);
(b) 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;
(c) an amount equal to the Class B Required Amount, if any, with
respect to such Transfer Date will be used to fund the Class B
Required Amount and be applied first in accordance with, and in the
priority set forth in, subsection 4.11(b) and then any remaining
amount available to pay the Class B Investor Default Amount shall be
treated as a portion of Investor Principal Collections and deposited
into the Principal Account on such Transfer Date;
(d) 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;
(e) an amount equal to the Collateral Monthly Interest plus the
amount of any past due Collateral Monthly Interest for such Transfer
Date will be paid to the Collateral Interest Holder in accordance with
the Loan Agreement;
(f) if the Originators are Servicer, an amount equal to the
aggregate amount of accrued but unpaid Collateral Interest Servicing
Fees will be paid to Servicer;
(g) 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;
(h) 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;
(i) 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;
(j) 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;
(k) 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 Servicer or Trustee in the Class A Interest Funding
Account for payment to the Class A Holders on the applicable Payment
Date;
(l) 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 Servicer or Trustee into the Class B Interest Funding
Account for payment to the Class B Holders on the applicable Payment
Date; and
(m) the balance, if any, after giving effect to the payments made
pursuant to clauses (a) through (l) 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 each
Transfer Date, Servicer shall instruct Trustee in writing (which writing shall
be substantially in the form of Exhibit B) to, and 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, shall be applied
pursuant to subsections 4.11(a)(i), (ii), and (iii) and
(b) an amount equal to the excess, if any, of (i) the Class B Required
Amount, if any, with respect to such Transfer Date over (ii) the amount of
Excess Spread allocated and available to the Class B Certificates pursuant to
subsection 4.13(c) on such Transfer Date shall be applied first pursuant to
subsections 4.11(b)(i) and (ii) and then pursuant to subsection 4.13(c).
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 1996-1 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 1996-1 with
respect to any Transfer Date means an amount equal to the Series Principal
Shortfall, if any, with respect to Series 1996-1 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 1996-1 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
1996-1 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, 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 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,
Transferor shall notify Trustee, and Trustee upon being notified (or 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, at the direction of Servicer, shall (i)
make withdrawals from the Principal Account and the Principal Funding Account
from time to time, in the amounts and for the purposes 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 Principal
Funding Account make a deposit into the Principal Funding Account in the amount
specified in, and otherwise in accordance with, subsection 4.11(e).
(b) Funds on deposit in the Principal Account and the Principal
Funding Account shall be invested pursuant to the written direction of Servicer
by Trustee in Permitted Investments. Funds on deposit in the Principal Funding
Account on any Transfer Date, after giving effect to any withdrawals from the
Principal Funding Account on such Transfer Date, shall be invested in such
investments that will mature so that such funds will be available for withdrawal
on or prior to the following Transfer Date. The Trustee shall 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, Trustee, acting at Servicer's
direction given on or before such Transfer Date, shall transfer from the
Principal Funding Account to the Finance Charge Account the Principal Funding
Investment Proceeds on deposit in the Principal Funding Account, but not in
excess of the Covered Amount, for application as Class A Available Funds applied
pursuant to subsection 4.11(a)(i).
Any Excess Principal Funding Investment Proceeds shall be paid to
Transferor on each Transfer Date. An amount equal to any 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). Principal Funding Investment Proceeds (including
reinvested interest) shall not be considered part of the amounts on deposit in
the Principal Funding Account 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 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, Transferor shall notify the Trustee and
each Rating Agency, and Trustee upon being notified (or 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 any investments to
such new Reserve Account. The Trustee, at the direction of 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(i).
(b) Funds on deposit in the Reserve Account shall be invested by
Trustee in Permitted Investments pursuant to the written direction of 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 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. 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 prior to the payment in full of the Class A Investor
Interest and on or before the first Transfer Date with respect to the Principal
Payment Period or the Rapid Amortization Period, Servicer shall calculate the
"Reserve Draw Amount" which shall be equal to the Principal Funding Investment
Shortfall with respect to each Transfer Date with respect to the Controlled
Accumulation Period or the first Transfer Date with respect to the Principal
Payment Period or the Rapid Amortization Period less, in each case, the amount
of funds deposited into the Finance Charge Account on such Transfer Date
pursuant to subsection 4.17(b).
(d) If the Reserve Draw Amount for any Transfer Date is greater than
zero, the Reserve Draw Amount, up to the Available Reserve Account Amount, shall
be withdrawn from the Reserve Account on such Transfer Date by Trustee (acting
in accordance with the instructions of Servicer), deposited into the Finance
Charge Account and included in Class A Available Funds 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, Trustee, acting in accordance with
the instructions of 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 Principal
Payment Period or the Rapid Amortization Period and (iii) the Transfer Date
immediately preceding the Class A Scheduled Payment Date, Trustee, acting in
accordance with the instructions of Servicer, after the prior payment of all
amounts owing to the Series 1996-1 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 two administrative subaccounts, the Class
A Interest Funding Account (the "Class A Interest Funding Account") and the
Class B Interest Funding Account (the "Class B 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 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,
Transferor shall notify Trustee, and Trustee upon being notified (or 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 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
pursuant to the written direction of Servicer by Trustee in Permitted
Investments. 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 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 Supplement.
SECTION 4.19 Determination of LIBOR. (a) On each LIBOR Determination
Date, 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 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 Trustee at its Corporate
Trust Office at Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx
00000-0000, Attention: Corporate Trust Services Division.
