AMENDED AND RESTATED
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SUPPLEMENT TO
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TRUST AGREEMENT
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FOR
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REVOLVING SERIES 1998-1
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This Amended and Restated Supplement to Trust Agreement for Revolving
Series 1998-1 (as amended or modified from time to time, this "Supplement"),
dated as of September 1, 1999, is entered into among Allegiance Funding I, LLC,
a Delaware limited liability company (successor to Allegiance Funding Corp. I)
(the "Depositor"), Manufacturers and Traders Trust Company, a New York banking
corporation (the "Trustee"), and Point West Capital Corporation, as servicer, a
Delaware corporation (the "Servicer").
This Supplement incorporates by reference all of the provisions of the
Trust Agreement (the "Trust Agreement"), dated as of August 1, 1998, among the
Depositor, the Servicer and the Trustee entered into in connection with the
transactions described below.
The Depositor duly authorized the execution and delivery of the
original Supplement dated as of August 1, 1998 to provide for the issuance of
the Allegiance Capital Trust I Revolving Certificates, Series 1998-1 (the "98-1
Revolving Certificates"), which consist of the Class A-R Revolving Certificates,
Series 1998-1 (the "98-1 Class A-R Certificates"), Class B-R Revolving
Certificates, Series 1998-1 (the "98-1 Class B-R Certificates"), Class C-R
Revolving Certificates, Series 1998-1 (the "98-1 Class C-R Certificates"), and
Class D-R Revolving Certificates, Series 1998-1 (the "98-1 Class D-R
Certificates"), each issuable as provided in the Trust Agreement. This Series of
Certificates has been designated as a "Revolving Series" under the Trust
Agreement. The Class A-R Certificates, Class B-R Certificates and Class C-R
Certificates have initial credit ratings from the Rating Agency of A, BBB and
BB, respectively, and the Class D-R Certificates are not rated. The Loan
Schedule for this Series as in effect on the date hereof is attached hereto as
Schedule A. Pursuant to Section 2.02 of the Trust Agreement, this Supplement
sets forth the following additional terms applicable to this Series of
Certificates.
Section 1. Definitions.
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"Applicable Rate Spread": For each of the Class A-R, Class B-R and
Class C-R Certificates within this Series, the amount specified below (or as
otherwise adjusted pursuant to Section 5 hereof):
Class A-R = 2.00% per annum for Accrual Periods
commencing before September 1, 1999 and
thereafter 2.05% per annum
Class B-R = 2.80% per annum
Class C-R = 5.50% per annum
"Certificate Interest Rate": (a) For the Class A-R Certificates in this
Series, a per annum rate equal to the LIBOR Rate plus the Applicable Rate Spread
for such Class, provided that such Certificate Interest Rate shall not exceed
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the Maximum Interest Rate; (b) for the Class B-R and C-R Certificates in this
Series, respectively, the rate that provides a bond equivalent yield equal to
the sum of the Applicable Rate Spread for such Class plus the Treasury Rate for
such Class (as reset for each Funding Date for such Class), which computation
shall have been approved in writing by the Certificateholder Agent; and (c) for
the Class D-R Certificates in this Series, 0.0%.
"Class A-R Certificate": Any Certificate of this Series designated as a
Class A-R Certificate, substantially in the form attached hereto as Exhibit A,
and which is Outstanding as of any date.
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"Class B-R Certificate": Any Certificate of this Series designated as a
Class B-R Certificate, substantially in the form attached hereto as Exhibit B,
and which is Outstanding as of any date.
"Class C-R Certificate": Any Certificate of this Series designated as a
Class C-R Certificate, substantially in the form attached hereto as Exhibit C,
and which is Outstanding as of any date.
"Class D-R Certificate": Any Certificate of this Series designated as a
Class D-R Certificate, substantially in the form attached hereto as Exhibit D,
and which is Outstanding as of any date.
"Delivery Date": August 19, 1998.
"Draw Fee": With respect to any Funding, an amount equal to the product
of (i) 0.0010 and (ii) the Funding Amount for such Funding that is attributable
to any Rated Certificates of this Series.
"Effective Date": September 10, 1999.
"Excess Funding Amount": With respect to any Funding Date, if the
requested Funding Amount (a) would, under Section 2 hereof, cause the
Outstanding Principal Amount of a Class of Certificates in this Series (other
than the Class A-R Certificates) to equal the Maximum Series Amount for such
Class but (b) would not be in an amount sufficient to also permit a Funding in
the amount of the Minimum Funding Amount for the next Class of Certificates to
be funded pursuant to Section 2 hereof, the amount by which the requested
Funding Amount exceeds the Maximum Series Amount for the Class of Certificates
referenced in clause (a) of this definition.
"Funding Termination Event": The earlier to occur of (a) the cumulative
Funding of Loans having an aggregate Loan Balance of $60,000,045 and (b) the
occurrence of a Depositor Event of Default, Servicer Event of Default or Special
Servicer Event of Default that has not been cured or waived within thirty (30)
days after written notice thereof.
"Initial Funding Amount": For each of the Class A-R, Class B-R, Class
C-R and Class D-R Certificates within this Series, the amount specified below:
Class A-R = $0.0
Class B-R = $0.0
Class C-R = $0.0
Class D-R = $3,650,000
"Initial Payment Date": October 15, 1998.
"LIBOR Rate": With respect to each Accrual Period, a per annum interest
rate equal to the rate for London interbank offered quotations for one-month
Eurodollar deposits determined by the Servicer for such Accrual Period as
follows:
(a) On each Reset Date, the Servicer will determine the LIBOR Rate on
the basis of the rate for deposits in U.S. Dollars for a period of one
month that appears on Bloomberg MMR2 or, if unavailable, Telerate Page
3750, as of 11:00 a.m. (London time) on such Reset Date.
(b) If such rate does not appear on Telerate Page 3750 or Bloomberg
MMR2, the rate for such Reset Date will be determined on the basis of
the rates at which deposits in U.S. Dollars are offered
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by the Reference Banks at approximately 11:00 a.m. (London time) on
such date to prime banks in the London interbank market for a period of
one month commencing on that Reset Date. The Servicer will request the
principal London office of each of the Reference Banks to provide such
a quotation. If, on any Reset Date: (i) at least two Reference Banks
provide quotations when requested, the LIBOR Rate for such Reset Date
will be the arithmetic mean of the quotations so received; or (ii) only
one or none of the Reference Banks provides such a quotation, the LIBOR
Rate will be the arithmetic mean of the offered rates quoted by major
banks in New York City selected by the Servicer at approximately 11:00
a.m. (New York City time) on such Reset Date for loans to leading
European banks in U.S. Dollars for a period of one month commencing on
that Reset Date.
(c) If, on any Reset Date, the LIBOR Rate cannot be calculated pursuant
to one of the above methods, the LIBOR Rate for such Reset Date shall
be the rate as most recently determinable under such methods.
"Maximum Interest Rate": A per annum rate for the Class A-R
Certificates that is derived from its pro rata share of the Series Percentage of
interest due on the Loans less the Series Percentage of Scheduled Expenses, with
such pro ration based upon the relative rate at which interest otherwise accrues
among Classes of this Series.
"Maximum Series Amount": $30,000,045, allocated to each Class of
Certificates in this Series as follows (or as otherwise adjusted pursuant to
Section 4 hereof):
Class A-R = $20,950,000
Class B-R = $ 3,300,045
Class C-R = $ 2,100,000
Class D-R = $ 3,650,000
"Minimum Funding Amount": The amount specified below for each Class of
Certificates in this Series:
Class A-R = $ 1,000,000
Class B-R = $ 3,300,045
Class C-R = $ 2,100,000
Class D-R = $ 1,000
provided that, with respect to the final funding prior to issuance of any Term
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Certificates, the Minimum Funding Amount for the Class A-R Certificates shall be
$100,000.
"Non-Usage Fee": With respect to each Accrual Period through the
Funding Termination Date, an amount, payable to ***. to the account specified in
Annex 2 to the Certificate Purchase Agreement, equal to the product of (a)
0.0025 per annum and (b) the positive difference between the Maximum Series
Amount for the Class A-R, B-R and C-R Certificates in this Series and the
average Outstanding Principal Amount of all Class A-R, B-R and C-R Certificates
in this Series during such Accrual Period.
"Revolving Funding Date": Any Funding Date on which the Depositor
obtains a Funding under the 98-1 Revolving Certificates.
***Confidential information omitted pursuant to a request for confidential
treatment filed separately with the Securities and Exchange Commission.
3
"Revolving Funding Schedule": The schedule attached hereto as Schedule
B, as amended from time to time pursuant to Section 4 hereof. Such Revolving
Funding Schedule, as amended from time to time, is incorporated herein by this
reference.
"Scheduled Funding Termination Date": (a) With respect to the Class A-R
certificates, March 31, 2000; and (b) with respect to the Class B-R and Class
C-R certificates, December 30, 1999, provided that if there is an active "B"
fund under management by the Certificateholder Agent, the Certificateholder
Agent shall use its best efforts to extend the Scheduled Funding Termination
Date applicable to any Class B-R or Class C-R Certificate to March 31, 2000.
"Scheduled Maturity": With respect to any Class A-R, Class B-R or Class
C-R Certificate, April 17, 2000.
"Series Termination Date": For each of the Class A-R, Class B-R, Class
C-R and Class D-R Certificates in this Series, the date specified below:
Class A-R = July 15, 2019
Class B-R = July 15, 2019
Class C-R = July 15, 2019
Class D-R = July 15, 2019
"Swap Agreement": Means the ISDA Master Agreement, dated as of August
1,1998, along with the related Schedule, dated as of August 1, 1998 and the
Confirmation dated as of August 1,1998, between Point West Capital Corporation
and the Trust.
