FIRST NATIONAL BANK OF COMMERCE
Transferor and Servicer
and
-------------------
Trustee
on behalf of the Series 1997-1 Holders
SERIES 1997-1 SUPPLEMENT
Dated as of ___________ __, 1997
to
POOLING AND SERVICING AGREEMENT
Dated as of ____________ __, 1997
FIRST NBC CREDIT CARD MASTER TRUST
Series 1997-1
TABLE OF CONTENTS
Page
SECTION 1. Designation...................................................1
SECTION 2. Definitions...................................................2
SECTION 3. Servicing Compensation and Assignment of Interchange and
Other Account Revenues..........................................20
SECTION 4. Reassignment and Transfer Terms..............................22
SECTION 5. Delivery and Payment for the Investor Certificates...........22
SECTION 6. Depository; Form of Delivery of Investor Certificates; Legends;
Transfer Restrictions and Procedures............................22
SECTION 7. Article IV of Agreement......................................22
SECTION 4.6 Rights of Holders and the Collateral Interest
Holder .........................................................22
SECTION 4.7 Allocations........................................23
SECTION 4.8 Determination of Monthly Interest..................29
SECTION 4.9 Determination of Monthly Principal.................30
SECTION 4.10 Coverage of Required Amount.......................31
SECTION 4.11 Monthly Payments..................................33
SECTION 4.12 Series Investor Charge-Offs.......................37
SECTION 4.13 Excess Spread.....................................39
SECTION 4.14 Reallocated Investor Finance Charge Collections...41
SECTION 4.15 Reallocated Principal Collections.................42
SECTION 4.16 Shared Principal Collections......................43
SECTION 4.17 Principal Account and Principal Funding Account...43
SECTION 4.18 Reserve Account...................................45
SECTION 4.19 Determination of LIBOR............................46
SECTION 4.20 Transferor's or Servicer's Failure to Make a Deposit
or Payment.............................................47
SECTION 8. Article V of the Agreement...................................48
SECTION 5.1 Distributions......................................48
SECTION 5.2 Monthly Series 1997-1 Holders' Statement...........48
SECTION 9. Series 1997-1 Pay Out Events.................................49
SECTION 10. Series 1997-1 Termination...................................50
-i-
Page
SECTION 11. Periodic Finance Charges and Other Fees.....................51
SECTION 12. Counterparts................................................51
SECTION 13. Governing Law...............................................51
SECTION 14. No Petition.................................................51
SECTION 15. Amendments..................................................51
EXHIBITS
EXHIBIT A-1 Form of Class A Certificate
EXHIBIT A-2 Form of Class B Certificate
EXHIBIT B Form of Monthly Payment Instructions
and Notification to Trustee
EXHIBIT C Form of Monthly Series 1997-1 Holders' Statement
-ii-
SERIES 1997-1 SUPPLEMENT, dated as of ______________ __, 1997 (this
"Series Supplement"), by and between FIRST NATIONAL BANK OF COMMERCE, a
national banking association ("First NBC"), as Transferor and Servicer, and
__________________________, as Trustee under the Pooling and Servicing
Agreement dated as of ______________ __, 1997 between First NBC and Trustee
(the "Agreement").
Section 6.9 of the Agreement provides, among other things, that
Transferor and Trustee may at any time and from time to time enter into a
supplement to the Agreement for the purpose of authorizing the delivery by
Trustee to Transferor for the execution and redelivery to Trustee for
authentication of one or more Series of Certificates.
Pursuant to this Series Supplement, Transferor and the Trust shall
create a new Series of Investor Certificates and shall specify the
Principal Terms thereof.
SECTION 1. Designation. (a) There is hereby created a Series of
Investor Certificates to be issued in two Classes pursuant to the Agreement
and this Series Supplement and to be known together as the "Series 1997-1
Certificates." The two classes shall be designated the Class A Floating
Rate Asset Backed Certificates, Series 1997-1 (the "Class A Certificates")
and the Class B Floating Rate Asset Backed Certificates, Series 1997-1 (the
"Class B Certificates"). The Class A Certificates and the Class B
Certificates shall be substantially in the form of Exhibits A-1 and A-2,
respectively. In addition, there is hereby created a third Class which
constitutes an uncertificated interest in the Trust, shall be deemed to be
an "Investor Certificate" for all purposes under the Agreement and this
Series Supplement, except as expressly provided herein, and shall be known
as the Collateral Interest, Series 1997-1 and have the rights assigned to
the Collateral Interest in this Series Supplement.
(b) Series 1997-1 shall be included in Group I, which shall be a
Reallocation Group in which all Series shall also be Excess Allocation
Series. Series 1997-1 shall be a Principal Sharing Series. Series 1997-1
shall not be subordinated to any other Series.
(c) The Collateral Interest Holder, as holder of an "Investor
Certificate" under the Agreement, shall be entitled to the benefits of the
Agreement and this Series Supplement upon payment by the Collateral
Interest Holder of amounts owing on the Closing Date pursuant to the Loan
Agreement. Notwithstanding the foregoing, except as expressly provided
herein, the provisions of Article VI and Article XII of the Agreement
relating to the registration, authentication, delivery, presentation,
cancellation and surrender of Registered Certificates shall not be
applicable to the Collateral Interest.
1
SECTION 2. Definitions. If any term or provision contained herein
shall conflict with or be inconsistent with any provision contained in the
Agreement, the terms and provisions of this Series Supplement shall govern.
References to any Article, Section or subsection are references to
Articles, Sections or subsections of the Agreement, except as otherwise
expressly provided. All capitalized terms not otherwise defined herein are
defined in the Agreement, and the interpretive provisions set out in
Section 1.2 of the Agreement apply to this Series Supplement. Each
capitalized term defined herein relates only to the Investor Certificates
and no other Series of Certificates issued by the Trust.
"Accumulation Shortfall" initially means zero and thereafter means,
with respect to any Monthly Period during the Controlled Accumulation
Period, the excess, if any, of the Controlled Deposit Amount for the
previous Monthly Period over the amount deposited into the Principal
Funding Account pursuant to subsection 4.11(e)(i) with respect to the Class
A Certificates for the previous Monthly Period.
"Actual Allocations" is defined in subsection 4.7(e).
"Adjusted Investor Interest" means, on any date of determination, an
amount equal to the sum of (a) the Class A Adjusted Investor Interest and
(b) the Class B Investor Interest and (c) the Collateral Interest.
"Available Investor Principal Collections" means, as to any Monthly
Period, an amount equal to (a) the Investor Principal Collections for such
Monthly Period, minus (b) the amount of Reallocated Principal Collections
with respect to such Monthly Period that, pursuant to Section 4.15, are
required to fund the Class A Required Amount and the Class B Required
Amount (other than any portions thereof that are applied pursuant to (x)
subsection 4.11(a)(iii) and (y) subsection 4.13(c) (to the extent such
portions pursuant to subsection 4.13(c) are available to pay the Class B
Net Default Amount), which shall, without duplication, be included as
Available Investor Principal Collections), plus (c) the amount of Shared
Principal Collections that are allocated to Series 1997-1 in accordance
with subsection 4.16(b).
"Available Reserve Account Amount" means, as to any Transfer Date, the
lesser of (a) the amount on deposit in the Reserve Account on such date
(after taking into account any interest and earnings retained in the
Reserve Account pursuant to subsection 4.18(b) on such date, but before
giving effect to any deposit made or to be made pursuant to subsection
4.13(i) to the Reserve Account on such date) and (b) the Required Reserve
Account Amount.
"Base Rate" means, as to any Monthly Period, the sum of (a) the
weighted average of the Class A Certificate Rate, the Class B Certificate
Rate,
2
and the Collateral Rate (each for the related Interest Period) plus (b) the
Series Servicing Fee Percentage.
"Class A Additional Interest" is defined in Section 4.8(a).
"Class A Adjusted Investor Interest" means, on any date of
determination, an amount equal to the Class A Investor Interest minus the
Principal Funding Account Balance on such date of determination.
"Class A Available Funds" means, as to any Monthly Period, an amount
equal to the sum of (a) the Class A Floating Allocation of Reallocated
Investor Finance Charge Collections, excluding the portion of Reallocated
Investor Finance Charge Collections attributable to Servicer Interchange,
(b) with respect to any Monthly Period during the Controlled Accumulation
Period prior to the payment in full of the Class A Investor Interest, the
Principal Funding Investment Proceeds arising pursuant to subsection
4.17(b), if any, with respect to the related Transfer Date that are to be
applied as Class A Available Funds pursuant to subsection 4.17(b) and (c)
amounts, if any, to be withdrawn from the Reserve Account that will be
deposited into the Finance Charge Account on the related Transfer Date
pursuant to subsections 4.18(b) and 4.18(d) (or that will be required to be
deposited in the Finance Charge Account pursuant to such subsections on the
related Transfer Date (before giving effect to any permitted netting)).
"Class A Certificate Rate" means with respect to each Interest Period
(or, in the case of the initial Interest Period, with respect to each
portion thereof having a separate LIBOR Determination Date) a per annum
rate equal to 0.___% per annum in excess of LIBOR, as determined on the
related LIBOR Determination Date.
"Class A Certificates" is defined in subsection 1(a) of this Series
Supplement.
"Class A Deficiency Amount" is defined in subsection 4.8(a).
"Class A Fixed Allocation" means, for any Monthly Period following the
Revolving Period, the percentage equivalent (which percentage shall never
exceed 100%) of a fraction, the numerator of which is the Class A Investor
Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is equal to the numerator used in
determining the related Fixed Investor Percentage; provided that if Series
1997-1 is paired with a Paired Series and a Pay Out Event occurs with
respect to such Paired Series during the Controlled Accumulation Period,
Transferor may, by written notice delivered to Trustee and Servicer,
designate a different numerator (provided that such numerator is not less
than the Class A Adjusted Investor Interest (less the balance
3
on deposit in the Principal Account) as of the last day of the revolving
period for such Paired Series).
"Class A Floating Allocation" means, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Class A Adjusted Investor Interest
as of the close of business on the last day of the preceding Monthly Period
and the denominator of which is equal to the Adjusted Investor Interest as
of the close of business on such day; provided that, with respect to the
first Monthly Period, the Class A Floating Allocation means the percentage
equivalent of a fraction, the numerator of which is the Class A Initial
Investor Interest and the denominator of which is the Initial Investor
Interest.
"Class A Holder" means the Person in whose name a Class A Certificate
is registered in the Certificate Register.
"Class A Initial Investor Interest" means the aggregate initial
principal amount of the Class A Certificates, which is $___________.
"Class A Investor Allocation" means, for any Monthly Period, (a) with
respect to Net Default Amounts and Reallocated Investor Finance Charge
Collections at any time and Principal Receivables during the Revolving
Period, the Class A Floating Allocation and (b) with respect to Principal
Receivables during the Controlled Accumulation Period or Rapid Amortization
Period, the Class A Fixed Allocation.
"Class A Investor Charge-Off" is defined in subsection 4.12(a).
"Class A Investor Interest" means, on any date of determination, an
amount equal to (a) the Class A Initial Investor Interest, minus (b) the
aggregate amount of principal payments made to Class A Holders prior to
such date and minus (c) the excess, if any, of the aggregate amount of
Class A Investor Charge- Offs pursuant to subsection 4.12(a) over Class A
Investor Charge-Offs reimbursed pursuant to subsection 4.13(b) prior to
such date of determination; provided that the Class A Investor Interest may
not be reduced below zero.
"Class A Monthly Interest" is defined in subsection 4.8(a).
"Class A Monthly Principal" is defined in subsection 4.9(a).
"Class A Net Default Amount" means, as to each Transfer Date, an
amount equal to the product of (a) the Series Net Default Amount for such
Transfer Date and (b) the Class A Floating Allocation applicable for the
related Monthly Period.
4
"Class A Required Amount" is defined in subsection 4.10(a).
"Class A Scheduled Payment Date" means the ______ _______
Distribution Date.
"Class A Servicing Fee" is defined in subsection 3(a) of this
Series Supplement.
"Class B Additional Interest" is defined in subsection 4.8(b).
"Class B Available Funds" means, as to any Monthly Period, an amount
equal to the Class B Floating Allocation of Reallocated Investor Finance
Charge Collections, excluding the portion of Reallocated Investor Finance
Charge Collections attributable to Servicer Interchange.
"Class B Certificate Rate" means, with respect to each Interest Period
(or, in the case of the initial Interest Period, with respect to each
portion thereof having a separate LIBOR Determination Date) a per annum
rate equal to 0.___% per annum in excess of LIBOR, as determined on the
related LIBOR Determination Date.
"Class B Certificates" is defined in subsection 1(a) of this Series
Supplement.
"Class B Deficiency Amount" is defined in subsection 4.8(b).
"Class B Fixed Allocation" means, for any Monthly Period following the
Revolving Period, the percentage equivalent (which percentage shall never
exceed 100%) of a fraction, the numerator of which is the Class B Investor
Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is equal to the numerator used in
determining the related Fixed Investor Percentage; provided that if Series
1997-1 is paired with a Paired Series and a Pay Out Event occurs with
respect to such Paired Series during the Controlled Accumulation Period,
Transferor may, by written notice delivered to Trustee and Servicer,
designate a different numerator (provided that such numerator is not less
than the Class B Investor Interest (less, if the Class A Fixed Allocation
is zero, the balance on deposit in the Principal Account and the Principal
Funding Account, in each case to the extent not subtracted in reducing the
Class A Fixed Allocation to zero) as of the last day of the revolving
period for such Paired Series).
"Class B Floating Allocation" means, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Class B Investor Interest as of the
close of business
5
on the last day of the preceding Monthly Period and the denominator of
which is equal to the Adjusted Investor Interest as of the close of
business on such day; provided that, with respect to the first Monthly
Period, the Class B Floating Allocation means the percentage equivalent of
a fraction, the numerator of which is the Class B Initial Investor Interest
and the denominator of which is the Initial Investor Interest.
"Class B Holder" means the Person in whose name a Class B
Certificate is registered in the Certificate Register.
"Class B Initial Investor Interest" means the aggregate initial
principal amount of the Class B Certificates, which is $____________.
"Class B Investor Allocation" means, for any Monthly Period, (a) with
respect to Net Default Amounts and Reallocated Investor Finance Charge
Collections at any time and Principal Receivables during the Revolving
Period, the Class B Floating Allocation and (b) with respect to Principal
Receivables during the Controlled Accumulation Period or Rapid Amortization
Period, the Class B Fixed Allocation.
"Class B Investor Charge-Off" is defined in subsection 4.12(b).
"Class B Investor Interest" means, on any date of determination, an
amount equal to (a) the Class B Initial Investor Interest, minus (b) the
aggregate amount of principal payments made to Class B Holders prior to
such date, minus (c) the aggregate amount of Class B Investor Charge-Offs
for all prior Transfer Dates pursuant to subsection 4.12(b), minus (d) the
amount of the Reallocated Class B Principal Collections allocated pursuant
to subsection 4.15(a) on all prior Transfer Dates for which the Collateral
Interest has not been reduced, minus (e) an amount equal to the amount by
which the Class B Investor Interest has been reduced on all prior Transfer
Dates pursuant to subsection 4.12(a), plus (f) the aggregate amount of
Excess Spread allocated and available on all prior Transfer Dates pursuant
to subsection 4.13(d) for the purpose of reimbursing amounts deducted
pursuant to the foregoing clauses (c), (d) and (e); provided that the Class
B Investor Interest may not be reduced below zero.
"Class B Monthly Interest" is defined in subsection 4.8(b).
"Class B Monthly Principal" is defined in subsection 4.9(b).
"Class B Net Default Amount" means, as to each Transfer Date, an
amount equal to the product of (a) the Series Net Default Amount for such
Transfer Date and (b) the Class B Floating Allocation applicable for the
related Monthly Period.
6
"Class B Required Amount" is defined in subsection 4.10(b).
"Class B Scheduled Payment Date" means the ______ _______
Distribution Date.
"Class B Servicing Fee" is defined in subsection 3(a) of this
Series Supplement.
"Closing Date" means ______________ ___, 1997.
"Collateral Allocation" means, for any Monthly Period, (a) with
respect to Net Default Amounts and Reallocated Investor Finance Charge
Collections at any time and Principal Receivables during the Revolving
Period, the Collateral Floating Allocation and (b) with respect to
Principal Receivables during the Controlled Accumulation Period or Rapid
Amortization Period, the Collateral Fixed Allocation.