(c) On each LIBOR Determination Date prior to 12:00 noon New York City
time, Trustee shall send to 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 Servicer or 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 Servicer or
Transferor, respectively, at the time specified in the Agreement (including
applicable grace periods), Trustee shall make such payment or deposit from the
applicable Investor Account without instruction from Servicer or Transferor. The
Trustee shall be required to make any such payment, deposit or withdrawal
hereunder only to the extent that Trustee has sufficient information to allow it
to determine the amount thereof; provided that Trustee shall in all cases be
deemed to have sufficient information to determine the amount of interest
payable to the Series 1996-1 Holders on each Distribution Date. The Servicer
shall, upon request of Trustee, promptly provide Trustee with all information
necessary to allow Trustee to make such payment, deposit or withdrawal. Such
funds or the proceeds of such withdrawal shall be applied by Trustee in the
manner in which such payment or deposit should have been made by Transferor or
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, Trustee shall
distribute (in accordance with the certificate delivered on or before the
related Transfer Date by Servicer to 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)(i) 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, Trustee shall distribute (in accordance with the certificate delivered on
or before the related Transfer Date by Servicer to 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, Trustee shall distribute (in accordance with
the certificate delivered on or before the related Transfer Date by Servicer to
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)(i) 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, Trustee shall distribute (in accordance with the certificate delivered on
or before the related Transfer Date by Servicer to 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.
SECTION 5.2 Monthly Series 1996-1 Holders' Statement. (a) On or before
each Distribution Date, Trustee shall forward to each Series 1996-1 Holder, each
Rating Agency and the Collateral Interest Holder a statement substantially in
the form of Exhibit C prepared by Servicer and delivered to Trustee.
(b) Annual Holders' Tax Statement. On or before January 31 of each
calendar year, beginning with calendar year 1996, Trustee shall distribute to
each Person who at any time during the preceding calendar year was a Series
1996-1 Holder, a statement prepared by 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 1996-1 Holder, together
with such other customary information (consistent with the treatment of the
Certificates as debt) as Trustee or Servicer (or Transferor, if Back-up Servicer
is Servicer) deems necessary or desirable to enable the Series 1996-1 Holders to
prepare their tax returns. Such obligations of Trustee shall be deemed to have
been satisfied to the extent that substantially comparable information shall be
provided by Trustee pursuant to any requirements of the Internal Revenue Code.
SECTION 9. Series 1996-1 Pay Out Events. If any one of the following
events shall occur with respect to the Investor Certificates:
(a) failure on the part of 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 Transferor set
forth in the Agreement or this Series Supplement (including the covenant of
Transferor contained in Section 11 of this Series Supplement), which failure has
a material adverse effect on the Series 1996-1 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 Transferor by Trustee, or to Transferor and
Trustee by the Holders of Investor Certificates evidencing Undivided Interests
aggregating not less than 50% of the Investor Interest of this Series 1996-1,
and continues to affect materially and adversely the interests of the Series
1996-1 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 Transferor in the Agreement
or this Series Supplement, or any information contained in a Receivable Schedule
required to be delivered by 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 Transferor by Trustee, or to Transferor and
Trustee by the Holders of Investor Certificates evidencing Undivided Interests
aggregating not less than 50% of the Investor Interest of this Series 1996-1,
and (ii) as a result of which the interests of the Series 1996-1 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 1996-1 Pay Out Event pursuant to this subsection 9(b) shall not be
deemed to have occurred hereunder if 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 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) the average Transferor Interest during any 10 consecutive days
being below the Minimum Transferor Interest for the same period and (ii) during
any 10 consecutive days the sum of (x) the Principal Receivables and (y) the
principal amount on deposit in the Excess Funding Account being less than the
Minimum Aggregate Principal Receivables for the same period;
(e) an Originator shall fail to convey Additional Receivables to
Transferor as required by the Receivables Purchase Agreement or 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 1996-1 Holders;
(g) the Class A Investor Interest shall not be paid in full on the
Class A Scheduled Payment Date or the Class B Investor Interest shall not be
paid in full on the Class B Scheduled Payment Date;
(h) the Monthly Payment Rate is less than 12% for three consecutive
Monthly Periods;
(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) the Investment Grade Insurer Percentage is
less than the Required Investment Grade Insurer Percentage, (iv) the Investment
Grade Insurer Percentage to be decreased, if on such day the Investment Grade
Insurer Percentage is equal to or less than the Required Investment Grade
Insurer Percentage, (v) there are less than 300 insurance carriers whose
insurance premiums have been financed by the Receivables, or (vi) the Top 10
Insurer Percentage is greater than the Maximum Top 10 Insurer Percentage; then,
in the case of any event described in subsection 9(a), (b) or (f) hereof, after
the applicable grace period set forth in such subsections, either Trustee or
Holders of Series 1996-1 Certificates (including, for this purpose, the
Collateral Interest Holder) evidencing Undivided Interests aggregating not less
than 50% of the Investor Interest of this Series 1996-1 by notice then given in
writing to Transferor and Servicer (and to Trustee if given by the Holders) may
declare that a pay out event (a "Series 1996-1 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 1996-1 Pay Out Event shall
occur without any notice or other action on the part of Trustee or the Investor
Holders immediately upon the occurrence of such event. The Series 1996- 1 Pay
Out Events described in subsection 9(i) 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 Certificateholders if the Rating Agency
Condition has been satisfied with respect to such amendment.
SECTION 10. Series 1996-1 Termination. The right of the Investor
Holders to receive payments from the Trust will terminate on the first Business
Day following the Series 1996-1 Termination Date.
SECTION 11. Initial Principal Payment Date. The Initial Principal
Payment Date shall automatically be extended to the next succeeding Distribution
Date after the then-current Initial Principal Payment Date unless the
Transferor, as of the first day of the Monthly Period preceding the Monthly
Period in which the then-current Initial Principal Payment Date occurs, elects
not to cause such extension. Such election may be made by the Transferor by
giving written notice thereof to the Trustee no earlier than the Distribution
Date second preceding the then-current Initial Principal Payment Date and no
later than the first day of the Monthly Period preceding the Monthly Period in
which the then-current Initial Principal Payment Date occurs.
