EXHIBIT 4.2
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST
Issuer
and
THE BANK OF NEW YORK
Indenture Trustee
Series 2001-A INDENTURE SUPPLEMENT
Dated as of _____ __, 2001
Table of Contents
ARTICLE I Creation of the Series 2001-A Notes........................................ 1
Section 1.1 Designation................................................ 1
ARTICLE II Definitions................................................................ 2
Section 2.1 Definitions................................................ 2
ARTICLE III Servicing Fee.............................................................. 15
Section 3.1 Servicing Compensation..................................... 15
ARTICLE IV Rights of Series 2001-A Noteholders and Allocation and
Application of Collections................................................. 15
Section 4.1 Collections and Allocations............................... 15
Section 4.2 Determination of Monthly Interest......................... 18
Section 4.3 Determination of Monthly Principal........................ 19
Section 4.4 Application of Available Finance Charge
Collections and Available Principal
Collections............................................... 20
Section 4.5 Investor Charge-Offs...................................... 23
Section 4.6 Reallocated Principal Collections......................... 23
Section 4.7 Excess Finance Charge Collections......................... 23
Section 4.8 Shared Principal Collections.............................. 23
Section 4.9 Principal Accumulation Account............................ 24
Section 4.10 Reserve Account........................................... 26
Section 4.11 Spread Account............................................ 28
Section 4.12 [Determination of LIBOR................................... 31
Section 4.13 Investment Instructions................................... 31
Section 4.14 Controlled Accumulation Period............................ 32
Section 4.15 Suspension of Controlled Accumulation
Period.................................................... 32
Section 4.16 Interchange............................................... 34
ARTICLE V Delivery of Series 2001-A Notes; Distributions; Reports to
Series 2001-A Noteholders.................................................. 34
Section 5.1 Delivery and Payment for the
Series 2001-A Notes........................................ 34
Section 5.2 Distributions.............................................. 35
Section 5.3 Reports and Statements to Series 2001-A
Noteholders................................................ 36
ARTICLE VI Series 2001-A Pay Out Events............................................... 36
Section 6.1 Series 2001-A Pay Out Events............................... 36
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ARTICLE VII Redemption of Series 2001-A Notes; Final Distributions;
Series Termination......................................................... 38
Section 7.1 Optional Redemption of Series
2001-A Notes; Final Distributions.......................... 38
Section 7.2 Series Termination......................................... 40
ARTICLE VIII Miscellaneous Provisions................................................... 40
Section 8.1 Ratification of Indenture; Amendments...................... 40
Section 8.2 Form of Delivery of the Series 2001-A
Notes...................................................... 40
Section 8.3 Counterparts............................................... 40
Section 8.4 GOVERNING LAW.............................................. 40
Section 8.5 Limitation of Liability.................................... 41
ii
EXHIBITS
EXHIBIT A-1 FORM OF CLASS A NOTE
EXHIBIT A-2 FORM OF CLASS B NOTE
EXHIBIT A-3 FORM OF CLASS C NOTE
EXHIBIT B FORM OF MONTHLY PAYMENT
INSTRUCTIONS AND NOTIFICATION TO THE
INDENTURE TRUSTEE
EXHIBIT C FORM OF MONTHLY NOTEHOLDERS' STATEMENT
iii
SERIES 2001-A INDENTURE SUPPLEMENT, dated as of ______ __, 2001 (the
"Indenture Supplement"), between FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST,
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a trust organized and existing under the laws of the State of Illinois (herein,
the "Issuer" or the "Trust"), and THE BANK OF NEW YORK, a banking corporation
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organized and existing under the laws of the State of New York, not in its
individual capacity, but solely as indenture trustee (herein, together with its
successors in the trusts thereunder as provided in the Master Indenture referred
to below, the "Indenture Trustee") under the Master Indenture, dated as of
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_______, 2001 (the "Indenture") between the Issuer and the Indenture Trustee
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(the Indenture, together with this Indenture Supplement, the "Agreement").
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Pursuant to Section 2.12 of the Indenture, the Seller may direct the Issuer
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to issue one or more Series of Notes. The Principal Terms of this Series are
set forth in this Indenture Supplement to the Indenture.
ARTICLE I
Creation of the Series 2001-A Notes
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Section 1.1 Designation.
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(a) There is hereby created and designated a Series of Notes to be issued
pursuant to the Indenture and this Indenture Supplement to be known as "First
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Consumers Credit Card Master Note Trust, Series 2001-A" or the "Series 2001-A
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Notes." The Series 2001-A Notes shall be issued in three Classes, known as the
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"Class A Series 2001-A [Floating Rate] Asset Backed Notes," the "Class B Series
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2001-A [Floating Rate] Asset Backed Notes," and the "Class C Series 2001-A
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[Floating Rate] Asset Backed Notes."
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(b) Series 2001-A shall be included in Group One and shall be a Principal
Sharing Series. Series 2001-A shall be an Excess Allocation Series with respect
to Group One only. Series 2001-A shall not be subordinated to any other Series.
(c) If any term or provision contained herein shall conflict with or be
inconsistent with any term or provision contained in the Indenture, the terms
and provisions of this Indenture Supplement shall be controlling. All
capitalized terms not otherwise defined herein are defined in the Indenture.
Each capitalized term defined herein shall relate only to the Series 2001-A
Notes and no other Series of Notes issued by the Issuer.
ARTICLE II
Definitions
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Section 2.1 Definitions.
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(a) Whenever used in this Indenture Supplement, the following words and
phrases shall have the following meanings, and the definitions of such terms are
applicable to the singular as well as the plural forms of such terms and the
masculine as well as the feminine and neuter genders of such terms.
"Accumulation Period Factor" means, for any Monthly Period, a fraction, the
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numerator of which is equal to the sum of the Initial Collateral Amounts of all
outstanding Series designated as Principal Sharing Series, and the denominator
of which is equal to the sum of (a) the Initial Collateral Amount and (b) the
Initial Collateral Amounts of all outstanding Series (other than Series 2001-A)
which are not expected to be in their revolving periods; provided, however, that
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this definition may be changed at any time if the Rating Agency Condition is
satisfied.
"Accumulation Period Length" is defined in subsection 4.14.
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"Accumulation Shortfall" means (a) for the first Monthly Period during the
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Controlled Accumulation Period, zero; and (b) thereafter, for 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 Accumulation Account pursuant to subsection 4.4(c)(i) for the
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previous Monthly Period.
"Additional Interest" means, for any Distribution Date, Class A Additional
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Interest, Class B Additional Interest and Class C Additional Interest for such
Distribution Date.
"Allocation Percentage" means, on any date of determination, the percentage
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equivalent of a fraction:
(a) the numerator of which shall be the Collateral Amount,
determined:
(i) for Principal Collections during the Revolving Period
and for Finance Charge Collections and Default Amounts at any time,
at the end of the last day of the prior Monthly Period (or, in the
case of the Monthly Period in which the Closing Date occurs, on the
Closing Date);
2
(ii) for Principal Collections during the Rapid Amortization
Period and the Controlled Accumulation Period, on the last day of
the Revolving Period, provided, however, that if Series 2001-A is
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paired with a Paired Series and a Rapid Amortization Period
commences for such Paired Series, the Seller may, by written notice
to the Indenture Trustee, the Servicer and the Rating Agency, but
only after satisfying the Rating Agency Condition, designate a
different numerator for such fraction, which numerator shall not be
less than the Collateral Amount as of the last day of the Revolving
Period for the Paired Series; and
(b) the denominator of which shall be the greater of (x) the
Aggregate Principal Balance at the end of the Business Day preceding such
date of determination and (y) the sum of the numerators used to calculate
the Allocation Percentages for allocations with respect to Finance Charge
Collections, Principal Collections or Default Amounts, as applicable, for
all outstanding Series on such date of determination.
"Available Finance Charge Collections" means, for any Monthly Period, an
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amount equal to the sum of (a) the Investor Finance Charge Collections for such
Monthly Period, plus (b) the Excess Finance Charge Collections allocated to
Series 2001-A for such Monthly Period, plus (c) Principal Accumulation
Investment Proceeds, if any, with respect to the related Distribution Date and
(d) amounts, if any, to be withdrawn from the Reserve Account which will be
deposited into the Collection Account on the related Distribution Date to be
treated as Available Finance Charge Collections pursuant to subsection 4.10(d).
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"Available Principal Collections" means, for any Monthly Period, an amount
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equal to the sum of (a) the Investor Principal Collections for such Monthly
Period minus (b) the amount of Reallocated Principal Collections with respect to
such Monthly Period which pursuant to Section 4.6 are required to be applied on
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the related Distribution Date, plus (c) any Shared Principal Collections with
respect to other Principal Sharing Series (including any amounts on deposit in
the Excess Funding Account that are allocated to Series 2001-A pursuant to the
Agreement for application as Shared Principal Collections), plus (d) the
aggregate amount to be treated as Available Principal Collections pursuant to
subsections 4.4(a)(v) and (vi) for the related Distribution Date.
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"Available Reserve Account Amount" means, for any Distribution Date, the
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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 4.10(b) on such date, but before giving effect to any
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deposit made or to be made pursuant to subsection 4.4(a)(vii) to the Reserve
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Account on such date) and (b) the Required Reserve Account Amount.
3
"Available Spread Account Amount" means, for any Distribution Date, an
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amount equal to the lesser of (a) the amount on deposit in the Spread Account
(exclusive of Investment Earnings, unless and until the occurrence of an Event
of Default with respect to Series 2001-A and acceleration of the maturity of the
Series 2001-A Notes pursuant to Section 5.3 of the Indenture) on such date
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(before giving effect to any deposit to, or withdrawal from, the Spread Account
made or to be made with respect to such date) and (b) the Required Spread
Account Amount for such Distribution Date.
"Average Excess Spread Percentage" means (a) with respect to the [Month 1]
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2001 Distribution Date, the Modified Excess Spread Percentage, (b) with respect
to the [Month 2] 2001 Distribution Date, the percentage equivalent of a fraction
the numerator of which is the sum of (i) the Modified Excess Spread Percentage
and (ii) the Excess Spread Percentage with respect to the [Month 1] 2001 Monthly
Period and the denominator of which is two, (c) with respect to the [Month 3]
2001 Distribution Date, the percentage equivalent of a fraction the numerator of
which is the sum of (i) the Modified Excess Spread Percentage, (ii) the Excess
Spread Percentage with respect to the [Month 1] 2001 Monthly Period and (iii)
the Excess Spread Percentage with respect to the [Month 2] 2001 Monthly Period
and the denominator of which is three and (d) with respect to the [Month 4] 2001
Distribution Date and each Distribution Date thereafter, the percentage
equivalent of a fraction the numerator of which is the sum of the Excess Spread
Percentages with respect to the immediately preceding three Monthly Periods and
the denominator of which is three.
"Base Rate" means, for any Monthly Period, the annualized percentage
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equivalent of a fraction, the numerator of which is equal to the sum of the
Monthly Interest and the Monthly Servicing Fee, each with respect to the related
Distribution Date, and the denominator of which is the Collateral Amount as of
the first day of such Monthly Period.
"Class A Additional Interest" is defined in subsection 4.2(a).
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"Class A Interest Shortfall" is defined in subsection 4.2(a).
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"Class A Monthly Interest" is defined in subsection 4.2(a).
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"Class A Note Initial Principal Balance" means $___________.
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"Class A Note Interest Rate" means a per annum rate of ____% [in excess of
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LIBOR as determined on the LIBOR Determination Date for the applicable Interest
Period].