"Collateral Available Funds" means, as to any Monthly Period, an
amount equal to the Collateral Floating Allocation of Reallocated Investor
Finance Charge Collections, excluding the portion of Reallocated Investor
Finance Charge Collections attributable to Servicer Interchange.
"Collateral Charge-Off" is defined in subsection 4.12(c).
"Collateral Fixed Allocation" means, for any Monthly Period following
the Revolving Period, the percentage equivalent (which percentage shall
never exceed 100%) of a fraction, the numerator of which is the Collateral
Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is equal to the numerator used in
determining the related Fixed Investor Percentage; provided that if Series
1997-1 is paired with a Paired Series and a Pay Out Event occurs with
respect to such Paired Series during the Controlled Accumulation Period,
Transferor may, by written notice delivered to Trustee and Servicer,
designate a different numerator (provided that such numerator is not less
than the Collateral Interest (less, if the Class B Fixed Allocation is
zero, the balance on deposit in the Principal Account, to the extent not
subtracted in reducing the Class B Fixed Allocation to zero) as of the last
day of the revolving period for such Paired Series).
"Collateral Floating Allocation" means, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Collateral Interest as of the close
of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Adjusted Investor Interest as of the
close of business on such day; provided that, with respect to the first
Monthly Period, the Collateral Floating Allocation
7
means the percentage equivalent of a fraction, the numerator of which is
the Collateral Initial Interest and the denominator of which is the Initial
Investor Interest.
"Collateral Initial Interest" means $___________.
"Collateral Interest" means, on any date of determination, a
fractional undivided interest in the Trust that shall consist of the right
to receive, to the extent necessary to make the required payments to the
Collateral Interest Holder under this Series Supplement, the portion of
Collections allocable thereto under the Agreement and this Series
Supplement and funds on deposit in the Collection Account allocable thereto
pursuant to the Agreement and this Series Supplement. On any date, for
purposes of all calculations in the Agreement and this Series Supplement,
the amount of the Collateral Interest shall be an amount equal to (a) the
Collateral Initial Interest, minus (b) the aggregate amount of principal
payments made to the Collateral Interest Holder prior to such date, minus
(c) the aggregate amount of Collateral Charge-Offs for all prior Transfer
Dates pursuant to subsection 4.12(c), minus (d) the amount of Reallocated
Principal Collections allocated pursuant to subsections 4.15(a) and (b) on
all prior Transfer Dates, minus (e) an amount equal to the amount by which
the Collateral Interest has been reduced on all prior Transfer Dates
pursuant to subsections 4.12(a) and (b), plus (f) the aggregate amount of
Excess Spread allocated and available on all prior Transfer Dates pursuant
to subsection 4.13(h) for the purpose of reimbursing amounts deducted
pursuant to the foregoing clauses (c), (d) and (e); provided that the
Collateral Interest may not be reduced below zero.
"Collateral Interest Holder" means the entity so designated in the Loan
Agreement.
"Collateral Interest Servicing Fee" is defined in subsection 3(a)
of this Series Supplement.
"Collateral Monthly Interest" is defined in subsection 4.8(c).
"Collateral Monthly Principal" is defined in subsection 4.9(c).
"Collateral Net Default Amount" means, as to any Transfer Date, an
amount equal to the product of (a) the Series Net Default Amount for such
Transfer Date and (b) the Collateral Floating Allocation applicable for the
related Monthly Period.
"Collateral Rate" means, for any Interest Period, the rate specified in the
Loan Agreement.
8
"Collection Recomputation Date" means, with respect to Collections
received during any Billing Cycle that are initially allocated on an
estimated basis as provided in subsection 4.7(d), the date on which
Servicer performs the recomputations provided for in subsection 4.7(e),
which date shall not be later than the Determination Date in the Monthly
Period following the Monthly Period in which such Billing Cycle ends.
"Controlled Accumulation Amount" means, for any Transfer Date with
respect to the Controlled Accumulation Period prior to the payment in full
of the Class A Investor Interest, $__________________; provided that if the
Controlled Accumulation Period Length is modified pursuant to subsection
4.11(i), (i) the Controlled Accumulation Amount for each Transfer Date with
respect to the Controlled Accumulation Period shall mean the amount
determined in accordance with Section 4.11(i) on the date on which the
Controlled Accumulation Period has most recently been modified and (ii) the
sum of the Controlled Accumulation Amounts for all Transfer Dates with
respect to the modified Controlled Accumulation Period shall not be less
than the Class A Investor Interest.
"Controlled Accumulation Date" means _____________, ____.
"Controlled Accumulation Period" means, unless a Pay Out Event shall
have occurred prior thereto, the period commencing at the close of business
on the Controlled Accumulation Date or such later date as is determined in
accordance with subsection 4.11(i) and ending on the first to occur of (a)
the commencement of the Rapid Amortization Period and (b) the Series 1997-1
Termination Date.
"Controlled Accumulation Period Length" is defined in subsection 4.11(i).
"Controlled Deposit Amount" means, with respect to any Transfer Date,
the sum of (a) the Controlled Accumulation Amount for such Transfer Date
and (b) any existing Accumulation Shortfall.
"Covered Amount" means an amount determined as of each Transfer Date
with respect to any Interest Period as the product of (a) (i) one-twelfth,
times (ii) the Class A Certificate Rate in effect with respect to such
Interest Period, and (b) the Principal Funding Account Balance as of the
Record Date preceding such Transfer Date.
"Credit Enhancement" means (a) with respect to the Class A
Certificates, the subordination of the Class B Certificates and the
Collateral Interest and (b) with respect to the Class B Certificates, the
subordination of the Collateral Interest.
9
"Credit Enhancement Provider" means the Collateral Interest Holder.
"Cumulative Series Principal Shortfall" means the sum of the Series
Principal Shortfalls (as such term is defined in each of the related
Supplements) for each Principal Sharing Series.
"Deficiency Amount" means, at any time of determination, the sum of
(a) the Class A Deficiency Amount and (b) the Class B Deficiency Amount.
"Distribution Date" means ___________ __[15], 1997 and the fifteenth
day of each calendar month thereafter or, if such fifteenth day is not a
Business Day, the next succeeding Business Day.
"Estimated Allocations" is defined in subsection 4.7(e).
"Excess Principal Funding Investment Proceeds" means, with respect to
each Transfer Date relating to the Controlled Accumulation Period, the
amount, if any, by which the Principal Funding Investment Proceeds for such
Transfer Date exceed the Covered Amount determined on such Transfer Date.
"Excess Spread" means, with respect to any Transfer Date, the sum of
(a) the sum of the amounts, if any, with respect to that Transfer Date
specified pursuant to subsections 4.11(a)(iv), 4.11(b)(iii) and
4.11(c)(ii), plus (b) the Excess Finance Charge Collections, if any,
allocated to the Investor Interest pursuant to Section 4.5 for that
Transfer Date.
"Finance Charge Shortfall" means, with respect to any Transfer Date,
an amount equal to the excess, if any, of (a) the sum of the amounts
specified in clauses (a) through (j) of Section 4.13 for that Transfer Date
over (b) the sum of the amounts, if any, with respect to such Transfer Date
specified pursuant to subsections 4.11(a)(iv), 4.11(b)(iii) and
4.11(c)(ii).
"Fixed Investor Percentage" means, with respect to any Monthly Period,
the percentage equivalent of a fraction, the numerator of which is the
Investor Interest as of the close of business on the last day of the
Revolving Period and the denominator of which is the greater of (a) the
Aggregate Principal Receivables determined as of the close of business on
the last day of the prior Monthly Period and (b) the sum of the numerators
used to calculate the Investor Percentages for all outstanding Series with
respect to Principal Receivables on such date of determination; provided
that (x) if Series 1997-1 is paired with a Paired Series and a Pay Out
Event occurs with respect to such Paired Series during the Controlled
Accumulation Period, Transferor may, by written notice delivered to Trustee
and Servicer, designate a different numerator (provided that such numerator
is not less than the Adjusted Investor Interest (less the balance on
10
deposit in the Principal Account) as of the last day of the revolving
period for such Paired Series) and (y) if one or more Reset Dates occur in
a Monthly Period, the Fixed Investor Percentage for the portion of the
Monthly Period falling after each such Reset Date (the "subject Reset
Date") and prior to the earlier of the last day of the current Monthly
Period and any subsequent Reset Date shall be determined using a
denominator equal to the greater of the amounts specified in clause (a) and
clause (b) above determined as of the subject Reset Date.
"Floating Investor Percentage" means, with respect to any Monthly
Period, the percentage equivalent of a fraction, the numerator of which is
the Adjusted Investor Interest as of the close of business on the last day
of the preceding Monthly Period (or with respect to the first Monthly
Period, the Initial Investor Interest) and the denominator of which is the
greater of (a) the Aggregate Principal Receivables as of the close of
business on the last day of the preceding Monthly Period and (b) the sum of
the numerators used to calculate the Investor Percentages for all
outstanding Series with respect to Finance Charge Receivables, Net Default
Amounts or Principal Receivables, as applicable, on such date of
determination; provided that if one or more Reset Dates occurs in a Monthly
Period, the Floating Investor Percentage for the portion of the Monthly
Period falling after each such Reset Date (the "subject Reset Date") and on
or prior to the earlier of the last day of the current Monthly Period and
any subsequent Reset Date shall be determined using a denominator equal to
the greater of the amounts specified in clause (a) and clause (b) above
determined as of the subject Reset Date.
"Group I" means Series 1997-1 and each other Series specified in
the related Supplement to be included in Group I.
"Group I Investor Charge-Offs" means, with respect to any Transfer
Date, the sum of (a) the Series Investor Charge-Offs for such Transfer Date
and (b) the series investor charge-offs for all other Series included in
Group I for such Transfer Date.
"Group I Investor Finance Charge Collections" means, with respect to
any Transfer Date, the sum of (a) the Investor Finance Charge Collections
for such Distribution Date and (b) the aggregate investor finance charge
collections for all other Series included in Group I for such Distribution
Date.
"Group I Monthly Fees" means, with respect to any Transfer Date, the
sum of (a) the Series Monthly Fees for such Transfer Date and (b) the
aggregate series monthly fees for all other Series included in Group I for
such Transfer Date.
11
"Group I Monthly Interest" means, with respect to any Transfer Date,
the sum of (a) the Series Monthly Interest for such Transfer Date and (b)
the aggregate series monthly interest for all other Series included in
Group I for such Transfer Date.
"Group I Net Default Amount" means, with respect to any Transfer Date,
the sum of (a) the Series Net Default Amount for such Transfer Date and (b)
the aggregate series net default amounts for all other Series included in
Group I for such Transfer Date.
"Initial Investor Interest" means $__________.
"Interest Period" means, with respect to any Distribution Date, the
period from and including the previous Distribution Date through and
including the day preceding such Distribution Date, except that the initial
Interest Period will be the period from and including the Closing Date
through the day preceding the initial Distribution Date.
"Investor Certificates" means the Class A Certificates, the Class
B Certificates and the Collateral Interest.
"Investor Finance Charge Collections" means for any Transfer Date,
the sum of the following amounts determined for the related Monthly Period:
(a) insofar as such Monthly Period fell prior to the
Conversion Date, an amount equal to the aggregate Collections of
Finance Charge Receivables processed during each Billing Cycle
which ended during such Monthly Period (and prior to the
Conversion Date) which are deposited in the Finance Charge Account
(or required to be deposited in the Finance Charge Account on that
Transfer Date (before giving effect to any permitted netting) with
respect to such portion of such Monthly Period pursuant to
subsection 4.2(e), the third paragraph of subsection 4.3(a) and
subsection 4.7(d) of the Agreement), less any amount required to
be withdrawn from the Finance Charge Account with respect to such
portion of such Monthly Period pursuant to subsection 4.7(f); plus
(b) insofar as such Monthly Period fell on or after the
Conversion Date, an amount equal to the aggregate Collections of
Finance Charge Receivables deposited in the Finance Charge Account
on each day in such Monthly Period falling on or after the
Conversion Date (or required to be deposited in the Finance Charge
Account on that Transfer Date (before giving effect to any
permitted netting) with respect to any such day pursuant to
subsection 4.2(e), the third paragraph of subsection 4.3(a) and
subsection 4.7(d) of the Agreement); plus
12
(c) any amount required to be deposited in the Finance
Charge Account on that Transfer Date (before giving effect to any
permitted netting) with respect to such Monthly Period pursuant to
subsection 3(b) of this Series Supplement and investment earnings
(net of losses and investment expenses) accrued on or prior to
that Transfer Date in connection with the investment of funds on
deposit in the Principal Account.
"Investor Holder" means (a) with respect to the Class A Certificates,
the holder of record of a Class A Certificate, (b) with respect to the
Class B Certificates, the holder of record of a Class B Certificate and (c)
with respect to the Collateral Interest, the Collateral Interest Holder.
"Investor Interest" means, on any date of determination, an amount
equal to the sum of (a) the Class A Investor Interest, (b) the Class B
Investor Interest and (c) the Collateral Interest, each as of such date.
"Investor Percentage" with respect to Series 1997-1 means, for any
Monthly Period, (a) with respect to Finance Charge Receivables and Net
Default Amounts at any time and Principal Receivables during the Revolving
Period, the Floating Investor Percentage and (b) with respect to Principal
Receivables during the Controlled Accumulation Period or the Rapid
Amortization Period, the Fixed Investor Percentage.
"Investor Principal Collections" means, for any Monthly Period, the sum
of:
(a) insofar as such Monthly Period fell prior to the
Conversion Date, an amount equal to the aggregate Collections of
Principal Receivables processed during each Billing Cycle which
ended during such Monthly Period (and prior to the Conversion
Date) which are deposited (or required to be deposited on the
related Transfer Date (before giving effect to any permitted
netting)) into the Principal Account for such Monthly Period
pursuant to subsections 4.7(a)(ii), (iii) and (iv), 4.7(b)(ii),
(iii) and (iv), or 4.7(c)(ii), in each case, as applicable to such
Monthly Period, minus any amount required to be withdrawn from the
Principal Account with respect to such Monthly Period pursuant to
subsection 4.7(f) of the Agreement; plus
(b) insofar as such Monthly Period fell on or after the
Conversion Date, an amount equal to the aggregate Collections of
Principal Receivables (or required to be deposited on the related
Transfer Date (before giving effect to any permitted netting))
into the Principal Account on any day in such Monthly Period
falling on or after the Conversion Date
13
pursuant to subsections 4.7(a)(ii), (iii) and (iv), 4.7(b)(ii),
(iii) and (iv), or 4.7(c)(ii), in each case, as applicable to such
Monthly Period; plus
(c) the aggregate amount to be treated as Investor
Principal Collections pursuant to subsections 4.11(a)(iii) and
4.13(a), (b), (c), (d), (g) and (h) for such Monthly Period (other
than such amount paid from Reallocated Principal Collections),
plus
(d) the aggregate amount transferred (or required to be
transferred on the related Distribution Date (before giving effect
to any permitted netting)) from the Excess Funding Account into
the Principal Account pursuant to subsection 4.2(f).
"Investor Servicing Fee" is defined in subsection 3(a) of this Series
Supplement.
"LIBOR" means, for the period from and including the Closing Date
through _______________ __, 1997 and the period from and including
___________ __, 1997 through the day preceding the Distribution Date with
respect to the initial Interest Period, and for any Interest Period
thereafter, the London interbank offered rate for one-month United States
dollar deposits determined by Trustee for each such period in accordance
with the provisions of Section 4.19.
"LIBOR Determination Date" means (a) for the initial Interest Period,
___________ __, 1997 (for the period from and including the Closing Date
through _________ __, 1997) and ___________ __, 1997 (for the period from
and including ____________ __, 1997 through ____________ __, 1997) and (b)
for each subsequent Interest Period, the second London Business Day prior
to the commencement of such Interest Period.
"Loan Agreement" means the agreement among Transferor, Servicer,
Trustee, and the Collateral Interest Holder, dated as of ___________ __,
1997, as amended or modified from time to time.
"London Business Day" means any Business Day on which dealings in
deposits in United States dollars are transacted in the London interbank
market.
"Monthly Period" is defined in the Agreement, except that for all
purposes other than the definition of "Floating Allocation Percentage" the
first Monthly Period with respect to the Investor Certificates begins on
and includes the Cut Off Date and ends on and includes ____________ __,
1997.