The Transferor will cause the Trustee to provide written notice to
each Certificateholder, the Servicer, each Rating Agency and the Collateral
Interest Holder of any election by the Transferor not to extend the Initial
Principal Payment Date. The Transferor will cause the Trustee to provide such
notice not more than 60 nor less than 30 days prior to the then- current Initial
Principal Payment Date.
SECTION 12. RESERVED.
SECTION 13. RESERVED.
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. Transferor shall notify the Collateral
Interest Holder promptly after becoming aware of any Lien on any Receivable
other than the conveyances under the Agreement. 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 Servicer in connection with the execution and
delivery of this Series Supplement by Servicer and the performance of the
transactions contemplated by this Series Supplement by 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 Servicer.
SECTION 17. No Petition. Transferor, Servicer, Back-up Servicer and
Trustee, by entering into this Series Supplement and each Holder, by accepting a
Series 1996-1 Certificate hereby covenant and agree that they will not at any
time institute against the Trust, or join in any institution against the Trust
of, any bankruptcy proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Investor Holders, the Agreement or this Series Supplement.
SECTION 18. Amendments. Subject to Section 9, this Series Supplement
may be amended pursuant to Section 13.1 of the Agreement. This Series Supplement
may also be amended by Transferor without the consent of Servicer, Back-up
Servicer, Trustee or any Investor Holder if Transferor provides Trustee with:
(i) an Opinion of Counsel to the effect that such amendment or modification
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) 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 Trustee's
consent, if 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), Trustee shall
furnish notification of the substance of such amendment to each Rating Agency.
Notwithstanding anything to the contrary contained in this Section 18, 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.
IN WITNESS WHEREOF, Transferor, Servicer, Back-up
Servicer and Trustee have caused this Series 1996-1 Supplement to be duly
executed by their respective officers as of the day and year first above
written.
MELLON BANK, N.A., Transferor
By:/s/ Xxxxxx X. Xxxxxx
Name:
Title:
AFCO CREDIT CORPORATION, Servicer
By:/s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: President and CEO
AFCO ACCEPTANCE CORPORATION,
Servicer
By:/s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: President and CEO
PREMIUM FINANCING SPECIALISTS,
INC. Back-up Servicer
By:/s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
Title:Controller
PREMIUM FINANCING SPECIALISTS OF
CALIFORNIA, INC., Back-up Servicer
By:/s/ Xxxxx Xxxxxx
Name: Xxxxx Xxxxxx
Title: Controller
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:/s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title:Vice President
CLASS A Certificate
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Mellon Bank,
N.A. or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
No. A-1 $200,000,000.00
CUSIP No. 00000XXX0
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, Series 1996-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of insurance premium finance loans originated by AFCO Credit
Corporation and AFCO Acceptance Corporation and other assets and interests
constituting the Trust under the Pooling and Servicing Agreement dated as of
December 1, 1996 as supplemented by the Series 1996-1 Supplement dated as of
December 1, 1996 (collectively, the "Pooling and Servicing Agreement"), by and
between Mellon Bank, N.A., as Transferor (the "Transferor"), AFCO Credit
Corporation and AFCO Acceptance Corporation, as Servicer (collectively, the
"Servicer"), Premium Financing Specialists, Inc. and Premium Financing
Specialists of California, Inc., as Back-up Servicer (collectively, the "Back-up
Servicer") and The First National Bank of Chicago, as Trustee (the "Trustee").
(Not an interest in or obligation of
Mellon Bank, N.A. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class A Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the corpus
of which consists of a portfolio of (i) the Receivables identified on the
Receivable Schedule delivered to the Trustee on the Initial Closing Date and
each Addition Date, (ii) the Transferor's security interest in the related
Unearned Premiums, (iii) all monies due or to become due with respect to such
Receivables, including all monies received from insurance companies and state
insurance guaranty funds representing returns of Unearned Premiums and other
charges due on such Receivables, (iv) the Receivables Purchase Agreement, and
(v) all proceeds of the foregoing. The Series 1996-1 Certificates are issued in
two classes, the Class A Certificates (of which this certificate is one) and the
Class B Certificates, which are subordinated to the Class A Certificates in
certain rights of payment as described herein and in the Pooling and Servicing
Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1996-1 Certificates with the intention that the Series 1996-1
Certificates will qualify under applicable tax law as indebtedness, and each of
Transferor, Servicer and each Series 1996-1 Holder (or Series 1996-1 Certificate
Owner) by acceptance of its Series 1996-1 Certificate (or in the case of a
Series 1996-1 Certificate Owner, by virtue of such Series 1996-1 Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the Series 1996-1 Certificates
(or any beneficial interest therein) as indebtedness for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income. Each Series 1996-1 Holder agrees that it will cause any
Series 1996-1 Certificate Owner acquiring an interest in a Series 1996-1
Certificate through it to comply with the Pooling and Servicing Agreement as to
treatment of the Series 1996-1 Certificates as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
This Class A Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class A Holder by virtue
of the acceptance hereof assents and by which the Class A Holder is bound.
This Class A Certificate represents an interest in Mellon Bank Premium
Finance Loan Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the Series
1996-1 Certificates nor the Accounts or Receivables are insured or guaranteed by
the Federal Deposit Insurance Corporation or any other governmental agency. This
Series 1996-1 Certificate is limited in right of payment to certain collections
respecting the Receivables, all as more specifically set forth hereinabove and
in the Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class A Certificate shall not
be entitled to any benefit under the Pooling and Servicing Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, Mellon Bank, N.A. has caused this Class A
Certificate to be duly executed under its official seal.