"Class A Note Principal Balance" means, on any date of determination, an
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amount equal to (a) the Class A Note Initial Principal Balance, minus (b) the
4
aggregate amount of principal payments made to the Class A Noteholders on or
prior to such date.
"Class A Noteholder" means the Person in whose name a Class A Note is
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registered in the Note Register.
"Class A Notes" means any one of the Notes executed by the Issuer and
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authenticated by or on behalf of the Indenture Trustee, substantially in the
form of Exhibit A-1.
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"Class A Required Amount" means, for any Distribution Date, an amount equal
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to the excess of the amount described in subsection 4.4(a)(i) over the Available
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Finance Charge Collections applied to pay such amount pursuant to subsection
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4.4(a).
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"Class B Additional Interest" is defined in subsection 4.2(b).
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"Class B Interest Shortfall" is defined in subsection 4.2(b).
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"Class B Monthly Interest" is defined in subsection 4.2(b).
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"Class B Note Initial Principal Balance" means $___________.
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"Class B Note Interest Rate" means a per annum rate of ____% [in excess of
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LIBOR as determined on the LIBOR Determination Date for the applicable Interest
Period].
"Class B Note Principal Balance" means, on any date of determination, an
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amount equal to (a) the Class B Note Initial Principal Balance, minus (b) the
aggregate amount of principal payments made to the Class B Noteholders on or
prior to such date.
"Class B Noteholder" means the Person in whose name a Class B Note is
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registered in the Note Register.
"Class B Notes" means any one of the Notes executed by the Issuer and
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authenticated by or on behalf of the Indenture Trustee, substantially in the
form of Exhibit A-2.
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"Class B Required Amount" means, for any Distribution Date, an amount equal
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to the excess of the amount described in subsection 4.4(a)(ii) over the
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Available Finance Charge Collections applied to pay such amount pursuant to
subsection 4.4(a).
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"Class C Additional Interest" is defined in subsection 4.2(c).
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5
"Class C Interest Shortfall" is defined in subsection 4.2(c).
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"Class C Monthly Interest" is defined in subsection 4.2(c).
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"Class C Note Initial Principal Balance" means $___________.
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"Class C Note Interest Rate" means a per annum rate of ____% [in excess of
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LIBOR as determined on the LIBOR Determination Date for the applicable Interest
Period].
"Class C Note Principal Balance" means, on any date of determination, an
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amount equal to (a) the Class C Note Initial Principal Balance, minus (b) the
aggregate amount of principal payments made to the Class C Noteholders on or
prior to such date.
"Class C Noteholder" means the Person in whose name a Class C Note is
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registered in the Note Register.
"Class C Notes" means any one of the Notes executed by the Issuer and
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authenticated by or on behalf of the Indenture Trustee, substantially in the
form of Exhibit A-3.
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"Class C Required Amount" means, for any Distribution Date, an amount equal
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to the excess of the amount described in subsection 4.4(a)(iv) over the
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Available Finance Charge Collections applied to pay such amount pursuant to
subsection 4.4(a).
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"Closing Date" means [_____ __], 2001.
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"Collateral Amount" means, as of any date of determination, an amount equal
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to the result of (a) the Initial Collateral Amount minus (b) the amount of
principal previously paid to the Series 2001-A Noteholders, minus (c) the
balance on deposit in the Principal Accumulation Account, minus (d) the
aggregate reductions to the Collateral Amount made pursuant to Section 4.4(c)(v)
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on or prior to such date of determination, minus the excess, if any, of the
aggregate amount of Investor Charge-Offs and Reallocated Principal Collections
over the reimbursements of such amounts pursuant to subsection 4.4(a)(vi) prior
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to such date.
"Controlled Accumulation Amount" means, for any Distribution Date with
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respect to the Controlled Accumulation Period, $[___________]; provided,
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however, that if the Accumulation Period Length is determined to be less than 12
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months pursuant to Section 4.14 or 4.15, the Controlled Accumulation Amount for
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each Distribution Date with respect to the Controlled Accumulation Period will
be equal to (i) the product of (x) the aggregate initial principal amount of the
Series 2001-A Notes and (y) the Accumulation Period Factor for such Monthly
Period divided by
6
(ii) the Required Accumulation Factor Number; provided, further, that the
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Controlled Accumulation Amount for any Distribution Date shall not exceed the
Note Principal Balance, minus any amount already on deposit in the Principal
Accumulation Account on such Distribution Date.
"Controlled Accumulation Period" means, unless a Pay Out Event shall have
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occurred prior thereto, the period commencing at the close of business on [_____
__, 20__] or such later date as is determined in accordance with Sections 4.14
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and 4.15, and ending on the first to occur of (a) the commencement of the Rapid
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Amortization Period, (b) the payment in full of the Note Principal Balance and
(c) the Series 2001-A Final Maturity Date.
"Controlled Deposit Amount" means, for any Distribution Date with respect
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to the Controlled Accumulation Period, an amount equal to the sum of the
Controlled Accumulation Amount for such Distribution Date and any existing
Accumulation Shortfall.
"Covered Amount" means an amount, determined as of each Distribution Date
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for any Interest Period, equal to the sum of (a) the product of (i) a fraction,
the numerator of which is the [actual] number of days in such Interest Period
and the denominator of which is 360, times (ii) the Class A Note Interest Rate
[in effect with respect to such Interest Period], times (iii) the aggregate
amount on deposit in the Principal Accumulation Account up to the Class A Note
Principal Balance as of the Record Date preceding such Distribution Date, plus
(b) the product of (i) a fraction, the numerator of which is the [actual] number
of days in such Interest Period and the denominator of which is 360, times (ii)
the Class B Note Interest Rate [in effect with respect to such Interest Period],
times (iii) the aggregate amount on deposit in the Principal Accumulation
Account in excess of the Class A Note Principal Balance as of the Record Date
preceding such Distribution Date up to the Class B Note Principal Balance as of
the Record Date preceding such Distribution Date, plus (c) the product of (i) a
fraction, the numerator of which is the [actual] number of days in such Interest
Period and the denominator of which is 360, times (ii) the Class C Note Interest
Rate [in effect with respect to such Interest Period], times (iii) the aggregate
amount on deposit in the Principal Accumulation Account in excess of the sum of
the Class A Note Principal Balance and the Class B Note Principal Balance as of
the Record Date preceding such Distribution Date.
"Default Estimate" means, for any Monthly Period, an amount equal to the
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product of (i) 1.5, multiplied by (ii) the arithmetic mean of the Investor
Default Amounts for the prior three Monthly Periods. For this purpose, the
[_______] 2000, [_______] 2000 and [_______] 2001 Investor Default Amounts shall
be deemed to have equaled $________, $________ and $_______, respectively.
7
"Distribution Date" means [_____ __], 2001 and the 15/th/ day of each
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calendar month thereafter, or if such 15th day is not a Business Day, the next
succeeding Business Day.
"Excess Collateral Amount" means, at any time, the result of the Collateral
------------------------
Amount, plus the Principal Accumulation Account Balance, minus the Note
Principal Balance.
"Excess Spread Percentage" means, for any Monthly Period, a percentage
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equal to the Portfolio Yield for such Monthly Period minus the Base Rate for
such Monthly Period.
"Expected Principal Distribution Date" means the [____ 20__] Distribution
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Date.
"Finance Charge Shortfall" is defined in Section 4.7.
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"Group One" means Series 2001-A, the outstanding Series under the Pooling
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and Servicing Agreement (other than Series represented by the Collateral
Certificate) and each other Series hereafter specified in the related Indenture
Supplement to be included in Group One.
"Initial Collateral Amount" means $[_________], which equals the sum of (i)
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the initial principal amount of the Series 2001-A Notes plus (ii) the Initial
Excess Collateral Amount.
"Initial Excess Collateral Amount" means $___________.
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"Interest Period" means, for any Distribution Date, the period from and
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including the Distribution Date immediately preceding such Distribution Date
(or, in the case of the first Distribution Date, from and including the Closing
Date) to but excluding such Distribution Date.
"Investment Earnings" means, for any Distribution Date, all interest and
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earnings on Permitted Investments included in the Spread Account (net of losses
and investment expenses) during the period commencing on and including the
Distribution Date immediately preceding such Distribution Date and ending on but
excluding such Distribution Date.
"Investor Charge-Offs" is defined in Section 4.5.
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"Investor Default Amount" means, for any Distribution Date, an amount equal
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to the product of (a) the Default Amount for the related Monthly Period and (b)
the Floating Allocation Percentage for such Monthly Period.
8
"Investor Finance Charge Collections" means, for any Monthly Period, an
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amount equal to the aggregate amount of Finance Charge Collections (including
Net Recoveries and Interchange treated as Finance Charge Collections) retained
or deposited in the Finance Charge Subaccount for Series 2001-A pursuant to
subsection 4.1(b)(i) for such Monthly Period.
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"Investor Principal Collections" means, for any Monthly Period, the
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aggregate amount of Principal Collections retained or deposited in the Principal
Collection Subaccount for Series 2001-A pursuant to subsection 4.1(b)(ii) for
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such Monthly Period.
"Investor Uncovered Dilution Amount" means, for any Distribution Date, an
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amount equal to the Series Share of shortfalls in Deposit Obligations that is
allocated to Series 2001-A pursuant to Section 8.4(h) of the Indenture.
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["LIBOR" means, for any Interest Period, the London interbank offered rate
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for one-month United States dollar deposits determined by the Indenture Trustee
for each Interest Period in accordance with the provisions of Section 4.12.]
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["LIBOR Determination Date" means (i) _____ __, 2001 for the period from
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and including the Closing Date through and including _____ __, 2001 and (ii) the
second London Business Day prior to the commencement of the second and each
subsequent Interest Period.]
"London Business Day" means any Business Day on which dealings in deposits
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in United States dollars are transacted in the London interbank market.
"Minimum Seller Percentage" means [ ]%, for Series 2001-A.
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"Modified Excess Spread Percentage" means with respect to the first Monthly
---------------------------------
Period an amount equal to [ ]%.
"Monthly Interest" means, for any Distribution Date, the sum of the Class A
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Monthly Interest, the Class B Monthly Interest, and the Class C Monthly Interest
for such Distribution Date.
"Monthly Principal" means the monthly principal distributable in respect of
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the Notes as calculated in accordance with Section 4.3.
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"Monthly Principal Reallocation Amount" means, for any Monthly Period, an
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amount equal to the sum of:
(a) the lower of (i) the Class A Required Amount and (ii) the
greater of (A)(x) the product of (I) [__]% and (II) the Initial Collateral
Amount minus (y) the amount of unreimbursed Investor Charge-Offs (after
9
giving effect to Investor Charge-Offs for the related Monthly Period) and
unreimbursed Reallocated Principal Collections (as of the previous
Distribution Date) and (B) zero;
(b) the lower of (i) the sum of the Class B Required Amount and the
Servicing Fee Required Amount and (ii) the greater of (A)(x) the product of
(I) [__]% and (II) the Initial Collateral Amount minus (y) the amount of
unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-
Offs for the related Monthly Period) and unreimbursed Reallocated Principal
Collections (as of the previous Distribution Date and as required in clause
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(a) above) and (B) zero; and
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(c) the lower of (i) the sum of the Class C Required Amount and (ii)
the greater of (A)(x) the product of (I) [__]% and (II) the Initial
Collateral Amount minus (y) the amount of unreimbursed Investor Charge-Offs
(after giving effect to Investor Charge-Offs for the related Monthly
Period) and unreimbursed Reallocated Principal Collections (as of the
previous Distribution Date and as required in clauses (a) and (b) above)
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and (B) zero.
"Monthly Servicing Fee" is defined in subsection 3.1.