14
"Net Servicing Fee Rate" means (a) so long as Transferor or [Trustee's
Name] is Servicer, [0.50]% per annum, and (b) if neither Transferor nor
[Trustee name] is Servicer, [2.00]% per annum.
"Paired Series" means a Series that has been paired with Series 1997-1
(which Series may be prefunded or partially prefunded or may be a Variable
Interest) such that a reduction of the Adjusted Investor Interest results
in (or permits) an increase of the investor interest of such Series that
has been paired with Series 1997-1.
"Pay Out Commencement Date" means the date on which a Trust Pay Out
Event is deemed to occur pursuant to Section 9.1 of the Agreement or a
Series 1997-1 Pay Out Event is deemed to occur pursuant to Section 9 of
this Series Supplement.
"Portfolio Adjusted Yield" means, with respect to any Transfer Date,
the average of the percentages obtained for each of the three preceding
Monthly Periods by subtracting the Base Rate from the Portfolio Yield for
such Monthly Period and deducting ____% from the result for each Monthly
Period.
"Portfolio Yield" means, with respect to any Monthly Period, the
annualized percentage equivalent of a fraction, the numerator of which is
an amount equal to the sum of (a) the amount of Reallocated Investor
Finance Charge Collections for the related Transfer Date, (b) the Principal
Funding Investment Proceeds deposited into the Finance Charge Account on
the Transfer Date related to such Monthly Period and (c) the amount of the
Reserve Draw Amount (up to the Available Reserve Account Amount) plus any
amounts of interest and earnings described in Section 4.18, each deposited
or required to be deposited into the Finance Charge Account on the Transfer
Date (before giving effect to any permitted netting) relating to such
Monthly Period, such sum to be calculated on a cash basis after subtracting
the Series Default Amount for such Monthly Period, and the denominator of
which is the Investor Interest as of the close of business on the last day
of such Monthly Period.
"Principal Account" is defined in subsection 4.17(a).
"Principal Funding Account" is defined in subsection 4.17(a).
"Principal Funding Account Balance" means, with respect to any date of
determination, the principal amount, if any, on deposit in the Principal
Funding Account on such date of determination.
"Principal Funding Investment Proceeds" means, with respect to each
Transfer Date, the investment earnings on funds in the Principal Funding
Account
15
(net of investment expenses and losses) for the period from and including
the immediately preceding Transfer Date to but excluding such Transfer
Date.
"Principal Funding Investment Shortfall" means, with respect to each
Transfer Date relating to the Controlled Accumulation Period, the amount,
if any, by which the Principal Funding Investment Proceeds for such
Transfer Date are less than the Covered Amount determined as of such
Transfer Date.
"Rapid Amortization Period" means the period commencing on the Pay Out
Commencement Date and ending on the earlier to occur of (a) the Series
1997-1 Termination Date and (b) the termination of the Trust pursuant to
Section 12.1.
"Rating Agency" means ▇▇▇▇▇'▇ and Standard & Poor's.
"Rating Agency Condition" means the notification in writing by each
Rating Agency to Transferor, Servicer and Trustee that an action will not
result in any Rating Agency reducing or withdrawing its then existing
rating of the Class A Certificates or the Class B Certificates.
"Reallocated Class B Principal Collections" means, with respect to any
Transfer Date, Collections of Principal Receivables applied in accordance
with subsection 4.15(a) in an amount not to exceed the product of (a) the
Class B Investor Allocation for the Monthly Period relating to such
Transfer Date and (b) the Investor Percentage for the Monthly Period
relating to such Transfer Date and (c) the amount of Collections of
Principal Receivables for the Monthly Period relating to such Transfer
Date; provided that such amount shall not exceed the Class B Investor
Interest after giving effect to any Class B Investor Charge-Offs for such
Transfer Date.
"Reallocated Collateral Principal Collections" means, with respect to
any Transfer Date, Collections of Principal Receivables applied in
accordance with subsections 4.15(a) and (b) in an amount not to exceed the
product of (a) the Collateral Allocation for the Monthly Period relating to
such Transfer Date and (b) the Investor Percentage for the Monthly Period
relating to such Transfer Date and (c) the amount of Collections of
Principal Receivables for the Monthly Period relating to such Transfer
Date; provided that such amount shall not exceed the Collateral Interest
after giving effect to any Collateral Charge-Offs for such Transfer Date.
"Reallocated Investor Finance Charge Collections" means that portion
of Group I Investor Finance Charge Collections allocated to Series 1997-1
pursuant to Section 4.14.
16
"Reallocated Principal Collections" means the sum of (a) Reallocated
Class B Principal Collections and (b) Reallocated Collateral Principal
Collections.
"Reference Banks" means four major banks in the London interbank
market selected by Servicer.
"Required Collateral Interest" means (a) initially, $______________
and (b) on any Transfer Date thereafter, __% of (1) the sum of the Class A
Adjusted Investor Interest and the Class B Investor Interest on such
Transfer Date, in each case after taking into account deposits into the
Principal Funding Account on such Transfer Date and payments to be made on
the related Distribution Date, plus (2) the Collateral Interest on the
prior Transfer Date, after any adjustments to be made on such date, but not
less than $_________; provided that (x) if either (i) there is a reduction
in the Collateral Interest pursuant to clause (c), (d) or (e) of the
definition of such term or (ii) a Pay Out Event with respect to the
Investor Certificates has occurred, the Required Collateral Interest for
any Transfer Date shall (subject to clauses (y) and (z)) equal the Required
Collateral Interest for the Transfer Date immediately preceding such
reduction or Pay Out Event, (y) in no event shall the Required Collateral
Interest exceed the sum of the outstanding principal amounts of (i) the
Class A Certificates and (ii) the Class B Certificates, each as of the last
day of the Monthly Period preceding such Transfer Date after taking into
account the payments to be made on the related Distribution Date and (z)
the Required Collateral Interest may be reduced at Transferor's option at
any time to a lesser amount if Transferor, Servicer, the Collateral
Interest Holder and Trustee have been provided evidence that the Rating
Agency Condition has been satisfied.
"Required Reserve Account Amount" means, with respect to any Transfer
Date on or after the Reserve Account Funding Date, an amount equal to (a)
___% of the outstanding principal balance of the Class A Certificates or
(b) any other amount designated by Transferor; provided that if such
designation is less than the amount determined pursuant to clause (a),
Transferor shall (i) provide Servicer, the Collateral Interest Holder and
Trustee with evidence that the Rating Agency Condition has been satisfied
and (ii) deliver to Trustee a certificate of an authorized officer to the
effect that, based on the facts known to such officer at such time, in the
reasonable belief of Transferor, such designation will not cause a Pay Out
Event or an event that, after the giving of notice or the lapse of time,
would cause a Pay Out Event to occur with respect to Series 1997-1.
"Reserve Account" is defined in subsection 4.18(a).
"Reserve Account Funding Date" means the Transfer Date that occurs not
later than the earliest of: (a) the Transfer Date with respect to the
Monthly Period that commences __ months prior to the commencement of the
Controlled
17
Accumulation Period; (b) the first Transfer Date for which the Portfolio
Adjusted Yield is less than ____%, but in such event the Reserve Account
Funding Date shall not be required to occur earlier than the Transfer Date
with respect to the Monthly Period that commences __ months prior to the
commencement of the Controlled Accumulation Period; (c) the first Transfer
Date for which the Portfolio Adjusted Yield is less than ____%, but in such
event the Reserve Account Funding Date shall not be required to occur
earlier than the Transfer Date with respect to the Monthly Period that
commences __ months prior to the commencement of the Controlled
Accumulation Period; and (d) the first Transfer Date for which the
Portfolio Adjusted Yield is less than ____%, but in such event the Reserve
Account Funding Date shall not be required to occur earlier than the
Transfer Date with respect to the Monthly Period that commences __ months
prior to the commencement of the Controlled Accumulation Period.
"Reserve Account Surplus" means, as of any Transfer Date following the
Reserve Account Funding Date, the amount, if any, by which the amount on
deposit in the Reserve Account exceeds the Required Reserve Account Amount.
"Reserve Draw Amount" is defined in subsection 4.18(c).
"Reset Date" means any of the following occurring after the Conversion
Date: (a) an Addition Date; (b) a Removal Date on which, if any Series has
been paid in full, Principal Receivables in an aggregate amount
approximately equal to the initial investor interest of such Series are
removed from the Trust; and (c) a date on which there is an increase in the
Investor Interest under any Variable Interest issued by the Trust.
"Revolving Period" means the period from and including the Closing
Date to, but not including, the earlier of (a) the day the Controlled
Accumulation Period commences and (b) the Pay Out Commencement Date.
"Series Investor Charge-Offs" means, for any Transfer Date, the sum of
the Class A Investor Charge-Offs, Class B Investor Charge-Offs and the
Collateral Investor Charge-Offs for such Transfer Date.
"Series Monthly Fees" means, for any Transfer Date, the sum of the
Investor Servicing Fee and Servicer Interchange for such Transfer Date.
"Series Monthly Interest" means, for any Transfer Date, the sum of the
Class A Monthly Interest, Class A Deficiency Amount, Class A Additional
Interest, Class B Monthly Interest, Class B Deficiency Amount, Class B
Additional Interest, Collateral Monthly Interest, Collateral Deficiency
Amount and Collateral Additional Interest for such Transfer Date.
18
"Series Net Default Amount" means, for any Transfer Date, the product
of the Net Default Amount and the Floating Investor Percentage, in each
case, for the related Monthly Period.
"Series Principal Shortfall" means, with respect to any Transfer Date,
the excess, if any, of (a) the sum of (i) with respect to any Transfer Date
relating to the Controlled Accumulation Period, the sum of (A) the
Controlled Deposit Amount for such Transfer Date, (B) on the Transfer Date
after the Transfer Date on which the Class A Adjusted Investor Interest is
reduced to zero, the Class B Invested Amount and (C) the excess, if any, of
the Collateral Interest for such Transfer Date over the Required Collateral
Interest for such Transfer Date, (ii) with respect to any Transfer Date
during the Rapid Amortization Period, the Adjusted Investor Interest and
(iii) with respect to any Transfer Date relating to the Revolving Period,
the amount specified in clause (a)(i)(C) above over (b) the Investor
Principal Collections minus the Reallocated Principal Collections (other
than any portions thereof that are applied pursuant to (x) subsection
4.11(a)(iii) and (y) subsection 4.13(c) (to the extent such portions
pursuant to subsection 4.13(c) are available to pay the Class B Net Default
Amount)) for such Transfer Date.
"Series Servicing Fee Percentage" means [2.0]%.
"Series 1997-1" means the Series of the First NBC Credit Card
Master Trust represented by the Investor Certificates.
"Series 1997-1 Certificates" means the Class A Certificates and
the Class B Certificates.
"Series 1997-1 Holder" means the holder of record of a Series 1997-1
Certificate.
"Series 1997-1 Pay Out Event" is defined in Section 9 of this
Series Supplement.
"Series 1997-1 Termination Date" means the earliest to occur of (a)
the Distribution Date on which the Investor Interest is paid in full, (b)
the _____ ________ Distribution Date and (c) the Trust Termination Date.
"Servicer Interchange" is defined in subsection 3(a) of this Series
Supplement.
"Shared Principal Collections" means, as the context requires, either
(a) the amount allocated to the Investor Certificates which may be applied
to the Series Principal Shortfall with respect to other outstanding
Principal Sharing
19
Series or (b) the amounts allocated to the investor certificates of other
Principal Sharing Series which the applicable Supplements for such Series
specify are to be treated as "Shared Principal Collections" and which may
be applied to cover the Series Principal Shortfall with respect to the
Investor Certificates.
"Target Amount" is defined in subsection 4.7(d).
"Telerate Page 3750" means the display page currently so designated on
the Dow ▇▇▇▇▇ Telerate Service for the purpose of displaying London
interbank offered rates for deposits in United States dollars as presented
by the British Banker's Association or, if such page has been replaced or
deleted, then such other page on Telerate or such other service that
displays the London interbank offered rate for deposits in United States
dollars as presented by the British Banker's Association.
SECTION 3. Servicing Compensation and Assignment of Interchange and
Other Account Revenues. (a) The share of the Servicing Fee allocable to
Series 1997-1 with respect to any Transfer Date (the "Investor Servicing
Fee") shall, for purposes of calculating the Base Rate for the related
Monthly Period, be equal to one-twelfth of the product of (i) the Series
Servicing Fee Percentage and (ii) the Adjusted Investor Interest as of the
last day of the Monthly Period preceding such Transfer Date; provided that
with respect to the first Transfer Date, the Investor Servicing Fee shall
equal $___________________ (or, for purposes of calculating the Base Rate
for the first Monthly Period, shall equal $_________________). The Investor
Servicing Fee shall be paid only from the sources and to the extent
provided in this Section 3. On each Transfer Date for which Transferor or
Trustee is Servicer, a portion of Interchange with respect to the related
Monthly Period that is on deposit in the Finance Charge Account shall be
withdrawn from the Finance Charge Account and paid to Servicer in payment
of a portion of the Investor Servicing Fee with respect to such Monthly
Period ("Servicer Interchange"); provided the amount so withdrawn and paid
to Servicer (and constituting Servicer Interchange) for a Monthly Period
shall not exceed one-twelfth of the product of (i) the Adjusted Investor
Interest as of the last day of such Monthly Period and (ii) __%. Should
Servicer Interchange on deposit in the Finance Charge Account on any
Transfer Date with respect to the related Monthly Period be less than
one-twelfth of __% of the Adjusted Investor Interest as of the last day of
such Monthly Period, the Investor Servicing Fee with respect to such
Monthly Period will not be paid to the extent of such insufficiency of
Servicer Interchange on deposit in the Finance Charge Account. The Servicer
Interchange with respect to the first Transfer Date shall equal
$____________. The share of the Investor Servicing Fee allocable to the
Class A Investor Interest (the "Class A Servicing Fee"), the Class B
Investor Interest (the "Class B Servicing Fee") and the Collateral Interest
(the "Collateral Interest Servicing Fee") with respect to any Transfer Date
shall equal one-twelfth of the product of
20
(i) the Class A Floating Allocation, the Class B Floating Allocation or the
Collateral Floating Allocation, respectively, (ii) the Net Servicing Fee
Rate and (iii) the Adjusted Investor Interest as of the last day of the
Monthly Period preceding such Transfer Date; provided that with respect to
the first Transfer Date, the Class A Servicing Fee, the Class B Servicing
Fee and the Collateral Interest Servicing Fee shall equal $__________,
$___________ and $__________, respectively. Except as specifically provided
in this subsection 3(a), the Servicing Fee shall be paid by the cash flows
from the Trust allocated to the Holder of the Transferor Certificate or the
certificateholders of other Series (as provided in the related Supplements)
and in no event shall the Trust, Trustee or the Investor Holders be liable
therefor. The Class A Servicing Fee shall be payable to Servicer solely to
the extent amounts are available for distribution in respect thereof
pursuant to subsections 4.11(a)(ii) and 4.13(a). The Class B Servicing Fee
shall be payable solely to the extent amounts are available for
distribution in respect thereof pursuant to subsections 4.11(b)(ii) and
4.13(c). The Collateral Interest Servicing Fee shall be payable solely to
the extent amounts are available for distribution in respect thereof
pursuant to subsection 4.13(f) or, if applicable. subsection 4.11(c)(i).
(b) On or before each Transfer Date, Transferor shall notify Servicer
of the amount of Interchange and Other Account Revenues to be included as
Finance Charge Collections with respect to the preceding Monthly Period as
determined pursuant to this subsection 3(b). The amount of Interchange to
be so included shall be equal to the product of (i) the total amount of
Interchange paid or payable to Transferor with respect to such Monthly
Period and (ii) a fraction, the numerator of which is the aggregate amount
of cardholder charges for goods and services in the Accounts with respect
to such Monthly Period, and the denominator of which is the aggregate
amount of cardholder charges for goods and services in all MasterCard and
VISA consumer revolving credit card accounts owned by Transferor with
respect to such Monthly Period. The amount of Other Account Revenues to be
so included shall be equal to the portion of the revenues in each
applicable category for the entire Bank Portfolio that is allocable to the
Accounts, as determined by Transferor using any reasonable method. On each
Transfer Date, Transferor shall pay to Servicer, and Servicer shall deposit
into the Finance Charge Account, in immediately available funds, the amount
of Interchange and Other Account Revenues to be so included as Finance
Charge Collections with respect to the preceding Monthly Period. Transferor
hereby assigns, sets over, conveys, pledges and grants a security interest
and lien to Trustee, for the benefit of the Investor Holders, in
Interchange and Other Account Revenues and the proceeds of both, as set
forth in this subsection 3(b). In connection with the foregoing grant of a
security interest, this Series Supplement shall constitute a security
agreement under applicable law. To the extent that a Supplement for a
related Series, other than Series 1997-1, assigns, sets over, conveys,
pledges or grants a security interest in Interchange and Other Account
21
Revenues allocable to the Trust, all investor certificates of any such
Series (except as otherwise specified in any such Supplement) and the
Investor Certificates shall rank pari passu and be equally and ratably
entitled as provided herein to the benefits of such Interchange and Other
Account Revenues without preference or priority on account of the actual
time or times of authentication and delivery, all in accordance with the
terms and provisions of this Series Supplement and other related
Supplements.