By:_________________________
Authorized Officer
Attested to:
By:_____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:
Authorized Signatory
CLASS A Certificate
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Mellon Bank,
N.A. or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
No. A-3 $40,000,000.00
CUSIP No. 00000XXX0
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, Series 1996-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of insurance premium finance loans originated by AFCO Credit
Corporation and AFCO Acceptance Corporation and other assets and interests
constituting the Trust under the Pooling and Servicing Agreement dated as of
December 1, 1996 as supplemented by the Series 1996-1 Supplement dated as of
December 1, 1996 (collectively, the "Pooling and Servicing Agreement"), by and
between Mellon Bank, N.A., as Transferor (the "Transferor"), AFCO Credit
Corporation and AFCO Acceptance Corporation, as Servicer (collectively, the
"Servicer"), Premium Financing Specialists, Inc. and Premium Financing
Specialists of California, Inc., as Back-up Servicer (collectively, the "Back-up
Servicer") and The First National Bank of Chicago, as Trustee (the "Trustee").
(Not an interest in or obligation of
Mellon Bank, N.A. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class A Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the corpus
of which consists of a portfolio of (i) the Receivables identified on the
Receivable Schedule delivered to the Trustee on the Initial Closing Date and
each Addition Date, (ii) the Transferor's security interest in the related
Unearned Premiums, (iii) all monies due or to become due with respect to such
Receivables, including all monies received from insurance companies and state
insurance guaranty funds representing returns of Unearned Premiums and other
charges due on such Receivables, (iv) the Receivables Purchase Agreement, and
(v) all proceeds of the foregoing. The Series 1996-1 Certificates are issued in
two classes, the Class A Certificates (of which this certificate is one) and the
Class B Certificates, which are subordinated to the Class A Certificates in
certain rights of payment as described herein and in the Pooling and Servicing
Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1996-1 Certificates with the intention that the Series 1996-1
Certificates will qualify under applicable tax law as indebtedness, and each of
Transferor, Servicer and each Series 1996-1 Holder (or Series 1996-1 Certificate
Owner) by acceptance of its Series 1996-1 Certificate (or in the case of a
Series 1996-1 Certificate Owner, by virtue of such Series 1996-1 Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the Series 1996-1 Certificates
(or any beneficial interest therein) as indebtedness for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income. Each Series 1996-1 Holder agrees that it will cause any
Series 1996-1 Certificate Owner acquiring an interest in a Series 1996-1
Certificate through it to comply with the Pooling and Servicing Agreement as to
treatment of the Series 1996-1 Certificates as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
This Class A Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class A Holder by virtue
of the acceptance hereof assents and by which the Class A Holder is bound.
This Class A Certificate represents an interest in Mellon Bank Premium
Finance Loan Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the Series
1996-1 Certificates nor the Accounts or Receivables are insured or guaranteed by
the Federal Deposit Insurance Corporation or any other governmental agency. This
Series 1996-1 Certificate is limited in right of payment to certain collections
respecting the Receivables, all as more specifically set forth hereinabove and
in the Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class A Certificate shall not
be entitled to any benefit under the Pooling and Servicing Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, Mellon Bank, N.A. has caused this Class A
Certificate to be duly executed under its official seal.
By:_________________________
Authorized Officer
Attested to:
By:_____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:
Authorized Signatory
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:
Authorized Signatory
CLASS B CERTIFICATE
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Mellon Bank,
N.A. or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
No. B-1 $25,000,000.00
CUSIP Xx.0000XXXX0
XXXXXX BANK PREMIUM FINANCE LOAN MASTER TRUST
CLASS B FLOATING RATE
ASSET BACKED CERTIFICATE, Series 1996-1
Evidencing an Undivided Interest in a trust, the corpus of which
consists of a portfolio of insurance premium finance loans originated by AFCO
Credit Corporation and AFCO Acceptance Corporation and other assets and
interests constituting the Trust under the Pooling and Servicing Agreement dated
as of December 1, 1996 as supplemented by the Series 1996-1 Supplement dated as
of December 1, 1996 (collectively, the "Pooling and Servicing Agreement"), by
and between Mellon Bank, N.A., as Transferor (the "Transferor"), AFCO Credit
Corporation and AFCO Acceptance Corporation, as Servicer (collectively, the
"Servicer"), Premium Financing Specialists, Inc. and Premium Financing
Specialists of California, Inc., as Back-up Servicer (collectively, the "Back-up
Servicer") and The First National Bank of Chicago, as Trustee (the "Trustee").
(Not an interest in or obligation of
Mellon Bank, N.A. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class B Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the corpus
of which consists of a portfolio of (i) the Receivables identified on the
Receivable Schedule delivered to the Trustee on the Initial Closing Date and
each Addition Date, (ii) the Transferor's security interest in the related
Unearned Premiums, (iii) all monies due or to become due with respect to such
Receivables, including all monies received from insurance companies and state
insurance guaranty funds representing returns of Unearned Premiums and other
charges due on such Receivables, (iv) the Receivables Purchase Agreement, and
(v) all proceeds of the foregoing. The Series 1996-1 Certificates are issued in
two classes, the Class A Certificates and the Class B Certificates (of which
this certificate is one), which are subordinated to the Class A Certificates in
certain rights of payment as described herein and in the Pooling and Servicing
Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1996-1 Certificates with the intention that the Series 1996-1
Certificates will qualify under applicable tax law as indebtedness, and each of
Transferor, Servicer and each Series 1996-1 Holder (or Series 1996-1 Certificate
Owner) by acceptance of its Series 1996-1 Certificate (or in the case of a
Series 1996-1 Certificate Owner, by virtue of such Series 1996-1 Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the Series 1996-1 Certificates
(or any beneficial interest therein) as indebtedness for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income. Each Series 1996-1 Holder agrees that it will cause any
Series 1996-1 Certificate Owner acquiring an interest in a Series 1996-1
Certificate through it to comply with the Pooling and Servicing Agreement as to
treatment of the Series 1996-1 Certificates as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
This Class B Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class B Holder by virtue
of the acceptance hereof assents and by which the Class B Holder is bound.