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"Note Principal Balance" means, on any date of determination, an amount
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equal to the sum of the Class A Note Principal Balance, the Class B Note
Principal Balance and the Class C Note Principal Balance.
"Percentage Allocation" is defined in subsection 4.1(b)(ii)(y).
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"Portfolio Yield" means, for any Monthly Period, the annualized percentage
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equivalent of a fraction, (a) the numerator of which is equal to the sum of (i)
Investor Finance Charge Collections with respect to such Monthly Period, plus
(ii) the Principal Accumulation Investment Proceeds deposited into the
Collection Account on the Distribution Date related to such Monthly Period, plus
(iii) the amount of the Reserve Draw Amount (up to the Available Reserve Account
Amount) plus any amounts of interest and earnings described in Section 4.10,
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each deposited into the Collection Account on the Distribution Date relating to
such Monthly Period, plus (iv) Excess Finance Charge Collections that are
allocated to Series 2001-A with respect to such Monthly Period, such sum to be
calculated on a cash basis after subtracting the Investor Default Amount for
such Monthly Period, and (b) the denominator of which is the Collateral Amount
as of the first day of such Monthly Period.
"Principal Accumulation Account" shall have the meaning set forth in
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subsection 4.9(a).
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10
"Principal Accumulation Account Balance" means, for any date of
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determination, the principal amount, if any, on deposit in the Principal
Accumulation Account on such date of determination.
"Principal Accumulation Investment Proceeds" means, with respect to each
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Distribution Date, the investment earnings on funds in the Principal
Accumulation Account (net of investment expenses and losses) for the period from
and including the immediately preceding Distribution Date to but excluding such
Distribution Date.
"Principal Shortfall" is defined in subsection 4.8.
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"Qualified Maturity Agreement" means an agreement whereby an Eligible
----------------------------
Institution agrees to make a deposit into the Principal Accumulation Account on
the Expected Principal Distribution Date in an amount equal to the Note
Principal Balance on such date; provided that for purposes of this definition,
references in the definition of "Eligible Institution" to ratings of "A-1+" and
"AAA" by Standard & Poor's shall be modified to require ratings of "A-1" and
"A+" from Standard & Poor's.
"Rapid Amortization Period" means the period commencing on the Business Day
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immediately preceding the day on which a Pay Out Event with respect to Series
2001-A is deemed to have occurred, and ending on the first to occur of (i) the
payment in full of the Collateral Amount and (ii) the Series 2001-A Final
Maturity Date.
"Rating Agency" means each of Fitch, Inc., ▇▇▇▇▇'▇ and Standard & Poor's.
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"Reallocated Principal Collections" means, for any Distribution Date,
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Investor Principal Collections applied in accordance with Section 4.6 in an
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amount not to exceed the Monthly Principal Reallocation Amount for the related
Monthly Period.
"Reassignment Amount" means, for any Distribution Date, after giving effect
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to any deposits and distributions otherwise to be made on such Distribution
Date, the sum of (i) the outstanding principal balance of the Series 2001-A
Notes on such Distribution Date, plus (ii) Monthly Interest for such
Distribution Date and any Monthly Interest previously due but not distributed to
the Series 2001-A Noteholders, plus (iii) the amount of Additional Interest, if
any, for such Distribution Date and any Additional Interest previously due but
not distributed to the Series 2001-A Noteholders on a prior Distribution Date.
"Reference Banks" means four major banks in the London interbank market
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selected by the Servicer.
11
"Required Accumulation Factor Number" shall be equal to a fraction, rounded
-----------------------------------
upwards to the nearest whole number, the numerator of which is one and the
denominator of which is equal to the lowest monthly principal payment rate on
the Accounts, expressed as a decimal, for the 12 months preceding the date of
such calculation; provided, however, that this definition may be changed at any
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time if the Rating Agency Condition is satisfied.
"Required Excess Collateral Amount" means, at any time, the product of the
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Required Excess Collateral Percentage and the Collateral Amount; provided that:
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(a) except as provided in clause (c), the Required Excess Collateral
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Amount shall never be less than 3% of the Initial Collateral Amount;
(b) except as provided in clause (c), the Required Excess Collateral
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Amount shall not decrease during a Rapid Amortization Period; and
(c) the Required Excess Collateral Amount shall never be greater
than the Note Principal Balance minus the balance on deposit in the
Principal Accumulation Account.
"Required Excess Collateral Percentage" means ____%.
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"Required Reserve Account Amount" means, for any Distribution Date on or
-------------------------------
after the Reserve Account Funding Date, an amount equal to (a) 0.5% of the Note
Principal Balance or (b) any other amount designated by the Seller; provided,
--------
however, that if such designation is of a lesser amount, the Seller shall (i)
-------
provide the Servicer and the Indenture Trustee with evidence that the Rating
Agency Condition shall have been satisfied and (ii) deliver to the Indenture
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 the
Seller, 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 2001-A.
"Required Spread Account Amount" means, prior to the occurrence of an Event
------------------------------
of Default with respect to Series 2001-A and acceleration of the maturity of the
Series 2001-A Notes pursuant to Section 5.3 of the Indenture, for any date of
-----------
determination, the product of (i) the Spread Account Percentage in effect on
such date and (ii) the Initial Collateral Amount; provided that the Required
--------
Spread Account Amount shall not exceed the Class C Note Principal Balance minus
the excess, if any, of the Principal Accumulation Account Balance over the sum
of the Class A Note Principal Balance and the Class B Note Principal Balance on
such date of determination.
12
"Reserve Account" is defined in subsection 4.10(a).
--------------- ------------------
"Reserve Account Funding Date" means the Distribution Date designated by
----------------------------
the Servicer which occurs not later than the earliest of (a) the Distribution
Date with respect to the Monthly Period which commences 3 months prior to the
commencement of the Controlled Accumulation Period (which commencement shall be
subject to postponement pursuant to Section 4.15); (b) the first Distribution
------------
Date for which the Average Excess Spread Percentage is less than 2%, but in such
event the Reserve Account Funding Date shall not be required to occur earlier
than the Distribution Date with respect to the Monthly Period which commences 12
months prior to the commencement of the Controlled Accumulation Period; (c) the
first Distribution Date for which the Average Excess Spread Percentage is less
than 3%, but in such event the Reserve Account Funding Date shall not be
required to occur earlier than the Distribution Date with respect to the Monthly
Period which commences 6 months prior to the commencement of the Controlled
Accumulation Period; and (d) the first Distribution Date for which the Average
Excess Spread Percentage is less than 4%, but in such event the Reserve Account
Funding Date shall not be required to occur earlier than the Distribution Date
with respect to the Monthly Period which commences 4 months prior to the
commencement of the Controlled Accumulation Period; provided, however, that
-------- -------
subject to satisfaction of the Rating Agency Condition, the Reserve Account
Funding Date may be any date selected by the Servicer.
"Reserve Account Surplus" means, as of any Distribution 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" means, with respect to each Distribution Date
-------------------
relating to the Controlled Accumulation Period or the first Distribution Date
relating to the Rapid Amortization Period, the amount, if any, by which the
Principal Accumulation Investment Proceeds for such Distribution Date are less
than the Covered Amount determined as of such Distribution Date.
"Revolving Period" means the period beginning on the Closing Date and
----------------
ending on the earlier of the close of business on the day immediately preceding
the day the Controlled Accumulation Period commences or the Rapid Amortization
Period commences.
"Series 2001-A" means the Series of Notes the terms of which are specified
-------------
in this Indenture Supplement.
"Series 2001-A Final Maturity Date" means the earlier to occur of (a) the
---------------------------------
Distribution Date on which the Note Principal Balance is paid in full and (b)
the [________ ____] Distribution Date.
13
"Series 2001-A Note" means a Class A Note, a Class B Note or a Class C
------------------
Note.
"Series 2001-A Noteholder" means a Class A Noteholder, a Class B Noteholder
------------------------
or a Class C Noteholder.
"Series 2001-A Pay Out Event" is defined in Section 6.1.
--------------------------- -----------
"Series Servicing Fee Percentage" means 2% per annum.
-------------------------------
"Servicing Fee Required Amount" means, for any Distribution Date, an amount
-----------------------------
equal to the excess of the amount described in subsection 4.4(a)(iii) over the
----------------------
Available Finance Charge Collections applied to pay such amount pursuant to
subsection 4.4(a).
-----------------
"Spread Account" is defined in subsection 4.11(a).
-------------- ------------------
"Spread Account Deficiency" means the excess, if any, of the Required
-------------------------
Spread Account Amount over the Available Spread Account Amount.
["Spread Account Percentage" means, (i) [___]%, if the Average Excess
-------------------------
Spread Percentage on such Distribution Date is greater than or equal to [____]%,
(ii) [____]%, if the Average Excess Spread Percentage on such Distribution Date
is less than [___]% and greater than or equal to [___]%, (iii) [____]%, if the
Average Excess Spread Percentage on such Distribution Date is less than [____]%
and greater than or equal to [____]%, (iv) [____]%, if the Average Excess Spread
Percentage on such Distribution Date is less than [____]% and greater than or
equal to [____]%, and (v) [____]%, if the Average Excess Spread Percentage on
such Distribution Date is less than [____]%; provided, that after the Spread
Account Percentage has been increased above zero pursuant to any of clauses (ii)
------------
through (v), the Spread Account Percentage shall remain at that percentage until
---
(a) further increased to a higher required percentage specified in clauses (ii)
------------
through (v) or (b) the third consecutive Distribution Date on which the Average
---
Excess Spread Percentage has increased to a level above that for the then
current Spread Account Percentage, in which case the Spread Account Percentage
shall be decreased to the appropriate percentage provided for in clauses (ii)
through (iv) that is lower than the current Spread Account Percentage (or, if
the Excess Spread Percentage is greater than or equal to [___]%, the Spread
Account Percentage shall be 0%); provided, further, that if a Pay Out Event with
-------- -------
respect to Series 2001-A has occurred, the Spread Account Percentage shall be
[____]% and shall no longer be subject to reduction.]
"Surplus Collateral Amount" means, at any time, the excess, if any, of the
-------------------------
Excess Collateral Amount over the Required Excess Collateral Amount.
14
["Telerate Page 3750" means the display page currently so designated on the
------------------
Bridge Telerate Capital Markets Report (or such other page as may replace that
page in that service for the purpose of displaying comparable rates or prices).]
(b) Each capitalized term defined herein shall relate to the Series 2001-A
Notes and no other Series of Notes issued by the Trust, unless the context
otherwise requires. All capitalized terms used herein and not otherwise defined
herein have the meanings ascribed to them in the Indenture or the Transfer and
Servicing Agreement. In the event that any term or provision contained herein
shall conflict with or be inconsistent with any term or provision contained in
the Indenture or the Transfer and Servicing Agreement, the terms and provisions
of this Indenture Supplement shall govern.
(c) The interpretive rules specified in Section 1.2 of the Master Indenture
-----------
also apply to this Indenture Supplement.
ARTICLE III
Servicing Fee
-------------
Section 3.1 Servicing Compensation. The share of the Servicing Fee
----------------------
allocable to Series 2001-A for any Distribution Date (the "Monthly Servicing
-----------------
Fee") shall be equal to one-twelfth of the product of (a) the Series Servicing
---
Fee Percentage and (b) (i) the Collateral Amount as of the last day of the
Monthly Period preceding such Distribution Date, minus (ii) the product of the
amount, if any, on deposit in the Excess Funding Account as of the last day of
the Monthly Period preceding such Distribution Date and the Allocation
Percentage for Finance Charge Collections with respect to such Monthly Period;
provided, however, that with respect to the first Distribution Date, the Monthly
-------- -------
Servicing Fee shall be equal to $[________]. The remainder of the Servicing Fee
shall be paid by the Holders of the Seller Interest or the noteholders of other
Series (as provided in the related Indenture Supplements) and in no event shall
the Trust, the Indenture Trustee or the Series 2001-A Noteholders be liable for
the share of the Servicing Fee to be paid by the Holders of the Seller Interest
or the noteholders of any other Series. [To the extent that the Monthly
Servicing Fee is not paid in full pursuant to the preceding provisions of this
Section 3.1, and Section 4.4, it shall be paid by the Holders of the Seller
----------- -----------
Interest.]