SECTION 4. Reassignment and Transfer Terms. The Investor Certificates
shall be subject to retransfer to Transferor at its option, in accordance
with subsection 12.2(a), on any Distribution Date on or after the
Distribution Date on which the Investor Interest is reduced to an amount
less than or equal to 5% of the Initial Investor Interest. The deposit
required in connection with any such repurchase shall include the amount,
if any, on deposit in the Principal Funding Account and will be equal to
the sum of (a) the Investor Interest and (b) accrued and unpaid interest on
the Investor Certificates through the day preceding the Distribution Date
on which the repurchase occurs.
SECTION 5. Delivery and Payment for the Investor Certificates.
Transferor shall execute and deliver the Series 1997-1 Certificates to
Trustee for authentication in accordance with Section 6.1. The Trustee
shall deliver such Certificates when authenticated in accordance with
Section 6.2.
SECTION 6. Depository; Form of Delivery of Investor Certificates;
Legends; Transfer Restrictions and Procedures. (a) The Class A Certificates
and the Class B Certificates shall be delivered as Book-Entry Certificates
as provided in Sections 6.1 and 6.10.
(b) The Depository for Series 1997-1 shall be The Depository Trust
Company, and the Class A Certificates shall be initially registered in the
name of Cede & Co., its nominee.
SECTION 7. Article IV of Agreement. Sections 4.1 through 4.5 shall
read in their entirety as provided in the Agreement. Article IV (except for
Sections 4.1 through 4.5 thereof) shall be read in its entirety as follows
and shall be applicable only to the Investor Certificates:
ARTICLE IV RIGHTS OF HOLDERS AND ALLOCATION AND
APPLICATION OF COLLECTIONS
SECTION 4.6 Rights of Holders and the Collateral Interest Holder. The
Investor Certificates shall represent undivided interests in the Trust,
consisting of the right to receive, to the extent necessary to make the
required payments with respect to such Investor Certificates at the times
and in the amounts specified in
22
this Agreement (and subject to reallocation as provided herein), (a) the
applicable Investor Percentage of Collections received with respect to the
Receivables and (b) funds on deposit in the Collection Account, the Finance
Charge Account, the Principal Account, the Principal Funding Account, the
Reserve Account and the Distribution Account. The Collateral Interest shall
be subordinate to the Class A Certificates and the Class B Certificates to
the extent described herein. The Class B Certificates shall be subordinate
to the Class A Certificates to the extent described herein. Transferor
shall not have any interest in the Collection Account, the Finance Charge
Account, the Principal Account, the Principal Funding Account, the Reserve
Account or the Distribution Account, except as specifically provided in
this Article IV.
SECTION 4.7 Allocations. (a) Allocations During the Revolving Period.
During the Revolving Period, Servicer shall allocate Collections to the
Investor Holders as follows:
(i) allocate to the Investor Holders an amount equal to
the product of (A) the Investor Percentage on the Date of
Processing of such Collections and (B) the aggregate amount of
Collections processed in respect of Finance Charge Receivables on
such Date of Processing;
(ii) allocate to the Investor Holders an amount equal to
the product of (A) the Collateral Allocation on the Date of
Processing of such Collections, (B) the Investor Percentage on the
Date of Processing of such Collections and (C) the aggregate
amount of Collections processed in respect of Principal
Receivables on such Date of Processing; and
(iii) allocate to the Investor Holders an amount equal to
the product of (A) the Class B Investor Allocation on the Date of
Processing of such Collections, (B) the Investor Percentage on the
Date of Processing of such Collections and (C) the aggregate
amount of Collections processed in respect of Principal
Receivables on such Date of Processing.
In addition, an amount equal to the product of (1) the Class A
Investor Allocation on the Date of Processing of such Collections, (2) the
Investor Percentage on the Date of Processing of such Collections and (3)
the aggregate amount of Collections processed in respect of Principal
Receivables on each Date of Processing shall be treated as Shared Principal
Collections.
(b) Allocations During the Controlled Amortization Period. During the
Controlled Amortization Period, Servicer shall allocate Collections to the
Investor Holders as follows:
23
(i) allocate to the Investor Holders an amount equal to
the product of (A) the Investor Percentage on the Date of
Processing of such Collections and (B) the aggregate amount of
Collections processed in respect of Finance Charge Receivables on
such Date of Processing;
(ii) allocate to the Investor Holders an amount equal to
the product of (A) the Collateral Allocation on the Date of
Processing of such Collections, (B) the Investor Percentage on the
Date of Processing of such Collections and (C) the aggregate
amount of Collections processed in respect of Principal
Receivables on such Date of Processing;
(iii) allocate to the Investor Holders an amount equal to
the product of (A) the Class B Investor Allocation on the Date of
Processing of such Collections, (B) the Investor Percentage on the
Date of Processing of such Collections and (C) the aggregate
amount of Collections processed in respect of Principal
Receivables on such Date of Processing; and
(iv) (A) allocate to the Investor Holders an amount equal
to the product of (1) the Class A Investor Allocation on the Date
of Processing of such Collections, (2) the Investor Percentage on
the Date of Processing of such Collections and (3) the aggregate
amount of Collections processed in respect of Principal
Receivables on such Date of Processing; provided that the amount
allocated pursuant to this subsection 4.7(b)(iv)(A) during any
Monthly Period shall not exceed the Controlled Deposit Amount for
the related Transfer Date (after taking into account any payments
to be made on the immediately preceding Distribution Date) and (B)
treat as Shared Principal Collections any amount not allocated as
a result of the proviso to clause (A).
(c) Allocations During the Rapid Amortization Period. During the Rapid
Amortization Period, Servicer shall allocate Collections to the Investor
Holders as follows:
(i) allocate to the Investor Holders an amount equal to
the product of (A) the Investor Percentage on the Date of
Processing of such Collections and (B) the aggregate amount of
Collections processed in respect of Finance Charge Receivables on
such Date of Processing;
(ii) allocate to the Investor Holders an amount equal to
the product of (A) the Collateral Allocation on the Date of
Processing of such Collections and (B) the Investor Percentage on
the Date of Processing of such Collections and (C) the aggregate
amount of Collections processed in respect of Principal
Receivables on such Date of Processing;
24
(iii) allocate to the Investor Holders an amount equal to
the product of (A) the Class B Investor Allocation on the Date of
Processing of such Collections, (B) the Investor Percentage on the
Date of Processing of such Collections and (C) the aggregate
amount of Collections processed in respect of Principal
Receivables on such Date of Processing; and
(iv) (A) allocate to the Investor Holders an amount equal
to the product of (1) the Class A Investor Allocation on the Date
of Processing of such Collections and (2) the Investor Percentage
on the Date of Processing of such Collections and (3) the
aggregate amount of Collections processed in respect of Principal
Receivables on such Date of Processing; provided that the
aggregate amount allocated pursuant to this subsection
4.7(c)(iv)(A) during any Monthly Period shall not exceed the
Adjusted Investor Interest as of the close of business on the last
day of the prior Monthly Period (after taking into account any
payments to be made on the Distribution Date relating to such
prior Monthly Period and deposits and any adjustments to be made
to the Invested Amount to be made on the Transfer Date relating to
such Monthly Period) and (B) treat as Shared Principal Collections
any amount not allocated as a result of the proviso to clause (A).
(d) Applications of Allocated Funds. During any period when Servicer
is permitted by Section 4.3 to make a single monthly deposit to the
Collection Account, amounts allocated to the Investor Holders pursuant to
Sections 4.7(a), (b) and (c) with respect to any Monthly Period need not be
deposited into the Collection Account or any Series Account prior to the
related Transfer Date, and, when so deposited, (x) may be deposited net of
any amounts required to be distributed to Transferor and, if First NBC is
Servicer, Servicer and (y) shall be deposited into the Finance Charge
Account (in the case of Collections of Finance Charge Receivables) and the
Principal Account (in the case of Collections of Principal Receivables (not
including any Shared Principal Collections allocated to Series 1997-1
pursuant to Section 4.16)), subject in either case to the proviso to the
next sentence. At any other time, amounts so allocated on each Date of
Processing shall be deposited on that Date of Processing into the Finance
Charge Account (in the case of Collections of Finance Charge Receivables)
and the Principal Account (in the case of Collections of Principal
Receivables (not including any Shared Principal Collections allocated to
Series 1996-A pursuant to Section 4.16)), provided that:
(i) with respect to any day falling after the LIBOR
Determination Date in each Monthly Period falling in the Revolving
Period or in that portion of each Monthly Period in the Controlled
Accumulation Period falling on or after the day on which
Collections of Principal Receivables equal to the related
Controlled Deposit Amount have been allocated
25
pursuant to subsection 4.7(b)(iv) and deposited pursuant to this
subsection 4.7(d)), Collections of Finance Charge Receivables
shall be deposited into the Finance Charge Account only until such
time as the aggregate amount so deposited, plus amounts similarly
deposited pursuant to the Supplement for each other outstanding
Series in Group I, equals the sum of (x) the sum (the "Target
Amount") of (A) the amounts of Class A Monthly Interest, Class B
Monthly Interest, and any Class A Deficiency Amount, Class A
Additional Interest, Class B Deficiency Amount and Class B
Additional Interest for the related Distribution Date, (B) if
First NBC is not Servicer, the Class A Servicing Fee, Class B
Servicing Fee and Collateral Interest Servicing Fee for the
related Distribution Date, (C) any Collateral Monthly Interest due
on the related Transfer Date, plus (y) the target amounts for each
other Series in Group I, calculated as provided in the related
Supplements, plus (z) any Finance Charge Shortfalls (as defined in
the related Supplement) for any outstanding Excess Allocation
Series not included in Group I; and
(ii) with respect to each Monthly Period falling in the
Revolving Period, Collections of Principal Receivables allocated
to the Investor Holders pursuant to Section 4.7(a)(ii) and (iii)
shall (after an amount equal to any Collateral Monthly Principal
for that Monthly Period has been deposited into the Principal
Account) be paid to Transferor (or, if the Transferor Interest is
less than the Minimum Transferor Interest, deposited into the
Excess Funding Account), but Transferor shall make an amount equal
to the Reallocated Principal Collections for the related Transfer
Date available on that Transfer Date for application in accordance
with Section 4.15.
With respect to any Monthly Period when deposits of Collections of Finance
Charge Receivables into the Finance Charge Account are limited in
accordance with clause (i) of the preceding proviso, notwithstanding such
limitation: (1) "Excess Spread" for the related Transfer Date shall be
calculated as if the full amount of Finance Charge Collections allocated to
the Investor Certificates during that Monthly Period had been deposited in
the Finance Charge Account and applied on such Transfer Date in accordance
with Sections 4.11(a), 4.11(b) and 4.11(c); (2) Collections of Finance
Charge Receivables released to Transferor pursuant to such clause (i) shall
be deemed, for purposes of all calculations under this Supplement and the
Loan Agreement, to have been distributed on account of or otherwise applied
to the items specified in Sections 4.11(a), 4.11(b), 4.11(c) and 4.13 to
which such amounts would have been applied (and in the priority in which
they would have been applied) had such amounts been available in the
Finance Charge Account on such Transfer Date. To avoid doubt, the
calculations referred to in the preceding clause (2) include the
calculations required by clause (c) of the definition of Class A Investor
Interest, clause (f) of the definition of
26
Class B Investor Interest, clause (f) of the definition of Collateral
Interest and Section 4.10.
Notwithstanding clause (i) above, if on any Business Day Servicer
determines that the Target Amount for a Monthly Period exceeds the Target
Amount for that Monthly Period as previously calculated by Servicer, then
(x) Servicer shall (on the same Business Day) inform Transferor of such
determination, and (y) within two Business Days of receiving such notice
Transferor shall deposit into the Finance Charge Account funds in an amount
equal to the amount of Collections of Finance Charge Receivables allocated
to the Investor Certificates for that Monthly Period but not deposited into
the Finance Charge Account due to the operation of clause (i) (but not in
excess of the amount required so that the aggregate amount deposited for
the subject Monthly Period equals the Target Amount). In addition, if on
any Transfer Date the Transferor Interest will be less than the Minimum
Transferor Interest after giving effect to all transfers and deposits on
that Transfer Date, Transferor shall, on that Transfer Date, deposit into
the Principal Account funds in an amount equal to the amounts of Class A
Available Funds and Excess Spread that are required to be treated as
Investor Principal Collections pursuant to Sections 4.11(a)(iii) and 4.13
but are not available from funds in the Finance Charge Account as a result
of the operation of clause (i).
(e) Allocation Adjustments. Unless the Servicer is depositing
Collections monthly pursuant to Section 4.3, on each Collection
Recomputation Date to and including the Collection Recomputation Date after
the Collection Recomputation Date referred to in clause (ii) below, the
Servicer shall recompute the allocations to the Series 1997-1 Certificates
previously made pursuant to subsections 4.7(a), (b) and (c)
(i) in the case of a Collection Recomputation Date which
occurs prior to the Conversion Date, during each Billing Cycle
which ended during the preceding Monthly Period and
(ii) in the case of the Collection Recomputation Date
which occurs in the Monthly Period in which the Conversion Date
occurs, during each Billing Cycle which ended during the preceding
Monthly Period and on any other Date of Processing during such
Monthly Period prior to the Conversion Date
(such allocations with respect to any such period, the "Estimated
Allocations") based on the Collected Finance Charge Receivables and the
Collected Principal Receivables (such allocations with respect to any such
period, the "Actual Allocations"), and based on the Actual Allocations of
Finance Charge Receivables
27
and Principal Receivables not later than 11:00 a.m. New York City time on
the Transfer Date following such Collection Recomputation Date:
(1) make any necessary deposits or withdrawals with
respect to the Finance Charge Account and the Principal Account
such that the amount on deposit in each such account with respect
to such Monthly Period is equal to the amount that would have been
on deposit if the Actual Allocation of Finance Charge Receivables
and the Actual Allocation of Principal Receivables had been made
on each day during such Monthly Period;
(2) pay to the Holder of the Transferor Certificate any
underpayment with respect to allocations of Principal Receivables
or Finance Charge Receivables with respect to such Monthly Period;
(3) notify the Holder of the Transferor Certificate of
the amount of any overpayment to such Holder which such
recomputation discloses, and the Holder of the Transferor
Certificate shall deposit into the Finance Charge Account, the
Principal Account and the Excess Funding Account, as provided in
the notice from the Servicer, any portion of any such overpayment
which resulted in a shortfall in the amounts deposited into each
such account; and
(4) for the purposes of administrative convenience,
payments to be made to the Holder of the Transferor Certificate
and deposits to be made by the Holder of the Transferor
Certificate pursuant to this subsection 4.7(e) may be netted
against each other.
It is the intention of the parties that this subsection 4.7(e) be
construed so that the reallocation provided for herein shall result in the
Series 1997-1 Certificateholders and the Collateral Interest Holder on the
one hand and the Holder of the Transferor Certificate on the other hand
being in the same position they would have been in if the Estimated
Allocations had been based upon actual Collections of Principal
Receivables.
(f) Certain Investment Earnings. On each Transfer Date, Servicer shall
allocate to the Investor Holders an amount equal to the product of the
Investor Percentage for the related Monthly Period and the aggregate amount
of interest and other investment earnings (net of losses and investment
expenses) accrued on or prior to the related Transfer Date in connection
with the investment of funds on deposit in the Collection Account, the
Distribution Account, the Excess Funding Account and the Finance Charge
Account and apply such amount as provided in subsection 4.7(d) as if such
amount had been allocated to the Investor
28
Holders as Collections of Finance Charge Receivables during the related
Monthly Period.
