Document:

Exhibit 10.26 Third Ameded and Erstated Supp to Trust AA 98-1

THIRD AMENDED AND RESTATED

SUPPLEMENT TO

TRUST AGREEMENT

FOR

REVOLVING SERIES 1998-1

                   
This Third 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 April
14, 2000, 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.
This Supplement further amends and restates in its entirety the Second Amended and
Restated Supplement to Trust Agreement for Revolving Series 1998-1, dated as of September
15, 1999 (the "Second Amended and Restated Supplement"), among such parties.

                   
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
consists 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. By the Second Amended and Restated Supplement, the Depositor issued
an additional Class of 98-1 Revolving Certificates, designated as the Class C2-R Revolving
Certificates, Series 1998-1 (the "98-1 C2-R Certificates") and authorized the
redesignation of the 98-1 Class C-R Certificates as the Class C1-R Revolving Certificates
, Series 1998-1 (the "98-1 C1-R Certificates"). This Series of Certificates has
been designated as a "Revolving Series" under the Trust Agreement. The Class A-R
Certificates, Class B-R Certificates, Class C1-R Certificates and Class C2-R Certificates
have initial credit ratings from the Rating Agency of A, BBB, BB and B, 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.

           
"Applicable Rate Spread": For each of the Class A-R, Class B-R, Class C1-R and
Class C2-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; 2.05% per annum
                                   
      for Accrual Periods commencing on or after September 1, 1999 and before 

                                 
      April 14, 2000; and 2.10% per annum thereafter.

      Class B-R =        2.80% per annum

      Class C1-R =     5.50% per annum

      Class C2-R =     6.75% per annum

      1

    

  

                   
"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 the Maximum Interest Rate; (b) for
the Class B-R, C1-R and C2-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.

                   
"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 C1-R Certificate": Any Certificate of this Series designated as a
Class C1-R Certificate, substantially in the form attached hereto as Exhibit C-1, and
which is Outstanding as of any date.

                   
"Class C2-R Certificate": Any Certificate of this Series designated as a
Class C2-R Certificate, substantially in the form attached hereto as Exhibit C-2, 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": April 14, 2000. 

                   
"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

        2

      

    

  

 

                   
"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 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 Certificates, the Minimum Funding Amount for the Class A-R Certificates
shall be $100,000.

3

                   
"Non-Usage Fee": With respect to each Accrual Period through the Funding
Termination Date, an amount, payable to Warehouse Line Advisors, Inc. 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, Class C1-R and C2-R Certificates in this Series and the
average Outstanding Principal Amount of all Class A-R, B-R, Class C1-R and C2-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. 

                   
"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, November 30, 2000; and (b) with respect to the Class B-R, Class C1-R and
Class C2-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, Class C1-R or Class C2-R Certificate to March 31, 2000.

                   
"Scheduled Maturity": With respect to any Class A-R, Class B-R , Class C1-R or
Class C2-R Certificate, December 15, 2000. 

                   
"Series Termination Date": For each of the Class A-R, Class B-R, Class C1-R,
Class C2-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 C1-R = July 15, 2019

          Class C2-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 the Class B-R, Class C1-R and Class C2-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. 

4

 

Section 2. Sequence for Fundings.

            (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, 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 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.

            (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 17, 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.

                   
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 first (i) on all outstanding Class
C1-R Certificates of this Series and any overdue interest thereon and then (ii) on all
outstanding Class C2-R Certificates of this Series and any overdue interest thereon;

            (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;

5

 

            (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 C1-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;

            (i)
to the extent of any remaining Series Collections, to pay to the Class C2-R
Certificateholders of this Series an amount equal to the Principal Distribution Amount
allocable this Series (and not already distributed pursuant to clauses (f), (g) and (h)
above), to be applied to the payment of the Outstanding Principal Amount of such
Certificates until such Outstanding Principal Amount is repaid in full;

            (j)
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;

            (k)
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;

            (l)
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

            (m)
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 and Minimum Funding Amounts.

            (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 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, Class C1-R and Class C2-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 

6

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 September 21, 1999, 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 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.

                   
Notwithstanding the definition of Certificate Interest Rate set forth above, if any
Class A-R, Class B-R, Class C1-R or Class C2-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.

                   
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.

                   
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

                   
The Certificates of this Series shall be issuable without minimum denominations. 

Section 9. Distribution In-Kind.

                   
By executing this Supplement (including the related Certificateholder consent) all parties
acknowledge and approve the distribution in-kind by the Trustee to the Holder of the 98-1
Class D-R Certificate of all right, title and interest in and to Loan # 1002A1 and any
Loan Assets related to such Loan in lieu of a portion of the cash prepayment
otherwise being made to such Holder as of September 21, 1999. 

7

 

The in kind distribution shall be credited against the cash prepayment
due to such Holder in an amount equal to the unpaid principal balance of such Loan, as
shown on the Repurchase Price Calculation Statement included in the Servicer Report dated
September 13, 1999. The Trustee is hereby directed to execute and deliver all assignments,
note endorsements and other documentation necessary to effectuate such distribution in
kind.

Section 10. Precondition to Fundings.

                   
On or before each date for the first Funding by the Holders of a Class of Rated
Certificates in this Series, the Depositor shall provide written confirmation from the
Rating Agency of the initial rating on the all of the Rated Certificates in this Series.

Section 11. References to Class C-R Certificates; General Provisions.

                   
The amendments made pursuant to this Third Amended and Restated Supplement shall be
effective as of the Effective Date. All references herein or in any other Transaction
Document (including any Purchase Agreement) to the 98-1 Class C-R Certificates shall, at
all times on and after September 21, 1999, be deemed to refer to the 98-1 Class C1-R
Certificates and 98-1 Class C2-R Certificates. 

                   
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.

                   
The 98-1 Certificates shall be deemed amended according to the terms of this Third Amended
and Restated Supplement. In the event that any term or provision contained herein shall
conflict with or be inconsistent with any term or provision contained in the existing 98-1
Certificates, the terms and conditions of this Third Amended and Restated Supplement shall
be controlling. The holders of the 98-1 Certificates shall not be required to exchange
their existing Certificates for amended Certificates. 

                   
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 1 llc, , as
    the Depositer

	
	By:
              ALLEGIANCE MANAGEMENT CORP., As
    Manager
	By:
             /s/ M.W. McDermitt
	

    
	Name:    M.W. McDermitt
	Title:        Vice
    President & Secertary

 

	MANUFACTURERE AND TRADERS TRUST
    COMPANY, as the Trustee

	
	By:
              /s/ Russell T. Whitley
	

    
	Name:     Russell T. Whitley
	Title:
            Assitant Vice President

 

	POINT WEST CAPITAL CORPORATION,
      as the Servicer

	
	By:
             /s/ John W. Rotter
	

    
	Name:    John Ward Rotter
	Title:        CFO

Consented and Agreed: 

Each of the Certificateholders authorizes and directs the Trustee to execute the
foregoing.