15
ARTICLE IV
Rights of Series 2001-A Noteholders
and Allocation and Application of Collections
---------------------------------------------
Section 4.1 Collections and Allocations.
---------------------------
(a) Allocations. Finance Charge Collections, Principal Collections and
-----------
Defaulted Receivables allocated to Series 2001-A pursuant to Article VIII of the
------------
Indenture shall be allocated and distributed as set forth in this Article.
(b) Allocations to the Series 2001-A Noteholders. The Servicer shall,
--------------------------------------------
prior to the close of business on any Deposit Date, allocate to the Series 2001-
A Noteholders the following amounts as set forth below:
(i) Allocations of Finance Charge Collections. The Servicer shall
-----------------------------------------
allocate to the Series 2001-A Noteholders and transfer to the Finance
Charge Subaccount for application as provided herein an amount equal to the
product of (A) the Allocation Percentage and (B) the aggregate Finance
Charge Collections deposited in the Collection Account on such Deposit
Date; provided, however, that with respect to the portion of each Monthly
-------- -------
Period falling in the Revolving Period or the Controlled Accumulation
Period, such allocation shall be transferred to the Finance Charge
Subaccount only until such time as the amount transferred to the Finance
Charge Subaccount pursuant to this subsection during that Monthly Period
equals the sum of (1) the aggregate amount of Monthly Interest with respect
to the Distribution Date relating to the current Monthly Period, (2) at any
time that FCNB is not the Servicer, the Monthly Servicing Fee payable on
the Distribution Date relating to the current Monthly Period and all
accrued and unpaid Investor Monthly Servicing Fees with respect to any
prior Monthly Periods, and (3) the Default Estimate for that Monthly
Period; provided further, however, that notwithstanding the foregoing
-------- ------- -------
proviso, (1) the entire Allocation Percentage of Finance Charge Collections
-------
shall be transferred to the Finance Charge Subaccount on a daily basis if
(x) the Excess Spread Percentage for the preceding Monthly Period is less
than 3.00% or (y) the Available Spread Account Amount is less than the
Required Spread Account Amount; and (2) subject to Section 8.4(a) of the
--------------
Indenture, on each Determination Date, the Servicer shall deposit in the
Finance Charge Subaccount any amounts not retained on a daily basis
pursuant to the preceding proviso. Any portion of such allocation not
-------
required to be transferred to the Finance Charge Subaccount pursuant to the
preceding sentence shall be (x) first, deposited in the Excess Funding
Account to the extent that the Seller Amount is less than the Minimum
Seller Amount and (y) thereafter paid to the Holders of the Seller
Interest.
16
(ii) Allocations of Principal Collections. The Servicer shall
------------------------------------
allocate to the Series 2001-A Noteholders the following amounts as set
forth below:
(x) Allocations During the Revolving Period. During the
---------------------------------------
Revolving Period an amount equal to the product of the Allocation
Percentage and the aggregate amount of Principal Collections deposited
in the Collection Account on such Deposit Date, shall be allocated to
the Series 2001-A Noteholders and shall be first, if any other
Principal Sharing Series is outstanding and in its amortization period
or accumulation period, retained in the Collection Account for
application, to the extent necessary, as Shared Principal Collections
to other Principal Sharing Series on the related Distribution Date,
second deposited in the Excess Funding Account to the extent necessary
so that the Seller Amount is not less than the Minimum Seller Amount
and third paid to the Holders of the Seller Interest.
(y) Allocations During the Controlled Accumulation Period.
-----------------------------------------------------
During the Controlled Accumulation Period an amount equal to the product of
(I) the Allocation Percentage and (II) the aggregate amount of Principal
Collections deposited in the Collection Account on such Deposit Date (the
product for any such date is hereinafter referred to as a "Percentage
----------
Allocation") shall be allocated to the Series 2001-A Noteholders and
----------
transferred to the Principal Collections Subaccount until applied as
provided herein; provided, however, that if the sum of such Percentage
-------- -------
Allocation and all preceding Percentage Allocations with respect to the
same Monthly Period exceeds the Controlled Deposit Amount during the
Controlled Accumulation Period for the related Distribution Date, then such
excess shall not be treated as a Percentage Allocation and shall be first,
if any other Principal Sharing Series is outstanding and in its
amortization period or accumulation period, transferred to the Principal
Collections Subaccount for application, to the extent necessary, as Shared
Principal Collections to other Principal Sharing Series on the related
Distribution Date, second deposited in the Excess Funding Account to the
extent necessary so that the Seller Amount is not less than the Minimum
Seller Amount and third paid to the Holders of the Seller Interest.
(z) Allocations During the Rapid Amortization Period.
------------------------------------------------
During the Rapid Amortization Period, an amount equal to the product of (I)
the Allocation Percentage and (II) the aggregate amount of Principal
Collections deposited in the Collection Account
17
on such Deposit Date, shall be allocated to the Series 2001-A
Noteholders and transferred to the Principal Collections Subaccount
until applied as provided herein; provided, however, that after the
-------- -------
date on which an amount of such Collections equal to the Note
Principal Balance has been deposited into the Collection Account and
allocated to the Series 2001-A Noteholders, such amount shall be
first, if any other Principal Sharing Series is outstanding and in its
amortization period or accumulation period, transferred to the
Principal Collections Subaccount for application, to the extent
necessary, as Shared Principal Collections to other Principal Sharing
Series on the related Distribution Date, second deposited in the
Excess Funding Account to the extent necessary so that the Seller
Amount is not less than the Minimum Seller Amount and third paid to
the Holders of the Seller Interest.
Section 4.2 Determination of Monthly Interest.
---------------------------------
(a) The amount of monthly interest ("Class A Monthly Interest")
------------------------
distributable from the Collection Account with respect to the Class A Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) [one-
twelfth] [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 Note Interest Rate [in effect with respect to the related Interest
Period] and (ii) the Class A Note Principal Balance as of the close of business
on the last day of the preceding Monthly Period [(or, with respect to the
initial Distribution Date, the Class A Note Initial Principal Balance)][;
provided, that for the initial Distribution Date, Class A Monthly Interest shall
--------
equal $__________].
On the Determination Date preceding each Distribution Date, the Servicer
shall determine the excess, if any (the "Class A Interest Shortfall"), of (x)
--------------------------
the Class A Monthly Interest for such Distribution Date over (y) the aggregate
amount of funds allocated and available to pay such Class A Monthly Interest on
such Distribution Date. If the Class A Interest Shortfall for any Distribution
Date is greater than zero, on each subsequent Distribution Date until such Class
A Interest Shortfall is fully paid, an additional amount ("Class A Additional
------------------
Interest") equal to the product of (i) (A) [one-twelfth] [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 Note Interest Rate
[in effect with respect to the related Interest Period] and (ii) such Class A
Interest Shortfall (or the portion thereof which has not been paid to the Class
A Noteholders) shall be payable as provided herein with respect to the Class A
Notes. Notwithstanding anything to the contrary herein, Class A Additional
Interest shall be payable or distributed to the Class A Noteholders only to the
extent permitted by applicable law.
18
(b) The amount of monthly interest ("Class B Monthly Interest")
------------------------
distributable from the Collection Account with respect to the Class B Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) [one-
twelfth] [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 Note Interest Rate [in effect with respect to the related Interest
Period] and (ii) the Class B Note Principal Balance as of the close of business
on the last day of the preceding Monthly Period [(or, with respect to the
initial Distribution Date, the Class B Note Initial Principal Balance)] [;
provided, that for the initial Distribution Date, Class B Monthly Interest shall
--------
equal $__________].
On the Determination Date preceding each Distribution Date, the Servicer
shall determine the excess, if any (the "Class B Interest Shortfall"), of (x)
--------------------------
the Class B Monthly Interest for such Distribution Date over (y) the aggregate
amount of funds allocated and available to pay such Class B Monthly Interest on
such Distribution Date. If the Class B Interest Shortfall for any Distribution
Date is greater than zero, on each subsequent Distribution Date until such Class
B Interest Shortfall is fully paid, an additional amount ("Class B Additional
------------------
Interest") equal to the product of (i) (A) [one-twelfth] [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 Note Interest Rate
[in effect with respect to the related Interest Period] and (ii) such Class B
Interest Shortfall (or the portion thereof which has not been paid to the Class
B Noteholders) shall be payable as provided herein with respect to the Class B
Notes. Notwithstanding anything to the contrary herein, Class B Additional
Interest shall be payable or distributed to the Class B Noteholders only to the
extent permitted by applicable law.
(c) The amount of monthly interest ("Class C Monthly Interest")
------------------------
distributable from the Collection Account with respect to the Class C Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) [one-
twelfth] [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 C Note Interest Rate [in effect with respect to the related Interest
Period] and (ii) the Class C Note Principal Balance as of the close of business
on the last day of the preceding Monthly Period (or, with respect to the initial
Distribution Date, the Class C Note Initial Principal Balance)][; provided, that
--------
for the initial Distribution Date, Class C Monthly Interest shall equal
$__________].
On the Determination Date preceding each Distribution Date, the Servicer
shall determine an amount (the "Class C Interest Shortfall") equal to (x) the
--------------------------
aggregate Class C Monthly Interest for such Distribution Date minus (y) the
aggregate amount of funds allocated and available to pay such Class C Monthly
Interest on such Distribution Date. If the Class C Interest Shortfall for any
Distribution Date is greater than zero, on each subsequent Distribution Date
until such Class C Interest Shortfall is fully paid, an
19
additional amount ("Class C Additional Interest") shall be payable as provided
---------------------------
herein with respect to the Class C Notes equal to the product of (i) (A) [one-
twelfth] [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 C Note Interest Rate [in effect with respect to the related Interest
Period] and (ii) such Class C Interest Shortfall (or the portion thereof which
has not been paid to the Class C Noteholders (after giving effect to the
application of the proceeds of any draw made on the Spread Account as provided
in subsections 4.4(a)(iv) and 4.11(c) for the purpose of paying such amount with
---------------------- -------
respect to such Distribution Date)). Notwithstanding anything to the contrary
herein, Class C Additional Interest shall be payable or distributed to the Class
C Noteholders only to the extent permitted by applicable law.
Section 4.3 Determination of Monthly Principal. The amount of monthly
----------------------------------
principal distributable from the Collection Account with respect to the Notes on
each Distribution Date (the "Monthly Principal"), beginning with the
-----------------
Distribution Date in the month following the month in which the Controlled
Accumulation Period or, if earlier, the Rapid Amortization Period, begins, shall
be equal to the least of (i) the Available Principal Collections on deposit in
the Collection Account with respect to such Distribution Date, (ii) for each
Distribution Date with respect to the Controlled Accumulation Period, the
Controlled Deposit Amount for such Distribution Date, (iii) the Note Principal
Balance, minus any amount already on deposit in the Principal Accumulation
Account on such Distribution Date and (iv) the Collateral Amount (after taking
into account any adjustments to be made pursuant to Sections 4.5 and 4.6) prior
------------ ---
to any deposit into the Principal Accumulation Account or payment to Noteholders
on such Distribution Date.
