AMENDMENT NUMBER 7 TO
TRANSFER AND ADMINISTRATION AGREEMENT
AMENDMENT NUMBER 7 TO TRANSFER AND ADMINISTRATION AGREEMENT (this
"Amendment"), dated as of March 31, 1997 between UNION ACCEPTANCE FUNDING
CORPORATION, a Delaware corporation, as transferor (in such capacity, the
"Transferor"), UNION ACCEPTANCE CORPORATION, an Indiana corporation, as
collection agent (in such capacity, the "Collection Agent"), and ENTERPRISE
FUNDING CORPORATION, a Delaware corporation (the "Company") amending that
certain Transfer and Administration Agreement dated as of June 27, 1995, as
amended as of September 8, 1995, September 29, 1995, March 1, 1996, September 5,
1996, October 31, 1996 and December 23, 1996 (the "Transfer and Administration
Agreement").
WHEREAS, the Transferor and the Company have agreed to make certain
amendments to the Transfer and Administration Agreement.
NOW, THEREFORE, the parties hereby agree as follows:
SECTION 1. Defined Terms. As used in this Amendment and except as
otherwise provided in this Section 1, capitalized terms shall have the same
meanings assigned thereto in the Transfer and Administration Agreement:
(a) Section 1.1 of the Transfer and Administration Agreement is hereby
amended by the addition of the following definition in the appropriate
alphabetic location:
"Actual Aggregate Securitized Pool Loss Amount" shall mean,
calculated as of the most recent Settlement Period, the sum of the
Actual Net Losses to Date for all Securitized Pools.
"Aggregate Securitized Pool Maximum Expected Loss Amount"
shall mean, calculated as of the most recent Settlement Period, the sum
of the Securitized Pool Maximum Expected Loss Amounts for all
Securitized Pools.
"Cut-off Date" shall mean, for each UAC Pool, the Cut-Off-Date
as defined in the prospectus supplement relating to such UAC Pool.
"Enhancement Calculation Side Letter" shall mean that certain
letter dated as of March 31, 1997 among the Transferor, the Collection
Agent and the Company describing the means by which the Liquidated Pool
Life Percentage and Exhibit D will be amended when each UAC Pool
becomes a Liquidated Pool.
"Expected Loss Projection Percentage" shall mean (i) the Loss
Percentage multiplied by (ii) 4.0%.
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"Investment Grade Rating" shall mean a rating of at least BBB
by Standard and Poor's, Fitch and/or Duff & Xxxxxx, and/or Baa by
Xxxxx'x.
"Liquidated Pool" shall mean a UAC Pool which has been
completely liquidated.
"Liquidated Pool Life Percentage" shall mean, initially,
77.37%, and will be adjusted as described in the Enhancement
Calculation Side Letter as each UAC Pool becomes a Liquidated Pool.
"Loss Percentage" or " Loss %" shall mean, on any date of
determination, the percentage equivalent of the fraction the numerator
of which is equal to the Actual Aggregate Securitized Pool Loss Amount
and the denominator of which is equal to the Aggregate Securitized Pool
Maximum Expected Loss Amount.
"Percentage of Expected Life" shall mean for any UAC Pool the
percentage obtained by dividing (i) the current number of months since
the Cut-Off Date applicable to such pool by (ii) the Securitized Pool
Expected Life.
"Securitized Pool Expected Life" shall mean the number of
months (rounded to two decimal places) achieved by multiplying (i) the
Liquidated Pool Life Percentage by (ii) the weighted average remaining
term for such Securitized Pool as of its Cut-off Date.
"Securitized Pool Expected Losses Experienced Percentage"
shall mean, for each Securitized Pool, the percentage set forth on
Exhibit D attached hereto opposite the Percentage of Expected Life
(rounded to the next highest whole percentage) since the Cut-Off Date
applicable to such Securitized Pool. Notwithstanding anything herein to
the contrary, Exhibit D will be amended from time to time by the
Company as each UAC Pool becomes a Liquidated Pool, in order to
incorporate the timing of losses experienced by such Liquidated Pool
provided that such revised Exhibit shall be derived in the manner
described in the Enhancement Calculation Side Letter.
"Securitized Pool Maximum Expected Loss Amount" shall mean,
for each Securitized Pool and calculated as of the most recent
Settlement Period, (i) the Securitized Pool Maximum Losses Experienced
Percentage applicable to such Securitized Pool multiplied by (ii) the
aggregate Outstanding Balance of the Receivables on the Cut-Off Date
applicable to such Securitized Pool.
"Securitized Pool Maximum Losses Experienced Percentage" shall
mean, for each Securitized Pool and calculated as of the most recent
Settlement Period, (i) the Securitized Pool Expected Losses Experienced
Percentage applicable to such Securitized Pool multiplied by (ii) 4.0%.
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"UAC Pool" shall mean each pool of receivables directly or
indirectly transferred by UAFC or UAC to a securitization vehicle in a
structured finance transaction involving prime automobile installment
sales contracts and installment notes and security agreements, similar
to the Contracts, beginning with and including the pool of receivables
securitized in connection with the UFSB 91B Auto Trust.