"Transaction Documents Date": As of August 1,1998.
"Treasury Rate": With respect to either the Class B-R and Class C-R
Certificates, on the date three (3) Business Days prior to any Funding Date for
such Class, a per annum rate equal to the bond equivalent yield on actively
traded U.S. government securities with a one year maturity as set forth on page
"USD" of the Bloomberg Financial Markets Screen (or if not available, any other
nationally recognized trading screen reporting on-line intra-day trading in
United States government securities) at 11:00 a.m. (New York time) on such date
of determination, or in the event no such nationally recognized trading screen
is available, the arithmetic mean of the yields for the two columns under the
heading "Week Ending" published in the Federal Reserve H.15 Statistical Release
under the caption "Treasury Constant Maturities" for one (1) year maturities.
Section 2. Sequence for Fundings.
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(a) Holders of Certificates in this Series shall provide Fundings under
this Series in sequence, by Class, in reverse order of alphabetical designation
such that no Class in this Series shall be obligated to make a Funding under
Section 4.05 of the Trust Agreement unless all subordinated Classes in this
Series have an Outstanding Principal Amount (taking into account any Fundings by
such subordinated Class on such Funding Date) equal to the Maximum Series Amount
for such Class; provided that, on any Funding Date, the Excess Funding Amount,
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if any, shall be funded by and allocated to the Class D-R Certificates, though
such Excess Funding Amount shall not change the Maximum Series Amount for such
Class; provided further that, on the next Funding Date, the Holders of
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Certificates in the applicable Class of this Series then obligated to make a
Funding shall first fund an amount equal to the Excess Funding Amount then held
by the Holders of the Class D-R Certificates.
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(b) On each Funding Date, all Draw Fees shall be paid as provided in
the applicable Certificate Purchase Agreement(s).
(c) Notwithstanding the definition of Funding Date set forth in the
Trust Agreement, upon the request of the Depositor, up to two additional Funding
Dates may be designated under this Series, one during the period beginning
August 30, 1999 and ending September 14, 1999 and one during the period
beginning March 30, 2000 and ending April 14, 2000. Such Fundings shall
otherwise occur on the terms set forth in the Transaction Documents.
Section 3. Distributions.
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Subject to the adjustments provided for in Section 5.02(c) of the Trust
Agreement, on each Payment Date, the Trustee shall withdraw all funds then in
the Distribution Account for such Series and shall make the following
disbursements in the following order of priority (in accordance with the
provisions of and instructions on the monthly Servicer Report):
(a) to pay the interest accrued as of that Payment Date on all
outstanding Class A-R Certificates of this Series and any overdue interest;
(b) to pay the interest accrued as of that Payment Date on all
outstanding Class B-R Certificates of this Series and any overdue interest;
(c) to pay the interest accrued as of that Payment Date on all
outstanding Class C-R Certificates of this Series and any overdue interest;
(d) to pay any Non-Usage Fees then due;
(e) to the extent of the Series Percentage of any Interest Collections
in excess of Scheduled Expenses and amounts distributed pursuant to clauses (a)
- (d) above, to deposit into the Reserve Account an amount equal to the Series
Percentage of the amount necessary to bring the balance therein to an amount
equal to the Reserve Account Required Balance;
(f) to the extent of any remaining Series Collections, to pay to the
Class A-R Certificateholders of this Series an amount equal to the Principal
Distribution Amount allocable this Series, to be applied to the payment of the
Outstanding Principal Amount of such Certificates until such Outstanding
Principal Amount is repaid in full;
(g) to the extent of any remaining Series Collections, to pay to the
Class B-R Certificateholders of this Series an amount equal to the Principal
Distribution Amount allocable this Series (and not already distributed pursuant
to clause (f) above), to be applied to the payment of the Outstanding Principal
Amount of such Certificates until such Outstanding Principal Amount is repaid in
full;
(h) to the extent of any remaining Series Collections, to pay to the
Class C-R Certificateholders of this Series an amount equal to the Principal
Distribution Amount allocable this Series (and not already distributed pursuant
to clauses (f) and (g) above), to be applied to the payment of the Outstanding
Principal Amount of such Certificates until such Outstanding Principal Amount is
repaid in full;
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(i) to pay to the Class A-R Certificateholders an amount equal to that
portion of the Certificate Interest Rate that would have otherwise accrued with
respect to such Class in respect of a prior Payment Date but for the application
of the Maximum Interest Rate, to the extent not already paid on a prior Payment
Date;
(j) to pay to the Trustee, the Servicer, the Special Servicer and the
Servicing Advisor any other amounts due to them as expressly provided in the
Trust Agreement or in the Servicing Agreement, including Recovery Expenses not
previously reimbursed and deferred Servicer Fees, Special Servicer Fees, and
Servicing Advisor Fees not otherwise paid pursuant to any Supplement or other
Transaction Document;
(k) upon the occurrence of a Depositor Event of Default, an amount
sufficient to reimburse the Trustee and the Certificateholders for any expenses
incurred by them in enforcing remedies available under Section 6.02 of the Trust
Agreement; and
(l) to pay any and all remaining funds to the Holders of the Class D-R
Certificates and, if no such Certificates are then Outstanding, to the
Depositor.
Section 4. Right to Cause Prepayments; Adjustment of Maximum Series Amounts
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and Minimum Funding Amounts.
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(a) Notwithstanding any other provision of the Trust Agreement or the
Certificates to the contrary, the Depositor shall have the option to cause the
Trust to prepay, without premium or penalty, principal on any Outstanding Class
of 98-1 Revolving Certificates on a dollar for dollar basis with the net
proceeds of the issuance of a Series of Term Certificates, with such net
proceeds being used to prepay all 98-1 Revolving Certificates by Class in
reverse order of issuance; provided that no such prepayment of 98-1 Revolving
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Certificates shall be permitted unless all Rated Certificates are prepaid in
full. Notwithstanding such prepayment, such 98-1 Revolving Certificates shall
remain Outstanding and additional Fundings may be made under such Certificates
in accordance with Article Three of the Trust Agreement. Following any such
prepayment in connection with the issuance of a Series of Term Certificates: (i)
the Maximum Series Amount for each Class of Certificates in this Series shall be
adjusted from time to time to the level required by the Rating Agency to
maintain the respective rating on each such Class of Certificates; provided that
in no event shall the aggregate Maximum Series Amount of $30,000,045 for all
Classes be exceeded; (ii) following such adjustment, the Minimum Funding Amount
for the Class B-R and Class C-R Certificates shall be adjusted upward or
downward, as appropriate; and (iii) such adjustments shall be reflected on a
Revolving Funding Schedule as described on clause (b) below. Notwithstanding the
foregoing, the Maximum Series Amounts and Minimum Funding Amounts shall not be
increased without the consent of the Holders of Certificates in the relevant
Class, and the Certificateholder Agent shall use its best efforts to obtain any
required approvals.
(b) As of the Delivery Date, the Revolving Funding Schedule is as set
forth on Schedule B hereto. Thereafter, a revised Revolving Funding Schedule
shall be included with each Funding Report delivered in connection with a
Funding Date. In addition, upon any prepayment in accordance with clause (a)
above, a revised Revolving Funding Schedule shall be provided by the Depositor
to the Rating Agency and the Certificateholder Agent. Each such revised
Revolving Funding Schedule shall, as appropriate, specify (i) the dollar amount
that each Class of this Series shall fund in connection with the related Funding
or (ii) the adjusted Maximum Series Amount and Minimum Funding Amount for each
Class of Certificates in this Series.
(c) In addition, on any Funding Date: (i) the Class D-R Certificates
may be prepaid, without premium or penalty, in the amount of any Excess Funding
Amount being funded on such date by the Holders
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of Rated Certificates; and (ii) the Maximum Series Amount for the Class D-R
Certificates shall be increased if required by the Rating Agency to maintain the
rating of any Certificates of this Series in connection with a specific Funding
that involves Loans that are permitted to deviate from the Program Guidelines or
the Pool Criteria.
(d) The parties agree that the aggregate amount of each Funding under a
Term Series shall be at least $15,000,000.
Section 5. Increase in Interest Rate.
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Notwithstanding the definition of Certificate Interest Rate set forth
above, if any Class A-R, Class B-R or Class C-R Certificate in this Series is
not repaid by its Scheduled Maturity, then, for any Accrual Period commencing on
or after such Scheduled Maturity, the Certificate Interest Rate on such
Certificate shall be increased by 1.00%.
Section 6. Limitation of Transfer and Exchange of Class D-R Certificates.
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So long as any Rated Certificates are Outstanding, the Depositor shall
maintain legal and beneficial ownership of at least 51% of the Outstanding
Principal Amount of the Class D-R Certificates, unless otherwise agreed to by
the Controlling Holders.
Section 7. Reserve Account Deposit.
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On or prior to the initial Funding Date for this Series, the Depositor
shall deposit $250,000 into the Reserve Account for investment and disbursement
in accordance with Section 5.03 of the Trust Agreement.
Section 8. Minimum Denominations
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The Certificates of this Series shall be issuable in minimum
denominations greater than $100,000 which denominations shall be, in the case of
the Class A-R Certificates, integral multiples of $500, in the case of the Class
B-R and Class C-R Certificates, integral multiples of $105, and in the case of
the Class D-R Certificates, integral multiples of $100.
Section 9. Legal Opinion.
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It shall be a condition to any Funding under this Series after
September 10, 1999 that prior to such Funding there shall have been delivered to
the Trustee and each Holder of Rated Certificates a legal opinion of counsel to
the Company, the Depositor and the Servicer, inform and substance satisfactory
to such Holders, with respect to this Supplement and such related matters as
such Holders may reasonably request.