Section 4.4 Application of Available Finance Charge Collections and
-------------------------------------------------------
Available Principal Collections. The Servicer shall apply, or shall cause the
-------------------------------
Indenture Trustee to apply by written instruction to the Indenture Trustee, on
each Distribution Date, Available Finance Charge Collections and Available
Principal Collections on deposit in the Collection Account with respect to such
Distribution Date to make the following distributions:
(a) On each Distribution Date, an amount equal to the Available Finance
Charge Collections with respect to such Distribution Date will be distributed or
deposited in the following priority:
(i) an amount equal to Class A Monthly Interest for such
Distribution Date, plus the amount of any Class A Monthly Interest
previously due but not distributed to Class A Noteholders on a prior
Distribution Date, plus the amount of any Class A Additional Interest for
such Distribution Date, plus the amount of any Class A Additional Interest
previously due but not distributed to Class A Noteholders on a prior
Distribution Date, shall be distributed to the Paying Agent for payment to
Class A Noteholders on such Distribution Date;
20
(ii) an amount equal to Class B Monthly Interest for such
Distribution Date, plus the amount of any Class B Monthly Interest
previously due but not distributed to Class B Noteholders on a prior
Distribution Date, plus the amount of any Class B Additional Interest for
such Distribution Date, plus the amount of any Class B Additional Interest
previously due but not distributed to Class B Noteholders on a prior
Distribution Date, shall be distributed to the Paying Agent for payment to
Class B Noteholders on such Distribution Date;
(iii) if neither FCNB nor any of its Affiliates is the Servicer, an
amount equal to the Noteholder Servicing Fee for such Distribution Date,
plus the amount of any Noteholder Servicing Fee previously due but not
distributed to the Servicer on a prior Distribution Date, shall be
distributed to the Servicer;
(iv) an amount equal to Class C Monthly Interest for such
Distribution Date, plus the amount of any Class C Monthly Interest
previously due but not distributed to the Class C Noteholders on a prior
Distribution Date, plus the amount of any Class C Additional Interest for
such Distribution Date, plus the amount of any Class C Additional Interest
previously due but not distributed to the Class C Noteholders on a prior
Distribution Date shall be distributed to the Paying Agent for payment to
the Class C Noteholders on such Distribution Date; provided, however, that,
-------- -------
in the event that the sum of Class C Monthly Interest exceeds the amount of
Available Finance Charge Collections available (after giving effect to
subsections 4.4(a)(i) through (iii) above) to fund such Class C Monthly
--------------------- -----
Interest and Class C Additional Interest, a draw will be made from amounts
available for distribution in the Spread Account (at the times and in the
amounts specified in Section 4.11) and shall be distributed to the Paying
------------
Agent for payment to the Class C Noteholders on such Distribution Date in
accordance with this subsection 4.4(a)(iv);
---------------------
(v) an amount equal to the Investor Default Amount and any
Investor Uncovered Dilution Amount for such Distribution Date shall be
treated as a portion of Available Principal Collections for such
Distribution Date;
(vi) an amount equal to the sum of the aggregate amount of Investor
Charge-Offs and the amount of Reallocated Principal Collections which have
not been previously reimbursed pursuant to this subsection (vi) shall be
---------------
treated as a portion of Available Principal Collections for such
Distribution Date;
(vii) on each Distribution Date from and after the Reserve Account
Funding Date, but prior to the date on which the Reserve Account terminates
as described in subsection 4.10(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;
21
(viii) an amount equal to the amounts required to be deposited in
the Spread Account pursuant to Section 4.11 shall be deposited into the
------------
Spread Account as provided in Section 4.11;
------------
(ix) any Noteholder Servicing Fee for such Distribution Date or
prior Distribution Dates not paid pursuant to subsection 4.4(a)(iii)
----------------------
(unless such amount has been netted against deposits to the Collection
Account in accordance with Section 8.4 of the Indenture); and
-----------
(x) the balance, if any, will constitute a portion of Excess
Finance Charge Collections for such Distribution Date and will be available
first for allocation to other Series in Group One, second deposited in the
Excess Funding Account to the extent necessary so that the Seller Amount is
not less than the Minimum Seller Amount and third to the Holders of the
Seller Interest as described in Section 8.6 of the Indenture.
-----------
(b) On each Distribution Date with respect to the Revolving Period, an
amount equal to the Available Principal Collections deposited in the Collection
Account for the related Monthly Period shall be treated as Shared Principal
Collections and applied in accordance with Section 8.5 of the Indenture.
-----------
(c) On each Distribution Date with respect to the Controlled
Accumulation Period or the Rapid Amortization Period, an amount equal to the
Available Principal Collections deposited in the Collection Account for the
related Monthly Period shall be distributed or deposited in the following order
of priority:
(i) during the Controlled Accumulation Period, an amount equal
to the Monthly Principal for such Distribution Date shall be deposited into
the Principal Accumulation Account;
(ii) during the Rapid Amortization Period, an amount equal to the
Monthly Principal for such Distribution Date shall be distributed to the
Paying Agent for payment to the Class A Noteholders on such Distribution
Date and on each subsequent Distribution Date until the Class A Note
Principal Balance has been paid in full;
(iii) after giving effect to the distribution referred to in
clause (ii) above, during the Rapid Amortization Period, an amount equal to
-----------
the Monthly Principal remaining, if any, shall be distributed to the Paying
Agent for payment to the Class B Noteholders on such Distribution Date and
on each subsequent Distribution Date until the Class B Note Principal
Balance has been paid in full;
(iv) after giving effect to the distributions referred to in
clauses (ii) and (iii) above, during the Rapid Amortization Period, an
------------
amount equal to the Monthly Principal remaining, if any, shall be
distributed to the Paying Agent for
22
payment to the Class C Noteholders on such Distribution Date and on each
subsequent Distribution Date until the Class C Note Principal Balance has
been paid in full; and
(v) in the case of each of the Controlled Accumulation Period and the
Rapid Amortization Period, the balance of such Available Principal
Collections remaining after application in accordance with clause (i) or
----------
(iv) above shall be treated as Shared Principal Collections and applied in
----
accordance with Section 8.5 of the Indenture. As of any Distribution Date
-----------
on which any Available Principal Collections are treated as Shared
Principal Collections as provided above, the Collateral Amount shall be
reduced by an amount equal to the lesser of (x) the amount of Available
Principal Collections applied as Shared Principal Collections and (y) the
Surplus Collateral Amount.
(d) On the earlier to occur of (i) the first Distribution Date with
respect to the Rapid Amortization Period and (ii) the Expected Principal
Distribution Date, the Indenture Trustee, acting in accordance with instructions
from the Servicer, shall withdraw from the Principal Accumulation Account and
distribute to the Paying Agent for payment to the Class A Noteholders, the Class
B Noteholders and the Class C Noteholders, the amounts deposited into the
Principal Accumulation Account pursuant to subsection 4.4(c)(i).
--------------------
Section 4.5 Investor Charge-Offs. On each Determination Date, the
--------------------
Servicer shall calculate the Investor Default Amount and any Investor Uncovered
Dilution Amount for the related Distribution Date. If, on any Distribution Date,
the sum of the Investor Default Amount and any Investor Uncovered Dilution
Amount for such Distribution Date exceeds the amount of Available Finance Charge
Collections allocated with respect thereto pursuant to subsection 4.4(a)(v) with
--------------------
respect to such Distribution Date, the Collateral Amount will be reduced (but
not below zero) by the amount of such excess (such reduction, an "Investor
--------
Charge-Off").
----------
Section 4.6 Reallocated Principal Collections. On each Distribution Date,
---------------------------------
the Servicer shall apply, or shall instruct the Indenture Trustee in writing to
apply, Reallocated Principal Collections with respect to such Distribution Date,
to fund any deficiency pursuant to and in the priority set forth in subsections
-----------
4.4(a)(i), (ii), (iii), and (iv). On each Distribution Date, the Collateral
--------- ---- ----- ----
Amount shall be reduced by the amount of Reallocated Principal Collections for
such Distribution Date.
Section 4.7 Excess Finance Charge Collections. Series 2001-A shall be an
---------------------------------
Excess Allocation Series with respect to Group One only. For this purpose, each
outstanding series of certificates issued by First Consumers Master Trust (other
than series represented by the Collateral Certificate) shall be deemed to be a
Series in Group One. Subject to Section 8.6 of the Indenture, Excess Finance
-----------
Charge Collections with respect to the Excess Allocation Series in Group One for
any Distribution Date will be allocated to Series 2001-A in an amount equal to
the product of (x) the aggregate
23
amount of Excess Finance Charge Collections with respect to all the Excess
Allocation Series in Group One for such Distribution Date and (y) a fraction,
the numerator of which is the Finance Charge Shortfall for Series 2001-A for
such Distribution Date and the denominator of which is the aggregate amount of
Finance Charge Shortfalls for all the Excess Allocation Series in Group One for
such Distribution Date. The "Finance Charge Shortfall" for Series 2001-A for any
------------------------
Distribution Date will be equal to the excess, if any, of (a) the full amount
required to be paid, without duplication, pursuant to subsections 4.4(a)(i)
---------------------
through (ix) on such Distribution Date over (b) the Available Finance Charge
----
Collections with respect to such Distribution Date (excluding any portion
thereof attributable to Excess Finance Charge Collections).
Section 4.8 Shared Principal Collections. Subject to Section 8.5 of the
---------------------------- -----------
Indenture, Shared Principal Collections for any Distribution Date will be
allocated to Series 2001-A in an amount equal to the product of (x) the
aggregate amount of Shared Principal Collections with respect to all Principal
Sharing Series for such Distribution Date and (y) a fraction, the numerator of
which is the Principal Shortfall for Series 2001-A for such Distribution Date
and the denominator of which is the aggregate amount of Principal Shortfalls for
all the Series which are Principal Sharing Series for such Distribution Date.
For this purpose, each outstanding series of certificates issued by Spiegel
Master Trust (other than series represented by the Collateral Certificate) shall
be deemed to be a Principal Sharing Series. The "Principal Shortfall" for
-------------------
Series 2001-A will be equal to (a) for any Distribution Date with respect to the
Revolving Period, zero, (b) for any Distribution Date with respect to the
Controlled Accumulation Period, the excess, if any, of the Controlled Deposit
Amount with respect to such Distribution Date over the amount of Available
Principal Collections for such Distribution Date (excluding any portion thereof
attributable to Shared Principal Collections), and (c) for any Distribution Date
with respect to the Rapid Amortization Period, the excess, if any, of the Note
Principal Balance less the balance in the Principal Accumulation Account over
the amount of Available Principal Collections for such Distribution Date
(excluding any portion thereof attributable to Shared Principal Collections).
Section 4.9 Principal Accumulation Account.
------------------------------
(a) The Indenture Trustee shall establish and maintain with an Eligible
Institution, which may be the Indenture Trustee in the name of the Trust, on
behalf of the Trust, for the benefit of the Series 2001-A Noteholders, a non-
interest bearing segregated trust account with the corporate trust department of
such Eligible Institution (the "Principal Accumulation Account"), bearing a
------------------------------
designation clearly indicating that the funds deposited therein are held for the
benefit of the Series 2001-A Noteholders. The Indenture Trustee shall possess
all right, title and interest in all funds on deposit from time to time in the
Principal Accumulation Account and in all proceeds thereof. The Principal
Accumulation Account shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Series 2001-A Noteholders. If at any
time the institution holding the Principal Accumulation Account ceases to be an
Eligible
24
Institution, the Servicer shall notify the Indenture Trustee in writing, and the
Indenture Trustee upon being notified (or the Servicer on its behalf) shall,
within ten (10) Business Days, establish a new Principal Accumulation Account
meeting the conditions specified above with an Eligible Institution, and shall
transfer any cash or any investments to such new Principal Accumulation Account.