(g) Errors. On any date, Servicer may withdraw from the Collection
Account or any Series Account any amounts inadvertently deposited in such
account that should have not been so deposited.
SECTION 4.8 Determination of Monthly Interest. (a) The amount of
monthly interest distributable to the Class A Certificates shall equal the
product of (i) (A) a fraction, the numerator of which is the actual number
of days in the related Interest Period and the denominator of which is 360,
times (B) the Class A Certificate Rate in effect with respect to the
related Interest Period times (ii) the outstanding principal balance of the
Class A Certificates determined as of the Record Date preceding the related
Transfer Date, provided that on the first Distribution Date interest will
be distributable to the Class A Certificates in the amount of $_________
(the "Class A Monthly Interest"); provided further that in addition to
Class A Monthly Interest an amount equal to the amount of any unpaid Class
A Deficiency Amounts, as defined below plus an amount equal to the product
of (A) a fraction, the numerator of which is the actual number of days in
the related Interest Period and the denominator of which is 360, times (B)
the sum of the Class A Certificate Rate in effect with respect to the
related Interest Period plus 2% per annum, and (B) any Class A Deficiency
Amount from the prior Transfer Date, as defined below (or the portion
thereof that has not theretofore been paid to Class A Holders) (the "Class
A Additional Interest"), shall also be distributable to the Class A
Certificates, and on such Transfer Date Trustee shall deposit such funds,
to the extent available, into the Distribution Account. The "Class A
Deficiency Amount" for any Transfer Date shall equal the excess, if any, of
the aggregate amount accrued pursuant to this subsection 4.8(a) as of the
prior Interest Period over the amount actually transferred to the
Distribution Account for payment of such amount. Notwithstanding anything
to the contrary herein, Class A Additional Interest shall be payable or
distributed to the Class A Certificateholders only to the extent permitted
by applicable law.
(b) The amount of monthly interest distributable to the Class B
Certificates shall equal the product of (i) (A) a fraction, the numerator
of which is the actual number of days in the related Interest Period and
the denominator of which is 360, times (B) the Class B Certificate Rate in
effect with respect to the related Interest Period times (ii) the
outstanding principal balance of the Class B Certificates determined as of
the Record Date preceding the related Transfer Date (the "Class B Monthly
Interest"); provided that on the first Distribution Date interest will be
distributable to the Class B Certificates in an amount equal to
$______________; provided, further that in addition to the Class B Monthly
Interest, an amount equal to the amount of any unpaid Class B Deficiency
Amounts, as defined below, plus an amount equal to the product of (A) a
29
fraction, the numerator of which is the actual number of days in the
related Interest Period and the denominator of which is 360, times (B) the
sum of the Class B Certificate Rate in effect with respect to the related
Interest Period plus 2% per annum, and (B) any Class B Deficiency Amount
from the prior Transfer Date, as defined below (or the portion thereof
which has not theretofore been paid to Class B Holders) (the "Class B
Additional Interest") shall also be distributable to the Class B
Certificates, and on such Transfer Date Trustee shall deposit such funds,
to the extent available, into the Distribution Account. The "Class B
Deficiency Amount" for any Transfer Date shall equal the excess, if any, of
the aggregate amount accrued pursuant to this subsection 4.8(b) as of the
prior Interest Period over the amount actually transferred to the
Distribution Account for payment of such amount. Notwithstanding anything
to the contrary herein, Class B Additional Interest shall be payable or
distributed to the Class B Certificateholders only to the extent permitted
by applicable law.
(c) The amount of monthly interest distributable to the Collateral
Interest shall equal the product of (i) (A) a fraction, the numerator of
which is the actual number of days in the related Interest Period and the
denominator of which is 360, times (B) the Collateral Rate in effect with
respect to the related Interest Period, times (ii) the Collateral Interest
determined as of the Record Date preceding such Transfer Date, provided
that on the first Distribution Date interest will be distributable to the
Collateral Interest in an amount equal to the sum of (A) the product of (x)
a fraction, the numerator of which is the actual number of days during the
period from and including the Closing Date through _____________ __, 1997
and the denominator of which is 360, times (y) the Collateral Rate in
effect for such period, determined using the LIBOR Determination Date for
such period, times (z) the outstanding principal balance of the Collateral
Interest as of the Closing Date, plus (B) the product of (x) a fraction,
the numerator of which is the actual number of days during the period from
and including _____________ __, 1997 through ___________ __, 1997 and the
denominator of which is 360, times (y) the Collateral Rate in effect for
such period, determined using the LIBOR Determination Date for such period,
times (z) the outstanding principal balance of the Collateral Interest
determined as of the Closing Date (the "Collateral Monthly Interest");
provided that for the purposes of determining Collateral Monthly Interest
only, the Collateral Rate shall not exceed a per annum rate of [1]% in
excess of LIBOR, as determined on the related LIBOR Determination Date.
SECTION 4.9 Determination of Monthly Principal. (a) The amount of
monthly principal distributable from the Principal Account with
respect to the Class A Certificates on each Transfer Date ("Class A
Monthly Principal"), beginning with the Transfer Date in the month
following the month in which the Controlled Accumulation Period begins
or, if earlier, the Transfer Date following the commencement of the
Rapid Amortization Period, shall be equal to the least
30
of (i) the Available Investor Principal Collections on deposit in the
Principal Account with respect to such Transfer Date, (ii) for each
Transfer Date with respect to the Controlled Accumulation Period prior to
the Class A Scheduled Payment Date, the Controlled Deposit Amount for such
Transfer Date and (iii) the Class A Adjusted Investor Interest on such
Transfer Date prior to any deposit into the Principal Funding Account to be
made on such day.
(b) The amount of monthly principal distributable from the Principal
Account with respect to the Class B Certificates on each Transfer Date (the
"Class B Monthly Principal") for the Controlled Accumulation Period,
beginning with the Transfer Date after the one on which the Class A
Adjusted Investor Interest is reduced to zero (and for the Rapid
Amortization Period beginning with the Transfer Date on which the Class A
Investor Interest is reduced to zero, after giving effect to payments to be
made on the related Distribution Date), shall be an amount equal to the
lesser of (i) the excess, if any, of (A) the Available Investor Principal
Collections on such Transfer Date over (B) the Class A Monthly Principal on
such Transfer Date, if any, and (ii) the Class B Investor Interest (after
taking into account any adjustments to be made on such Transfer Date
pursuant to Sections 4.12 and 4.15) on such Transfer Date.
(c) The amount of monthly principal (the "Collateral Monthly
Principal") distributable from the Principal Account with respect to the
Collateral Interest on each Transfer Date shall be (i) if any reduction of
the Required Collateral Interest has occurred pursuant to clause (z) of the
proviso in the definition thereof during the Revolving Period, an amount
equal to the lesser of (A) the excess, if any, of the Collateral Interest
(after taking into account any adjustments to be made on such Transfer Date
pursuant to Sections 4.12 and 4.15) over the Required Collateral Interest
on such Transfer Date, and (B) the Available Investor Principal Collections
on such Transfer Date or (ii) at all times during the Controlled
Accumulation Period or Rapid Amortization Period, an amount equal to the
lesser of (A) the excess, if any, of the Collateral Interest (after taking
into account any adjustments to be made on such Transfer Date pursuant to
Sections 4.12 and 4.15) over the Required Collateral Interest on such
Transfer Date and (B) the excess, if any, of (1) the Available Investor
Principal Collections on such Transfer Date over (2) the sum of the Class A
Monthly Principal and the Class B Monthly Principal for such Transfer Date.
SECTION 4.10 Coverage of Required Amount. (a) On or before each
Transfer Date, Servicer shall determine the amount (the "Class A Required
Amount"), if any, by which the sum of (i) the Class A Monthly Interest for
such Transfer Date, plus (ii) the Class A Deficiency Amount, if any, for
such Transfer Date, plus (iii) the Class A Additional Interest, if any, for
such Transfer Date, plus (iv) the Class A Servicing Fee for the prior
Monthly Period, plus (v) the Class A Servicing Fee, if any, due but not
paid on any prior Transfer Date, plus
31
(vi) the Class A Net Default Amount, if any, for such Transfer Date,
exceeds the Class A Available Funds for the related Monthly Period.
(b) On or before each Transfer Date, Servicer shall also determine the
amount (the "Class B Required Amount"), if any, equal to the sum of (i) the
amount, if any, by which the sum of (A) the Class B Monthly Interest for
such Transfer Date, plus (B) the Class B Deficiency Amount, if any, for
such Transfer Date, plus (C) the Class B Additional Interest, if any, for
such Transfer Date, plus (D) the Class B Servicing Fee for the prior
Monthly Period, plus (E) the Class B Servicing Fee, if any, due but not
paid on any prior Transfer Date, exceeds the Class B Available Funds for
the related Monthly Period, plus (ii) the Class B Net Default Amount, if
any, for the prior Monthly Period.
(c) If the sum of the Class A Required Amount and the Class B Required
Amount for such Transfer Date is greater than zero, Servicer shall give
written notice to Trustee of such positive Class A Required Amount and/or
Class B Required Amount on or before such Transfer Date. In addition:
(i) If the Class A Required Amount for such Transfer Date
is greater than zero, all or a portion of the Excess Spread with
respect to such Transfer Date in an amount equal to the Class A
Required Amount, to the extent available, for such Transfer Date
shall be distributed from the Finance Charge Account on such
Transfer Date pursuant to subsection 4.13(a). If the Class A
Required Amount for such Transfer Date exceeds the amount of
Excess Spread with respect to such Transfer Date, the Collections
of Principal Receivables allocable to the Collateral Interest and
the Class B Certificates with respect to the prior Monthly Period
shall be applied as specified in Section 4.15.
(ii) If the Class B Required Amount for such Transfer
Date is greater than zero, all or a portion of the Excess Spread
with respect to such Transfer Date in an amount equal to the Class
B Required Amount, to the extent available, for such Transfer Date
shall be distributed from the Finance Charge Account on such
Transfer Date pursuant to subsection 4.13(c). If the Class B
Required Amount for such Transfer Date exceeds the amount of
Excess Spread available to fund the Class B Required Amount
pursuant to subsection 4.13(c), the Collections of Principal
Receivables allocable to the Collateral Interest (after
application to the Class A Required Amount) shall be applied as
specified in Section 4.15; provided that the sum of any payments
pursuant to this subsection 4.10(c) shall not exceed the sum of
the Class A Required Amount and the Class B Required Amount.
32
SECTION 4.11 Monthly Payments. On or before each Transfer Date,
Servicer shall instruct Trustee in writing (which writing shall be
substantially in the form of Exhibit B to the Series Supplement) to
withdraw, and Trustee, acting in accordance with such instructions, shall
withdraw on such Transfer Date or the related Distribution Date, as
applicable, to the extent of available funds, the amounts required to be
withdrawn from the Finance Charge Account, the Principal Account, the
Principal Funding Account and the Distribution Account as follows:
(a) An amount equal to the Class A Available Funds for the related
Monthly Period will be distributed on each Transfer Date, to the extent
available, in the following priority:
(i) an amount equal to Class A Monthly Interest plus any
Class A Deficiency Amount plus any Class A Additional Interest (in
each case for such Transfer Date) shall be deposited by Servicer
or Trustee into the Distribution Account;
(ii) an amount equal to the Class A Servicing Fee for
such Transfer Date plus any Class A Servicing Fee due but not paid
to Servicer on any prior Transfer Date shall be distributed to
Servicer;
(iii) an amount equal to the Class A Net Default Amount,
if any, for the preceding Monthly Period shall be treated as a
portion of Investor Principal Collections and deposited into the
Principal Account on such Transfer Date; and
(iv) the balance, if any, shall constitute Excess Spread
and shall be allocated and distributed as set forth in Section
4.13.
(b) An amount equal to the Class B Available Funds for the related
Monthly Period will be distributed on each Transfer Date, to the extent
available, in the following priority:
(i) an amount equal to the Class B Monthly Interest plus
any Class B Deficiency Amount plus any Class B Additional Interest
(in each case for such Transfer Date) shall be deposited by
Servicer or Trustee into the Distribution Account;
(ii) an amount equal to the Class B Servicing Fee for
such Transfer Date plus any Class B Servicing Fee due but not paid
to Servicer on any prior Transfer Date for such Transfer Date
shall be distributed to Servicer; and
33
(iii) the balance, if any, shall constitute Excess Spread
and shall be allocated and distributed as set forth in Section
4.13.
(c) An amount equal to the Collateral Available Funds for the related
Monthly Period will be distributed on each Transfer Date, to the extent
available, in the following priority:
(i) if Transferor or Trustee is no longer Servicer, an
amount equal to the Collateral Interest Servicing Fee for such
Transfer Date plus any Collateral Interest Servicing Fee due but
not paid to Servicer on any prior Transfer Date shall be
distributed to Servicer; and
(ii) the balance, if any, shall constitute Excess Spread
and shall be allocated and distributed as set forth in Section
4.13.
(d) During the Revolving Period, an amount equal to the Available
Investor Principal Collections for the related Monthly Period will be
distributed on each Transfer Date, to the extent available, in the
following priority:
(i) an amount equal to the Collateral Monthly Principal
for such Transfer Date shall be distributed to the Collateral
Interest Holder in accordance with the Loan Agreement;
(ii) an amount equal to the lesser of (A) the product of
(1) a fraction, the numerator of which is equal to the Available
Investor Principal Collections remaining after the application
specified in subsection 4.11(d)(i) and the denominator of which is
equal to the sum of (x) the Shared Principal Collections
(determined in accordance with clause (b) of the definition
thereof), plus (y) the Available Investor Principal Collections
remaining after the application specified in subsection 4.11(d)(i)
and (2) the Cumulative Series Principal Shortfall and (B)
Available Investor Principal Collections shall remain in the
Principal Account to be treated as Shared Principal Collections
and applied to Principal Sharing Series other than this Series
1997-1; and
(iii) an amount equal to the excess, if any, of (A) the
Available Investor Principal Collections for such Transfer Date
over (B) the applications specified in subsections 4.11(d)(i) and
(ii) above shall be paid to the Holder of the Transferor
Certificate; provided that the amount to be paid to the Holder of
the Transferor Certificate pursuant to this subsection
4.11(d)(iii) with respect to such Transfer Date shall be paid to
the Holder of the Transferor Certificate only to the extent that
the Transferor Interest on such Transfer Date is greater than the
Minimum Transferor Interest (after giving effect to the inclusion
in the Trust of all Receivables created
34
on or prior to such Transfer Date and the application of payments
referred to in subsection 4.3(b)) and otherwise shall be deposited
into the Excess Funding Account in accordance with subsection
4.7(d).
(e) During the Controlled Accumulation Period or the Rapid
Amortization Period, an amount equal to the Available Investor Principal
Collections for the related Monthly Period will be distributed on each
Transfer Date, beginning with the Transfer Date in the month following the
month in which the Controlled Accumulation Period began or the Transfer
Date following the commencement of the Rapid Amortization Period, as
applicable, to the extent available, in the following priority:
(i) an amount equal to the Class A Monthly Principal for
such Transfer Date shall be, (A) during the Controlled
Accumulation Period, deposited into the Principal Funding Account,
and (B) during the Rapid Amortization Period, deposited into the
Distribution Account;
(ii) after giving effect to the distribution referred to
in clause (i), an amount equal to the Class B Monthly Principal
shall be deposited into the Distribution Account;
(iii) for each Transfer Date (other than the Transfer
Date immediately preceding the Series 1997-1 Termination Date, in
which case on the Series 1997-1 Termination Date), after giving
effect to the distribution referred to in clauses (i) and (ii), an
amount equal to Collateral Monthly Principal shall be distributed
to the Collateral Interest Holder in accordance with the Loan
Agreement;
(iv) an amount equal to the lesser of (A) the product of
(1) a fraction, the numerator of which is equal to the Available
Investor Principal Collections remaining after the application
specified in subsections 4.11(e)(i), (ii) and (iii) and the
denominator of which is equal to the sum of the Shared Principal
Collections (determined in accordance with clause (b) of the
definition thereof), and (2) the Cumulative Series Principal
Shortfall and (B) the Available Investor Principal Collections
shall remain in the Principal Account to be treated as Shared
Principal Collections and applied to Principal Sharing Series
other than this Series 1997-1; and
(v) an amount equal to the excess, if any, of (A) the
Available Investor Principal Collections over (B) the applications
specified in subsections 4.11(e)(i) through (iv) shall be paid to
the Holder of the Transferor Certificate; provided that the amount
to be paid to the Holder of the Transferor Certificate pursuant to
this subsection 4.11(e)(v) with
35
respect to such Transfer Date shall be paid to the Holder of the
Transferor Certificate only to the extent that the Transferor
Interest on such Transfer Date is greater than the Minimum
Transferor Interest (after giving effect to the inclusion in the
Trust of all Receivables created on or prior to such Transfer Date
and the application of payments referred to in subsection 4.3(b))
and otherwise shall be deposited into the Excess Funding Account
in accordance with subsection 4.7(d).