This Class B Certificate represents an interest in Mellon Bank Premium
Finance Loan Master Trust. This Class B Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the Series
1996-1 Certificates nor the Accounts or Receivables are insured or guaranteed by
the Federal Deposit Insurance Corporation or any other governmental agency. This
Series 1996-1 Certificate is limited in right of payment to certain collections
respecting the Receivables, all as more specifically set forth hereinabove and
in the Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class B Certificate shall not
be entitled to any benefit under the Pooling and Servicing Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, Mellon Bank, N.A. has caused this Class B
Certificate to be duly executed under its official seal.
By:_________________________
Authorized Officer
Attested to:
By:_____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
BY:_________________________
Authorized Signatory
EXHIBIT A-1
FORM OF CERTIFICATE
CLASS A Certificate
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Mellon Bank,
N.A. or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
No. A-1 $
CUSIP No.
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, Series 1996-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of insurance premium finance loans originated by AFCO Credit
Corporation and AFCO Acceptance Corporation and other assets and interests
constituting the Trust under the Pooling and Servicing Agreement dated as of
December 1, 1996 as supplemented by the Series 1996-1 Supplement dated as of
December 1, 1996 (collectively, the "Pooling and Servicing Agreement"), by and
between Mellon Bank, N.A., as Transferor (the "Transferor"), AFCO Credit
Corporation and AFCO Acceptance Corporation, as Servicer (collectively, the
"Servicer"), Premium Financing Specialists, Inc. and Premium Financing
Specialists of California, Inc., as Back-up Servicer (collectively, the "Back-up
Servicer") and The First National Bank of Chicago, as Trustee (the "Trustee").
(Not an interest in or obligation of
Mellon Bank, N.A. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class A Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the corpus
of which consists of a portfolio of (i) the Receivables identified on the
Receivable Schedule delivered to the Trustee on the Initial Closing Date and
each Addition Date, (ii) the Transferor's security interest in the related
Unearned Premiums, (iii) all monies due or to become due with respect to such
Receivables, including all monies received from insurance companies and state
insurance guaranty funds representing returns of Unearned Premiums and other
charges due on such Receivables, (iv) the Receivables Purchase Agreement, and
(v) all proceeds of the foregoing. The Series 1996-1 Certificates are issued in
two classes, the Class A Certificates (of which this certificate is one) and the
Class B Certificates, which are subordinated to the Class A Certificates in
certain rights of payment as described herein and in the Pooling and Servicing
Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1996-1 Certificates with the intention that the Series 1996-1
Certificates will qualify under applicable tax law as indebtedness, and each of
Transferor, Servicer and each Series 1996-1 Holder (or Series 1996-1 Certificate
Owner) by acceptance of its Series 1996-1 Certificate (or in the case of a
Series 1996-1 Certificate Owner, by virtue of such Series 1996-1 Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the Series 1996-1 Certificates
(or any beneficial interest therein) as indebtedness for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income. Each Series 1996-1 Holder agrees that it will cause any
Series 1996-1 Certificate Owner acquiring an interest in a Series 1996-1
Certificate through it to comply with the Pooling and Servicing Agreement as to
treatment of the Series 1996-1 Certificates as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
This Class A Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class A Holder by virtue
of the acceptance hereof assents and by which the Class A Holder is bound.
This Class A Certificate represents an interest in Mellon Bank Premium
Finance Loan Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the Series
1996-1 Certificates nor the Accounts or Receivables are insured or guaranteed by
the Federal Deposit Insurance Corporation or any other governmental agency. This
Series 1996-1 Certificate is limited in right of payment to certain collections
respecting the Receivables, all as more specifically set forth hereinabove and
in the Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class A Certificate shall not
be entitled to any benefit under the Pooling and Servicing Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, Mellon Bank, N.A. has caused this Class A
Certificate to be duly executed under its official seal.
By:_________________________
Authorized Officer
Attested to:
By:_____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:
Authorized Signatory
FORM OF CERTIFICATE
CLASS A
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Mellon Bank,
N.A. or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
No. R-2 $200,000,000
CUSIP No. 0000XXXX0
XXXXXX BANK PREMIUM FINANCE LOAN MASTER TRUST
CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, Series 1996-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of insurance premium finance loans originated by AFCO Credit
Corporation and AFCO Acceptance Corporation and other assets and interests
constituting the Trust under the Pooling and Servicing Agreement dated as of
December 1, 1996 as supplemented by the Series 1996-1 Supplement dated as of
December 1, 1996 (collectively, the "Pooling and Servicing Agreement"), by and
between Mellon Bank, N.A., as Transferor (the "Transferor"), AFCO Credit
Corporation and AFCO Acceptance Corporation, as Servicer (collectively, the
"Servicer"), Premium Financing Specialists, Inc. and Premium Financing
Specialists of California, Inc., as Back-up Servicer (collectively, the "Back-up
Servicer") and The First National Bank of Chicago, as Trustee (the "Trustee").