The Indenture Trustee, at the written direction of the Servicer, shall (i) make
withdrawals from the Principal Accumulation Account from time to time, in the
amounts and for the purposes set forth in this Indenture Supplement, and (ii) on
each Distribution Date (from and after the commencement of the Controlled
Accumulation Period) prior to the termination of the Principal Accumulation
Account, make deposits into the Principal Accumulation Account in the amounts
specified in, and otherwise in accordance with, subsection 4.4(c)(i).
--------------------
(b) Funds on deposit in the Principal Accumulation Account shall be
invested at the written direction of the Servicer by the Indenture Trustee in
Permitted Investments [; provided, however, that, for purposes of the investment
-------- -------
of funds on deposit in the Principal Accumulation Account, references in the
definition of "Permitted Investments" to a rating in the "highest rating
category" shall be modified to require a rating, from any one of the following
Rating Agencies, of at least A-2 by Standard & Poor's, P-2 by ▇▇▇▇▇'▇ or (if
such investment is rated by Fitch) F2 by Fitch]. Funds on deposit in the
Principal Accumulation Account on any Distribution Date, after giving effect to
any withdrawals from the Principal Accumulation Account on such Distribution
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 Distribution Date.
The Indenture Trustee shall hold such of the Permitted Investments as
consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of New York and/or
Illinois. The Indenture Trustee shall hold such of the Permitted Investments as
constitutes investment property through a securities intermediary, which
securities intermediary shall agree with the Indenture Trustee that (a) such
investment property shall at all times be credited to a securities account of
the Indenture Trustee, (b) such securities intermediary shall treat the
Indenture Trustee as entitled to exercise the rights that comprise each
financial asset credited to such securities account, (c) all property credited
to such securities account shall be treated as a financial asset, (d) such
securities intermediary shall comply with entitlement orders originated by the
Indenture Trustee without the further consent of any other person or entity, (e)
such securities intermediary will not agree with any person or entity other than
the Indenture Trustee to comply with entitlement orders originated by such other
person or entity, (f) such securities accounts and the property credited thereto
shall not be subject to any lien, security interest or right of set-off in favor
of such securities intermediary or anyone claiming through it (other than the
Indenture Trustee), and (g) such agreement shall be governed by the laws of the
State of Illinois. Terms used in the preceding sentence that are defined in the
New York UCC and not otherwise defined herein shall have the meaning set forth
in the New York UCC.
25
On each Distribution Date with respect to the Controlled Accumulation
Period and on the first Distribution Date with respect to the Rapid Amortization
Period, the Indenture Trustee, acting at the Servicer's written direction given
on or before such Distribution Date, shall transfer from the Principal
Accumulation Account to the Collection Account the Principal Accumulation
Investment Proceeds on deposit in the Principal Accumulation Account for
application as Available Finance Charge Collections in accordance with Section
-------
4.4.
---
Principal Accumulation Investment Proceeds (including reinvested interest)
shall not be considered part of the amounts on deposit in the Principal
Accumulation Account for purposes of this Indenture Supplement.
Section 4.10 Reserve Account.
---------------
(a) The Indenture Trustee shall establish and maintain with an Eligible
Institution, which may be the Indenture Trustee in the name of the Trust, on
behalf of the Trust, for the benefit of the Series 2001-A Noteholders, a non-
interest bearing segregated trust account with the corporate trust department of
such Eligible Institution (the "Reserve Account"), bearing a designation clearly
---------------
indicating that the funds deposited therein are held for the benefit of the
Series 2001-A Noteholders. The Indenture 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 the Indenture Trustee for the benefit of the Series
2001-A Noteholders. If at any time the institution holding the Reserve Account
ceases to be an Eligible Institution, the Servicer shall notify the Indenture
Trustee in writing, and the Indenture Trustee upon being notified (or the
Servicer on its behalf) shall, within ten (10) Business Days, establish a new
Reserve Account meeting the conditions specified above with an Eligible
Institution, and shall transfer any cash or any investments to such new Reserve
Account. The Indenture Trustee, at the written direction of the 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 Indenture Supplement, and (ii) on each Distribution 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 4.4(a)(vii).
----------------------
(b) Funds on deposit in the Reserve Account shall be invested at the
written direction of the Servicer by the Indenture Trustee in Permitted
Investments[; provided, however, that, for purposes of the investment of funds
-------- -------
on deposit in the Reserve Account, references in the definition of "Permitted
Investments" to a rating in the "highest rating category" shall be modified to
require a rating, from any one of the following Rating Agencies, of at least A-2
by Standard & Poor's, P-2 by ▇▇▇▇▇'▇ or (if such investment is rated by Fitch)
F2 by Fitch.] Funds on deposit in the Reserve Account on any Distribution Date,
after giving effect to any withdrawals from the
26
Reserve Account on such Distribution 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 Distribution Date.
The Indenture Trustee shall hold such of the Permitted Investments as
consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of New York. The Indenture
Trustee shall hold such of the Permitted Investments as constitutes investment
property through a securities intermediary, which securities intermediary shall
agree with the Indenture Trustee that (a) such investment property shall at all
times be credited to a securities account of the Indenture Trustee, (b) such
securities intermediary shall treat the Indenture Trustee as entitled to
exercise the rights that comprise each financial asset credited to such
securities account, (c) all property credited to such securities account shall
be treated as a financial asset, (d) such securities intermediary shall comply
with entitlement orders originated by the Indenture Trustee without the further
consent of any other person or entity, (e) such securities intermediary will not
agree with any person or entity other than the Indenture Trustee to comply with
entitlement orders originated by such other person or entity, (f) such
securities accounts and the property credited thereto shall not be subject to
any lien, security interest, or right of set-off in favor of such securities
intermediary or anyone claiming through it (other than the Indenture Trustee),
and (g) such agreement shall be governed by the laws of the State of New York.
Terms used in the preceding sentence that are defined in the New York UCC and
not otherwise defined herein shall have the meaning set forth in the New York
UCC.
On each Distribution Date, all interest and earnings (net of losses and
investment expenses) accrued since the preceding Distribution 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
Collection Account and included in Available Finance Charge Collections for such
Distribution Date. For purposes of determining the availability of funds or the
balance in the Reserve Account for any reason under this Indenture Supplement,
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 Distribution Date with respect to the Controlled
Accumulation Period and on or before the first Distribution Date with respect to
the Rapid Amortization Period, the Servicer shall calculate the Reserve Draw
Amount; provided, however, that such amount will be reduced to the extent that
-------- -------
funds otherwise would be available for deposit in the Reserve Account under
Section 4.4(a)(vii) with respect to such Distribution Date.
-------------------
(d) If for any Distribution Date the Reserve Draw Amount is greater than
zero, the Reserve Draw Amount, up to the Available Reserve Account Amount, shall
27
be withdrawn from the Reserve Account on such Distribution Date by the Indenture
Trustee (acting in accordance with the written instructions of the Servicer) and
deposited into the Collection Account for application as Available Finance
Charge Collections for such Distribution Date.
(e) If the Reserve Account Surplus on any Distribution Date, after giving
effect to all deposits to and withdrawals from the Reserve Account with respect
to such Distribution Date, is greater than zero, the Indenture Trustee, acting
in accordance with the written instructions of the Servicer, shall withdraw from
the Reserve Account an amount equal to such Reserve Account Surplus and (i)
deposit such amounts in the Spread Account, to the extent that funds on deposit
in the Spread Account are less than the Required Spread Account Amount, and (ii)
distribute any such amounts remaining after application pursuant to subsection
----------
4.10(e)(i) to the holders of the Seller Interest.
----------
(f) Upon the earliest to occur of (i) the termination of the Trust pursuant
to Article VIII of the Trust Agreement, (ii) the first Distribution Date
------------
relating to the Rapid Amortization Period and (iii) the Expected Principal
Distribution Date, the Indenture Trustee, acting in accordance with the
instructions of the Servicer, after the prior payment of all amounts owing to
the Series 2001-A Noteholders that are payable from the Reserve Account as
provided herein, shall withdraw from the Reserve Account all amounts, if any, on
deposit in the Reserve Account and (i) deposit such amounts in the Spread
Account, to the extent that funds on deposit in the Spread Account are less than
the Required Spread Account Amount, and (ii) distribute any such amounts
remaining after application pursuant to subsection 4.10(f)(i) to the holders of
---------------------
the Seller Interest. The Reserve Account shall thereafter be deemed to have
terminated for purposes of this Indenture Supplement. Funds on deposit in the
Reserve Account at any time that the Controlled Accumulation Period is suspended
pursuant to Section 4.15 shall remain on deposit until applied in accordance
------------
with subsection 4.10(d), (e) or (f).
------------------ --- ---
Section 4.11 Spread Account.
--------------
(a) On or prior to the Closing Date, the Indenture Trustee shall establish
and maintain with an Eligible Institution, which may be the Indenture Trustee in
the name of the Trust, on behalf of the Trust, for the benefit of the Class C
Noteholders and the Seller, a non-interest bearing segregated account with the
corporate trust department of such Eligible Institution (the "Spread Account"),
--------------
bearing a designation clearly indicating that the funds deposited therein are
held for the benefit of the Class C Noteholders and the Seller. Except as
otherwise provided in this Section 4.11, the Indenture Trustee shall possess all
------------
right, title and interest in all funds on deposit from time to time in the
Spread Account and in all proceeds thereof. The Spread Account shall be under
the sole dominion and control of the Indenture Trustee for the benefit of the
Class C Noteholders and the Servicer. If at any time the institution holding
the Spread Account ceases to be an Eligible Institution, the Servicer shall
notify the Indenture Trustee in writing, and the Indenture Trustee upon being
notified (or the
28
Servicer on its behalf) shall, within ten (10) Business Days (or such longer
period as to which the Rating Agencies may consent) establish a new Spread
Account meeting the conditions specified above with an Eligible Institution and
shall transfer any cash or any investments to such new Spread Account. The
Indenture Trustee, at the written direction of the Servicer, shall (i) make
withdrawals from the Spread Account from time to time in an amount up to the
Available Spread Account Amount at such time, for the purposes set forth in this
Indenture Supplement, and (ii) on each Distribution Date prior to termination of
the Spread Account, make a deposit into the Spread Account in the amount
specified in, and otherwise in accordance with, subsection 4.11(g).
------------------
(b) Funds on deposit in the Spread Account shall be invested at the written
direction of the Servicer by the Indenture Trustee in Permitted Investments;
provided, however, that, for purposes of the investment of funds on deposit in
-------- -------
the Spread Account, references in the definition of "Permitted Investments" to a
rating in the "highest rating category" shall be modified to require a rating,
from any one of the following Rating Agencies, of at least A-2 by Standard &
Poor's, P-2 by ▇▇▇▇▇'▇ or (if such investment is rated by Fitch) F2 by Fitch.
Funds on deposit in the Spread Account on any Distribution Date, after giving
effect to any withdrawals from and deposits to the Spread Account on such
Distribution 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
Distribution Date.
The Indenture Trustee shall hold such of the Permitted Investments as
consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of New York. The Indenture
Trustee shall hold such of the Permitted Investments as constitutes investment
property through a securities intermediary, which securities intermediary shall
agree with the Indenture Trustee that (a) such investment property shall at all
times be credited to a securities account of the Indenture Trustee, (b) such
securities intermediary shall treat the Indenture Trustee as entitled to
exercise the rights that comprise each financial asset credited to such
securities account, (c) all property credited to such securities account shall
be treated as a financial asset, (d) such securities intermediary shall comply
with entitlement orders originated by the Indenture Trustee without the further
consent of any other person or entity, (e) such securities intermediary will not
agree with any person or entity other than the Indenture Trustee to comply with
entitlement orders originated by such other person or entity, (f) such
securities accounts and the property credited thereto shall not be subject to
any lien, security interest, or right of set-off in favor of such securities
intermediary or anyone claiming through it (other than the Indenture Trustee),
and (g) such agreement shall be governed by the laws of the State of New York.