(f) On the earlier to occur of (i) the first Transfer Date with
respect to the Rapid Amortization Period and (ii) the Transfer Date
immediately preceding the Class A Scheduled Payment Date, Trustee, acting
in accordance with instructions from Servicer, shall withdraw from the
Principal Funding Account and deposit in the Distribution Account the
amount on deposit in the Principal Funding Account.
(g) On each Distribution Date, Trustee shall pay (i) in accordance
with subsection 5.1(a) to the Class A Holders from the Distribution
Account, the amount deposited into the Distribution Account pursuant to
subsection 4.11(a)(i) on the preceding Transfer Date and (ii) in accordance
with subsection 5.1(b) to the Class B Holders from the Distribution
Account, the amount deposited into the Distribution Account pursuant to
subsection 4.11(b)(i) on the preceding Transfer Date.
(h) On the earlier to occur of (i) the first Distribution Date with
respect to the Rapid Amortization Period and (ii) the Class A Scheduled
Payment Date and on each Distribution Date thereafter, Trustee, acting in
accordance with instructions from Servicer, shall pay in accordance with
Section 5.1 from the Distribution Account the amount so deposited into the
Distribution Account pursuant to subsections 4.11(e) and (f) on the related
Transfer Date in the following priority:
(i) an amount equal to the lesser of such amount on
deposit in the Distribution Account and the Class A Investor
Interest shall be paid to the Class A Holders; and
(ii) for each Distribution Date with respect to the Rapid
Amortization Period and on the Class B Scheduled Payment Date,
after giving effect to the distributions referred to in clause (i)
above, an amount equal to the lesser of such amount on deposit in
the Distribution Account and the Class B Investor Interest shall
be paid to the Class B Holders.
(i) The Controlled Accumulation Period is scheduled to commence at the
close of business on the Controlled Accumulation Date; provided that if the
Controlled Accumulation Period Length (determined as described below) on any
36
Determination Date on or after the __________ __________ Determination Date
is less than [twelve] months, upon written notice to Trustee, Transferor
and each Rating Agency, Servicer, at its option, may elect to modify the
date on which the Controlled Accumulation Period actually commences to the
first day of the month that is a number of months prior to the month in
which the Class A Scheduled Payment Date occurs at least equal to the
Controlled Accumulation Period Length (so that as a result of such election
the number of Monthly Periods in the Controlled Accumulation Period will at
least equal the Controlled Accumulation Period Length); provided that (i)
the length of the Controlled Accumulation Period will not be less than
[one] month; (ii) such determination of the Controlled Accumulation Period
Length shall be made on each Determination Date on and after the __________
_________ Determination Date but prior to the commencement of the
Controlled Accumulation Period, and any election to shorten the Controlled
Accumulation Period shall be subject to the subsequent lengthening of the
Controlled Accumulation Period to the Controlled Accumulation Period Length
determined on any subsequent Determination Date, but the Controlled
Accumulation Period shall in no event commence prior to the Controlled
Accumulation Date and (iii) notwithstanding any other provision of this
Series Supplement to the contrary, no election to postpone the commencement
of the Controlled Accumulation Period shall be made after a Pay Out Event
shall have occurred and be continuing with respect to any other Series. The
"Controlled Accumulation Period Length" will mean a number of months such
that the amount available for distribution of principal on the Class A
Certificates on the Class A Scheduled Payment Date is expected to equal or
exceed the Class A Investor Interest, assuming for this purpose that (1)
the payment rate with respect to Collections of Principal Receivables
remains constant at the lowest level of such payment rate during the
[twelve] preceding Monthly Periods (or such lower payment rate as Servicer
may select), (2) the total amount of Principal Receivables in the Trust
(and the principal amount on deposit in the Excess Funding Account, if any)
remains constant at the level on such date of determination, (3) no Pay Out
Event with respect to any Series will subsequently occur and (4) no
additional Series (other than any Series being issued on such date of
determination) will be subsequently issued. Any notice by Servicer electing
to modify the commencement of the Controlled Accumulation Period pursuant
to this clause (i) shall specify (i) the Controlled Accumulation Period
Length, (ii) the commencement date of the Controlled Accumulation Period
and (iii) the Controlled Accumulation Amount with respect to each Monthly
Period during the Controlled Accumulation Period.
SECTION 4.12 Series Investor Charge-Offs. (a) On or before each
Transfer Date, Servicer shall calculate the Class A Net Default Amount. If,
on any Transfer Date, the Class A Net Default Amount for the prior Monthly
Period exceeds the sum of the amounts available for allocation with respect
thereto pursuant to subsection 4.11(a)(iii), subsection 4.13(a) and Section
4.15 with
37
respect to such Monthly Period, then the Collateral Interest (after giving
effect to reductions for any Collateral Charge-Offs and any Reallocated
Principal Collections on such Transfer Date) will be reduced by the amount
of such excess, but not by more than the lesser of the Class A Net Default
Amount and the Collateral Interest (after giving effect to reductions for
any Collateral Charge-Offs and any Reallocated Principal Collections on
such Transfer Date) for such Transfer Date. If such reduction would cause
the Collateral Interest to be a negative number, the Collateral Interest
will be reduced to zero, and the Class B Investor Interest (after giving
effect to reductions for any Class B Investor Charge-Offs and any
Reallocated Class B Principal Collections on such Transfer Date) will be
reduced by the amount by which the Collateral Interest would have been
reduced below zero. If such reduction would cause the Class B Investor
Interest to be a negative number, the Class B Investor Interest will be
reduced to zero, and the Class A Investor Interest will be reduced by the
amount by which the Class B Investor Interest would have been reduced below
zero, but not by more than the Class A Net Default Amount for such Transfer
Date (a "Class A Investor Charge-Off"). If the Class A Investor Interest
has been reduced by the amount of any Class A Investor Charge-Offs, it will
be reimbursed on any Transfer Date by the amount of Excess Spread allocated
and available for such purpose pursuant to subsection 4.13(b).
(b) On or before each Transfer Date, Servicer shall calculate the
Class B Net Default Amount. If, on any Transfer Date, the Class B Net
Default Amount for the prior Monthly Period exceeds the amount of Excess
Spread and Reallocated Collateral Principal Collections that are allocated
and available to fund such amount pursuant to subsection 4.13(c) and
Section 4.15, the Collateral Interest (after giving effect to reductions
for any Collateral Charge-Offs and any Reallocated Principal Collections on
such Transfer Date and any adjustments with respect thereto as described in
subsection 4.12(a)) will be reduced by the amount of such excess, but not
by more than the lesser of the Class B Net Default Amount and the
Collateral Interest (after giving effect to reductions for any Collateral
Charge-Offs and any Reallocated Principal Collections on such Transfer Date
and any adjustments with respect thereto as described in subsection
4.12(a)) for such Transfer Date. If such reduction would cause the
Collateral Interest to be a negative number, the Collateral Interest shall
be reduced to zero and the Class B Investor Interest shall be reduced by
the amount by which the Collateral Interest would have been reduced below
zero, but not by more than the Class B Net Default Amount for such Transfer
Date (a "Class B Investor Charge-Off"). The Class B Investor Interest will
also be reduced by the amount of Reallocated Class B Principal Collections
in excess of the Collateral Interest pursuant to Section 4.15 and the
amount of any portion of the Class B Investor Interest allocated to the
Class A Certificates to avoid a reduction in the Class A Investor Interest
pursuant to subsection 4.12(a). The Class B Investor Interest will
38
thereafter be reimbursed on any Transfer Date by the amount of Excess
Spread allocated and available for that purpose as described under
subsection 4.13(d).
(c) On or before each Transfer Date, Servicer shall calculate the
Collateral Net Default Amount. If, on any Transfer Date, the Collateral Net
Default Amount for the prior Monthly Period exceeds the amount of Excess
Spread which is allocated and available to fund such amount pursuant to
subsection 4.13(g), the Collateral Interest will be reduced by the amount
of such excess but not by more than the lesser of the Collateral Net
Default Amount and the Collateral Interest for such Transfer Date (a
"Collateral Charge-Off"). The Collateral Interest will also be reduced by
the amount of Reallocated Principal Collections pursuant to Section 4.15
and the amount of any portion of the Collateral Interest allocated to the
Class A Certificates or the Class B Certificates to avoid a reduction in
the Class A Investor Interest, pursuant to subsection 4.12(a), or the Class
B Investor Interest, pursuant to subsection 4.12(b), respectively. The
Collateral Interest will thereafter be reimbursed on any Transfer Date by
the amount of the Excess Spread allocated and available for that purpose as
described under subsection 4.13(h).
SECTION 4.13 Excess Spread. On or before each Transfer Date, Servicer
shall instruct Trustee in writing (which writing shall be substantially in
the form of Exhibit B to the Series Supplement) to apply, and Trustee,
acting in accordance with such instructions shall apply, Excess Spread with
respect to the related Monthly Period, to make the following distributions
on each Transfer Date in the following priority:
(a) an amount equal to the Class A Required Amount, if any, with
respect to such Transfer Date will be used to fund the Class A Required
Amount and be applied in accordance with, and in the priority set forth in,
subsection 4.11(a);
(b) an amount equal to the aggregate amount of Class A Investor
Charge- Offs which have not been previously reimbursed will be treated as a
portion of Investor Principal Collections and deposited into the Principal
Account on such Transfer Date;
(c) an amount equal to the Class B Required Amount, if any, with
respect to such Transfer Date will be used to fund the Class B Required
Amount and be applied first in accordance with, and in the priority set
forth in, subsection 4.11(b) and then any remaining amount available to pay
the Class B Net Default Amount shall be treated as a portion of Investor
Principal Collections and deposited into the Principal Account on such
Transfer Date;
(d) an amount equal to the aggregate amount by which the Class B
Investor Interest has been reduced below the Class B Initial Investor
Interest for
39
reasons other than the payment of principal to the Class B Holders (but not
in excess of the aggregate amount of such reductions which have not been
previously reimbursed) will be treated as a portion of Investor Principal
Collections and deposited into the Principal Account on such Transfer Date;
(e) an amount equal to the Collateral Monthly Interest plus the amount
of any past due Collateral Monthly Interest for such Transfer Date will be
held in the Finance Charge Account, invested overnight in Permitted
Investments and paid to the Collateral Interest Holder on the related
Distribution Date in accordance with the Loan Agreement;
(f) if Transferor or Trustee is Servicer, an amount equal to the
aggregate amount of accrued but unpaid Collateral Interest Servicing Fee
will be paid to Servicer;
(g) an amount equal to the Collateral Net Default Amount, if any, for
the prior Monthly Period will be treated as a portion of Investor Principal
Collections and deposited into the Principal Account on such Transfer Date;
(h) an amount equal to the aggregate amount by which the Collateral
Interest has been reduced below the Required Collateral Interest for
reasons other than the payment of principal to the Collateral Interest
Holder (but not in excess of the aggregate amount of such reductions which
have not been previously reimbursed) will be treated as a portion of
Investor Principal Collections and deposited into the Principal Account on
such Transfer Date;
(i) on each Transfer Date from and after the Reserve Account Funding
Date, but prior to the date on which the Reserve Account terminates as
described in subsection 4.18(f), an amount up to the excess, if any, of the
Required Reserve Account Amount over the Available Reserve Account Amount
shall be deposited into the Reserve Account;
(j) an amount equal to all other amounts specified in the Loan
Agreement (to the extent payable from "Available Non-Principal Funds," as
defined therein) shall be held in the Finance Charge Account, invested
overnight in Permitted Investments and distributed on the related
Distribution Date in accordance with the Loan Agreement; and
(k) the balance, if any, after giving effect to the payments made
pursuant to clauses (a) through (j), shall constitute "Excess Finance
Charge Collections" to be applied with respect to other Principal Sharing
Series in accordance with Section 4.5 of the Agreement.
40
SECTION 4.14 Reallocated Investor Finance Charge Collections. (a) That
portion of Group I Investor Finance Charge Collections for any Transfer
Date equal to the amount of Reallocated Investor Finance Charge Collections
for such Transfer Date will be allocated to Series 1997-1 and will be
distributed as set forth in this Supplement.
(b) Reallocated Investor Finance Charge Collections with respect to
any Transfer Date shall equal the sum of (i) the aggregate amount of Series
Monthly Interest, Series Monthly Fees, Series Net Default Amount and Series
Investor Charge-Offs for such Distribution Date and (ii) that portion of
excess Group I Investor Finance Charge Collections to be included in
Reallocated Investor Finance Charge Collections pursuant to subsection
4.14(c); provided that if the amount of Group I Investor Finance Charge
Collections for such Distribution Date is less than the sum of (w) Group I
Investor Monthly Interest, (x) Group I Investor Monthly Fees, (y) Group I
Net Default Amount and (z) Group I Investor Charge-Offs, then "Reallocated
Investor Finance Charge Collections" shall equal the sum of the following
amounts for such Distribution Date:
(A) The product of (I) Group I Investor Finance Charge
Collections (up to the amount of Group I Investor Monthly
Interest) and (II) a fraction, the numerator of which is Series
Monthly Interest and the denominator of which is Group I Investor
Monthly Interest;
(B) the product of (I) Group I Investor Finance Charge
Collections less the amount of Group I Investor Monthly Interest
(up to the Group I Investor Monthly Fees) and (II) a fraction, the
numerator of which is the Series Monthly Fees and the denominator
of which is the Group I Investor Monthly Fees;
(C) the product of (I) Group I Investor Finance Charge
Collections less the amount of Group I Investor Monthly Interest
and the Group I Investor Monthly Fees (up to Group I Net Default
Amount) and (II) a fraction, the numerator of which is Series Net
Default Amount and the denominator of which is Group I Net Default
Amount; and
(D) the product of (I) Group I Investor Finance Charge
Collections less the sum of (x) Group I Investor Monthly Interest,
(y) the Group I Investor Monthly Fees and (z) Group I Net Default
Amount and (II) a fraction, the numerator of which is Series
Investor Charge-Offs and the denominator of which is Group I
Investor Charge-Offs.
(c) If the amount of Group I Investor Finance Charge Collections for
such Distribution Date exceeds the sum of (i) Group I Investor Monthly
Interest, (ii)
41
Group I Investor Monthly Fees, (iii) Group I Net Default Amount and (iv)
Group I Investor Charge-Offs, then Reallocated Investor Finance Charge
Collections for such Distribution Date shall include an amount equal to the
product of (x) the amount of such excess and (y) a fraction, the numerator
of which is the Investor Interest as of the last day of the second
preceding Monthly Period (or, for Series 1997-1 only, with respect to the
first Transfer Date, as of the Closing Date) and the denominator of which
is the sum of such Investor Interest and the aggregate Investor Interests
for all other Series included in Group I as of such last day (or, for
Series 1997-1 only, with respect to the first Transfer Date, as of the
Closing Date).
SECTION 4.15 Reallocated Principal Collections. On or before each
Transfer Date, Servicer shall instruct Trustee in writing (which writing
shall be substantially in the form of Exhibit B to the Series Supplement)
to, and Trustee in accordance with such instructions shall, withdraw from
the Principal Account and apply Reallocated Principal Collections (applying
all Reallocated Collateral Principal Collections in accordance with
subsections 4.15(a) and (b) prior to applying any Reallocated Class B
Principal Collections in accordance with subsection 4.15(a) for any amounts
still owing after the application of Reallocated Collateral Principal
Collections) with respect to such Transfer Date, to make the following
distributions on each Transfer Date in the following priority:
(a) an amount equal to the excess, if any, of (i) the Class A Required
Amount, if any, with respect to such Transfer Date over (ii) the amount of
Excess Spread with respect to the related Monthly Period, shall be applied
pursuant to subsections 4.11(a)(i), (ii) and (iii); and
(b) an amount equal to the excess, if any, of (i) the Class B Required
Amount, if any, with respect to such Transfer Date over (ii) the amount of
Excess Spread allocated and available to the Class B Certificates pursuant
to subsection 4.13(c) on such Transfer Date shall be applied first pursuant
to subsections 4.11(b)(i) and (ii) and then pursuant to subsection 4.13(c).