Section 10. General Provisions.
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The amendments to the original Supplement dated as of August 1, 1998
made pursuant to this Amended and Restated Supplement shall be effective as of
the Effective Date. Upon execution and delivery of this Supplement, the
Depositor shall execute and the Trustee shall authenticate amended 98-1
Revolving Certificates which shall be delivered by the Trustee to each Holder of
a 98-1 Revolving Certificate in exchange for its existing 98-1 Revolving
Certificate.
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As amended and supplemented by this Supplement, the Trust Agreement is
in all respects ratified and confirmed and the Trust Agreement as so
supplemented shall be read, taken and construed as one and the same instrument.
In the event that any term or provision contained herein shall conflict with or
be inconsistent with any term or provision contained in the Trust Agreement, the
terms and conditions of the Supplement shall be controlling.
This Supplement shall be construed in accordance with and governed by
the internal laws of the State of New York applicable to agreements made and to
be performed therein, without regard to the conflict of laws provisions of any
State.
This Supplement may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
8
IN WITNESS WHEREOF, the Depositor, the Trustee and the Servicer have
caused this Supplement to be executed by their respective duly authorized
officers as of the date and year first written above.
ALLEGIANCE FUNDING I, LLC, as the
Depositor
By: ALLEGIANCE MANAGEMENT CORP., as Manager
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
MANUFACTURERS AND TRADERS TRUST
COMPANY, as the Trustee
By: /S/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Assistant Vice President
POINT WEST CAPITAL CORPORATION, as
the Servicer
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
Consented and Agreed:
▇▇▇▇ & CO., as registered owner of the Class A-R
Certificates
By: /s/ ▇▇▇▇▇ ▇▇▇▇
Its: Vice President
Date: 9/10/99
▇▇▇▇ & CO., as registered owner of the Class B-R
Certificates
By: /s/ ▇▇▇▇▇ ▇▇▇▇
Its: Vice President
Date: 9/10/99
▇▇▇▇ & CO., as registered owner of the Class C-R
Certificates
By: /s/ ▇▇▇▇▇ ▇▇▇▇
Its: Vice President
Date: 9/10/99
EXHIBIT A
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FORM OF AMENDED AND RESTATED CLASS A-R REVOLVING CERTIFICATE
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THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS IN
RELIANCE ON EXEMPTIONS PROVIDED BY THE SECURITIES ACT AND SUCH STATE SECURITIES
LAWS. THIS CERTIFICATE MAY NOT BE SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS SUCH RESALE, TRANSFER, PLEDGE OR HYPOTHECATION (A) IS MADE
IN ACCORDANCE WITH SECTION 2.06 OF THE TRUST AGREEMENT REFERRED TO HEREIN AND
(B) IS MADE (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, (ii) IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR (iii) TO A PERSON
WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT WHO IS AWARE THAT THE RESALE
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A. NEITHER ALLEGIANCE
FUNDING I, LLC (THE "DEPOSITOR") NOR MANUFACTURERS AND TRADERS TRUST COMPANY, AS
TRUSTEE (THE "TRUSTEE"), IS OBLIGATED TO REGISTER THE CERTIFICATES UNDER THE
SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS. IN THE EVENT THAT A
TRANSFER OF A CLASS A-R CERTIFICATE IS TO BE MADE, THE PROSPECTIVE TRANSFEREE
SHALL DELIVER AN INVESTMENT AND ASSUMPTION LETTER IN THE FORM REQUIRED UNDER THE
TRUST AGREEMENT AND, IF THE TRUSTEE SO REQUESTS (IN A TRANSFER OTHER THAN UNDER
RULE 144A), AN OPINION OF COUNSEL TO THE EFFECT THAT SUCH TRANSFER MAY BE MADE
WITHOUT REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES
LAWS.
DUE TO THE PROVISIONS FOR FUNDINGS AND FOR THE PAYMENT OF PRINCIPAL CONTAINED
HEREIN, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS CERTIFICATE ON ANY PARTICULAR
DATE MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. ANYONE PURCHASING
THIS CERTIFICATE MAY ASCERTAIN THE OUTSTANDING PRINCIPAL AMOUNT HEREOF BY
INQUIRY OF THE TRUSTEE.
No. A-R $
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ALLEGIANCE CAPITAL TRUST I
AMENDED AND RESTATED CLASS A-R REVOLVING CERTIFICATE, SERIES 1998-1
Evidencing an undivided fractional interest in the Trust Estate, the property of
which includes, among other things, certain Loan Assets and monies on deposit in
the Collection Account.
(This Certificate does not represent an obligation of, or an
interest in, the Depositor, Allegiance Capital, LLC, the Trustee or
any of their respective affiliates or successors.)
Registered Owner:
-----------------------
A-1
DELIVERY DATE:
----- --, ----
SERIES TERMINATION DATE: July 15, 2019
THIS CERTIFIES THAT the registered owner specified above is the owner
of a(n) DOLLAR AND NO CENTS ($ ) nonassessable, fully paid,
----------- --------
undivided fractional interest in the Allegiance Capital Trust I (the "Trust")
formed by Allegiance Funding Corp. I (the "Depositor"). The Trust was created
pursuant to the Trust Agreement, dated as of August 1, 1998, among the
Depositor, Manufacturers and Traders Trust Company, as Trustee (the "Trustee"),
and Point West Capital Corporation, as Servicer, and the Amended and Restated
Supplement to Trust Agreement for Revolving Series 1998-1, dated as of September
1, 1999 (amending and restating the original Supplement to Trust Agreement for
Revolving Series 1998-1, dated as of August 1, 1998), among the Depositor, the
Trustee and Point West Capital Corporation, as Servicer (collectively, the
"Trust Agreement"). Reference is made to the Trust Agreement for a statement of
the respective rights thereunder of the Depositor, the Trustee and the Holders
of the Certificates, and the terms upon which the Certificates are, and are to
be, authenticated and delivered. To the extent not otherwise defined herein,
each capitalized term used herein has the meaning assigned to it in the Trust
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as the Amended and Restated Class A-R Revolving Certificates, Series
1998-1 having a scheduled maturity of April 17, 2000 and a Series Termination
Date of July 15, 2019 (herein called the "Class A-R Certificates") issued and to
be issued under the Trust Agreement. This Class A-R Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the holder of this Class A-R Certificate by virtue of
such Holder's acceptance hereof assents and by which such Holder is bound.
The Holder of this Certificate is obligated to provide funds to the
Depositor on each Funding Date during the Funding Period subject to the
applicable terms and conditions set forth in the Transaction Documents. The
Fundings made by the Holder of this Certificate to the Depositor shall be
evidenced by this Certificate and the Certificateholder shall endorse on the
schedule annexed hereto and made a part hereof, or elsewhere in its internal
records, the date and amount of each Funding made by it to the Depositor and the
amount of each payment of principal made by the Depositor with respect thereto.
The Certificateholder is authorized and directed by the Depositor to endorse the
schedule attached hereto or maintain such records; provided that each
Certificateholder's endorsements or records shall be effective only if they are
in agreement with the register maintained by the Trustee, absent manifest error
in such register. The failure of the Certificateholder to make, or an error in
making, a notation with respect to any Funding shall not limit or otherwise
affect the obligations of the Depositor hereunder or under the Trust Agreement.
The aggregate amount of all Fundings required to be made by the Holder of this
Certificate, shall be as set forth in the Revolving Funding Schedule.
This Class A-R Certificate bears interest during each Accrual Period on
the Outstanding Principal Amount hereof (as of the first day of the Accrual
Period) at the Certificate Interest Rate, until and including the last day
preceding the Payment Date on which the Outstanding Principal Amount hereof has
been reduced to zero. Interest on the Outstanding Principal Amount hereof shall
be calculated on the basis of a 360-day year consisting of 12 months of 30 days
each. Interest shall be due and payable in arrears on each Payment Date. In
addition, with respect to any Funding by the Class A-R Certificates of this
Series occurring in any Accrual Period following the preceding Payment Date, the
related Funding Amounts shall accrue interest from the related Funding Date
through the end of the Accrual Period in which such Funding occurs in the amount
of the applicable First Period Interest, which interest shall be paid on the
next Payment Date. The First Period Interest on the Funding Amount shall be
determined on the Funding Date at the rate established on the applicable Reset
Date. Notwithstanding the foregoing, if the Outstanding Principal Amount of this
A-2
Certificate is not paid in full by its Scheduled Maturity, then, for any Accrual
Period commencing on or after such Scheduled Maturity, the Floating Rate Spread
on this Certificate shall be increased by 1.00%. In making any interest payment,
if the interest calculation with respect to a Certificate shall result in a
portion of such payment being less than $0.01, then such payment shall be
decreased to the nearest whole cent, and no subsequent adjustment shall be made
in respect thereof.
The principal of this Class A-R Certificate shall be payable in
installments ending no later than the Series Termination Date unless this Class
A-R Certificate becomes due and payable at an earlier date by call for
redemption or otherwise. All reductions in the principal amount of a Class A-R
Certificate effected by payments of installments of principal made on any
Payment Date shall be binding upon all future Holders of this Class A-R
Certificate and of any Class A-R Certificate issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof, whether or not such
payment is noted on this Class A-R Certificate. Each installment of principal
payable on this Class A-R Certificate shall be in an amount equal to this
Certificateholder's pro rata share of the Class A-R Principal Distribution
Amount available to be paid in accordance with the priorities of Section 3 of
the Supplement for this Series and Section 5.02 of the Trust Agreement. Subject
to the terms of the Trust Agreement, the principal payable on this Class A-R
Certificate shall be paid on each Payment Date during the term of the Trust
Agreement, beginning on the Initial Payment Date. All payments of principal with
respect to all of the Class A-R Certificates of a Series shall be made on a pro
rata basis based upon the ratio that the Outstanding Principal Amount of a Class
A-R Certificate bears to the Outstanding Principal Amount of all Class A-R
Certificates of such Series; provided that, if as a result of such proration a
--------
portion of such principal would be less than $0.01, then such payment shall be
reduced to the nearest whole cent.