Terms used in the preceding sentence that are defined in the New York UCC and
not otherwise defined herein shall have the meaning set forth in the New York
UCC. Except as permitted by this subsection 4.11(b), the Indenture Trustee shall
------------------
not hold Permitted Investments through an agent or a nominee.
29
On each Distribution Date (but subject to subsections 4.11(c) and 4.11(d)),
------------------- -------
the Investment Earnings, if any, accrued since the preceding Distribution Date
on funds on deposit in the Spread Account shall be paid to the Seller by the
Indenture Trustee upon written direction of the Servicer. For purposes of
determining the availability of funds or the balance in the Spread Account for
any reason under this Indenture Supplement (subject to subsections 4.11(c) and
-------------------
4.11(d)), all Investment Earnings shall be deemed not to be available or on
-------
deposit; provided that after the maturity of the Series 2001-A Notes has been
--------
accelerated as a result of an Event of Default, all Investment Earnings shall be
added to the balance on deposit in the Spread Account and treated like the rest
of the Available Spread Account Amount.
(c) If, on any Distribution Date, the aggregate amount available for
distribution pursuant to subsection 4.4(a)(iv) is less than the aggregate amount
---------------------
required to be distributed pursuant to subsection 4.4(a)(iv) (without giving
---------------------
effect to any limitation based on Available Finance Charge Collections), the
Indenture Trustee, at the written direction of the Servicer, shall withdraw from
the Spread Account the amount of such deficiency up to the Available Spread
Account Amount and, if the Available Spread Account Amount is less than such
deficiency, Investment Earnings credited to the Spread Account, and deposit such
amount in the Collection Account for payment to the Class C Noteholders in
respect of interest on the Class C Notes.
(d) If, on any Distribution Date, the Excess Collateral Amount previously
has been reduced below zero, or would be reduced below zero, as a result of the
application of the Investor Default Amount and the Investor Uncovered Dilution
Amount, if any, on such Distribution Date pursuant to Section 4.5 or the
-----------
application of Reallocated Principal Collections on such Distribution Date
pursuant to Section 4.6, then the Indenture Trustee (i) shall withdraw from the
-----------
Spread Account the lesser of (A) the amount required (1) to cover any potential
reductions to the Collateral Amount that would occur on such Distribution Date
after the reduction of the Excess Collateral to zero and (2) to reimburse prior
reductions in the Collateral Amount that have not reimbursed (other than
reductions to the Excess Collateral Amount), so that the Collateral Amount
equals the Note Principal Balance, less any amounts on deposit in the Principal
Accumulation Account, and (B) the Available Spread Account Amount remaining
after making any payments required pursuant to subsection 4.11(c) and, if the
------------------
remaining Available Spread Account Amount is less than the amount described in
clause (A) of this sentence, Investment Earnings credited to the Spread Account
remaining after making any payments required pursuant to subsection 4.11(c), and
------------------
(ii) shall deposit such amounts into the Collection Account for application as
Available Principal Collections pursuant to subsections 4.4(a)(v) and
---------------------
4.4(a)(vi).
----------
(e) On the earlier of Series 2001-A Final Maturity Date and the date on
which the Class A Note Principal Balance and the Class B Note Principal Balance
have been paid in full, after applying any funds on deposit in the Spread
Account as described in Section 4.11(c), the Indenture Trustee at the written
---------------
direction of the
30
Servicer shall withdraw from the Spread Account an amount equal to the lesser of
(i) the Class C Note Principal Balance (after any payments to be made pursuant
to subsection 4.4(c) on such date) and (ii) the Available Spread Account Amount
-----------------
and, if the Available Spread Account Amount is not sufficient to reduce the
Class C Note Principal Balance to zero, Investment Earnings credited to the
Spread Account up to the amount required to reduce the Class C Note Principal
Balance to zero, and the Indenture Trustee upon the written direction of the
Servicer or the Servicer shall deposit such amounts into the Collection Account
for distribution to the Class C Noteholders in accordance with subsection
----------
5.2(e).
------
(f) On any day following the occurrence of an Event of Default with respect
to Series 2001-A and acceleration of the maturity of the Series 2001-A Notes
pursuant to Section 5.3 of the Indenture, the Servicer shall withdraw from the
-----------
Spread Account an amount equal to the Available Spread Account Amount and the
Indenture Trustee upon the written direction of the Servicer or the Servicer
shall deposit such amounts into the Collection Account for distribution to the
Class C Noteholders in accordance with Section 5.2, to fund any shortfalls in
-----------
amounts owed to the Class C Noteholders.
(g) If on any Distribution Date, after giving effect to all withdrawals
from the Spread Account, the Available Spread Account Amount is less than the
Required Spread Account Amount then in effect, Available Finance Charge
Collections shall be deposited into the Spread Account under the circumstances
set forth in subsection 4.4(a)(viii) up to the amount of the Spread Account
-----------------------
Deficiency.
(h) If on any Distribution Date, after giving effect to all withdrawals
from and deposits to the Spread Account, the amount on deposit in the Spread
Account would exceed the Required Spread Account Amount then in effect, the
Indenture Trustee shall, at the written direction of the Servicer, release such
excess to the Seller. On the date on which the Class C Note Principal Balance
has been paid in full (including amounts to be paid to the Class C Noteholders
pursuant to subsection 4.11(d) above), the Indenture Trustee, at the written
------------------
direction of the Servicer, shall withdraw from the Spread Account all amounts
then remaining in the Spread Account and pay such amounts to the Seller.
Section 4.12 [Determination of LIBOR.
----------------------
(a) On each LIBOR Determination Date in respect of an Interest Period, the
Indenture Trustee shall determine LIBOR on the basis of the rate for deposits in
United States dollars for a one-month period 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 Interest Period Determination Date shall
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. The Indenture Trustee shall request the principal London office of each
of the Reference Banks to provide a quotation of its rate. If at least two (2)
such quotations are provided, the rate for that Interest Period
31
shall be the arithmetic mean of the quotations. If fewer than two (2) quotations
are provided as requested, the rate for that Interest Period will be the
arithmetic mean of the rates quoted by major banks in New York City, selected by
the 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.
(b) The Class A Note Interest Rate, Class B Note Interest Rate and Class C
Note Interest Rate applicable to the then current and the immediately preceding
Interest Periods may be obtained by telephoning the Indenture Trustee at its
corporate trust office at (▇▇▇) ▇▇▇-▇▇▇▇ or such other telephone number as shall
be designated by the Indenture Trustee for such purpose by prior written notice
by the Indenture Trustee to each Series 2001-A Noteholder from time to time.
(c) On each LIBOR Determination Date, the Indenture Trustee shall send to
the Servicer by facsimile transmission, notification of LIBOR for the following
Interest Period.]
Section 4.13 Investment Instructions. Any investment instructions required
-----------------------
to be given to the Indenture Trustee pursuant to the terms hereof must be given
to the Indenture Trustee no later than 11:00 a.m., New York City time, on the
date such investment is to be made. In the event the Indenture Trustee receives
such investment instruction later than such time, the Indenture Trustee may, but
shall have no obligation to, make such investment. In the event the Indenture
Trustee is unable to make an investment required in an investment instruction
received by the Indenture Trustee after 11:00 a.m., New York City time, on such
day, such investment shall be made by the Indenture Trustee on the next
succeeding Business Day. In no event shall the Indenture Trustee be liable for
any investment not made pursuant to investment instructions received after 11:00
a.m., New York City time, on the day such investment is requested to be made.
Section 4.14 Controlled Accumulation Period. The Controlled Accumulation
------------------------------
Period is scheduled to commence at the close of business on [_____ __, 20__].
However, if the Accumulation Period Length (determined as described below) is
less than 12 months, the date on which the Controlled Accumulation Period
actually commences will be delayed to the first Business Day of the month that
is the number of whole months prior to the Expected Principal Distribution Date
at least equal to the Accumulation Period Length and, as a result, the number of
Monthly Periods in the Controlled Accumulation Period will at least equal the
Accumulation Period Length. On the Determination Date immediately preceding the
[_____ ____] Distribution Date, and each Determination Date thereafter until the
Controlled Accumulation Period begins, the Servicer will determine the
"Accumulation Period Length" which will equal the number of whole months such
--------------------------
that the sum of the Accumulation Period Factors for each month during such
period will be equal to or greater than the Required Accumulation Factor Number;
provided, however, that the Accumulation Period Length
-------- -------
32
will not be determined to be less than one month; provided further, however,
---------------- -------
that the determination of the Accumulation Period Length may be changed at any
time if the Rating Agency Condition is satisfied.
Section 4.15 Suspension of Controlled Accumulation Period. (a) The Issuer
--------------------------------------------
may, in its sole discretion, elect to suspend the commencement of the Controlled
Accumulation Period. The commencement of the Controlled Accumulation Period
shall be suspended upon delivery by the Issuer to the Trustee of (i) an
Officer's Certificate stating that the Issuer has elected to suspend the
commencement of the Controlled Accumulation Period and that all conditions
precedent to such suspension set forth in this Section 4.15 have been satisfied,
------------
(ii) a copy of an executed Qualified Maturity Agreement and (iii) an Opinion of
Counsel addressed to the Indenture Trustee as to the due authorization,
execution and delivery and the validity and enforceability of such Qualified
Maturity Agreement. The Issuer does hereby transfer, assign, set-over, and
otherwise convey to the Indenture Trustee for the benefit of the Class A
Noteholders, the Class B Noteholders, Class C Noteholders without recourse, all
of its rights under any Qualified Maturity Agreement obtained in accordance with
this Section 4.15 and all proceeds thereof. Such property shall constitute part
------------
of the Trust Estate for all purposes of the Indenture. The foregoing transfer,
assignment, set-over and conveyance does not constitute and is not intended to
result in a creation or an assumption by the Indenture Trustee or any Noteholder
of any obligation of the Issuer or any other Person in connection with a
Qualified Maturity Agreement or under any agreement or instrument relating
thereto.
The Indenture Trustee hereby acknowledges its acceptance, to the extent
validly transferred, assigned, set-over or otherwise conveyed to the Indenture
Trustee, for the benefit of the Class A Noteholders, the Class B Noteholders and
the Class C Noteholder, of all of the rights previously held by the Issuer under
any Qualified Maturity Agreement obtained by the Issuer and all proceeds
thereof, and declares that it shall hold such rights upon the trust set forth
herein and in the Agreement, and subject to the terms hereof and thereof, for
the benefit of the Class A Noteholders, the Class B Noteholders and the Class C
Noteholders.
(b) The Issuer shall cause the provider of each Qualified Maturity
Agreement to deposit into the Principal Accumulation Account on or before the
Expected Principal Distribution Date an amount equal to the aggregate
outstanding principal balance of the Class A Note, the Class B Note and the
Class C Notes on such Distribution Date; provided, however, that the Issuer may
-------- -------
instead elect to fund all or a portion of such deposit with the proceeds of the
issuance of a new Series or with the Available Principal Collections with
respect to such Distribution Date. The amount deposited shall be applied on the
Expected Principal Distribution Date pursuant to Section 4.4(d) as if the
commencement of the Controlled Accumulation Period had not been suspended.