(Not an interest in or obligation of
Mellon Bank, N.A. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class A Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the corpus
of which consists of a portfolio of (i) the Receivables identified on the
Receivable Schedule delivered to the Trustee on the Initial Closing Date and
each Addition Date, (ii) the Transferor's security interest in the related
Unearned Premiums, (iii) all monies due or to become due with respect to such
Receivables, including all monies received from insurance companies and state
insurance guaranty funds representing returns of Unearned Premiums and other
charges due on such Receivables, (iv) the Receivables Purchase Agreement, and
(v) all proceeds of the foregoing. The Series 1996-1 Certificates are issued in
two classes, the Class A Certificates (of which this certificate is one) and the
Class B Certificates, which are subordinated to the Class A Certificates in
certain rights of payment as described herein and in the Pooling and Servicing
Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1996-1 Certificates with the intention that the Series 1996-1
Certificates will qualify under applicable tax law as indebtedness, and each of
Transferor, Servicer and each Series 1996-1 Holder (or Series 1996-1 Certificate
Owner) by acceptance of its Series 1996-1 Certificate (or in the case of a
Series 1996-1 Certificate Owner, by virtue of such Series 1996-1 Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the Series 1996-1 Certificates
(or any beneficial interest therein) as indebtedness for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income. Each Series 1996-1 Holder agrees that it will cause any
Series 1996-1 Certificate Owner acquiring an interest in a Series 1996-1
Certificate through it to comply with the Pooling and Servicing Agreement as to
treatment of the Series 1996-1 Certificates as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
This Class A Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class A Holder by virtue
of the acceptance hereof assents and by which the Class A Holder is bound.
This Class A Certificate represents an interest in Mellon Bank Premium
Finance Loan Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the Series
1996-1 Certificates nor the Accounts or Receivables are insured or guaranteed by
the Federal Deposit Insurance Corporation or any other governmental agency. This
Series 1996-1 Certificate is limited in right of payment to certain collections
respecting the Receivables, all as more specifically set forth hereinabove and
in the Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class A Certificate shall not
be entitled to any benefit under the Pooling and Servicing Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, Mellon Bank, N.A. has caused this Class A
Certificate to be duly executed under its official seal.
By:_________________________
Authorized Officer
Attested to:
By:_____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:
Authorized Signatory
FORM OF CERTIFICATE
CLASS A
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Mellon Bank,
N.A. or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
No. R-3 $40,000,000
CUSIP No. 0000XXXX0
XXXXXX BANK PREMIUM FINANCE LOAN MASTER TRUST
CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, Series 1996-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of insurance premium finance loans originated by AFCO Credit
Corporation and AFCO Acceptance Corporation and other assets and interests
constituting the Trust under the Pooling and Servicing Agreement dated as of
December 1, 1996 as supplemented by the Series 1996-1 Supplement dated as of
December 1, 1996 (collectively, the "Pooling and Servicing Agreement"), by and
between Mellon Bank, N.A., as Transferor (the "Transferor"), AFCO Credit
Corporation and AFCO Acceptance Corporation, as Servicer (collectively, the
"Servicer"), Premium Financing Specialists, Inc. and Premium Financing
Specialists of California, Inc., as Back-up Servicer (collectively, the "Back-up
Servicer") and The First National Bank of Chicago, as Trustee (the "Trustee").
(Not an interest in or obligation of
Mellon Bank, N.A. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class A Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the corpus
of which consists of a portfolio of (i) the Receivables identified on the
Receivable Schedule delivered to the Trustee on the Initial Closing Date and
each Addition Date, (ii) the Transferor's security interest in the related
Unearned Premiums, (iii) all monies due or to become due with respect to such
Receivables, including all monies received from insurance companies and state
insurance guaranty funds representing returns of Unearned Premiums and other
charges due on such Receivables, (iv) the Receivables Purchase Agreement, and
(v) all proceeds of the foregoing. The Series 1996-1 Certificates are issued in
two classes, the Class A Certificates (of which this certificate is one) and the
Class B Certificates, which are subordinated to the Class A Certificates in
certain rights of payment as described herein and in the Pooling and Servicing
Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1996-1 Certificates with the intention that the Series 1996-1
Certificates will qualify under applicable tax law as indebtedness, and each of
Transferor, Servicer and each Series 1996-1 Holder (or Series 1996-1 Certificate
Owner) by acceptance of its Series 1996-1 Certificate (or in the case of a
Series 1996-1 Certificate Owner, by virtue of such Series 1996-1 Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the Series 1996-1 Certificates
(or any beneficial interest therein) as indebtedness for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income. Each Series 1996-1 Holder agrees that it will cause any
Series 1996-1 Certificate Owner acquiring an interest in a Series 1996-1
Certificate through it to comply with the Pooling and Servicing Agreement as to
treatment of the Series 1996-1 Certificates as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
This Class A Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class A Holder by virtue
of the acceptance hereof assents and by which the Class A Holder is bound.
This Class A Certificate represents an interest in Mellon Bank Premium
Finance Loan Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the Series
1996-1 Certificates nor the Accounts or Receivables are insured or guaranteed by
the Federal Deposit Insurance Corporation or any other governmental agency. This
Series 1996-1 Certificate is limited in right of payment to certain collections
respecting the Receivables, all as more specifically set forth hereinabove and
in the Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class A Certificate shall not
be entitled to any benefit under the Pooling and Servicing Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, Mellon Bank, N.A. has caused this Class A
Certificate to be duly executed under its official seal.
By:_________________________
Authorized Officer
Attested to:
By:_____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:
Authorized Signatory
EXHIBIT A-2
FORM OF CERTIFICATE
CLASS B CERTIFICATE
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to Mellon Bank,
N.A. or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.
No. B-1 $
CUSIP No.
MELLON BANK PREMIUM FINANCE LOAN MASTER TRUST
CLASS B FLOATING RATE
ASSET BACKED CERTIFICATE, Series 1996-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of insurance premium finance loans originated by AFCO Credit
Corporation and AFCO Acceptance Corporation and other assets and interests
constituting the Trust under the Pooling and Servicing Agreement dated as of
December 1, 1996 as supplemented by the Series 1996-1 Supplement dated as of
December 1, 1996 (collectively, the "Pooling and Servicing Agreement"), by and
between Mellon Bank, N.A., as Transferor (the "Transferor"), AFCO Credit
Corporation and AFCO Acceptance Corporation, as Servicer (collectively, the
"Servicer"), Premium Financing Specialists, Inc. and Premium Financing
Specialists of California, Inc., as Back-up Servicer (collectively, the "Back-up
Servicer") and The First National Bank of Chicago, as Trustee (the "Trustee").