On each Transfer Date, the Collateral Interest shall be reduced by the
amount of Reallocated Collateral Principal Collections and by the amount of
Reallocated Class B Principal Collections applied pursuant to subsections
4.15(a) and/or (b) on such Transfer Date. If such reduction would cause the
Collateral Interest (after giving effect to any Collateral Charge-Offs for
such Transfer Date) to be a negative number, the Collateral Interest (after
giving effect to any Collateral Charge-Offs for such Transfer Date) shall
be reduced to zero and the Class B Investor Interest shall be reduced by
the amount by which the Collateral Interest would have been reduced below
zero. If the reallocation of Reallocated Principal Collections would cause
the Class B Investor Interest (after giving effect to any Class B Investor
Charge-Offs for such Transfer Date) to be a negative
42
number on any Transfer Date, Reallocated Principal Collections shall be
reallocated on such Transfer Date in an aggregate amount not to exceed the
amount which would cause the Class B Investor Interest (after giving effect
to any Class B Investor Charge-Offs for such Transfer Date) to be reduced
to zero.
SECTION 4.16 Shared Principal Collections. (a) The portion of Shared
Principal Collections on deposit in the Principal Account equal to the
amount of Shared Principal Collections allocable to Series 1997-1 on any
Transfer Date shall be applied as Available Investor Principal Collections
pursuant to Section 4.11 and pursuant to such Section 4.11 shall be
deposited in the Distribution Account or distributed in accordance with the
Loan Agreement.
(b) Shared Principal Collections allocable to Series 1997-1 with
respect to any Transfer Date means an amount equal to the Series Principal
Shortfall, if any, with respect to Series 1997-1 for such Transfer Date;
provided that if the aggregate amount of Shared Principal Collections for
all Principal Sharing Series for such Transfer Date is less than the
Cumulative Series Principal Shortfall for such Transfer Date, then Shared
Principal Collections allocable to Series 1997-1 on such Transfer Date
shall equal the product of (i) Shared Principal Collections for all
Principal Sharing Series for such Transfer Date and (ii) a fraction, the
numerator of which is the Series Principal Shortfall with respect to Series
1997-1 for such Transfer Date and the denominator of which is the
Cumulative Series Principal Shortfall for all Principal Sharing Series for
such Transfer Date.
(c) Solely for the purpose of determining the amount of Available
Investor Principal Collections to be treated as Shared Principal
Collections on any Transfer Date allocable to other Principal Sharing
Series, on each Determination Date, Servicer shall determine the Class A
Required Amount, the Class B Required Amount, Excess Spread and Reallocated
Principal Collections as of such Determination Date for the following
Transfer Date.
SECTION 4.17 Principal Account and Principal Funding Account. (a) The
Trustee shall establish and maintain with a Qualified Institution, which
may be Trustee, in the name of the Trustee, on behalf of the Trust, for the
benefit of the Investor Holders, two segregated trust accounts with the
corporate trust department of such Qualified Institution (the "Principal
Account" and the "Principal Funding Account"), bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Investor Holders. The Trustee shall possess all right, title
and interest in all funds on deposit from time to time in the Principal
Account and the Principal Funding Account and in all proceeds thereof. The
Principal Account and the Principal Funding Account shall be under the sole
dominion and control of Trustee for the benefit of the Investor Holders. If
at any time the institution holding the Principal Account and the Principal
Funding Account ceases to be a Qualified Institution, Transferor shall
43
notify Trustee, and Trustee upon being notified (or Servicer on its behalf)
shall, within 10 Business Days, establish a new Principal Account and a new
Principal Funding Account meeting the conditions specified above with a
Qualified Institution, and shall transfer any cash or any investments to
such new Principal Account and Principal Funding Account. The Trustee, at
the direction of Servicer, shall (i) make withdrawals from the Principal
Account and the Principal Funding Account from time to time in the amounts
and for the purposes set forth in this Agreement, and (ii) on each Transfer
Date (from and after the commencement of the Controlled Accumulation
Period) prior to termination of the Principal Funding Account make a
deposit into the Principal Funding Account in the amount specified in, and
otherwise in accordance with, subsection 4.11(e).
(b) Funds on deposit in the Principal Account and the Principal
Funding Account shall be invested at the direction of Servicer by Trustee
in Permitted Investments. Funds on deposit in the Principal Funding Account
on any Transfer Date, after giving effect to any withdrawals from the
Principal Funding Account on such Transfer Date, shall be invested in such
investments that will mature so that such funds will be available for
withdrawal on or prior to the following Transfer Date. The Trustee shall
maintain, for the benefit of the Investor Holders, possession of the
negotiable instruments or securities, if any, evidencing such Permitted
Investments. No Permitted Investment shall be disposed of prior to its
maturity.
On each Transfer Date, Trustee, acting at Servicer's direction given
on or before such Transfer Date, shall transfer (i) from the Principal
Account to the Finance Charge Account all investment earnings (net of
losses and investment expenses) accrued on or prior to that Transfer Date
in connection with the investment of funds on deposit in the Principal
Account for application as a part of Investor Finance Charge Collections
and (ii) from the Principal Funding Account to the Finance Charge Account
the Principal Funding Investment Proceeds on deposit in the Principal
Funding Account, but not in excess of the Covered Amount, for application
as Class A Available Funds applied pursuant to subsection 4.11(a)(i).
Any Excess Principal Funding Investment Proceeds shall be paid to the
Holder of the Transferor Certificate on each Transfer Date. An amount equal
to any Principal Funding Investment Shortfall will be deposited in the
Finance Charge Account on each Transfer Date from the Reserve Account to
the extent funds are available pursuant to subsection 4.18(d). Principal
Funding Investment Proceeds (including reinvested interest) shall not be
considered part of the amounts on deposit in the Principal Funding Account
for purposes of this Agreement.
44
SECTION 4.18 Reserve Account. (a) The Trustee shall establish and
maintain with a Qualified Institution, which may be Trustee, in the name of
the Trust, on behalf of the Trust, for the benefit of the Investor Holders,
a segregated trust account with the corporate trust department of such
Qualified Institution (the "Reserve Account"), bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Investor Holders. The Trustee shall possess all right, title
and interest in all funds on deposit from time to time in the Reserve
Account and in all proceeds thereof. The Reserve Account shall be under the
sole dominion and control of Trustee for the benefit of the Investor
Holders. If at any time the institution holding the Reserve Account ceases
to be a Qualified Institution, Transferor shall notify Trustee, and Trustee
upon being notified (or Servicer on its behalf) shall, within 10 Business
Days, establish a new Reserve Account meeting the conditions specified
above with a Qualified Institution, and shall transfer any cash or any
investments to such new Reserve Account. The Trustee, at the direction of
Servicer, shall (i) make withdrawals from the Reserve Account from time to
time in an amount up to the Available Reserve Account Amount at such time,
for the purposes set forth in this Agreement, and (ii) on each Transfer
Date (from and after the Reserve Account Funding Date) prior to termination
of the Reserve Account make a deposit into the Reserve Account in the
amount specified in, and otherwise in accordance with, subsection 4.13(i).
(b) Funds on deposit in the Reserve Account shall be invested at the
direction of Servicer by Trustee in Permitted Investments. Funds on deposit
in the Reserve Account on any Transfer Date, after giving effect to any
withdrawals from the Reserve Account on such Transfer Date, shall be
invested in such investments that will mature so that such funds will be
available for withdrawal on or prior to the following Transfer Date. The
Trustee shall maintain, for the benefit of the Investor Holders, possession
of the negotiable instruments or securities, if any, evidencing such
Permitted Investments. No Permitted Investment shall be disposed of prior
to its maturity. On each Transfer Date, all interest and earnings (net of
losses and investment expenses) accrued since the preceding Transfer Date
on funds on deposit in the Reserve Account shall be retained in the Reserve
Account (to the extent that the Available Reserve Account Amount is less
than the Required Reserve Account Amount) and the balance, if any, shall be
deposited into the Finance Charge Account and included in Class A Available
Funds for such Transfer Date. For purposes of determining the availability
of funds or the balance in the Reserve Account for any reason under this
Agreement, except as otherwise provided in the preceding sentence,
investment earnings on such funds shall be deemed not to be available or on
deposit.
(c) On or before each Transfer Date with respect to the Controlled
Accumulation Period prior to the payment in full of the Class A Investor
Interest
45
and on or before the first Transfer Date with respect to the Rapid
Amortization Period, Servicer shall calculate the "Reserve Draw Amount"
which shall be equal to the Principal Funding Investment Shortfall with
respect to each Transfer Date with respect to the Controlled Accumulation
Period or the first Transfer Date with respect to the Rapid Amortization
Period less, in each case, the amount of funds deposited into the Finance
Charge Account on such Transfer Date pursuant to subsection 4.18(b).
(d) If the Reserve Draw Amount for any Transfer Date is greater than
zero, the Reserve Draw Amount, up to the Available Reserve Account Amount,
shall be withdrawn from the Reserve Account on such Transfer Date by
Trustee (acting in accordance with the instructions of Servicer), deposited
into the Finance Charge Account and included in Class A Available Funds for
such Transfer Date.
(e) If the Reserve Account Surplus on any Transfer Date, after giving
effect to all deposits to and withdrawals from the Reserve Account with
respect to such Transfer Date, is greater than zero, Trustee, acting in
accordance with the instructions of Servicer, shall withdraw from the
Reserve Account, and pay in accordance with the Loan Agreement, an amount
equal to such Reserve Account Surplus.
(f) Upon the earliest to occur of (i) the termination of the Trust
pursuant to Article XII, (ii) the first Transfer Date relating to the Rapid
Amortization Period and (iii) the Transfer Date immediately preceding the
Class A Scheduled Payment Date, Trustee, acting in accordance with the
instructions of Servicer, after the prior payment of all amounts owing to
the Series 1997-1 Holders that are payable from the Reserve Account as
provided herein, shall withdraw from the Reserve Account and pay in
accordance with the Loan Agreement all amounts, if any, on deposit in the
Reserve Account and the Reserve Account shall be deemed to have terminated
for purposes of this Series Supplement.
SECTION 4.19 Determination of LIBOR. (a) On each LIBOR Determination
Date for each Interest Period (or, in the case of the initial Interest
Period, for each portion thereof having a separate LIBOR Determination
Date), Trustee will determine LIBOR on the basis of the rate for deposits
in United States dollars for a one-month period (commencing on the first
day of such Interest Period (or such portion of the initial Interest
Period, as applicable)) which appears on Telerate Page 3750 as of 11:00
a.m., London time, on such date. If such rate does not appear on Telerate
Page 3750, the rate for that LIBOR Determination Date will be determined on
the basis of the rates at which deposits in United States dollars are
offered by the Reference Banks at approximately 11:00 a.m., London time, on
that day to prime banks in the London interbank market for a one-month
period (commencing on the first day of such Interest Period (or such
portion of the initial Interest Period, as applicable)). The Trustee
46
will request the principal London office of each of the Reference Banks to
provide a quotation of its rate. If at least two such quotations are
provided, the rate for that LIBOR Determination Date will be the arithmetic
mean of the quotations. If fewer than two quotations are provided as
requested, the rate for that LIBOR Determination Date will be the
arithmetic mean of the rates quoted by three major banks in New York City,
selected by Servicer, at approximately 11:00 a.m., New York City time, on
that day for loans in United States dollars to leading European banks for a
one-month period (commencing on the first day of such Interest Period (or
such portion of the initial Interest Period, as applicable)). If the banks
selected by the Servicer are not quoting rates as provided in the
immediately preceding sentence, LIBOR for such Interest Period shall be
LIBOR in effect for the immediately preceding Interest Period.
(b) The Class B Certificate Rate applicable to the then current and
the immediately preceding Interest Periods may be obtained by any Investor
Holder by telephoning Trustee at its Corporate Trust Office at (212)
815-5286.
(c) On each LIBOR Determination Date prior to 12:00 noon New York City
time, Trustee shall send to Servicer, by facsimile, notification of LIBOR
for the following Interest Period.
SECTION 4.20 Transferor's or Servicer's Failure to Make a Deposit or
Payment. If Servicer or Transferor fails to make, or give instructions to
make, any payment or deposit (other than as required by subsections 2.4(d)
and (e) and 12.2(a) or Sections 10.2 and 12.1) required to be made or given
by Servicer or Transferor, respectively, at the time specified in the
Agreement (including applicable grace periods), Trustee shall make such
payment or deposit from the applicable Investor Account without instruction
from Servicer or Transferor. The Trustee shall be required to make any such
payment, deposit or withdrawal hereunder only to the extent that Trustee
has sufficient information to allow it to determine the amount thereof;
provided that Trustee shall in all cases be deemed to have sufficient
information to determine the amount of interest payable to the Series
1997-1 Holders on each Distribution Date. The Servicer shall, upon request
of Trustee, promptly provide Trustee with all information necessary to
allow Trustee to make such payment, deposit or withdrawal. Such funds or
the proceeds of such withdrawal shall be applied by Trustee in the manner
in which such payment or deposit should have been made by Transferor or
Servicer, as the case may be.
SECTION 4.21. Conversion Date. Notwithstanding anything contained in
the Agreement to the contrary, the Agreement and this Series Supplement may
be amended pursuant to subsection 13.1(a) from time to time by Transferor,
Servicer and Trustee and without the consent of the Certificateholders, to
facilitate the conversion from a Billing Cycle basis to Monthly Period
basis for
47
allocations or to remove provisions of the Agreement or this Series
Supplement made superfluous by such conversion.
SECTION 8. Article V of the Agreement. Article V of the Agreement
shall read in its entirety as follows and shall be applicable only to the
Investor Holders:
ARTICLE V DISTRIBUTIONS AND REPORTS TO
INVESTOR HOLDERS
SECTION 5.1 Distributions. (a) On each Distribution Date, Trustee
shall distribute (in accordance with the certificate delivered on or before
the related Transfer Date by Servicer to Trustee pursuant to subsection
3.4(b)) to each Class A Holder of record on the immediately preceding
Record Date (other than as provided in subsection 2.4(e) or Section 12.3
respecting a final distribution) such Holder's pro rata share (based on the
aggregate Undivided Interests represented by Class A Certificates held by
such Holder) of amounts on deposit in the Distribution Account as are
payable to the Class A Holders pursuant to Section 4.11 by check mailed to
each Class A Holder (at such Holder's address as it appears in the
Certificate Register), except that with respect to Class A Certificates
registered in the name of the nominee of a Clearing Agency, such
distribution shall be made in immediately available funds.
(b) On each Distribution Date, Trustee shall distribute (in accordance
with the certificate delivered on or before the related Transfer Date by
Servicer to Trustee pursuant to subsection 3.4(b)) to each Class B Holder
of record on the immediately preceding Record Date (other than as provided
in subsection 2.4(e) or Section 12.3 respecting a final distribution) such
Holder's pro rata share (based on the aggregate Undivided Interests
represented by Class B Certificates held by such Holder) of amounts on
deposit in the Distribution Account as are payable to the Class B Holders
pursuant to Section 4.11 by check mailed to each Class B Holder (at such
Holder's address as it appears in the Certificate Register), except that
with respect to Class B Certificates registered in the name of the nominee
of a Clearing Agency, such distribution shall be made in immediately
available funds.
SECTION 5.2 Monthly Series 1997-1 Holders' Statement. (a) On or before
each Distribution Date, Trustee shall forward to each Series 1997-1 Holder
a statement substantially in the form of Exhibit C to the Series Supplement
prepared by Servicer and delivered to Trustee.
(b) Annual Holders' Tax Statement. On or before January 31 of each
calendar year, beginning with calendar year 1998, Trustee shall distribute
to each Person who at any time during the preceding calendar year was a
Series 1997-1 Holder, a statement prepared by Servicer containing the
following information:
48
(i) the amount of the current distribution allocable to
Class A Monthly Principal, Class B Monthly Principal and
Collateral Monthly Principal, respectively; and
(ii) the amount of the current distribution allocable to
Class A Monthly Interest, Class A Deficiency Amounts, Class A
Additional Interest, Class B Monthly Interest, Class B Deficiency
Amounts, Class B Additional Interest and Collateral Monthly
Interest, and any accrued and unpaid Collateral Monthly Interest,
respectively.
Such information shall be aggregated for such calendar year or the
applicable portion thereof during which such Person was a Series 1997-1
Holder, together with such other customary information (consistent with the
treatment of the Certificates as debt) as Servicer deems necessary or
desirable to enable the Series 1997-1 Holders to prepare their tax returns.
Such obligations of Trustee shall be deemed to have been satisfied to the
extent that substantially comparable information shall be provided by
Trustee pursuant to any requirements of the Internal Revenue Code.
SECTION 9. Series 1997-1 Pay Out Events. If any one of the following
events shall occur with respect to the Investor Certificates:
(a) failure on the part of Transferor (i) to make any payment or
deposit required by the terms of (A) the Agreement or (B) this Series
Supplement, on or before the date occurring five days after the date such
payment or deposit is herein required to be made or (ii) duly to observe or
perform in any material respect any covenants or agreements of Transferor
set forth in the Agreement or this Series Supplement (including the
covenant of Transferor contained in Section 11 of this Series Supplement),
which failure has a material adverse effect on the Series 1997-1 Holders
(which determination shall be made without reference to whether any funds
are available under the Collateral Interest) and which continues unremedied
for a period of 60 days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to
Transferor by Trustee, or to Transferor and Trustee by the Holders of
Investor Certificates evidencing Undivided Interests aggregating not less
than 50% of the Investor Interest of this Series 1997-1, and continues to
materially and adversely affect the interests of the Series 1997-1 Holders
(which determination shall be made without reference to whether any funds
are available under the Collateral Interest) for such period;
(b) any representation or warranty made by Transferor in the Agreement
or this Series Supplement, or any information contained in an Account
Schedule required to be delivered by Transferor pursuant to Section 2.1 or
2.6, (i) shall prove to have been incorrect in any material respect when
made or when
49
delivered, which continues to be incorrect in any material respect for a
period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to Transferor by
Trustee, or to Transferor and Trustee by the Holders of Investor
Certificates evidencing Undivided Interests aggregating not less than 50%
of the Investor Interest of this Series 1997-1, and (ii) results in a
material and adverse effect on the interests of the Series 1997-1 Holders
(which material adverse effect shall be determined without reference to
whether any funds are available under the Collateral Interest), which
result continues for such period; provided that a Series 1997-1 Pay Out
Event pursuant to this subsection 9(b) shall not be deemed to have occurred
hereunder if Transferor has accepted reassignment of the related
Receivable, or all of such Receivables, if applicable, during such period
in accordance with the provisions of the Agreement;
(c) the average Portfolio Yield for any three consecutive Monthly
Periods is reduced to a rate which is less than the average Base Rate for
such period;
(d) Transferor shall fail to convey Receivables arising under
Additional Accounts, or Participations, to the Trust, as required by
subsection 2.6(b);
(e) any Servicer Default shall occur which would have a material
adverse effect on the Series 1997-1 Holders; or
(f) the Class A Investor Interest shall not be paid in full on the
Class A Scheduled Payment Date or the Class B Investor Interest shall not
be paid in full on the Class B Scheduled Payment Date;
then, in the case of any event described in subsection 9(a), (b), (c) or
(e) of this Series Supplement, after the applicable grace period set forth
in such subsections, either Trustee or Holders of Series 1997-1
Certificates (including, for this purpose, the Collateral Interest Holder)
evidencing Undivided Interests aggregating not less than 50% of the
Investor Interest of this Series 1997-1 by notice then given in writing to
Transferor and Servicer (and to Trustee if given by the Holders) may
declare that a pay out event (a "Series 1997-1 Pay Out Event") has occurred
as of the date of such notice, and in the case of any event described in
subsection 9 (d) or (f) of this Series Supplement, a Series 1997-1 Pay Out
Event shall occur without any notice or other action on the part of Trustee
or the Investor Holders immediately upon the occurrence of such event.
SECTION 10. Series 1997-1 Termination. The right of the Investor
Holders to receive payments from the Trust will terminate on the first
Business Day following the Series 1997-1 Termination Date.
50
SECTION 11. Periodic Finance Charges and Other Fees. Transferor hereby
agrees that, except as otherwise required by any Requirement of Law, or as
is deemed by Transferor to be necessary in order for Transferor to maintain
its revolving credit business, based upon a good faith assessment by
Transferor, in its sole discretion, of the nature of the competition in the
credit card business, it shall not at any time reduce the Periodic Finance
Charges assessed on any Receivable or other fees on any Account if
Transferor reasonably expects that, as a result of such reduction, the
Portfolio Yield for the Monthly Period during which such reduction becomes
effective will be less than the Base Rate as at the beginning of such
Monthly Period.
SECTION 12. Counterparts. This Series Supplement may be executed in
any number of counterparts, each of which so executed shall be deemed to be
an original, but all of such counterparts shall together constitute but one
and the same instrument.
SECTION 13. Governing Law. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
SECTION 14. No Petition. Transferor, Servicer and Trustee, by entering
into this Series Supplement and each Holder, by accepting a Series 1997-1
Certificate, hereby covenant and agree that they will not at any time
institute against the Trust, or join in any institution against the Trust
of, any bankruptcy proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to
the Investor Holders, the Agreement or this Series Supplement.
SECTION 15. Amendments. This Series Supplement may be amended pursuant
to Section 13.1 of the Agreement. This Series Supplement may also be
amended by Transferor without the consent of Servicer, Trustee or any
Investor Holder if Transferor provides Trustee with (i) an Opinion of
Counsel to the effect that such amendment or modification would reduce the
risk that the Trust would be treated as taxable as a publicly traded
partnership pursuant to Internal Revenue Code section 7704 and would not
cause the Trust to be classified, for Federal income tax purposes, as an
association (or publicly traded partnership) taxable as a corporation or
cause or constitute an event in which gain or loss would be recognized by
any Investor Holder and (ii) a certificate that such amendment or
modification would not materially and adversely affect any Investor Holder;
provided that no such amendment shall be deemed effective without Trustee's
consent, if Trustee's rights, duties and obligations hereunder are thereby
modified. Promptly after the execution of any such amendment (other than an
51
amendment pursuant to subsection 13.1(a)), Trustee shall furnish
notification of the substance of such amendment to each Rating Agency.
IN WITNESS WHEREOF, Transferor, Servicer and Trustee have caused
this Series 1997-1 Supplement to be duly executed by their respective
officers as of the day and year first above written.
FIRST NATIONAL BANK OF COMMERCE,
Transferor and Servicer
By:______________________________________
Name:
Title:
----------------------------------------,
Trustee
By:_____________________________________
Name:
Title:
52
EXHIBIT A-1
FORM OF CERTIFICATE
CLASS A
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to First
National Bank of Commerce or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name
of Cede & Co. or in such other name as requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to such
other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has
an interest herein.
No. ___ $________
CUSIP No.________
FIRST NBC CREDIT CARD MASTER TRUST
CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, SERIES 1997-1
Evidencing an Undivided Interest in a trust, the corpus of which consists
of a portfolio of MasterCard(R), VISA(R)* and Private Label credit
card receivables generated or acquired by First National Bank of Commerce
and other assets and interests constituting the Trust under the Pooling and
Servicing Agreement described below.
(Not an interest in or obligation of
First National Bank of Commerce
or any Affiliate thereof.)
---------------
* MasterCard(R) and VISA(R) are federally registered servicemarks of
MasterCard International Inc. and of VISA U.S.A., Inc., respectively.
Exhibit A-1, Page 1
This certifies that CEDE & CO. (the "Class A Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the
corpus of which consists of a portfolio of receivables (the "Receivables")
now existing or hereafter created and arising in connection with selected
MasterCard, VISA and Private Label credit card accounts] (the "Accounts")
of First National Bank of Commerce, a national banking association
organized under the laws of the United States, all monies due or to become
due in payment of the Receivables (including all Finance Charge Receivables
and Recoveries), the right to certain amounts received as Interchange with
respect to the Accounts, the benefits of the Collateral Interest (as
defined below) and the other assets and interests constituting the Trust
pursuant to a Pooling and Servicing Agreement dated as of _____________ __,
1997 as supplemented by the Series 1997-1 Supplement dated as of
______________ __, 1997 (collectively, the "Pooling and Servicing
Agreement"), by and between First National Bank of Commerce, as Transferor
("Transferor") and as Servicer ("Servicer"), and ___________________, as
Trustee ("Trustee"). The Series 1997-1 Certificates are issued in two
classes, the Class A Certificates (of which this certificate is one) and
the Class B Certificates, which are subordinated to the Class A
Certificates in certain rights of payment as described herein and in the
Pooling and Servicing Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1997-1 Certificates with the intention that the Series 1997-1
Certificates will qualify under applicable tax law as indebtedness, and
each of Transferor, Servicer and each Series 1997-1 Holder (or Series
1997-1 Certificate Owner) by acceptance of its Series 1997-1 Certificate
(or in the case of a Series 1997-1 Certificate Owner, by virtue of such
Series 1997-1 Certificate Owner's acquisition of a beneficial interest
therein), agrees to treat and to take no action inconsistent with the
treatment of the Series 1997-1 Certificates (or any beneficial interest
therein) as indebtedness for purposes of federal, state, local and foreign
income or franchise taxes and any other tax imposed on or measured by
income. Each Series 1997-1 Holder agrees that it will cause any Series
1997-1 Certificate Owner acquiring an interest in a Series 1997-1
Certificate through it to comply with the Pooling and Servicing Agreement
as to treatment of the Series 1997-1 Certificates as indebtedness for
certain tax purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing
Agreement. This Class A Certificate is issued under and is subject to the
terms, provisions and conditions of the Pooling and Servicing Agreement, to
which Pooling and Servicing Agreement, as amended from time to time, the
Class A Holder by virtue of the acceptance hereof assents and by which the
Class A Holder is bound.
Exhibit A-1, Page 2
This Class A Certificate represents an interest in only the First NBC
Credit Card Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, Transferor or Servicer, and neither the
Series 1997-1 Certificates nor the Accounts or Receivables are insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency. This Series 1997-1 Certificate is limited in right of
payment to certain collections respecting the Receivables, all as more
specifically set forth hereinabove and in the Pooling and Servicing
Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class A Certificate
shall not be entitled to any benefit under the Pooling and Servicing
Agreement, or be valid for any purpose.
Exhibit A-1, Page 3
IN WITNESS WHEREOF, First National Bank of Commerce has caused this
Class A Certificate to be duly executed under its official seal.
By:_____________________
Authorized Officer
[Seal]
Attested to:
By:______________________________
Secretary
Date:____________________________
Exhibit A-1, Page 4
Form of Trustee's Certificate of Authentication
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates, Series 1997-1, of the First
NBC Credit Card Master Trust referred to in the within-mentioned Pooling
and Servicing Agreement.
-------------------,
Trustee
By:__________________________
Authorized Signatory
EXHIBIT A-2
FORM OF CERTIFICATE
CLASS B
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to First
National Bank of Commerce or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name
of Cede & Co. or in such other name as requested by an authorized
representative of DTC (and any payment is made to Cede & Co. or to such
other entity as is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has
an interest herein.
No. ___ $________
CUSIP No.________
FIRST NBC CREDIT CARD MASTER TRUST
CLASS B FLOATING RATE
ASSET BACKED CERTIFICATE, SERIES 1997-1
Evidencing an Undivided Interest in a trust, the corpus of which
consists of a portfolio of MasterCard(R), VISA(R)* and Private Label
credit card receivables generated or acquired by First National Bank of
Commerce and other assets and interests constituting the Trust under the
Pooling and Servicing Agreement described below.
(Not an interest in or obligation of
First National Bank of Commerce
or any Affiliate thereof.)
------------------
* MasterCard(R) and VISA(R) are federally registered servicemarks of
MasterCard International Inc. and of VISA U.S.A., Inc., respectively.
Exhibit A-2, Page 1
This certifies that CEDE & CO. (the "Class B Holder") is the
registered owner of an Undivided Interest in a trust (the "Trust"), the
corpus of which consists of a portfolio of receivables (the "Receivables")
now existing or hereafter created and arising in connection with selected
MasterCard, VISA and Private Label credit card accounts] (the "Accounts")
of First National Bank of Commerce, a national banking association
organized under the laws of the United States, all monies due or to become
due in payment of the Receivables (including all Finance Charge Receivables
and Recoveries), the right to certain amounts received as Interchange with
respect to the Accounts, the benefits of the Collateral Interest (as
defined below) and the other assets and interests constituting the Trust
pursuant to a Pooling and Servicing Agreement dated as of ______________
__, 1997 as supplemented by the Series 1997-1 Supplement dated as of
_______________ __, 1997 (collectively, the "Pooling and Servicing
Agreement"), by and between First National Bank of Commerce, as Transferor
("Transferor") and as Servicer ("Servicer"), and _______________, as
Trustee ("Trustee"). The Series 1997-1 Certificates are issued in two
classes, the Class A Certificates and the Class B Certificates (of which
this certificate is one), which are subordinated to the Class A
Certificates in certain rights of payment as described herein and in the
Pooling and Servicing Agreement.
Transferor has structured the Pooling and Servicing Agreement and the
Series 1997-1 Certificates with the intention that the Series 1997-1
Certificates will qualify under applicable tax law as indebtedness, and
each of Transferor, Servicer and each Series 1997-1 Holder (or Series
1997-1 Certificate Owner) by acceptance of its Series 1997-1 Certificate
(or in the case of a Series 1997-1 Certificate Owner, by virtue of such
Series 1997-1 Certificate Owner's acquisition of a beneficial interest
therein), agrees to treat and to take no action inconsistent with the
treatment of the Series 1997-1 Certificates (or any beneficial interest
therein) as indebtedness for purposes of federal, state, local and foreign
income or franchise taxes and any other tax imposed on or measured by
income. Each Series 1997-1 Holder agrees that it will cause any Series
1997-1 Certificate Owner acquiring an interest in a Series 1997-1
Certificate through it to comply with the Pooling and Servicing Agreement
as to treatment of the Series 1997-1 Certificates as indebtedness for
certain tax purposes.
To the extent not defined herein, capitalized terms used herein have
the respective meanings assigned to them in the Pooling and Servicing
Agreement. This Class B Certificate is issued under and is subject to the
terms, provisions and conditions of the Pooling and Servicing Agreement, to
which Pooling and Servicing Agreement, as amended from time to time, the
Class B Holder by virtue of the acceptance hereof assents and by which the
Class B Holder is bound.
This Class B Certificate represents an interest in only the First NBC
Credit Card Master Trust. This Class B Certificate does not represent an
Exhibit A-2, Page 2
obligation of, or an interest in, Transferor or Servicer, and neither the
Series 1997-1 Certificates nor the Accounts or Receivables are insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency. This Series 1997-1 Certificate is limited in right of
payment to certain collections respecting the Receivables, all as more
specifically set forth hereinabove and in the Pooling and Servicing
Agreement.
Unless the certificate of authentication hereon has been executed by
or on behalf of Trustee, by manual signature, this Class B Certificate
shall not be entitled to any benefit under the Pooling and Servicing
Agreement, or be valid for any purpose.
Exhibit A-2, Page 3
IN WITNESS WHEREOF, First National Bank of Commerce has caused this
Class B Certificate to be duly executed under its official seal.
By:______________________
Authorized Officer
[Seal]
Attested to:
By:_________________________
Secretary
Date:_______________________
Exhibit A-2, Page 4
Form of Trustee's Certificate of Authentication
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates, Series 1997-1, of the First
NBC Credit Card Master Trust referred to in the within-mentioned Pooling
and Servicing Agreement.
------------------------,
Trustee
By:_______________________
Authorized Signatory
EXHIBIT B
FORM OF MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION TO TRUSTEE
FIRST NATIONAL BANK OF COMMERCE
FIRST NBC CREDIT CARD MASTER TRUST, SERIES 1997-1
MONTHLY PERIOD ENDING ______________, ____
[TO COME]
EXHIBIT C
FORM OF MONTHLY SERIES 1997-1
HOLDERS' STATEMENT
SERIES 1997-1
FIRST NATIONAL BANK OF COMMERCE
------------------------------------
FIRST NBC CREDIT CARD MASTER TRUST
----------------------------------------
[TO COME]