(b) The definition of "Transfer Percentage" is hereby deleted and
replaced with the following:
"Transfer Percentage" shall mean, on any date of
determination, the percentage equal to (rounded to the nearest whole
percentage) (i) 100% minus (ii) the product of (a) the Expected Loss
Projection Percentage and (b) 1.75 minus (iii) the amount available to
be withdrawn from the Reserve Account as of the last day of the most
recent Settlement Period expressed as a percentage of the Maximum Net
Investment minus (iv) in the case of any Contract(s) which upon
origination provided for more than 72 monthly payments, 8.0%, provided,
that in the event that the Transferor shall have failed to cause a
Take-Out to occur at least once in the sixteen (16) consecutive
calendar week period (or such longer period as agreed to by the
Transferor and the Company) immediately preceding such date of
determination, the Transfer Percentage shall, until the Prefunding Date
occurring after the next occurring Take-Out, equal the lesser of (x)
the Transfer Percentage described above and (y) 92%, in respect of
Contracts which upon origination provided for 72 monthly payments or
less and 84% in respect of Contracts which upon origination provided
for more than 72 monthly payments; provided further that in no case
will (i) 100% minus the Transfer Percentage plus the Reserve Account
expressed as a percentage of the Maximum Net Investment (after giving
effect to any withdrawal therefrom on such date of determination) be
less than (ii) the enhancement required for the most recent securitized
pool to achieve an Investment Grade Rating.
(c) The following definitions are hereby deleted in their entirety:
"Actual Loss Percentage", "Maximum Net Loss", and "Maximum Net Loss Percentage."
SECTION 2. Section 7.1(1) of the Transfer Agreement is hereby deleted
and replaced with the following:
(i) the Transfer Percentage is less than 80% for Contracts
which upon origination provided for 72 monthly payments or less at the
end of any Settlement Period.
SECTION 3. Exhibits. Exhibit A to the Transfer and Administration
Agreement is hereby deleted and replaced with "Reserved and Exhibit D thereto is
hereby deleted and replaced with Exhibit D attached hereto.
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SECTION 4. Limited Scope. This amendment is specific to the
circumstances described above and does not imply any future amendment or waiver
of rights allocated to the Company, the Transferor, Union Acceptance
Corporation, the Collection Agent, the Administrative Agent or the Collateral
Agent under the Transfer and Administration Agreement.
SECTION 5. Governing Law. THIS AMENDMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 6. Severability; Counterparts. This Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which when taken together shall constitute one and the same
instrument. Any provisions of this Amendment which are prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 7. Ratification. Except as expressly affected by the provisions
hereof, the Transfer and Administration Agreement as amended shall remain in
full force and effect in accordance with its terms and ratified and confirmed by
the parties hereto. On and after the date hereof, each reference in the Transfer
and Administration Agreement to "this Agreement", "hereunder", "herein" or words
of like import shall mean and be a reference to the Transfer and Administration
Agreement as amended by this Amendment.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amendment Number 7 as of the date first written above.
ENTERPRISE FUNDING CORPORATION,
as Company
By: /s/ X. Xxxxxx Xxxxxx
Name: X. Xxxxxx Xxxxxx
Title: Vice President
UNION ACCEPTANCE FUNDING CORPORATION
as Transferor
By: /s/ Xxxxxxx X. Xxxx
Name: Xxxxxxx X. Xxxx
Title: Assistant Secretary
UNION ACCEPTANCE CORPORATION
as Collection Agent
By: /s/ Xxxx Xxxxx
Name: Xxxx Xxxxx
Title: Vice President and
Chief Financial Officer
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Union Acceptance Funding Corporation
Union Acceptance Corporation
March 31, 1997
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March 31, 1997
Union Acceptance Funding Corporation
000 Xxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Union Acceptance Corporation
000 Xxxxx Xxxxxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Re: Enhancement Calculations for the UAFC Enterprise
Funding $350 Million Warehouse Facility
Ladies and Gentlemen:
This letter will establish the guidelines by which the definition of Liquidated
Pool Life Percentage and Exhibit D to the Transfer and Administration Agreement
will be adjusted when each UAC Pool becomes a Liquidated Pool. Capitalized terms
used herein but not defined shall have the meaning specified in the Transfer and
Administration Agreement, dated as of June 27, 1995, as amended as of September
8, 1995, September 29, 1995, March 1, 1996, September 5, 1996, October 31, 1996,
December 23, 1996 and March 31, 1997 (the "Transfer and Administration
Agreement"), among the Company, the Transferor and the Collection Agent.
When any UAC Pool becomes a Liquidated Pool, the following calculations will be
made to revise the definition of Liquidated Pool Life Percentage and Exhibit D.
1. Liquidated Pool Life Percentage - shall mean the percentage (rounded to
the nearest one hundredth of one percent) obtained from the average of
the Actual Life Percentages for each Liquidated Pool. For the purposes
of this definition, the Actual Life Percentage for any Liquidated Pool
will be equal to the percentage obtained from the ratio of (i) the
number of months from the Cut-Off Date through final liquidation of the
Liquidated Pool to (ii) the weighted average remaining term for such
pool as of the related Cut-Off Date.
2. Exhibit D - the Average Loss Curve in Exhibit D will be revised to
incorporate the historical performance of each Liquidated Pool. The
revised Average Loss Curve will be determined as the average of each
Liquidated Pool's loss curve.
Union Acceptance Funding Corporation
Union Acceptance Corporation
March 31, 1997
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This letter may be executed in any number of counterparts, each of
which shall be deemed an original and all of which taken together shall
constitute one letter.
Sincerely,
/s/ X. Xxxxxx Xxxxxx
By: Enterprise Funding Corporation
Agreed and accepted as of the date first above written:
Union Acceptance Corporation
By: /s/ Xxxx X. Xxxxx
Name: Xxxx X. Xxxxx
Title: Vice President, Treasurer and CFO
Union Acceptance Funding Corporation
By: /s/ Xxxxxxx X. Xxxx
Name: Xxxxxxx X. Xxxx
Title: Vice President