(Not an interest in or obligation of
Mellon Bank, N.A. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class B Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the corpus
of which consists of a portfolio of (i) the Receivables identified on the
Receivable Schedule delivered to the Trustee on the Initial Closing Date and
each Addition Date, (ii) the Transferor's security interest in the related
Unearned Premiums, (iii) all monies due or to become due with respect to such
Receivables, including all monies received from insurance companies and state
insurance guaranty funds representing returns of Unearned Premiums and other
charges due on such Receivables, (iv) the Receivables Purchase Agreement, and
(v) all proceeds of the foregoing. The Series 1996-1 Certificates are issued in
two classes, the Class A Certificates and the Class B Certificates (of which
this certificate is one), which are subordinated to the Class A Certificates in
certain rights of payment as described herein and in the Pooling and Servicing
Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1996-1 Certificates with the intention that the Series 1996-1
Certificates will qualify under applicable tax law as indebtedness, and each of
Transferor, Servicer and each Series 1996-1 Holder (or Series 1996-1 Certificate
Owner) by acceptance of its Series 1996-1 Certificate (or in the case of a
Series 1996-1 Certificate Owner, by virtue of such Series 1996-1 Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the Series 1996-1 Certificates
(or any beneficial interest therein) as indebtedness for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income. Each Series 1996-1 Holder agrees that it will cause any
Series 1996-1 Certificate Owner acquiring an interest in a Series 1996-1
Certificate through it to comply with the Pooling and Servicing Agreement as to
treatment of the Series 1996-1 Certificates as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing Agreement.
This Class B Certificate is issued under and is subject to the terms, provisions
and conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class B Holder by virtue
of the acceptance hereof assents and by which the Class B Holder is bound.
This Class B Certificate represents an interest in Mellon Bank Premium
Finance Loan Master Trust. This Class B Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the Series
1996-1 Certificates nor the Accounts or Receivables are insured or guaranteed by
the Federal Deposit Insurance Corporation or any other governmental agency. This
Series 1996-1 Certificate is limited in right of payment to certain collections
respecting the Receivables, all as more specifically set forth hereinabove and
in the Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class B Certificate shall not
be entitled to any benefit under the Pooling and Servicing Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, Mellon Bank, N.A. has caused this Class B
Certificate to be duly executed under its official seal.
By:_________________________
Authorized Officer
Attested to:
By:_____________________
Secretary
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
Trustee
By:
Authorized Signatory
EXHIBIT B
FORM OF MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION TO TRUSTEE
MELLON BANK, X.X.
XXXXXX BANK PREMIUM FINANCE LOAN MASTER TRUST Series 1996-1
MONTHLY PERIOD ENDING _________, ___
Capitalized terms used in this notice have their respective meanings set forth
in the Pooling and Servicing Agreement. References herein to certain sections
and subsections are references to the respective sections and subsections of the
Pooling and Servicing Agreement as supplemented by the Series 1996-1 Supplement.
This notice is delivered pursuant to Section 4.11.
A) AFCO Credit and AFCO Acceptance are Servicer
under the Pooling and Servicing Agreement.
B) The undersigned is a Servicing Officer.
C) The date of this notice is on or before the
related Transfer Date under the Pooling and
Servicing Agreement.
I. INSTRUCTION TO MAKE A WITHDRAWAL
Pursuant to Section 4.11, Servicer does hereby instruct Trustee (i) to
make withdrawals from the Finance Charge Account, the Principal Account, the
Distribution Account and the Principal Funding Account on ______________, ____,
which date is a Transfer Date under the Pooling and Servicing Agreement, in
aggregate amounts set forth below in respect of the following amounts and (ii)
to apply the proceeds of such withdrawals in accordance with Section 3 of the
Series 1996-1 Supplement and Section 4.11 of the Pooling and Servicing
Agreement:
A. Pursuant to Section 3 of the
Series 1996-1 Supplement:
1. Servicer Interchange $___________
B. Pursuant to subsection 4.11(a)(i):
1. Class A Monthly Interest at
the Class A Certificate Rate
on the Class A Investor
Interest $____________
2. Class A Deficiency Amount $____________
3. Class A Additional Interest $____________
C. Pursuant to subsection 4.11(a)(ii):
1. Class A Servicing Fee $____________
2. Accrued and unpaid Class A
Servicing Fee $____________
D. Pursuant to subsection 4.11(a)(iii):
l. Class A Investor Default
Amount $___________
E. Pursuant to subsection 4.11(a)(iv):
l. Portion of Excess Spread
from Class A Available Funds
to be allocated and distributed
as provided in Section 4.13 $___________
F. Pursuant to subsection 4.11(b)(i):
1. Class B Monthly Interest at
the Class B Certificate Rate
on the Class B Investor
Interest $___________
2. Class B Deficiency Amount $___________
3. Class B Additional Interest $___________
G. Pursuant to subsection 4.11(b)(ii):
1. Class B Servicing Fee $___________
2. Accrued and unpaid Class B
Servicing Fee $___________
H. Pursuant to subsection 4.11(b)(iii):
1. Portion of Excess Spread
from Class B Available Funds
to be allocated and distributed
as provided in Section 4.13 $___________
I. Pursuant to subsection 4.11(c)(i):
1. Collateral Interest
Servicing Fee, if applicable $___________
2. Accrued and unpaid
Collateral Interest
Servicing Fee, if applicable $__________
J. Pursuant to subsection 4.11(c)(ii):