 

	TICE & CO., as registered
    owner of the 

	Class A-R Certificates
	
	By:
             /s/  Brian D. Hunt

	

    
	Its::   
          Partner
	Date:       
    4/13/00

 

	TICE & CO., as registered
    owner of the 

	Class B-R Certificates
	
	By:
             /s/  Brian D. Hunt

	

    
	Its::   
          Manager
	Date:       
    4/13/00

 

	TICE & CO., as registered
    owner of the 

	Class C-R Certificates
	
	By:
             /s/  Brian D. Hunt

	

    
	Its::   
          Manager
	Date:       
    4/13/00

 

 

EXHIBIT A

 

FORM OF AMENDED AND RESTATED CLASS A-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 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 _____
                                                                                                                                                                     
% of Class ____

 

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 an 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 Second Amended and Restated Supplement to Trust
Agreement for Revolving Series 1998-1, dated as of September 15, 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 Certificate is not paid in full by its Scheduled
Maturity, then, for any Accrual Period 

A-2

commencing on or after such Scheduled Maturity, the Certificate
Interest Rate 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
generally 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 or Funding 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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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 

A-4

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 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 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 Amended Class A-R Revolving 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 _____
                                                                                                                                                                     
% of Class ____

 

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 an 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 Second Amended and Restated Supplement to Trust
Agreement for Revolving Series 1998-1, dated as of September 15, 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 Certificate is not paid in full by its Scheduled
Maturity, then, for any Accrual Period 

B-2

commencing on or after such Scheduled Maturity, the Certificate
Interest Rate 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
generally 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 or Funding 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 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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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 

B-4

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 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 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 Amended Class B-R Revolving Certificates, Series 1998-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

 

EXHIBIT C-1

 

FORM OF AMENDED AND RESTATED CLASS C1-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 C1-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. C1-R _____
                                                                                                                                                                     
% of Class ____

 

ALLEGIANCE CAPITAL TRUST I

AMENDED AND RESTATED CLASS C1-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:                                               
            

             

            C1-1

             

             

          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                            
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an 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 Second Amended and Restated Supplement to Trust
Agreement for Revolving Series 1998-1, dated as of September 15, 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 C1-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 C1-R Certificates") issued and to be issued under
the Trust Agreement. This Class C1-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 C1-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 C1-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 C1-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 Certificate is not paid in full by its Scheduled
Maturity, then, for any Accrual Period 

C1-2

commencing on or after such Scheduled Maturity, the Certificate
Interest Rate 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 C1-R Certificate shall be payable in installments ending
no later than the Series Termination Date unless this Class C1-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 C1-R Certificate effected by payments of installments
of principal made on any Payment Date shall be binding upon all future Holders of this
Class C1-R Certificate and of any Class C1-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 C1-R Certificate. Each installment of principal
payable on this Class C1-R Certificate shall be in an amount equal to this
Certificateholder's pro rata share of the Class C1-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 C1-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 C1-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 C1-R Certificate bears to the Outstanding
Principal Amount of all Class C1-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 C1-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 C1-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 C1-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 

C1-3

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 C1-R Certificates of the 1998-1 Series
and all other Series of Class C1-R Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class C1-R
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class C1-R Certificate by reason of time of issue or otherwise. The
Class C1-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 C1-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 C1-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 C1-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 or Funding 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 C1-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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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 

C1-4

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 C1-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 C1-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 C1-R Certificate, but
solely from the assets of the Trust Estate at the times, place and rate, and in the coin
or currency, herein prescribed.

C1-5

 

                   
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 C1-R Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class C1-R Revolving Certificates, Series 1998-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

EXHIBIT C-2

 

FORM OF AMENDED AND RESTATED CLASS C2-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 C2-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. C2-R _____
                                                                                                                                                                     
% of Class ____

 

ALLEGIANCE CAPITAL TRUST I

AMENDED AND RESTATED CLASS C2-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:                                               
            

             

            C2-1

             

             

          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                            
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an 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 Second Amended and Restated Supplement to Trust
Agreement for Revolving Series 1998-1, dated as of September 15, 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 C2-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 C2-R Certificates") issued and to be issued under
the Trust Agreement. This Class C2-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 C2-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 C2-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 C2-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 Certificate is not paid in full by its Scheduled
Maturity, then, for any Accrual Period 

C2-2

commencing on or after such Scheduled Maturity, the Certificate
Interest Rate 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 C2-R Certificate shall be payable in installments ending
no later than the Series Termination Date unless this Class C2-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 C2-R Certificate effected by payments of installments
of principal made on any Payment Date shall be binding upon all future Holders of this
Class C2-R Certificate and of any Class C2-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 C2-R Certificate. Each installment of principal
payable on this Class C2-R Certificate shall be in an amount equal to this
Certificateholder's pro rata share of the Class C2-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 C2-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 C2-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 C2-R Certificate bears to the Outstanding
Principal Amount of all Class C2-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 C2-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 C2-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 C2-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 

C2-3

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 C2-R Certificates of the 1998-1 Series
and all other Series of Class C2-R Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class C2-R
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class C2-R Certificate by reason of time of issue or otherwise. The
Class C2-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 C2-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 C2-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 C2-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 or Funding 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 C2-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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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 

C2-4

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 C2-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 C2-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 C2-R Certificate, but
solely from the assets of the Trust Estate at the times, place and rate, and in the coin
or currency, herein prescribed.

C2-5

 

                   
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 C2-R Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class C2-R Revolving 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 _____
                                                                                                                                                                                 
% of Class ____

 

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 an 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 Second Amended and Restated Supplement to Trust
Agreement for Revolving Series 1998-1, dated as of September 15, 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
generally 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

D-3

 

for dollar basis the principal, without penalty or premium, of any
Outstanding Series of Revolving Certificates with the proceeds of the issuance or Funding
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 D-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; provided
that 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. 

                   
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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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 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 Amended Class D-R Revolving Certificates, Series 1998-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paidExhibit 10.27 Amended and Restated Supp to Trust AA 99-1

AMENDED AND RESTATED SUPPLEMENT TO

TRUST AGREEMENT

FOR

TERM SERIES 1999-1

                   
This Amended and Restated Supplement to Trust Agreement for Term Series 1999-1 (as amended
or modified from time to time, this "Supplement"), dated as of April 14, 2000,
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, 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.
This Supplement amends and restates in its entirety the Supplement to Trust Agreement for
Term Series 1999-1, dated as of September 15, 1999 (the "Prior Supplement"),
among such parties.

                   
The Depositor duly authorized the execution and delivery of the Prior Supplement to
provide for the issuance of the Allegiance Capital Trust I Term Certificates, Series
1999-1 (the "99-1 Term Certificates"), which consists of the Class A
Certificates, Series 1999-1(the "Class A Certificates"), Class B
Certificates, Series 1999-1 (the "Class B Certificates"), Class C
Certificates, Series 1999-1 (the "Class C Certificates"), Class D
Certificates, Series 1999-1 (the "Class D Certificates"), Class E
Certificates, Series 1999-1 (the "Class E Certificates"), Class F
Certificates, Series 1999-1 (the "Class F Certificates"), and Class R
Certificates, Series 1999-1 (the "Class R Certificates") with no aggregate
principal amount, each issuable as provided in the Trust Agreement. This Series of
Certificates has been designated as a "Term Series" under the Trust Agreement.
The Class A Certificates, Class B Certificates, Class C Certificates,
Class D Certificates and Class E Certificates have initial credit ratings from
the Rating Agency of AA, A, BBB, BB and B, respectively, and the Class F and Class R
Certificates are not rated. 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.

                   
"Applicable Rate Spread": For each of the Class A, Class B,
Class C, Class D, Class E, Class F and Class R Certificates within this
Series, the amount specified below:

  
    
      
        Class A =         2.00%
        per annum for Funding Amounts funded by this Class prior to April 14, 2000; and
                                 
        2.05% per annum for Funding Amounts funded by this Class thereafter;

        Class B =         2.35% per annum for Funding
        Amounts funded by this Class prior to April 14, 2000; and
                                 
        2.40% per annum for Funding Amounts funded by this Class thereafter;

        Class C =         3.50% per annum

        Class D =         7.50% per annum

        Class E =         8.50% per annum

        Class F =         0.0% per annum

        Class R =         0.0% per annum

      

    

  

                   
"Blended Interest Rate": means for each Class of Certificates other than the
Class F and the Class R Certificates, a per annum interest rate determined as of each Term
Reset Date equal to the weighted 

1

average of (i) the Certificate Interest Rate as in effect on the day
prior to such Term Reset Date and (ii) the Treasury Rate determined as of such Term Reset
Date plus the Applicable Rate Spread, if any, for such Class. Such weighted average shall
be weighted by reference to the Outstanding Principal Amount of such Class as of such Term
Reset Date as compared to the increase in the Outstanding Principal Amount of such Class
taking effect on the related Term Funding Date.

                   
"Certificate Interest Rate": With respect to (i) the Class A, Class B,
Class C, Class D and Class E Certificates (other than a Sub-Class), (A) for
Accrual Periods commencing prior to the first Term Funding Date after the Delivery Date, a
per annum rate equal to the Initial Certificate Interest Rate for such Class and (B) for
Accrual Periods commencing on or after such Term Funding Date, a per annum rate equal to
the Blended Interest Rate for such Class; (ii) with respect to any Sub-Class of
Certificates, the applicable Sub-Class Interest Rate and (iii) with respect to the Class F
Certificates, the Class F Interest Rate.

                   
"Class A Certificate": Any Certificate of this Series designated as a
Class A Certificate or Class A-FL Certificate, substantially in the form attached
hereto as Exhibit A, and which is Outstanding as of any date.

                   
"Class B Certificate": Any Certificate of this Series designated as a
Class B Certificate or Class B-FL Certificate, substantially in the form attached
hereto as Exhibit B, and which is Outstanding as of any date.

                   
"Class C Certificate": Any Certificate of this Series designated as a
Class C Certificate, substantially in the form attached hereto as Exhibit C, and
which is Outstanding as of any date.

                   
"Class D Certificate": Any Certificate of this Series designated as a
Class D Certificate, substantially in the form attached hereto as Exhibit D, and
which is Outstanding as of any date.

                   
"Class E Certificate": Any Certificate of this Series designated as a
Class E Certificate, substantially in the form attached hereto as Exhibit E, and
which is Outstanding as of any date.

                   
"Class F Certificate": Any Certificate of this Series designated as a
Class F Certificate, substantially in the form attached hereto as Exhibit F, and
which is Outstanding as of any date.

                   
"Class F Interest Rate": means a per annum rate equal to 17.5%.

                   
"Class R Certificate": Any Certificate of this Series designated as a
Class R Certificate, substantially in the form attached hereto as Exhibit G, and
which is Outstanding as of any date.

                   
"Class Commitment Percentage:" With respect to each Class, the meaning set forth
in the Purchase Agreement applicable to this Series.

                   
"Delivery Date": September 21, 1999.

                   
"Funding Termination Event": The cumulative Funding of Series 99-1 Term
Certificates having an aggregate original principal amount of $60,000,045. 

                   
"Initial Certificate Interest Rate": The amount specified below for each Class
of Certificates in this Series: 

  
    
      
        Class A =         7.250%

        2

         

        Class B =         7.490%

        Class C =         8.510%

        Class D =         13.050%

        Class E =         13.290%

        Class F =         17.500%

      

    

  

                   
"Initial Funding Amount": The amount specified below for each Class of
Certificates in this Series: 

  
    
      
        Class A =     $17,750,000.00 

        Class B =     $ 1,775,000.00 

        Class C =     $ 2,045,000.00 

        Class D =     $ 1,775,000.00

        Class E =     $ 1,290,000.00

        Class F =     $ 2,673,529.24

        Class R =     $ 0.00

      

    

  

                   
"Initial Payment Date": October 15, 1999. 

                   
"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 Term 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 Term Reset Date.

    (b) If such rate does not appear on Telerate Page 3750 or Bloomberg
    MMR2, the rate for such Term Reset Date will be determined on the basis of the rates at
    which deposits in U.S. Dollars are offered 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 Term Reset Date. The Servicer will request the principal
    London office of each of the Reference Banks to provide such a quotation. If, on any Term
    Reset Date: (i) at least two Reference Banks provide quotations when requested, the
    LIBOR Rate for such Term 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 Term Reset Date for loans to leading European banks in U.S. Dollars for a period of
    one month commencing on that Term Reset Date.

    (c) If, on any Term Reset Date, the LIBOR Rate cannot be calculated
    pursuant to one of the above methods, the LIBOR Rate for such Term Reset Date shall be the
    rate as most recently determinable under such methods.

  

                   
"Maximum Series Amount": $60,000,045, allocated to each Class (or
Sub-Class) of Certificates in this Series as provided on the Term Funding Schedule.

                   
"Minimum Funding Amount": Fifteen million dollars ($15,000,000), to be funded
among the various Classes Outstanding in accordance with their relative Maximum Series
Amounts; or, with respect to the final issuance of Term Certificates hereunder, such
smaller amount necessary to reach the Maximum Series Amount.

3

 

                   
"Pro Rata Share": With respect to (i) a Class of Certificates in this Series, a
fraction, expressed as a percentage, the numerator of which is the aggregate Outstanding
Principal Amount of such Class, and the denominator of which is the Series Principal
Amount; and (ii) a Certificate or Certificateholder within a Class, a fraction, expressed
as a percentage, the numerator of which is the Outstanding Principal Amount of such
Certificate, and the denominator of which is the Outstanding Principal Amount of all
Certificates in the Class.

                   
"Scheduled Funding Termination Date": December 15, 2000. 

                   
"Series Distributable Amount": As defined in Section 8 hereof.

                   
"Series Termination Date": For each of the Class A, Class B,
Class C, Class D, Class E, Class F and Class R Certificates in this
Series, the date specified below:

  
    
      
        Class A =     July 15, 2019

        Class B =     July 15, 2019

        Class C =     July 15, 2019

        Class D =     July 15, 2019

        Class E =     July 15, 2019

        Class F =     July 15, 2019

        Class R =     July 15, 2019

      

    

  

                   
"Sub-Class": A Class A or Class B Certificate designated to accrue interest at a
floating rate in accordance with Section 4 hereof.

                   
"Sub-Class Interest Rate": For each Sub-Class, a per annum rate equal to the
LIBOR Rate as of the Term Reset Date plus the Applicable Rate Spread less 0.25%, or as
otherwise set forth on the Term Funding Schedule delivered to the Trustee in connection
with the designation and Funding of such Sub-Class pursuant to Section 4 hereof. 

                   
"Term Funding Date": Any Funding Date on which the Depositor obtains a Funding
under the 99-1 Term Certificates. 

"Term Funding Schedule": The schedule attached hereto as
Schedule A, as supplemented from time to time pursuant to Section 6 hereof and delivered
with a Funding Report related to a Term Funding Date. Such Term Funding Schedule, as
amended from time to time, is incorporated herein by this reference. 

                   
"Term Reset Date": With respect to the Blended Rate, the second Business Day
preceding a Term Funding Date.

                   
"Transaction Documents Date": Unless otherwise, indicated as of September 1,
1999.

                   
"Treasury Rate": As determined on each Term Reset Date with respect to each
Class of Certificates of this Series (other than the class F and Class R Certificates), a
per annum rate equal to the bond equivalent yield on actively traded U.S. government
securities with a maturity that most closely corresponds to the weighted average life of
the Loans 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 Term Reset Date, or in the event no such nationally recognized trading screen is
available, the arithmetic mean of the yields for the applicable two columns under the
heading "Week Ending" published in the Federal Reserve H.15 Statistical Release 

4

under the caption "Treasury Constant Maturities" for
maturities that most closely correspond to the weighted average life of such Class.

Section 2.        
Clarification of Provisions in Trust Agreement as they Relate to this Series. 

            (a)
For all purposes of the Trust Agreement and any Supplement thereto, the term Class D
Percentage shall be deemed to refer to the Class F Certificates of this Series and not the
Class D Certificates of this Series.

            (b)
Notwithstanding Section 5.03(d)(ii) of the Trust Agreement, so long as any Class of
Certificates in this Series remains Outstanding, any excess funds that would otherwise be
released from the Reserve Account pursuant to such Section shall instead be distributed as
follows:

  
    
      (i) first to the Depositor, to the extent of any unreimbursed deposits
      made by it pursuant to any Series Supplement; and 

      (ii) second to the Holders of the Class F Certificates, to the extent
      of any overdue interest owing with respect to such
                Class;

      (iii) third, to the Holders of the Class R Certificates of any Term
      Series then Outstanding and if no such Certificates are
                then Outstanding, to the Depositor.

    

  

Section 3.
               
Class R Certificates.

The Class R Certificates shall be entitled to receive distributions as
provided in Section 8 hereof, along with (a) amounts released from the Reserve Account to
the extent provided in Section 5.03(d) of the Trust Agreement (as modified by Section 2 of
this Supplement) and (b) Prepayment Fee Collections to the extent provided in Section
5.01(f)(v) of the Trust Agreement. 

Section 3.
               
Procedures for Obtaining Fundings.

            (a) Conditions
Precedent. Each Funding under this Series is subject to the satisfaction of the
following conditions precedent on the relevant date specified below:

  
    
      (i) fifteen (15) days prior to the Term Funding Date (or such shorter
      period of time as may be agreed to by the Certificateholder Agent in its sole discretion),
      the Depositor shall deliver to the Certificateholder Agent and the Certificateholders of
      this Series a draft Funding Report indicating the amount of the Funding (which shall be
      within a 5% plus or minus variance, except in connection with the final Funding under this
      Series) and including any proposed changes to the Term Funding Schedule;

      (ii) five (5) Business Days prior to the requested Term Funding Date
      the Depositor shall deliver to the Certificateholder Agent, the Certificateholders of this
      Series and the Trustee the final Funding Report, the Term Funding Schedule, and an
      executed AFI Certificate substantially in the form attached hereto as Exhibit I; 

      (iii) (A) after giving effect to such Funding, the applicable
      Maximum Series Amount shall not be exceeded and (B) the Depositor shall use the proceeds
      of such Funding to repay the 98-1 Revolving Certificates; 

      5

       

    

    
      (iv) such Funding shall occur on a date prior to the applicable Funding
      Termination Date and shall be at least equal to the Minimum Funding Amount for this Series
      when aggregated with any amounts to be funded on such Term Funding Date under subsection
      (a) above; 

      (v) after giving effect to such Funding, there shall not have been more
      than four (4) Fundings under this Series; 

      (vi) no Default (other than a Servicing Advisor Default), Depositor
      Event of Default, Servicer Event of Default, Special Servicer Event of Default or
      Servicing Advisor Event of Default shall exist or shall result from the Funding;

      (vii) both before and after giving effect to such Funding, the Pool
      Performance Condition shall be met; and

      (viii) such other conditions as may be specified in the related
      Certificate Purchase Agreements.

    

  

            (b) Preparation
of Funding Report. In connection with each Funding under this Series, the Depositor
shall prepare the Funding Report, including the Term Funding Schedule, and shall calculate
the Certificate Interest Rate that will be in effect after such Funding. Each Funding
Report together with the applicable Term Funding Schedule shall be countersigned by the
Certificateholder Agent to evidence its approval of the contents thereof.

Section 5.
             Floating Rate
Sub-Classes.

            (a)
With respect to any Funding made under this Series after the Series Principal Amount
equals at least $30,000,000, and subject to certain conditions specified in the
Certificate Purchase Agreement for this Series, the Depositor may designate all or a
portion of the Funding Amount to be funded by the Class A or Class B Certificates on such
date as a Sub-Class that accrues interest based on the LIBOR Rate. Notwithstanding the
foregoing, the cumulative amount of such Fundings that may be designated as a Sub-Class
shall not exceed $10,000,000 without the prior written consent of the Certificateholder
Agent. The Depositor shall make such Sub-Class designation in the Term Funding Schedule
delivered with the Funding Report applicable to such Term Funding Date and shall include
in such Term Funding Schedule the Sub-Class Interest Rate applicable to such Sub-Class.
Any such Sub-Class shall accrue interest at the interest rate set forth on such schedule
and shall be paid principal and interest pari passu with its corresponding Class of 99-1
Term Certificates.

            (b)
Certificates evidencing a Sub-Class shall be issued by the Depositor and authenticated by
the Trustee in connection with the initial Funding of any Sub-Class hereunder.

            (c)
On or before the date for initial issuance of any Sub-Class, the Depositor shall provide
confirmation from the Rating Agency of the initial rating on each Class of Rated
Certificates in any Series then Outstanding, including such Sub-Class.

Section 6.
            Adjustments to Term
Funding Schedule and Sharing of Fundings.

                   
As of the Delivery Date, the Term Funding Schedule is as set forth on Schedule A hereto. A
revised Term Funding Schedule shall be included with each Funding Report delivered in
connection with a Term Funding Date from time to time thereafter and a draft revised Term
Funding Schedule shall be included with the draft Funding Report prepared in connection
with such Term Funding Date. Each such Term Funding 

6

Schedule shall specify the dollar amount that each Class (or Sub-Class)
of this Series shall fund in connection with the related Funding. Each Certificateholder
within a Class (or Sub-Class) shall fund in the aggregate its Class Commitment Percentage
of each Funding Amount allocable to such Class (or Sub-Class).

Section 7.
            Calculation of Rates.

                   
On the Term Reset Date preceding each Term Funding Date, the Servicer shall calculate, and
the Certificateholder Agent shall approve in writing, the Blended Interest Rate (and the
components thereof) for each Class of Certificates that will take effect as of such Term
Funding Date, and notify the Certificateholder Agent and the Trustee in writing of the
rates or other amounts determined with respect to each such calculation. If a Term Funding
Date occurs in the middle of an Accrual Period, for purposes of determining the
Certificate Interest Rate, the Accrual Period for the portion of the 99-1 Term
Certificates so funded shall be deemed to commence on such Term Funding Date.

Section 8.     Distributions.

           
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 (the "Series Distributable Amount") 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); provided, however, that all Recovery
Proceeds, if any, included in the Series Distributable Amount shall be treated as
Principal Collections for purposes hereof:

             
(a)     to the extent of the Series Distributable Amount not attributable
to the Series Percentage of Principal Collections, to pay the interest accrued as of that
Payment Date on all outstanding Class A Certificates of this Series and any overdue
interest;

             
(b)     to the extent of the Series Distributable Amount not attributable
to the Series Percentage of Principal Collections, to pay the interest accrued as of that
Payment Date on all outstanding Class B Certificates of this Series and any overdue
interest;

             
(c)     to the extent of the Series Distributable Amount not attributable
to the Series Percentage of Principal Collections, to pay the interest accrued as of that
Payment Date on all outstanding Class C Certificates of this Series and any overdue
interest;

             
(d)     to the extent of the Series Distributable Amount not attributable
to the Series Percentage of Principal Collections, to pay the interest accrued as of that
Payment Date on all outstanding Class D Certificates of this Series and any overdue
interest;

             
(e)     to the extent of the Series Distributable Amount are not
attributable to the Series Percentage of Principal Collections, to pay the interest
accrued as of that Payment Date on all outstanding Class E Certificates of this
Series and any overdue interest;

             
(f)     to the extent of the Series Percentage of any Interest Collections
in excess of Scheduled Expenses and amounts distributed pursuant to clauses (a) - (e)
above, to (i) 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 and then (ii) pay interest accrued as of that Payment Date on all
outstanding Class F Certificates of this Series; 

7

 

             
(g)     to the extent of any remaining Series Collections, to pay to the
Class A Certificateholders, including any related Sub-Class Certificateholders, of
this Series (i) an amount equal to its Pro Rata Share of 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, provided,
however, that on any Payment Date on which the Pool Performance Condition is not met, to
pay to the Class A Certificateholders, including any related Sub-Class Certificateholders,
of this Series any remaining Series Collections to be applied to the payment of the
Outstanding Principal Amount of such Certificates until such Outstanding Principal Amount
is repaid in full and (ii) any remaining overdue interest; 

             
(h)     to the extent of any remaining Series Collections, to pay to the
Class B Certificateholders, including any related Sub-Class Certificateholders, of
this Series (i) an amount equal to its Pro Rata Share of 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, provided,
however, that on any Payment Date on which the Pool Performance Condition is not met, to
pay to the Class B Certificateholders, including any related Sub-Class Certificateholders,
of this Series any remaining Series Collections to be applied to the payment of the
Outstanding Principal Amount of such Certificates until such Outstanding Principal Amount
is repaid in full and (ii) any remaining overdue interest; 

             
(i)     to the extent of any remaining Series Collections, to pay to the
Class C Certificateholders of this Series (i) an amount equal to its Pro Rata Share
of 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, provided, however, that on any Payment Date on which the Pool
Performance Condition is not met, to pay to the Class C Certificateholders of this Series
any remaining Series Collections to be applied to the payment of the Outstanding Principal
Amount of such Certificates until such Outstanding Principal Amount is repaid in full and
(ii) any remaining overdue interest; 

             
(j)     to the extent of any remaining Series Collections, to pay to the
Class D Certificateholders of this Series (i) an amount equal to its Pro Rata Share
of 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, provided, however, that on any Payment Date on which the Pool
Performance Condition is not met, to pay to the Class D Certificateholders of this Series
any remaining Series Collections to be applied to the payment of the Outstanding Principal
Amount of such Certificates until such Outstanding Principal Amount is repaid in full and
(ii) any remaining overdue interest; 

             
(k)     to the extent of any remaining Series Collections, to pay to the
Class E Certificateholders of this Series (i) an amount equal to its Pro Rata Share
of 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, provided, however, that on any Payment Date on which the Pool
Performance Condition is not met, to pay to the Class E Certificateholders of this Series
any remaining Series Collections to be applied to the payment of the Outstanding Principal
Amount of such Certificates until such Outstanding Principal Amount is repaid in full and
(ii) any remaining overdue interest; 

            
(l)      to pay to the Class F Certificateholders, any remaining
Principal Collections until such Outstanding Principal Amount is repaid in full; 

            
(m)      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;

8

 

             
(n)     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;

             
(o)     to pay to the Class F Certificateholders, any accrued but unpaid
interest (including overdue interest) and their remaining Pro Rata Share of the Principal
Distribution Amount not already paid above; and

             
(p)     to pay any and all remaining funds to the Class R
Certificateholders. 

Section 9.     Limitation of Transfer and
Exchange of Class F Certificates.

                   
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 F Certificates, unless otherwise agreed to in writing by the Controlling
Holders, which consent will not be unreasonably withheld if (i) the purpose of such
reduction in legal or beneficial ownership is to generate funds for reinvestment in the
business of the Depositor or Allegiance Capital, LLC and (ii) the making of such
investment is not materially adverse to the interests of the Certificateholders. 

Section 10.     Minimum Denominations.

                   
The Certificates of this Series shall be issuable without minimum denominations.

Section 11.     Distribution In-Kind.

                   
The parties hereto, by their execution of this Supplement, and the Holders of the 99-1
Term Certificates, by their execution of the Purchase Agreement, acknowledge and approve
the distribution in-kind by the Trustee to the Holder of the Class D-R Revolving
Certificate, Series 1998-1 of all right, title and interest in and to Loan # 1002A1 and
any Loan Assets related to such Loan in lieu of a portion of the cash prepayment
otherwise being made to such Holder as of the Delivery Date. The in kind distribution
shall be credited against the cash prepayment due to such Holder in an amount equal to the
unpaid principal balance of such Loan, as shown on the Repurchase Price Calculation
Statement included in the Servicer Report dated September 13, 1999. The Trustee is
hereby directed to execute and deliver all assignments, note endorsements and other
documentation necessary to effectuate such distribution in kind.

Section 12.     General Provisions.

                   
As 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.

                   
The 99-1 Certificates shall be deemed amended according to the terms of this Amended and
Restated Supplement. In the event that any term or provision contained herein shall
conflict with or be inconsistent with any term or provision contained in the existing 99-1
Certificates, the terms and conditions of this Amended and Restated Supplement shall be
controlling. The holders of the 99-1 Certificates shall not be required to exchange their
existing Certificates for amended Certificates. 

9

 

                   
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.

                   
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.

10

 

                   
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 1 llc, , as
    the Depositer

	
	By:
             /s/ M. W. McDermitt
	

    
	Name:    M. W. McDermitt
	Title:        Vice
    President & Secretary

 

	MANUFACTURERE AND TRADERS TRUST
    COMPANY, as the Trustee

	
	By:
              /s/ Russell T. Whitley
	

    
	Name:     Russell T. Whitley
	Title:
            Assitant Vice President

 

	POINT WEST CAPITAL CORPORATION,
      as the Servicer

	
	By:
             /s/ John Ward Rotter
	

    
	Name:    John Ward Rotter
	Title:        CFO

Consented and Agreed:

 

	PACIFIC LIFE INSURANCE COMPANY

	(Certificates held in the nominee name MAC &
    Co.
	
	By:
             /s/ Cathy Schwartz

	

    
	Its::   
          Assistant Vice President
	Date:        
	
	By:
            /s/ Audrey L. Milfs
	Its:
            Corporate Secretary
	Date:

 

	UNITED OF OMAHA LIFE INSURANCE 

	COMPANY
	
	By:
             /s/ Kent Knudsen

	

    
	Its::   
          Vice President
	Date:        

 

	NATIONWIDE LIFE INSURANCE 

	COMPANY
	
	By:
             /s/ Mark W. Poeppelman

	

    
	Its::   
          Associate Vice President
	Date:       
    4/13/2000

 

	LIBERTY LIFE
    INSURANCE COMPANY

	(Certificates held in the nominee
    name HARE & CO.)

	

	By:
             /s/ Adam Emerson

	

    

	Its::   
          Aurthorized Officer 

	Date:
           4/14/2000

 

	TICE & CO.

	

	

	By:
             /s/ Brian D. Hunt

	

    

	Its::   
          Partner

	Date:
           4/13/2000

 

 

EXHIBIT A

 

FORM OF CLASS A TERM 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 A 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 _____
                                                                                                                                                                                           
% of Class ___

 

ALLEGIANCE CAPITAL TRUST I

CLASS A TERM CERTIFICATE, SERIES 1999-1

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.)

A-1

 

  
    
      
        
          
            Registered Owner:                                    
            

            
          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                                
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an undivided
fractional interest in the Allegiance Capital Trust I (the "Trust") formed
by Allegiance Funding I, LLC (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 Supplement to Trust Agreement for Term Series 1999-1,
dated as of September 15, 1999, 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
Class A Term Certificates, Series 1999-1 having a Series Termination Date of July 15,
2019 (herein called the "Class A Certificates") issued and to be issued
under the Trust Agreement. This Class A 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 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 to be made by the Holder of this
Certificate shall be set forth in the Term Funding Schedule.

                   
This Class A 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 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 at the applicable Certificate Interest Rate. 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.

 

A-2

                   
The principal of this Class A Certificate shall be payable in installments ending no
later than the Series Termination Date unless this Class A 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 Certificate effected by payments of installments of
principal made on any Payment Date shall be binding upon all future Holders of this
Class A Certificate and of any Class A 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 Certificate. Each installment of principal payable on this
Class A Certificate shall be in an amount equal to this Certificateholder's
pro rata share of the Class A Principal Distribution Amount available to be paid
in accordance with the priorities of Section 8 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 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 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 Certificate bears to the Outstanding Principal Amount of all
Class A 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 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 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 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 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.

A-3

                   
The property of the Trust Estate includes certain Loan Assets and certain other assets
described in the Trust Agreement. The Class A Certificates of the 1999-1 Series and
all other Series of Class A Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class A
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class A Certificate by reason of time of issue or otherwise. The Class A
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
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 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 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.

                   
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
Certificates 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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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.

A-4

 

                   
This Class A 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
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 Certificate, but solely
from the assets of the Trust Estate 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 its President or a Vice President.

 

 

 

 

	ALLEGIANCE FUNDING I, LLC

	By: Allegiance Management Corp., as Manager

	By:

	Title:

 

 

 

CERTIFICATE OF AUTHENTICATION

 

                   
This is one of the Class A Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class A Term Certificates, Series 1999-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

 

EXHIBIT B

 

FORM OF CLASS B TERM 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 A 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 _____
                                                                                                                                                                                           
% of Class ___

 

ALLEGIANCE CAPITAL TRUST I

CLASS B TERM CERTIFICATE, SERIES 1999-1

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.)

B-1

 

  
    
      
        
          
            Registered Owner:                                    
            

            
          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                                
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an undivided
fractional interest in the Allegiance Capital Trust I (the "Trust") formed
by Allegiance Funding I, LLC (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 Supplement to Trust Agreement for Term Series 1999-1,
dated as of September 15, 1999, 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
Class B Term Certificates, Series 1999-1 having a Series Termination Date of July 15,
2019 (herein called the "Class B Certificates") issued and to be issued
under the Trust Agreement. This Class B 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 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 to be made by the Holder of this
Certificate shall be set forth in the Term Funding Schedule.

                   
This Class B 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 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 at the applicable Certificate Interest Rate. 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.

 

B-2

                   
The principal of this Class B Certificate shall be payable in installments ending no
later than the Series Termination Date unless this Class B 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 Certificate effected by payments of installments of
principal made on any Payment Date shall be binding upon all future Holders of this
Class B Certificate and of any Class B 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 Certificate. Each installment of principal payable on this
Class B Certificate shall be in an amount equal to this Certificateholder's
pro rata share of the Class B Principal Distribution Amount available to be paid
in accordance with the priorities of Section 8 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 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 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 Certificate bears to the Outstanding Principal Amount of all
Class B 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 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 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 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 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.

B-3

                   
The property of the Trust Estate includes certain Loan Assets and certain other assets
described in the Trust Agreement. The Class B Certificates of the 1999-1 Series and
all other Series of Class B Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class B
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class B Certificate by reason of time of issue or otherwise. The Class B
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
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 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 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.

                   
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
Certificates 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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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.

B-4

 

                   
This Class B 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
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 Certificate, but solely
from the assets of the Trust Estate 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 its President or a Vice President.

 

 

 

 

	ALLEGIANCE FUNDING I, LLC

	By: Allegiance Management Corp., as Manager

	By:

	Title:

 

 

 

CERTIFICATE OF AUTHENTICATION

 

                   
This is one of the Class B Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class B Term Certificates, Series 1999-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

 

EXHIBIT C

 

FORM OF CLASS C TERM 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 A 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 _____
                                                                                                                                                                                           
% of Class ___

 

ALLEGIANCE CAPITAL TRUST I

CLASS B TERM CERTIFICATE, SERIES 1999-1

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.)

C-1

 

  
    
      
        
          
            Registered Owner:                                    
            

            
          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                                
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an undivided
fractional interest in the Allegiance Capital Trust I (the "Trust") formed
by Allegiance Funding I, LLC (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 Supplement to Trust Agreement for Term Series 1999-1,
dated as of September 15, 1999, 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
Class C Term Certificates, Series 1999-1 having a Series Termination Date of July 15,
2019 (herein called the "Class C Certificates") issued and to be issued
under the Trust Agreement. This Class C 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 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 to be made by the Holder of this
Certificate shall be set forth in the Term Funding Schedule.

                   
This Class C 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 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 at the applicable Certificate Interest Rate. 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.

 

C-2

                   
The principal of this Class C Certificate shall be payable in installments ending no
later than the Series Termination Date unless this Class C 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 Certificate effected by payments of installments of
principal made on any Payment Date shall be binding upon all future Holders of this
Class C Certificate and of any Class C 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 Certificate. Each installment of principal payable on this
Class C Certificate shall be in an amount equal to this Certificateholder's
pro rata share of the Class C Principal Distribution Amount available to be paid
in accordance with the priorities of Section 8 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 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 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 Certificate bears to the Outstanding Principal Amount of all
Class C 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 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 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 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 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.

C-3

                   
The property of the Trust Estate includes certain Loan Assets and certain other assets
described in the Trust Agreement. The Class C Certificates of the 1999-1 Series and
all other Series of Class C Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class C
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class C Certificate by reason of time of issue or otherwise. The Class C
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
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 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 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.

                   
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
Certificates 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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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.

C-4

 

                   
This Class C 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
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 Certificate, but solely
from the assets of the Trust Estate 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 its President or a Vice President.

 

 

 

 

	ALLEGIANCE FUNDING I, LLC

	By: Allegiance Management Corp., as Manager

	By:

	Title:

 

 

 

CERTIFICATE OF AUTHENTICATION

 

                   
This is one of the Class C Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class C Term Certificates, Series 1999-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

EXHIBIT D

 

FORM OF CLASS D TERM 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 A 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 _____
                                                                                                                                                                                           
% of Class ___

 

ALLEGIANCE CAPITAL TRUST I

CLASS B TERM CERTIFICATE, SERIES 1999-1

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.)

D-1

 

  
    
      
        
          
            Registered Owner:                                    
            

            
          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                                
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an undivided
fractional interest in the Allegiance Capital Trust I (the "Trust") formed
by Allegiance Funding I, LLC (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 Supplement to Trust Agreement for Term Series 1999-1,
dated as of September 15, 1999, 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
Class D Term Certificates, Series 1999-1 having a Series Termination Date of July 15,
2019 (herein called the "Class D Certificates") issued and to be issued
under the Trust Agreement. This Class D 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 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 to be made by the Holder of this
Certificate shall be set forth in the Term Funding Schedule.

                   
This Class D 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 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 at the applicable Certificate Interest Rate. 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.

 

D-2

                   
The principal of this Class D Certificate shall be payable in installments ending no
later than the Series Termination Date unless this Class D Certificate becomes due
and payable at an earlier date by call for redemption or otherwise. All reductions in the
principal amount of a Class D Certificate effected by payments of installments of
principal made on any Payment Date shall be binding upon all future Holders of this
Class D Certificate and of any Class D 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 Certificate. Each installment of principal payable on this
Class D Certificate shall be in an amount equal to this Certificateholder's
pro rata share of the Class D Principal Distribution Amount available to be paid
in accordance with the priorities of Section 8 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 D 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 D Certificates of a Series
shall be made on a pro rata basis based upon the ratio that the Outstanding Principal
Amount of a Class D Certificate bears to the Outstanding Principal Amount of all
Class D 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 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 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 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 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.

D-3

                   
The property of the Trust Estate includes certain Loan Assets and certain other assets
described in the Trust Agreement. The Class D Certificates of the 1999-1 Series and
all other Series of Class D Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class D
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class D Certificate by reason of time of issue or otherwise. The Class D
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
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 D 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 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.

                   
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
Certificates 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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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.

D-4

 

                   
This Class D 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
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 Certificate, but solely
from the assets of the Trust Estate at the times, place and rate, and in the coin or
currency, herein prescribed.

 

D-5

 

                   
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this instrument to be signed,
manually, by its President or a Vice President.

 

 

 

 

	ALLEGIANCE FUNDING I, LLC

	By: Allegiance Management Corp., as Manager

	By:

	Title:

 

 

 

CERTIFICATE OF AUTHENTICATION

 

                   
This is one of the Class D Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class D Term Certificates, Series 1999-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

 

EXHIBIT E

 

FORM OF CLASS E TERM 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 A 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. E _____
                                                                                                                                                                                           
% of Class ___

 

ALLEGIANCE CAPITAL TRUST I

CLASS B TERM CERTIFICATE, SERIES 1999-1

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.)

E-1

 

  
    
      
        
          
            Registered Owner:                                    
            

            
          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                                
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an undivided
fractional interest in the Allegiance Capital Trust I (the "Trust") formed
by Allegiance Funding I, LLC (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 Supplement to Trust Agreement for Term Series 1999-1,
dated as of September 15, 1999, 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
Class E Term Certificates, Series 1999-1 having a Series Termination Date of July 15,
2019 (herein called the "Class E Certificates") issued and to be issued
under the Trust Agreement. This Class E 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 E 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 to be made by the Holder of this
Certificate shall be set forth in the Term Funding Schedule.

                   
This Class E 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 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 at the applicable Certificate Interest Rate. 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.

 

E-2

                   
The principal of this Class E Certificate shall be payable in installments ending no
later than the Series Termination Date unless this Class E Certificate becomes due
and payable at an earlier date by call for redemption or otherwise. All reductions in the
principal amount of a Class E Certificate effected by payments of installments of
principal made on any Payment Date shall be binding upon all future Holders of this
Class E Certificate and of any Class E 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 E Certificate. Each installment of principal payable on this
Class E Certificate shall be in an amount equal to this Certificateholder's
pro rata share of the Class E Principal Distribution Amount available to be paid
in accordance with the priorities of Section 8 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 E 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 E Certificates of a Series
shall be made on a pro rata basis based upon the ratio that the Outstanding Principal
Amount of a Class E Certificate bears to the Outstanding Principal Amount of all
Class E 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 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 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 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 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.

E-3

                   
The property of the Trust Estate includes certain Loan Assets and certain other assets
described in the Trust Agreement. The Class E Certificates of the 1999-1 Series and
all other Series of Class E Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class E
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class E Certificate by reason of time of issue or otherwise. The Class E
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 E
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 E 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 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.

                   
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 E
Certificates 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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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.

E-4

 

                   
This Class E 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 E
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 E Certificate, but solely
from the assets of the Trust Estate at the times, place and rate, and in the coin or
currency, herein prescribed.

 

E-5

 

                   
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this instrument to be signed,
manually, by its President or a Vice President.

 

 

 

 

	ALLEGIANCE FUNDING I, LLC

	By: Allegiance Management Corp., as Manager

	By:

	Title:

 

 

 

CERTIFICATE OF AUTHENTICATION

 

                   
This is one of the Class E Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class E Term Certificates, Series 1999-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

 

EXHIBIT F

 

FORM OF CLASS F TERM 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 F 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. F _____
                                                                                                                                                                                         
% of Class ___

 

ALLEGIANCE CAPITAL TRUST I

CLASS F TERM CERTIFICATE, SERIES 1999-1

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.)

 

F-1

 

  
    
      
        
          
            Registered Owner:                                          
            

             

          

        

      

    

  

DELIVERY DATE: ____ __, ____
                                                                                                            
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an undivided
fractional interest in the Allegiance Capital Trust I (the "Trust") formed
by Allegiance Funding I, LLC (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 Supplement to Trust Agreement for Term Series 1999-1,
dated as of September 15, 1999, 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
Class F Term Certificates, Series 1999-1 having a Series Termination Date of July 15,
2019 (herein called the "Class F Certificates") issued and to be issued
under the Trust Agreement. This Class F 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 F 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 to be made by the Holder of this
Certificate shall be set forth in the Term Funding Schedule.

                   
This Class F 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 F 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 at the applicable Certificate Interest Rate.
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.

F-2

 

                   
The principal of this Class F Certificate shall be payable in installments ending no
later than the Series Termination Date unless this Class F Certificate becomes due
and payable at an earlier date by call for redemption or otherwise. All reductions in the
principal amount of a Class F Certificate effected by payments of installments of
principal made on any Payment Date shall be binding upon all future Holders of this
Class F Certificate and of any Class F 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 F Certificate. Each installment of principal payable on this
Class F Certificate shall be in an amount equal to this Certificateholder's
pro rata share of the Class F Principal Distribution Amount available to be paid
in accordance with the priorities of Section 8 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 F 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 F Certificates of a Series
shall be made on a pro rata basis based upon the ratio that the Outstanding Principal
Amount of a Class F Certificate bears to the Outstanding Principal Amount of all
Class F 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 F 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 F
Certificates shall be made prorata based upon the ratio of the Outstanding Principal
Amount of this Certificate to the Outstanding Principal Amount of Class F
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. Certain amounts released from the Reserve Account are also payable to the
Holders of the Class F Certificates, generally to the extent of funds deposited therein
that would otherwise have been distributed to such Holders.

                   
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 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.

F-3

 

                   
The property of the Trust Estate includes certain Loan Assets and certain other assets
described in the Trust Agreement. The Class F Certificates of the 1999-1 Series and
all other Series of Class F Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class F
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class F Certificate by reason of time of issue or otherwise. The Class F
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 F
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 F 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 and to deposits to maintain the Reserve Account Required
Balance. Payments of principal in the Class F 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.

                   
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 F
Certificates of authorized denominations and for the same initial aggregate principal
amount will be issued to the designated transferees; provided that 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 F
Certificates, unless otherwise agreed to in writing by the Controlling Holders.

                   
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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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.

F-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 F 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 F
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 F Certificate, but solely
from the assets of the Trust Estate at the times, place and rate, and in the coin or
currency, herein prescribed.

F-5

 

                   
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this instrument to be signed,
manually, by its President or a Vice President.

 

 

 

	ALLEGIANCE FUNDING I, LLC

	By: Allegiance Management Corp., as Manager

	By:

	Title:

 

 

 

CERTIFICATE OF AUTHENTICATION

 

                   
This is one of the Class F Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class F Term Certificates, Series 1999-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

 

EXHIBIT G

 

FORM OF CLASS R TERM 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 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.

No. R _____
                                                                                                                                                                                           
% of Class ___

 

ALLEGIANCE CAPITAL TRUST I

CLASS R TERM CERTIFICATE, SERIES 1999-1

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.)

G-1

 

 

  
    
      
        
          
            Registered Owner:                                               
            

            
          

        

      

    

  

DELIVERY DATE: ________ __, ____
                                                                                                     
SERIES TERMINATION DATE: July 15, 2019

                   
THIS CERTIFIES THAT the registered owner specified above is the owner of an undivided
fractional interest in the Allegiance Capital Trust I (the "Trust") formed
by Allegiance Funding I, LLC (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 Supplement to Trust Agreement for Term Series 1999-1,
dated as of September 15, 1999, 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
Class R Term Certificates, Series 1999-1 having a Series Termination Date of July 15,
2019 (herein called the "Class R Certificates") issued and to be issued
under the Trust Agreement. This Class 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 R Certificate by virtue of such Holder's acceptance hereof
assents and by which such Holder is bound.

                   
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 payment made by the
Depositor with respect to this Certificate. 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 payment shall not limit or otherwise
affect the obligations of the Depositor hereunder or under the Trust Agreement.

                   
Class R Certificateholders are entitled to receive certain distributions from the
Series Distributable Amount, certain amounts released from the Reserve Account and certain
Prepayment Fee Collections, as further provided in the Trust Agreement and related
supplement. Amounts distributable with respect to Class 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 R Certificates set forth in Section 8 of the
Supplement for this Series and Sections 5.01 and 5.03 of the Trust Agreement, in
installments ending no later than the Series Termination Date unless the Class R
Certificates becomes due and payable at an earlier date by call for redemption or
otherwise. All distributions made on any such Payment Date shall be binding upon all
future Holders of this Class R Certificate and of any Class 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 R Certificate. All payments with respect
to all of the Class R Certificates of a Series shall be made on a pro rata basis
based upon the percentage interest specified on the face hereof; 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. 

                   
All amounts payable with respect to this Class 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 

G-2

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 R Certificates of the 1999-1 Series and
all other Series of Class R Certificates issued under the Trust Agreement are
generally payable out of the Trust Estate pari passu among such Class R
Certificateholders equally and ratably without prejudice, priority or distinction between
any Class R Certificate by reason of time of issue or otherwise. The Class 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 R
Certificate is issued also provides for the issuance of other Classes and Series of
Certificates from time to time. Payments on the Class R Certificates are generally
subordinated 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.

                   
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 R
Certificates 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.

G-3

 

                   
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
(without the consent of Holders holding at least 51% of all Rated Certificates, by
Outstanding Principal Amount) 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 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 R
Certificate or of the Trust Agreement shall alter or impair the obligation of the Trust
Estate to pay amounts due on this Class R Certificate, but solely from the assets of
the Trust Estate at the times, place and rate, and in the coin or currency, herein
prescribed.

G-4

                   
IN WITNESS WHEREOF, Allegiance Funding I, LLC has caused this instrument to be signed,
manually, by its President or a Vice President.

 

 

 

	ALLEGIANCE FUNDING I, LLC

	By: Allegiance Management Corp., as Manager

	By:

	Title:

 

 

 

CERTIFICATE OF AUTHENTICATION

 

                   
This is one of the Class R Certificates described in the within-mentioned Trust
Agreement.

 

  
    Dated:                                
    

    
  

 

  
     

  

MANUFACTURERS AND TRADERS TRUST 

COMPANY, as Trustee

By: 

Authorized Signatory

 

 

Schedule to Amended Class R Term Certificates, Series 1999-1

	Disbursement
                                       
    			
	Date of
                       
    	Amount of   	Principal	
	Funding
                            
    	Funding	Payment 	Date paid

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