In addition, the Certificate Prepayment Fee Amount, if any, shall be
distributed on each Payment Date to the Holders of the Class A-R Certificates to
the extent such Class is receiving a distribution of Prepaid Principal Amount on
such date. All payments of Certificate Prepayment Fee Amounts with respect to
the Class A-R Certificates shall be made prorata based upon the ratio of the
Outstanding Principal Amount of this Certificate to the Outstanding Principal
Amount of Class A-R Certificates of this Series, provided that if as a result of
such proration, a portion of such payment would be less than $0.01, then such
payment shall be reduce to the nearest whole cent.
The interest and principal so payable on any Payment Date will, as
provided in the Trust Agreement, be paid to the Person in whose name this
Certificate is registered on the Record Date for such Payment Date, which shall
be the close of business on the last day of the month prior to such Payment Date
(whether or not a Business Day). The principal and interest on this Certificate
are payable by wire transfer in immediately available funds to the account
specified in writing to the Trustee by the Person whose name appears as the
Registered Holder of this Certificate on the Certificate Register received at
least five (5) Business Days prior to the Record Date for the Payment Date (or
if no such account is specified or if such wire fails, by check mailed by
first-class mail to the Person whose name appears as the Registered Holder of
this Certificate on the Certificate Register at the address of such Person as it
appears on the Certificate Register), in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts. Funds represented by checks returned undelivered will
be held for payment to the Person entitled thereto, subject to the terms of the
Trust Agreement, at the office or agency in the United States of America
designated as such by the Depositor for such purpose pursuant to the Trust
Agreement.
The Depositor has structured the Trust Agreement and the Certificates
with the intention that the Trust be treated as a partnership, with the assets
of the partnership including all of the assets of the Trust Estate and the
partners of the partnership being all of the Certificateholders and the
Depositor. The Depositor, the Trustee, the Servicer and each Certificateholder,
by acceptance of its Certificate (and any
A-3
Person that is a beneficial owner of any interest in a Certificate, by virtue of
such Person's acquisition of a beneficial interest therein), agree to report the
transactions contemplated thereby in accordance with such stated intentions
unless and until determined to the contrary by an applicable taxing authority.
The property of the Trust Estate includes certain Loan Assets and
certain other assets described in the Trust Agreement. The Class A-R
Certificates of the 1998-1 Series and all other Series of Class A-R Certificates
issued under the Trust Agreement are payable out of the Trust Estate pari passu
among such Class A-R Certificateholders equally and ratably without prejudice,
priority or distinction between any Class A-R Certificate by reason of time of
issue or otherwise. The Class A-R Certificates are payable only out of the Trust
Estate and do not represent recourse obligations of the Depositor, Allegiance
Capital, LLC or any of their respective affiliates or successors. The Trust
Agreement pursuant to which this Class A-R Certificate is issued also provides
for the issuance of other Classes and Series of Certificates from time to time.
Payments of interest on the Class A-R Certificates are senior to such payments
on other Classes having a lower credit rating from the Rating Agency and are
subordinate to payments of interest on any Classes having a higher credit rating
form the Rating Agency. Payments of principal in the Class A-R Certificates are
senior to payments of principal on other classes having a lower credit rating
from the Rating Agency and are subordinate to such payments on any Class having
a higher credit rating from the Rating Agency.
Unless the Depositor exercises its Optional Termination rights, the
Certificates are payable only at the time and in the manner provided in the
Trust Agreement and are not redeemable or prepayable at the option of the
Depositor before such time, except that the Depositor may cause the Trust to
prepay on a dollar for dollar basis the principal, without penalty or premium,
of any Outstanding Series of Revolving Certificates with the proceeds of the
issuance of a Series of Term Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate may be registered on the
Certificate Register of the Depositor upon surrender of this Certificate for
registration of transfer at the office or agency of the Depositor in the United
States of America maintained for such purpose, duly endorsed by, or accompanied
by a written instrument of transfer in form reasonably satisfactory to the
Depositor and the Trustee and duly executed by the holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Class A-R Certificates
of the same Scheduled Maturity of authorized denominations and for the same
initial aggregate principal amount will be issued to the designated transferees.
Prior to due presentment for registration of transfer of this
Certificate, the Depositor, the Trustee and any agent of the Depositor or the
Trustee shall treat the Person in whose name this Certificate is registered as
the owner hereof for the purpose of receiving payment as herein provided and for
all other purposes whether or not this Certificate be overdue, and neither the
Depositor, the Trustee, nor any such agent shall be affected by notice to the
contrary.
The Holder of this Certificate, by acceptance of this Certificate,
agrees that for one year and one day after it has been paid hereunder, it or any
Affiliate thereof will not file any involuntary petition or otherwise institute
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or similar
law against the Depositor.
The Trust Agreement permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the rights of the Holders of the Certificates
under the Trust Agreement at any time by the Depositor, the Trustee and the
Servicer without the consent of the Holders of the Certificates.
A-4
The Certificates are issuable only in registered form without coupons
in such authorized denominations as provided in the Trust Agreement and subject
to certain limitations therein set forth.
This Class A-R Certificate and the Trust Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York,
without regard to conflicts of laws principles.
No reference herein to the Trust Agreement and no provision of this
Class A-R Certificate or of the Trust Agreement shall alter or impair the
obligation of the Trust Estate to pay the principal of and interest on this
Class A-R Certificate, but solely from the assets of the Trust Estate and the
Class A-R Certificate Insurance Policy at the times, place and rate, and in the
coin or currency, herein prescribed.
A-5
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this
instrument to be signed, manually, by the President or a Vice President of its
Manager, Allegiance Management Corp.
ALLEGIANCE FUNDING I, LLC
By: Allegiance Management Corp.
as Manager
By:
------------------------------
Title:
------------------------------
CERTIFICATE OF AUTHENTICATION
This is one of the Class A-R Certificates described in the
within-mentioned Trust Agreement.
Dated:
-------------------------------------
MANUFACTURERS AND TRADERS TRUST
COMPANY, as Trustee
By:
--------------------------------------
Authorized Signatory
Schedule to Class A-R Term Certificates, Series 1998-1
Disbursement
Date of Amount of Principal
Funding Funding Payment &
Date Paid
-------------------------------------------------------------------------------
EXHIBIT B
---------
FORM OF AMENDED AND RESTATED CLASS B-R REVOLVING CERTIFICATE
------------------------------------------------------------
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS IN
RELIANCE ON EXEMPTIONS PROVIDED BY THE SECURITIES ACT AND SUCH STATE SECURITIES
LAWS. THIS CERTIFICATE MAY NOT BE SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS SUCH RESALE, TRANSFER, PLEDGE OR HYPOTHECATION (A) IS MADE
IN ACCORDANCE WITH SECTION 2.06 OF THE TRUST AGREEMENT REFERRED TO HEREIN AND
(B) IS MADE (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, (ii) IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR (iii) TO A PERSON
WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT WHO IS AWARE THAT THE RESALE
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A. NEITHER ALLEGIANCE
FUNDING I, LLC (THE "DEPOSITOR") NOR MANUFACTURERS AND TRADERS TRUST COMPANY, AS
TRUSTEE (THE "TRUSTEE"), IS OBLIGATED TO REGISTER THE CERTIFICATES UNDER THE
SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS. IN THE EVENT THAT A
TRANSFER OF A CLASS B-R CERTIFICATE IS TO BE MADE, THE PROSPECTIVE TRANSFEREE
SHALL DELIVER AN INVESTMENT AND ASSUMPTION LETTER IN THE FORM REQUIRED UNDER THE
TRUST AGREEMENT AND, IF THE TRUSTEE SO REQUESTS (IN A TRANSFER OTHER THAN UNDER
RULE 144A), AN OPINION OF COUNSEL TO THE EFFECT THAT SUCH TRANSFER MAY BE MADE
WITHOUT REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES
LAWS.
DUE TO THE PROVISIONS FOR FUNDINGS AND FOR THE PAYMENT OF PRINCIPAL CONTAINED
HEREIN, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS CERTIFICATE ON ANY PARTICULAR
DATE MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. ANYONE PURCHASING
THIS CERTIFICATE MAY ASCERTAIN THE OUTSTANDING PRINCIPAL AMOUNT HEREOF BY
INQUIRY OF THE TRUSTEE.
No. B-R $
---- ------------
ALLEGIANCE CAPITAL TRUST I
AMENDED AND RESTATED CLASS B-R REVOLVING CERTIFICATE, SERIES 1998-1
Evidencing an undivided fractional interest in the Trust Estate, the property of
which includes, among other things, certain Loan Assets and monies on deposit in
the Collection Account.
(This Certificate does not represent an obligation of, or an
interest in, the Depositor, Allegiance Capital, LLC, the Trustee or
any of their respective affiliates or successors.)