1. Portion of Excess Spread
from Collateral Available
Funds to be allocated and
distributed as provided in
Section 4.13 $__________
Total $
K. Pursuant to subsection 4.11(d)(i):
1. Collateral Monthly Principal,
if any, applied in accordance
with the Loan Agreement $__________
L. Pursuant to subsection 4.11(d)(ii):
1. Amount to be treated as Shared
Principal Collections $__________
M. Pursuant to subsection 4.11(d)(iii):
1. Amount to be paid to
Transferor $___________
2. Unallocated Principal
Collections $___________
N. Pursuant to subsection 4.11(e)(i):
1. Class A Monthly Principal $___________
O. Pursuant to subsection 4.11(e)(ii):
1. Class B Monthly Principal $____________
P. Pursuant to subsection 4.11(e)(iii)
1. Collateral Monthly Principal to
be applied in accordance with the
Loan Agreement $____________
Q. Pursuant to subsection 4.11(e)(iv):
1. Amount to be treated as Shared
Principal Collections $____________
R. Pursuant to subsection 4.11(e)(v):
1. Amount to be paid to
Transferor $____________
2. Unallocated Principal Collections $____________
Total $____________
S. Pursuant to subsection 4.11(f):
1. Amount to be withdrawn from the
Principal Funding Account and
deposited into the Distribution
Account $____________
II. INSTRUCTION TO MAKE CERTAIN PAYMENTS
Pursuant to Section 4.11, Servicer does hereby instruct Trustee to pay
in accordance with Section 5.1 from the Distribution Account on ____________,
____, which date is a Distribution Date under the Pooling and Servicing
Agreement, amounts so deposited in the Distribution Account pursuant to Section
4.11 as set forth below:
A. Pursuant to subsection 4.11(g);
1. Amount to be distributed to
Class A Holders $____________
2. Amount to be distributed to
Class B Holders $____________
B. Pursuant to subsection 4.11(h)(i):
1. Amount to be distributed to the
Class A Holders $____________
C. Pursuant to subsection 4.11(h)(ii):
1. Amount to be distributed to the
Class B Holders $____________
III. Application OF EXCESS SPREAD
Pursuant to Section 4.13, Servicer does hereby instruct Trustee to
apply the Excess Spread with respect to the related Monthly Period and to make
the following distributions in the following priority:
A. The amount equal to the Class A Required
Amount, if any, which will be used to fund
the Class A Required Amount and be applied
in accordance with, and in the priority set
forth in, subsection 4.11(a) $________
B. The amount equal to the aggregate amount
of Class A Investor Charge-Offs which have
not been previously reimbursed (after giving
effect to the allocation on such Transfer
Date of certain other amounts applied
for that purpose) which will be treated as a
portion of Investor Principal Collections
and deposited into the Principal Account
on such Transfer Date $________
C. The amount equal to the Class B Required
Amount, if any, which will be used to
find the Class B Required Amount and be
applied first in accordance with, and
in the priority set forth in, subsection
4.11(b) and then any amount available
to pay the Class B Investor Default Amount
shall be treated as a portion of Investor
Principal Collections and deposited
into the Principal Account $________
D. The 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) which
will be treated as a portion of Investor
Principal Collections and deposited into
the Principal Account $________
E. The amount equal to the Collateral Monthly
Interest plus the amount of any past due
Collateral Monthly Interest which will be
paid to the Collateral Interest Holder for
application in accordance with the Loan
Agreement $________
F. The amount equal to the aggregate amount
of accrued but unpaid Collateral Interest
Servicing Fees which will be paid to
Servicer if Transferor or The Bank of
New York is Servicer $________
G. The amount equal to the Collateral Default
Amount, if any, for the prior Monthly
Period which will be treated as a portion
of Investor Principal Collections and
deposited into the Principal Account $________
H. The 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)
which will be treated as a portion of
Investor Principal Collections and
deposited into the Principal Account $________
I. 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.l7(f), the amount up to the excess,
if any, of the Required Reserve Account
Amount over the Available Reserve Account
Amount which shall be deposited into the
Reserve Account $________
J. 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 deposited
into the Distribution Account and applied
in accordance with the Loan Agreement $________
K. The balance, if any, after giving effect
to the payments made pursuant to subparagraphs
(a) through (j) above shall constitute
"Excess Finance Charge Collections" to be
applied with respect to other Series in
accordance with Section 4.5 $________
IV. REALLOCATED PRINCIPAL COLLECTIONS
Pursuant to Section 4.14, Servicer does hereby instruct Trustee to
withdraw from the Principal Account and apply Reallocated Principal Collections
pursuant to Section 4.14 with respect to the related Monthly Period in the
following amounts:
A. Reallocated Collateral Principal Receivables $_____________
B. Reallocated Class B Principal Receivables $_____________
V. ACCRUED AND UNPAID AMOUNTS
After giving effect to the withdrawals and transfers to be made in
accordance with this notice, the following amounts will be accrued and unpaid
with respect to all Monthly Periods preceding the current calendar month
A. Subsections 4.11(a)(i) and (b)(i):
(1) The aggregate amount of the Class A
Deficiency Amount $____________
(2) The aggregate amount of Class B
Deficiency Amount $____________
B. Subsections 4.11(a)(ii) and (b)(ii):
The aggregate amount of all accrued and
unpaid Investor Monthly Servicing Fees $_____________
C. Section 4.12:
The aggregate amount of all unreimbursed
Investor Charge Offs $_____________
IN WITNESS WHEREOF, the undersigned has duly executed this
certificate this __ day of__________, ___.
MELLON BANK, N.A.
Transferor
By:______________________________
Name:
Title:
