In the event that an investment quality debtor defaults, Credebt Exchange can Repurchase the ETR. The Standard & Poor table shown below, demonstrates that over the past thirty years, the average default rate by Investment Grade [IG] organisations has been 0.078%. Combining this average default rate of 0.078% with ETR Repurchase, and the credit insurance Credebt Exchange purchases from AIG, makes ETR a compelling proposition to Investors.
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In accordance with sub section 6.12 of the Master Agreement, the Investor shall have the right to request Credebt Exchange to Repurchase any Traded ETR that is not Settled within ninety (90) days of the Expected Date due to non-payment or insolvency of the Debtor or which has been written-off as uncollectible.
In signing the Revolving ETR Purchase Agreement [RPA] Credebt Exchange can be requested to Repurchase any defaulted ETR and to pay the Repurchase Price. The “Repurchase Price” is defined in the Master Agreement as the Purchase Price that the Investor paid for the ETR, plus the daily Discount percentage (i.e. the Buy rate) for each day that the ETR is outstanding, less any applicable fees and/or commissions payable to Credebt Exchange.