Registered Owner:
-------------------------
B-1
DELIVERY DATE:
----- --, ----
SERIES TERMINATION DATE: July 15, 2019
THIS CERTIFIES THAT the registered owner specified above is the owner
of a(n) DOLLAR AND NO CENTS ($ ) nonassessable, fully paid,
------------ ---------
undivided fractional interest in the Allegiance Capital Trust I (the "Trust")
formed by Allegiance Funding Corp. I (the "Depositor"). The Trust was created
pursuant to the Trust Agreement, dated as of August 1, 1998, among the
Depositor, Manufacturers and Traders Trust Company, as Trustee (the "Trustee"),
and Point West Capital Corporation, as Servicer, and the Amended and Restated
Supplement to Trust Agreement for Revolving Series 1998-1, dated as of September
1, 1999 (amending and restating the original Supplement to Trust Agreement for
Revolving Series 1998-1, dated as of August 1, 1998), among the Depositor, the
Trustee and Point West Capital Corporation, as Servicer (collectively, the
"Trust Agreement"). Reference is made to the Trust Agreement for a statement of
the respective rights thereunder of the Depositor, the Trustee and the Holders
of the Certificates, and the terms upon which the Certificates are, and are to
be, authenticated and delivered. To the extent not otherwise defined herein,
each capitalized term used herein has the meaning assigned to it in the Trust
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as the Amended and Restated Class B-R Revolving Certificates, Series
1998-1 having a scheduled maturity of April 17, 2000 and a Series Termination
Date of July 15, 2019 (herein called the "Class B-R Certificates") issued and to
be issued under the Trust Agreement. This Class B-R Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the holder of this Class B-R Certificate by virtue of
such Holder's acceptance hereof assents and by which such Holder is bound.
The Holder of this Certificate is obligated to provide funds to the
Depositor on each Funding Date during the Funding Period subject to the
applicable terms and conditions set forth in the Transaction Documents. The
Fundings made by the Holder of this Certificate to the Depositor shall be
evidenced by this Certificate and the Certificateholder shall endorse on the
schedule annexed hereto and made a part hereof, or elsewhere in its internal
records, the date and amount of each Funding made by it to the Depositor and the
amount of each payment of principal made by the Depositor with respect thereto.
The Certificateholder is authorized and directed by the Depositor to endorse the
schedule attached hereto or maintain such records; provided that each
--------
Certificateholder's endorsements or records shall be effective only if they are
in agreement with the register maintained by the Trustee, absent manifest error
in such register. The failure of the Certificateholder to make, or an error in
making, a notation with respect to any Funding shall not limit or otherwise
affect the obligations of the Depositor hereunder or under the Trust Agreement.
The aggregate amount of all Fundings required to be made by the Holder of this
Certificate, shall be as set forth in the Revolving Funding Schedule.
This Class B-R Certificate bears interest during each Accrual Period on
the Outstanding Principal Amount hereof (as of the first day of the Accrual
Period) at the Certificate Interest Rate, until and including the last day
preceding the Payment Date on which the Outstanding Principal Amount hereof has
been reduced to zero. Interest on the Outstanding Principal Amount hereof shall
be calculated on the basis of a 360-day year consisting of 12 months of 30 days
each. Interest shall be due and payable in arrears on each Payment Date. In
addition, with respect to any Funding by the Class B-R Certificates of this
Series occurring in any Accrual Period following the preceding Payment Date, the
related Funding Amounts shall accrue interest from the related Funding Date
through the end of the Accrual Period in which such Funding occurs in the amount
of the applicable First Period Interest, which interest shall be paid on the
next Payment Date. The First Period Interest on the Funding Amount shall be
determined on the Funding Date at the rate established on the applicable Reset
Date. Notwithstanding the foregoing, if the Outstanding Principal Amount of this
B-2
Certificate is not paid in full by its Scheduled Maturity, then, for any Accrual
Period commencing on or after such Scheduled Maturity, the Floating Rate Spread
on this Certificate shall be increased by 1.00%. In making any interest payment,
if the interest calculation with respect to a Certificate shall result in a
portion of such payment being less than $0.01, then such payment shall be
decreased to the nearest whole cent, and no subsequent adjustment shall be made
in respect thereof.
The principal of this Class B-R Certificate shall be payable in
installments ending no later than the Series Termination Date unless this Class
B-R Certificate becomes due and payable at an earlier date by call for
redemption or otherwise. All reductions in the principal amount of a Class B-R
Certificate effected by payments of installments of principal made on any
Payment Date shall be binding upon all future Holders of this Class B-R
Certificate and of any Class B-R Certificate issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof, whether or not such
payment is noted on this Class B-R Certificate. Each installment of principal
payable on this Class B-R Certificate shall be in an amount equal to this
Certificateholder's pro rata share of the Class B-R Principal Distribution
Amount available to be paid in accordance with the priorities of Section 3 of
the Supplement for this Series and Section 5.02 of the Trust Agreement. Subject
to the terms of the Trust Agreement, the principal payable on this Class B-R
Certificate shall be paid on each Payment Date during the term of the Trust
Agreement, beginning on the Initial Payment Date. All payments of principal with
respect to all of the Class B-R Certificates of a Series shall be made on a pro
rata basis based upon the ratio that the Outstanding Principal Amount of a Class
B-R Certificate bears to the Outstanding Principal Amount of all Class B-R
Certificates of such Series; provided that, if as a result of such proration a
--------
portion of such principal would be less than $0.01, then such payment shall be
reduced to the nearest whole cent.
In addition, the Certificate Prepayment Fee Amount, if any, shall be
distributed on each Payment Date to the Holders of the Class B-R Certificates to
the extent such Class is receiving a distribution of Prepaid Principal Amount on
such date. All payments of Certificate Prepayment Fee Amounts with respect to
the Class B-R Certificates shall be made prorata based upon the ratio of the
Outstanding Principal Amount of this Certificate to the Outstanding Principal
Amount of Class B-R Certificates of this Series, provided that if as a result of
such proration, a portion of such payment would be less than $0.01, then such
payment shall be reduce to the nearest whole cent.
The interest and principal so payable on any Payment Date will, as
provided in the Trust Agreement, be paid to the Person in whose name this
Certificate is registered on the Record Date for such Payment Date, which shall
be the close of business on the last day of the month prior to such Payment Date
(whether or not a Business Day). The principal and interest on this Certificate
are payable by wire transfer in immediately available funds to the account
specified in writing to the Trustee by the Person whose name appears as the
Registered Holder of this Certificate on the Certificate Register received at
least five (5) Business Days prior to the Record Date for the Payment Date (or
if no such account is specified or if such wire fails, by check mailed by
first-class mail to the Person whose name appears as the Registered Holder of
this Certificate on the Certificate Register at the address of such Person as it
appears on the Certificate Register), in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts. Funds represented by checks returned undelivered will
be held for payment to the Person entitled thereto, subject to the terms of the
Trust Agreement, at the office or agency in the United States of America
designated as such by the Depositor for such purpose pursuant to the Trust
Agreement.
The Depositor has structured the Trust Agreement and the Certificates
with the intention that the Trust be treated as a partnership, with the assets
of the partnership including all of the assets of the Trust Estate and the
partners of the partnership being all of the Certificateholders and the
Depositor. The Depositor, the Trustee, the Servicer and each Certificateholder,
by acceptance of its Certificate (and any
B-3
Person that is a beneficial owner of any interest in a Certificate, by virtue of
such Person's acquisition of a beneficial interest therein), agree to report the
transactions contemplated thereby in accordance with such stated intentions
unless and until determined to the contrary by an applicable taxing authority.
The property of the Trust Estate includes certain Loan Assets and
certain other assets described in the Trust Agreement. The Class B-R
Certificates of the 1998-1 Series and all other Series of Class B-R Certificates
issued under the Trust Agreement are payable out of the Trust Estate pari passu
among such Class B-R Certificateholders equally and ratably without prejudice,
priority or distinction between any Class B-R Certificate by reason of time of
issue or otherwise. The Class B-R Certificates are payable only out of the Trust
Estate and do not represent recourse obligations of the Depositor, Allegiance
Capital, LLC or any of their respective affiliates or successors. The Trust
Agreement pursuant to which this Class B-R Certificate is issued also provides
for the issuance of other Classes and Series of Certificates from time to time.
Payments of interest on the Class B-R Certificates are senior to such payments
on other Classes having a lower credit rating from the Rating Agency and are
subordinate to payments of interest on any Classes having a higher credit rating
form the Rating Agency. Payments of principal in the Class B-R Certificates are
senior to payments of principal on other classes having a lower credit rating
from the Rating Agency and are subordinate to such payments on any Class having
a higher credit rating from the Rating Agency.
Unless the Depositor exercises its Optional Termination rights, the
Certificates are payable only at the time and in the manner provided in the
Trust Agreement and are not redeemable or prepayable at the option of the
Depositor before such time, except that the Depositor may cause the Trust to
prepay on a dollar for dollar basis the principal, without penalty or premium,
of any Outstanding Series of Revolving Certificates with the proceeds of the
issuance of a Series of Term Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate may be registered on the
Certificate Register of the Depositor upon surrender of this Certificate for
registration of transfer at the office or agency of the Depositor in the United
States of America maintained for such purpose, duly endorsed by, or accompanied
by a written instrument of transfer in form reasonably satisfactory to the
Depositor and the Trustee and duly executed by the holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Class B-R Certificates
having the same Scheduled Maturity, Series Termination Date, authorized
denomination(s) and for the same initial aggregate principal amount will be
issued to the designated transferees.
Prior to due presentment for registration of transfer of this
Certificate, the Depositor, the Trustee and any agent of the Depositor or the
Trustee shall treat the Person in whose name this Certificate is registered as
the owner hereof for the purpose of receiving payment as herein provided and for
all other purposes whether or not this Certificate be overdue, and neither the
Depositor, the Trustee, nor any such agent shall be affected by notice to the
contrary.
The Holder of this Certificate, by acceptance of this Certificate,
agrees that for one year and one day after it has been paid hereunder, it or any
Affiliate thereof will not file any involuntary petition or otherwise institute
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or similar
law against the Depositor.
The Trust Agreement permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the rights of the Holders of the Certificates
under the Trust Agreement at any time by the Depositor, the Trustee and the
Servicer without the consent of the Holders of the Certificates.
B-4
The Certificates are issuable only in registered form without coupons
in such authorized denominations as provided in the Trust Agreement and subject
to certain limitations therein set forth.
This Class B-R Certificate and the Trust Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York,
without regard to conflicts of laws principles.
No reference herein to the Trust Agreement and no provision of this
Class B-R Certificate or of the Trust Agreement shall alter or impair the
obligation of the Trust Estate to pay the principal of and interest on this
Class B-R Certificate, but solely from the assets of the Trust Estate and the
Class B-R Certificate Insurance Policy at the times, place and rate, and in the
coin or currency, herein prescribed.
B-5
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this
instrument to be signed, manually, by the President or a Vice President of its
Manager, Allegiance Management Corp.
ALLEGIANCE FUNDING I, LLC
By: Allegiance Management Corp.,
as Manager
By:
------------------------------
Title:
------------------------------
CERTIFICATE OF AUTHENTICATION
This is one of the Class B-R Certificates described in the
within-mentioned Trust Agreement.
Dated:
-------------------------------------
MANUFACTURERS AND TRADERS TRUST
COMPANY, as Trustee
By:
--------------------------------------
Authorized Signatory
Schedule to Class B-R Term Certificates, Series 1998-1
Disbursement
Date of Amount of Principal
Funding Funding Payment &
Date Paid
-------------------------------------------------------------------------------
EXHIBIT C
---------
FORM OF AMENDED AND RESTATED CLASS C-R REVOLVING CERTIFICATE
------------------------------------------------------------
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS IN
RELIANCE ON EXEMPTIONS PROVIDED BY THE SECURITIES ACT AND SUCH STATE SECURITIES
LAWS. THIS CERTIFICATE MAY NOT BE SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS SUCH RESALE, TRANSFER, PLEDGE OR HYPOTHECATION (A) IS MADE
IN ACCORDANCE WITH SECTION 2.06 OF THE TRUST AGREEMENT REFERRED TO HEREIN AND
(B) IS MADE (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, (ii) IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR (iii) TO A PERSON
WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT WHO IS AWARE THAT THE RESALE
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A. NEITHER ALLEGIANCE
FUNDING I, LLC (THE "DEPOSITOR") NOR MANUFACTURERS AND TRADERS TRUST COMPANY, AS
TRUSTEE (THE "TRUSTEE"), IS OBLIGATED TO REGISTER THE CERTIFICATES UNDER THE
SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS. IN THE EVENT THAT A
TRANSFER OF A CLASS C-R CERTIFICATE IS TO BE MADE, THE PROSPECTIVE TRANSFEREE
SHALL DELIVER AN INVESTMENT AND ASSUMPTION LETTER IN THE FORM REQUIRED UNDER THE
TRUST AGREEMENT AND, IF THE TRUSTEE SO REQUESTS (IN A TRANSFER OTHER THAN UNDER
RULE 144A), AN OPINION OF COUNSEL TO THE EFFECT THAT SUCH TRANSFER MAY BE MADE
WITHOUT REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES
LAWS.
DUE TO THE PROVISIONS FOR FUNDINGS AND FOR THE PAYMENT OF PRINCIPAL CONTAINED
HEREIN, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS CERTIFICATE ON ANY PARTICULAR
DATE MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. ANYONE PURCHASING
THIS CERTIFICATE MAY ASCERTAIN THE OUTSTANDING PRINCIPAL AMOUNT HEREOF BY
INQUIRY OF THE TRUSTEE.
No. C-R $
----- ----------
ALLEGIANCE CAPITAL TRUST I
AMENDED AND RESTATED CLASS C-R REVOLVING CERTIFICATE, SERIES 1998-1
Evidencing an undivided fractional interest in the Trust Estate, the property of
which includes, among other things, certain Loan Assets and monies on deposit in
the Collection Account.
(This Certificate does not represent an obligation of, or an
interest in, the Depositor, Allegiance Capital, LLC, the Trustee or
any of their respective affiliates or successors.)
Registered Owner:
-------------------------
C-1
DELIVERY DATE:
----- --, ----
SERIES TERMINATION DATE: July 15, 2019
THIS CERTIFIES THAT the registered owner specified above is the owner
of a(n) DOLLAR AND NO CENTS ($ ) nonassessable, fully paid,
---------- ----------
undivided fractional interest in the Allegiance Capital Trust I (the "Trust")
formed by Allegiance Funding Corp. I (the "Depositor"). The Trust was created
pursuant to the Trust Agreement, dated as of August 1, 1998, among the
Depositor, Manufacturers and Traders Trust Company, as Trustee (the "Trustee"),
and Point West Capital Corporation, as Servicer, and the Amended and Restated
Supplement to Trust Agreement for Revolving Series 1998-1, dated as of September
1, 1999 (amending and restating the original Supplement to Trust Agreement for
Revolving Series 1998-1, dated as of August 1, 1998), among the Depositor, the
Trustee and Point West Capital Corporation, as Servicer (collectively, the
"Trust Agreement"). Reference is made to the Trust Agreement for a statement of
the respective rights thereunder of the Depositor, the Trustee and the Holders
of the Certificates, and the terms upon which the Certificates are, and are to
be, authenticated and delivered. To the extent not otherwise defined herein,
each capitalized term used herein has the meaning assigned to it in the Trust
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as the Amended and Restated Class C-R Revolving Certificates, Series
1998-1 having a scheduled maturity of April 17, 2000 and a Series Termination
Date of July 15, 2019 (herein called the "Class C-R Certificates") issued and to
be issued under the Trust Agreement. This Class C-R Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the holder of this Class C-R Certificate by virtue of
such Holder's acceptance hereof assents and by which such Holder is bound.
The Holder of this Certificate is obligated to provide funds to the
Depositor on each Funding Date during the Funding Period subject to the
applicable terms and conditions set forth in the Transaction Documents. The
Fundings made by the Holder of this Certificate to the Depositor shall be
evidenced by this Certificate and the Certificateholder shall endorse on the
schedule annexed hereto and made a part hereof, or elsewhere in its internal
records, the date and amount of each Funding made by it to the Depositor and the
amount of each payment of principal made by the Depositor with respect thereto.
The Certificateholder is authorized and directed by the Depositor to endorse the
schedule attached hereto or maintain such records; provided that each
--------
Certificateholder's endorsements or records shall be effective only if they are
in agreement with the register maintained by the Trustee, absent manifest error
in such register. The failure of the Certificateholder to make, or an error in
making, a notation with respect to any Funding shall not limit or otherwise
affect the obligations of the Depositor hereunder or under the Trust Agreement.
The aggregate amount of all Fundings required to be made by the Holder of this
Certificate, shall be as set forth in the Revolving Funding Schedule.
This Class C-R Certificate bears interest during each Accrual Period on
the Outstanding Principal Amount hereof (as of the first day of the Accrual
Period) at the Certificate Interest Rate, until and including the last day
preceding the Payment Date on which the Outstanding Principal Amount hereof has
been reduced to zero. Interest on the Outstanding Principal Amount hereof shall
be calculated on the basis of a 360-day year consisting of 12 months of 30 days
each. Interest shall be due and payable in arrears on each Payment Date. In
addition, with respect to any Funding by the Class C-R Certificates of this
Series occurring in any Accrual Period following the preceding Payment Date, the
related Funding Amounts shall accrue interest from the related Funding Date
through the end of the Accrual Period in which such Funding occurs in the amount
of the applicable First Period Interest, which interest shall be paid on the
next Payment Date. The First Period Interest on the Funding Amount shall be
determined on the Funding Date at the rate established on the applicable Reset
Date. Notwithstanding the foregoing, if the Outstanding Principal Amount of this
C-2
Certificate is not paid in full by its Scheduled Maturity, then, for any Accrual
Period commencing on or after such Scheduled Maturity, the Floating Rate Spread
on this Certificate shall be increased by 1.00%. In making any interest payment,
if the interest calculation with respect to a Certificate shall result in a
portion of such payment being less than $0.01, then such payment shall be
decreased to the nearest whole cent, and no subsequent adjustment shall be made
in respect thereof.
The principal of this Class C-R Certificate shall be payable in
installments ending no later than the Series Termination Date unless this Class
C-R Certificate becomes due and payable at an earlier date by call for
redemption or otherwise. All reductions in the principal amount of a Class C-R
Certificate effected by payments of installments of principal made on any
Payment Date shall be binding upon all future Holders of this Class C-R
Certificate and of any Class C-R Certificate issued upon the registration of
transfer hereof or in exchange herefor or in lieu hereof, whether or not such
payment is noted on this Class C-R Certificate. Each installment of principal
payable on this Class C-R Certificate shall be in an amount equal to this
Certificateholder's pro rata share of the Class C-R Principal Distribution
Amount available to be paid in accordance with the priorities of Section 3 of
the Supplement for this Series and Section 5.02 of the Trust Agreement. Subject
to the terms of the Trust Agreement, the principal payable on this Class C-R
Certificate shall be paid on each Payment Date during the term of the Trust
Agreement, beginning on the Initial Payment Date. All payments of principal with
respect to all of the Class C-R Certificates of a Series shall be made on a pro
rata basis based upon the ratio that the Outstanding Principal Amount of a Class
C-R Certificate bears to the Outstanding Principal Amount of all Class C-R
Certificates of such Series; provided that, if as a result of such proration a
--------
portion of such principal would be less than $0.01, then such payment shall be
reduced to the nearest whole cent.
In addition, the Certificate Prepayment Fee Amount, if any, shall be
distributed on each Payment Date to the Holders of the Class C-R Certificates to
the extent such Class is receiving a distribution of Prepaid Principal Amount on
such date. All payments of Certificate Prepayment Fee Amounts with respect to
the Class C-R Certificates shall be made prorata based upon the ratio of the
Outstanding Principal Amount of this Certificate to the Outstanding Principal
Amount of Class C-R Certificates of this Series, provided that if as a result of
such proration, a portion of such payment would be less than $0.01, then such
payment shall be reduce to the nearest whole cent.
The interest and principal so payable on any Payment Date will, as
provided in the Trust Agreement, be paid to the Person in whose name this
Certificate is registered on the Record Date for such Payment Date, which shall
be the close of business on the last day of the month prior to such Payment Date
(whether or not a Business Day). The principal and interest on this Certificate
are payable by wire transfer in immediately available funds to the account
specified in writing to the Trustee by the Person whose name appears as the
Registered Holder of this Certificate on the Certificate Register received at
least five (5) Business Days prior to the Record Date for the Payment Date (or
if no such account is specified or if such wire fails, by check mailed by
first-class mail to the Person whose name appears as the Registered Holder of
this Certificate on the Certificate Register at the address of such Person as it
appears on the Certificate Register), in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts. Funds represented by checks returned undelivered will
be held for payment to the Person entitled thereto, subject to the terms of the
Trust Agreement, at the office or agency in the United States of America
designated as such by the Depositor for such purpose pursuant to the Trust
Agreement.
The Depositor has structured the Trust Agreement and the Certificates
with the intention that the Trust be treated as a partnership, with the assets
of the partnership including all of the assets of the Trust Estate and the
partners of the partnership being all of the Certificateholders and the
Depositor. The Depositor, the Trustee, the Servicer and each Certificateholder,
by acceptance of its Certificate (and any
C-3
Person that is a beneficial owner of any interest in a Certificate, by virtue of
such Person's acquisition of a beneficial interest therein), agree to report the
transactions contemplated thereby in accordance with such stated intentions
unless and until determined to the contrary by an applicable taxing authority.
The property of the Trust Estate includes certain Loan Assets and
certain other assets described in the Trust Agreement. The Class C-R
Certificates of the 1998-1 Series and all other Series of Class C-R Certificates
issued under the Trust Agreement are payable out of the Trust Estate pari passu
among such Class C-R Certificateholders equally and ratably without prejudice,
priority or distinction between any Class C-R Certificate by reason of time of
issue or otherwise. The Class C-R Certificates are payable only out of the Trust
Estate and do not represent recourse obligations of the Depositor, Allegiance
Capital, LLC or any of their respective affiliates or successors. The Trust
Agreement pursuant to which this Class C-R Certificate is issued also provides
for the issuance of other Classes and Series of Certificates from time to time.
Payments of interest on the Class C-R Certificates are senior to such payments
on other Classes having a lower credit rating from the Rating Agency and are
subordinate to payments of interest on any Classes having a higher credit rating
form the Rating Agency. Payments of principal in the Class C-R Certificates are
senior to payments of principal on other classes having a lower credit rating
from the Rating Agency and are subordinate to such payments on any Class having
a higher credit rating from the Rating Agency.
Unless the Depositor exercises its Optional Termination rights, the
Certificates are payable only at the time and in the manner provided in the
Trust Agreement and are not redeemable or prepayable at the option of the
Depositor before such time, except that the Depositor may cause the Trust to
prepay on a dollar for dollar basis the principal, without penalty or premium,
of any Outstanding Series of Revolving Certificates with the proceeds of the
issuance of a Series of Term Certificates.
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate may be registered on the
Certificate Register of the Depositor upon surrender of this Certificate for
registration of transfer at the office or agency of the Depositor in the United
States of America maintained for such purpose, duly endorsed by, or accompanied
by a written instrument of transfer in form reasonably satisfactory to the
Depositor and the Trustee and duly executed by the holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Class C-R Certificates
having the same Scheduled Maturity, Series Termination Date, authorized
denomination(s) and for the same initial aggregate principal amount will be
issued to the designated transferees.
Prior to due presentment for registration of transfer of this
Certificate, the Depositor, the Trustee and any agent of the Depositor or the
Trustee shall treat the Person in whose name this Certificate is registered as
the owner hereof for the purpose of receiving payment as herein provided and for
all other purposes whether or not this Certificate be overdue, and neither the
Depositor, the Trustee, nor any such agent shall be affected by notice to the
contrary.
The Holder of this Certificate, by acceptance of this Certificate,
agrees that for one year and one day after it has been paid hereunder, it or any
Affiliate thereof will not file any involuntary petition or otherwise institute
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or similar
law against the Depositor.
The Trust Agreement permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the rights of the Holders of the Certificates
under the Trust Agreement at any time by the Depositor, the Trustee and the
Servicer without the consent of the Holders of the Certificates.
C-4
The Certificates are issuable only in registered form without coupons
in such authorized denominations as provided in the Trust Agreement and subject
to certain limitations therein set forth.
This Class C-R Certificate and the Trust Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York,
without regard to conflicts of laws principles.
No reference herein to the Trust Agreement and no provision of this
Class C-R Certificate or of the Trust Agreement shall alter or impair the
obligation of the Trust Estate to pay the principal of and interest on this
Class C-R Certificate, but solely from the assets of the Trust Estate and the
Class C-R Certificate Insurance Policy at the times, place and rate, and in the
coin or currency, herein prescribed.
C-5
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this
instrument to be signed, manually, by the President or a Vice President of its
Manager, Allegiance Management Corp.
ALLEGIANCE FUNDING I, LLC
By: Allegiance Management Corp.
as Manager
By:
------------------------------
Title:
------------------------------
CERTIFICATE OF AUTHENTICATION
This is one of the Class C-R Certificates described in the
within-mentioned Trust Agreement.
Dated:
-------------------------------------
MANUFACTURERS AND TRADERS TRUST
COMPANY, as Trustee
By:
--------------------------------------
Authorized Signatory
Schedule to Class C-R Term Certificates, Series 1998-1
Disbursement
Date of Amount of Principal
Funding Funding Payment &
Date Paid
-------------------------------------------------------------------------------
EXHIBIT D
---------
FORM OF AMENDED AND RESTATED CLASS D-R REVOLVING CERTIFICATE
------------------------------------------------------------
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR ANY STATE SECURITIES LAWS IN
RELIANCE ON EXEMPTIONS PROVIDED BY THE SECURITIES ACT AND SUCH STATE SECURITIES
LAWS. THIS CERTIFICATE MAY NOT BE SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS SUCH RESALE, TRANSFER, PLEDGE OR HYPOTHECATION (A) IS MADE
IN ACCORDANCE WITH SECTION 2.06 OF THE TRUST AGREEMENT REFERRED TO HEREIN AND
(B) IS MADE (i) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, (ii) IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS OR (iii) TO A PERSON
WHO THE TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN
THE MEANING OF RULE 144A UNDER THE SECURITIES ACT WHO IS AWARE THAT THE RESALE
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A. NEITHER ALLEGIANCE
FUNDING I, LLC (THE "DEPOSITOR") NOR MANUFACTURERS AND TRADERS TRUST COMPANY, AS
TRUSTEE (THE "TRUSTEE"), IS OBLIGATED TO REGISTER THE CERTIFICATES UNDER THE
SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES LAWS. IN THE EVENT THAT A
TRANSFER OF A CLASS D-R CERTIFICATE IS TO BE MADE, THE PROSPECTIVE TRANSFEREE
SHALL DELIVER AN INVESTMENT AND ASSUMPTION LETTER IN THE FORM REQUIRED UNDER THE
TRUST AGREEMENT AND, IF THE TRUSTEE SO REQUESTS (IN A TRANSFER OTHER THAN UNDER
RULE 144A), AN OPINION OF COUNSEL TO THE EFFECT THAT SUCH TRANSFER MAY BE MADE
WITHOUT REGISTRATION UNDER THE SECURITIES ACT OR ANY APPLICABLE STATE SECURITIES
LAWS.
DUE TO THE PROVISIONS FOR FUNDINGS AND FOR THE PAYMENT OF PRINCIPAL CONTAINED
HEREIN, THE OUTSTANDING PRINCIPAL AMOUNT OF THIS CERTIFICATE ON ANY PARTICULAR
DATE MAY BE LESS THAN THE AMOUNT SHOWN ON THE FACE HEREOF. ANYONE PURCHASING
THIS CERTIFICATE MAY ASCERTAIN THE OUTSTANDING PRINCIPAL AMOUNT HEREOF BY
INQUIRY OF THE TRUSTEE.
No. D-R $
---- -------------
ALLEGIANCE CAPITAL TRUST I
AMENDED AND RESTATED CLASS D-R REVOLVING CERTIFICATE, SERIES 1998-1
Evidencing an undivided fractional interest in the Trust Estate, the property of
which includes, among other things, certain Loan Assets and monies on deposit in
the Collection Account.
(This Certificate does not represent an obligation of, or an
interest in, the Depositor, Allegiance Capital, LLC, the Trustee or
any of their respective affiliates or successors.)
Registered Owner:
---------------------------
D-1
DELIVERY DATE:
----- --, ----
SERIES TERMINATION DATE: July 15, 2019
THIS CERTIFIES THAT the registered owner specified above is the owner
of a(n) DOLLAR AND NO CENTS ($ ) nonassessable, fully paid,
---------- ----------
undivided fractional interest in the Allegiance Capital Trust I (the "Trust")
formed by Allegiance Funding Corp. I (the "Depositor"). The Trust was created
pursuant to the Trust Agreement, dated as of August 1, 1998, among the
Depositor, Manufacturers and Traders Trust Company, as Trustee (the "Trustee"),
and Point West Capital Corporation, as Servicer, and the Amended and Restated
Supplement to Trust Agreement for Revolving Series 1998-1, dated as of September
1, 1999 (amending and restating the original Supplement to Trust Agreement for
Revolving Series 1998-1, dated as of August 1, 1998), among the Depositor, the
Trustee and Point West Capital Corporation, as Servicer (collectively, the
"Trust Agreement"). Reference is made to the Trust Agreement for a statement of
the respective rights thereunder of the Depositor, the Trustee and the Holders
of the Certificates, and the terms upon which the Certificates are, and are to
be, authenticated and delivered. To the extent not otherwise defined herein,
each capitalized term used herein has the meaning assigned to it in the Trust
Agreement.
This Certificate is one of a duly authorized issue of Certificates
designated as the Amended and Restated Class D-R Revolving Certificates, Series
1998-1 having a scheduled maturity of April 17, 2000 and a Series Termination
Date of July 15, 2019 (herein called the "Class D-R Certificates") issued and to
be issued under the Trust Agreement. This Class D-R Certificate is issued under
and is subject to the terms, provisions and conditions of the Trust Agreement,
to which Trust Agreement the holder of this Class D-R Certificate by virtue of
such Holder's acceptance hereof assents and by which such Holder is bound.
The Holder of this Certificate is obligated to provide funds to the
Depositor on each Funding Date during the Funding Period subject to the
applicable terms and conditions set forth in the Transaction Documents. The
Fundings made by the Holder of this Certificate to the Depositor shall be
evidenced by this Certificate and the Certificateholder shall endorse on the
schedule annexed hereto and made a part hereof, or elsewhere in its internal
records, the date and amount of each Funding made by it to the Depositor and the
amount of each payment of principal made by the Depositor with respect thereto.
The Certificateholder is authorized and directed by the Depositor to endorse the
schedule attached hereto or maintain such records; provided that each
--------
Certificateholder's endorsements or records shall be effective only if they are
in agreement with the register maintained by the Trustee, absent manifest error
in such register. The failure of the Certificateholder to make, or an error in
making, a notation with respect to any Funding shall not limit or otherwise
affect the obligations of the Depositor hereunder or under the Trust Agreement.
The aggregate amount of all Fundings required to be made by the Holder of this
Certificate, shall be as set forth in the Revolving Funding Schedule.
Principal and other amounts distributable with respect to Class D-R
Certificates shall be payable only to the extent of amounts available in
accordance with, and to the extent of, the priorities for payment of Class D-R
Certificates set forth in Section 3 of the Supplement for this Series and
Section 5.02 of the Trust Agreement, in installments ending no later than the
Series Termination Date unless the Class D-R Certificates becomes due and
payable at an earlier date by call for redemption or otherwise. All reductions
in the principal amount of a Class D-R Certificate effected by distributions
made on any such Payment Date shall be binding upon all future Holders of this
Class D-R Certificate and of any Class D-R Certificate issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not such payment is noted on this Class D-R Certificate. All payments
with respect to all of the Class D-R Certificates of a Series shall be made on a
pro rata basis based upon the ratio that the Outstanding Principal Amount of
this Class D-R Certificate bears to the Outstanding Principal Amount of all
Class D-R Certificates of such Series;
D-2
provided that, if as a result of such proration a portion of such payment would
--------
be less than $0.01, then such payment shall be reduced to the nearest whole
cent.
In addition, the Certificate Prepayment Fee Amount, if any, shall be
distributed on each Payment Date to the Holders of the Class D-R Certificates to
the extent such Class is receiving a distribution of Prepaid Principal Amount on
such date. All payments of Certificate Prepayment Fee Amounts with respect to
the Class D-R Certificates shall be made prorata based upon the ratio of the
Outstanding Principal Amount of this Certificate to the Outstanding Principal
Amount of Class D-R Certificates of this Series, provided that if as a result of
such proration, a portion of such payment would be less than $0.01, then such
payment shall be reduce to the nearest whole cent.
All amounts payable with respect to this Class D-R Certificate on any
Payment Date will, as provided in the Trust Agreement, be paid to the Person in
whose name this Certificate is registered on the Record Date for such Payment
Date, which shall be the close of business on the last day of the month prior to
such Payment Date (whether or not a Business Day). Such amounts are payable by
wire transfer in immediately available funds to the account specified in writing
to the Trustee by the Person whose name appears as the Registered Holder of this
Certificate on the Certificate Register received at least five (5) Business Days
prior to the Record Date for the Payment Date (or if no such account is
specified or if such wire fails, by check mailed by first-class mail to the
Person whose name appears as the Registered Holder of this Certificate on the
Certificate Register at the address of such Person as it appears on the
Certificate Register), in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts. Funds represented by checks returned undelivered will be held for payment
to the Person entitled thereto, subject to the terms of the Trust Agreement, at
the office or agency in the United States of America designated as such by the
Depositor for such purpose pursuant to the Trust Agreement.
The Depositor has structured the Trust Agreement and the Certificates
with the intention that the Trust be treated as a partnership, with the assets
of the partnership including all of the assets of the Trust Estate and the
partners of the partnership being all of the Certificateholders and the
Depositor. The Depositor, the Trustee, the Servicer and each Certificateholder,
by acceptance of its Certificate (and any Person that is a beneficial owner of
any interest in a Certificate, by virtue of such Person's acquisition of a
beneficial interest therein), agree to report the transactions contemplated
thereby in accordance with such stated intentions unless and until determined to
the contrary by an applicable taxing authority.
The property of the Trust Estate includes certain Loan Assets and
certain other assets described in the Trust Agreement. The Class D-R
Certificates of the 1998-1 Series and all other Series of Class D-R Certificates
issued under the Trust Agreement are payable out of the Trust Estate pari passu
among such Class D-R Certificateholders equally and ratably without prejudice,
priority or distinction between any Class D-R Certificate by reason of time of
issue or otherwise. The Class D-R Certificates are payable only out of the Trust
Estate and do not represent recourse obligations of the Depositor, Allegiance
Capital, LLC or any of their respective affiliates or successors. The Trust
Agreement pursuant to which this Class D-R Certificate is issued also provides
for the issuance of other Classes and Series of Certificates from time to time.
Except as otherwise may be provided in future Supplements to the Trust
Agreement, payments on the Class D-R Certificates are subordinate to payments on
all other Classes of Certificates.
Unless the Depositor exercises its Optional Termination rights, the
Certificates are payable only at the time and in the manner provided in the
Trust Agreement and are not redeemable or prepayable at the option of the
Depositor before such time, except that the Depositor may cause the Trust to
prepay on a dollar for dollar basis the principal, without penalty or premium,
of any Outstanding Series of Revolving Certificates with the proceeds of the
issuance of a Series of Term Certificates.
D-3
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of this Certificate may be registered on the
Certificate Register of the Depositor upon surrender of this Certificate for
registration of transfer at the office or agency of the Depositor in the United
States of America maintained for such purpose, duly endorsed by, or accompanied
by a written instrument of transfer in form reasonably satisfactory to the
Depositor and the Trustee and duly executed by the holder hereof or his attorney
duly authorized in writing, and thereupon one or more new Class D-R Certificates
having the same Scheduled Maturity, Series Termination Date, authorized
denomination(s) and for the same initial aggregate principal amount will be
issued to the designated transferees.
Prior to due presentment for registration of transfer of this
Certificate, the Depositor, the Trustee and any agent of the Depositor or the
Trustee shall treat the Person in whose name this Certificate is registered as
the owner hereof for the purpose of receiving payment as herein provided and for
all other purposes whether or not this Certificate be overdue, and neither the
Depositor, the Trustee, nor any such agent shall be affected by notice to the
contrary.
The Holder of this Certificate, by acceptance of this Certificate,
agrees that for one year and one day after it has been paid hereunder, it or any
Affiliate thereof will not file any involuntary petition or otherwise institute
any bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or similar
law against the Depositor.
The Trust Agreement permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the rights of the Holders of the Certificates
under the Trust Agreement at any time by the Depositor, the Trustee and the
Servicer without the consent of the Holders of the Certificates.
The Certificates are issuable only in registered form without coupons
in such authorized denominations as provided in the Trust Agreement and subject
to certain limitations therein set forth.
This Class D-R Certificate and the Trust Agreement shall be governed by
and construed in accordance with the internal laws of the State of New York,
without regard to conflicts of laws principles.
No reference herein to the Trust Agreement and no provision of this
Class D-R Certificate or of the Trust Agreement shall alter or impair the
obligation of the Trust Estate to pay the principal of and interest on this
Class D-R Certificate, but solely from the assets of the Trust Estate and the
Class D-R Certificate Insurance Policy at the times, place and rate, and in the
coin or currency, herein prescribed.
D-4
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this
instrument to be signed, manually, by the President or a Vice President of its
Manager, Allegiance Management Corp.
ALLEGIANCE FUNDING I, LLC
By: Allegiance Management Corp.,
as Manager
By:
------------------------------
Title:
------------------------------
CERTIFICATE OF AUTHENTICATION
This is one of the Class D-R Certificates described in the
within-mentioned Trust Agreement.
Dated:
-------------------------------------
MANUFACTURERS AND TRADERS TRUST
COMPANY, as Trustee
By:
--------------------------------------
Authorized Signatory
Schedule to Class D-R Term Certificates, Series 1998-1
Disbursement
Date of Amount of Principal
Funding Funding Payment &
Date Paid
-------------------------------------------------------------------------------