33
(c) Each Qualified Maturity Agreement shall terminate at the close of
business on the Expected Principal Distribution Date; provided, however, that
-------- -------
the Issuer may terminate a Qualified Maturity Agreement prior to such
Distribution Date, with notice to each Rating Agency, if (i) the Available
Reserve Account Amount equals the Required Reserve Account Amount and (ii) one
of the following events occurs: (A) the Issuer obtains a substitute Qualified
Maturity Agreement, (B) the provider of the Qualified Maturity Agreement ceases
to qualify as an Eligible Institution and the Issuer is unable to obtain a
substitute Qualified Maturity Agreement or (C) a Pay Out Event occurs. In
addition, the Issuer may terminate a Qualified Maturity Agreement prior to the
later of (i) the date on which the Controlled Accumulation Period was scheduled
to begin, before giving effect to the suspension of the Controlled Accumulation
Period, and (b) the date to which the commencement of the Controlled
Accumulation Period may be postponed pursuant to Section 4.14 (as determined on
------------
the Determination Date preceding the date of such termination), in which case
the commencement of the Controlled Accumulation Period shall be determined as if
the Issuer had not elected to suspend such commencement. In the event that the
provider of a Qualified Maturity Agreement ceases to qualify as an Eligible
Institution, the Issuer shall use its best efforts to obtain a substitute
Qualified Maturity Agreement.
(d) If a Qualified Maturity Agreement is terminated prior to the earlier of
the Expected Principal Distribution Date and the commencement of the Rapid
Amortization Period and the Issuer does not obtain a substitute Qualified
Maturity Agreement, the Controlled Accumulation Period shall commence on the
latest of (i) the last day of the _________ Monthly Period, (ii) at the election
of the Issuer, the date to which the commencement of the Controlled Accumulation
Period may be postponed pursuant to Section 4.l4 (as determined on the date of
------------
such termination) and (iii) the first day of the Monthly Period following the
date of such termination.
Section 4.16 Interchange. On or prior to each Determination Date, Seller
-----------
shall notify the Servicer of the amount of Interchange to be included as Finance
Charge Collections allocable to the Series 2001-A Notes with respect to the
preceding Monthly Period, which allocation shall equal the Allocation Percentage
for Finance Charge Collections for such preceding Monthly Period times the total
amount of Interchange for such Monthly Period. On each Transfer Date, Seller
shall pay to the Servicer, and the Servicer shall deposit into the Finance
Charge Subaccount, in immediately available funds, the amount of Interchange to
be so included as Finance Charge Collections allocable to the Series 2001-A
Notes with respect to the preceding Monthly Period. Seller hereby assigns, sets-
over, conveys, pledges and grants a security interest and lien to the Indenture
Trustee for the benefit of the Series 2001-A Noteholders in such Interchange and
the proceeds of such Interchange, as set forth in this Section 4.16. To the
------------
extent that an indenture supplement for a Series, other than Series 2001-A,
assigns, sets-over, conveys, pledges or grants a security interest in
Interchange allocable to the Issuer, all Notes of any such Series (except as
otherwise specified in any such Supplement) and the Series 2001-A Notes shall
rank pari passu and be equally and
---- -----
34
ratably entitled as provided herein to the benefits of such Interchange 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 Indenture
Supplement and the other related indenture supplements.
ARTICLE V
Delivery of Series 2001-A Notes;
Distributions; Reports to Series 2001-A Noteholders
---------------------------------------------------
Section 5.1 Delivery and Payment for the Series 2001-A Notes.
------------------------------------------------
The Issuer shall execute and issue, and the Indenture Trustee shall
authenticate, the Series 2001-A Notes in accordance with Section 2.3 of the
-----------
Indenture. The Indenture Trustee shall deliver the Series 2001-A Notes to or
upon the written order of the Trust when so authenticated.
Section 5.2 Distributions.
-------------
(a) On each Distribution Date, the Paying Agent shall distribute to each
Class A Noteholder of record on the related Record Date (other than as provided
in Section 11.2 of the Indenture) such Class A Noteholder's pro rata share of
------------
the amounts held by the Paying Agent that are allocated and available on such
Distribution Date to pay interest on the Class A Notes pursuant to this
Indenture Supplement.
(b) On each Distribution Date, the Paying Agent shall distribute to each
Class A Noteholder of record on the related Record Date such Class A
Noteholder's pro rata share of the amounts held by the Paying Agent that are
allocated and available on such Distribution Date to pay principal of the Class
A Notes pursuant to this Indenture Supplement.
(c) On each Distribution Date, the Paying Agent shall distribute to each
Class B Noteholder of record on the related Record Date (other than as provided
in Section 11.2 of the Indenture) such Class B Noteholder's pro rata share of
------------
the amounts held by the Paying Agent that are allocated and available on such
Distribution Date to pay interest on the Class B Notes pursuant to this
Indenture Supplement.
(d) On each Distribution Date, the Paying Agent shall distribute to each
Class B Noteholder of record on the related Record Date such Class B
Noteholder's pro rata share of the amounts held by the Paying Agent that are
allocated and available on such Distribution Date to pay principal of the Class
B Notes pursuant to this Indenture Supplement.
(e) On each Distribution Date, the Paying Agent shall distribute to each
Class C Noteholder of record on the related Record Date (other than as provided
in
35
Section 11.2 of the Indenture) such Class C Noteholder's pro rata share of the
------------
amounts held by the Paying Agent (including amounts held by the Paying Agent
with respect to amounts withdrawn from the Spread Account (at the times and in
the amounts specified in Section 4.11)) that are allocated and available on such
-------------
Distribution Date to pay interest on the Class C Notes pursuant to this
Indenture Supplement.
(f) On each Distribution Date, the Paying Agent shall distribute to each
Class C Noteholder of record on the related Record Date such Class C
Noteholder's pro rata share of the amounts held by the Paying Agent that are
allocated and available on such Distribution Date to pay principal of the Class
C Notes pursuant to this Indenture Supplement.
(g) The distributions to be made pursuant to this Section 5.2 are subject
-----------
to the provisions of Sections 2.6, 6.1 and 7.1 of the Transfer and Servicing
------------ --- ---
Agreement, Section 11.2 of the Indenture and Section 7.1 of this Indenture
------------ -----------
Supplement.
(h) Except as provided in Section 11.2 of the Indenture with respect to a
------------
final distribution, distributions to Series 2001-A Noteholders hereunder shall
be made by (i) check mailed to each Series 2001-A Noteholder (at such
Noteholder's address as it appears in the Note Register), except that for any
Series 2001-A Notes registered in the name of the nominee of a Clearing Agency,
such distribution shall be made by wire transfer of immediately available funds
and (ii) without presentation or surrender of any Series 2001-A Note or the
making of any notation thereon.
Section 5.3 Reports and Statements to Series 2001-A Noteholders.
---------------------------------------------------
(a) On each Distribution Date, the Paying Agent, on behalf of the Indenture
Trustee, shall forward to each Series 2001-A Noteholder a statement
substantially in the form of Exhibit C prepared by the Servicer.
---------
(b) Not later than the second Business Day preceding each Distribution
Date, the Servicer shall deliver to the Owner Trustee, the Indenture Trustee,
the Paying Agent and each Rating Agency a statement substantially in the form of
Exhibit B prepared by the Servicer; provided that the Servicer may amend the
--------- --------
form of Exhibit B from time to time, with the prior written consent of the
---------
Indenture Trustee.
(c) A copy of each statement or certificate provided pursuant to paragraph
(a) or (b) may be obtained by any Series 2001-A Noteholder by a request in
writing to the Servicer.
(d) On or before January 31 of each calendar year, beginning with January
31, 2002, the Paying Agent, on behalf of the Indenture Trustee, shall furnish or
cause to be furnished to each Person who at any time during the preceding
calendar year was a Series 2001-A Noteholder, a statement prepared by the
Servicer containing the information which is required to be contained in the
statement to Series 2001-A
36
Noteholders, as set forth in paragraph (a) above, aggregated for such calendar
year or the applicable portion thereof during which such Person was a Series
2001-A Noteholder, together with other information as is required to be provided
by an issuer of indebtedness under the Code. Such obligation of the Paying Agent
shall be deemed to have been satisfied to the extent that substantially
comparable information shall be provided by the Servicer pursuant to any
requirements of the Code as from time to time in effect.
ARTICLE VI
Series 2001-A Pay Out Events
----------------------------
Section 6.1 Series 2001-A Pay Out Events. If any one of the following
----------------------------
events shall occur with respect to the Series 2001-A Notes:
(a) failure on the part of the Seller (i) to make any payment or deposit
required to be made by the Seller by the terms of the Transfer and Servicing
Agreement, the Indenture or this Indenture Supplement on or before the date
occurring five (5) Business Days after the date such payment or deposit is
required to be made therein or herein or (ii) duly to observe or perform in any
material respect any other covenants or agreements of the Seller set forth in
the Transfer and Servicing Agreement, the Indenture or this Indenture
Supplement, which failure has a material adverse effect on the Series 2001-A
Noteholders and which continues unremedied for a period of sixty (60) days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Seller by the Indenture Trustee, or to
the Seller and the Indenture Trustee by any Holder of the Series 2001-A Notes;
(b) any representation or warranty made by the Seller in the Transfer and
Servicing Agreement or, prior to the FCMT Termination Date, the Pooling and
Servicing Agreement, or any information contained in a computer file or
microfiche list required to be delivered by the Seller pursuant to Section 2.1
-----------
or subsection 2.6(c) of the Transfer and Servicing Agreement or Section 2.1 or
----------------- -----------
subsection 2.6(c) of the Pooling and Servicing Agreement shall prove to have
-----------------
been incorrect in any material respect when made or when delivered, which
continues to be incorrect in any material respect for a period of sixty (60)
days after the date on which written notice of such failure, requiring the same
to be remedied, shall have been given to the Seller by the Indenture Trustee, or
to the Seller and the Indenture Trustee by any Holder of the Series 2001-A Notes
and as a result of which the interests of the Series 2001-A Noteholders are
materially and adversely affected for such period; provided, however, that a
-------- -------
Series 2001-A Pay Out Event pursuant to this subsection 6.1(b) shall not be
-----------------
deemed to have occurred hereunder if the Seller has accepted reassignment of the
related Receivable, or all of such Receivables, if applicable, during such
period in accordance with the provisions of the Transfer and Servicing Agreement
or the Pooling and Servicing Agreement;
37
(c) a failure by the Seller to convey Receivables in Additional Accounts to
the Trust within ten (10) days after the day on which it is required to convey
such Receivables pursuant to subsection 2.6(a) of the Transfer and Servicing
-----------------
Agreement or subsection 2.6(a) of the Pooling and Servicing Agreement;
-----------------
(d) any Servicer Default shall occur;
(e) the average of the Average Excess Spread Percentages for any three
consecutive Monthly Periods is less than zero;
(f) the Class A Note Principal Balance, the Class B Note Principal Balance
or the Class C Note Principal Balance shall not be paid in full on the Expected
Principal Distribution Date;
(g) without limiting the foregoing, the occurrence of an Event of Default
with respect to Series 2001-A and acceleration of the maturity of the Series
2001-A Notes pursuant to Section 5.3 of the Indenture; or
-----------
(h) prior to the FCMT Termination Date, a Trust Pay Out Event shall occur
under (and as defined in) the Pooling and Servicing Agreement;
then, in the case of any event described in subsection (a), (b) or (d), after
-------------- --- ---
the applicable grace period, if any, set forth in such subparagraphs, either the
Indenture Trustee or the Holders of Series 2001-A Notes evidencing more than 50%
of the aggregate unpaid principal amount of Series 2001-A Notes by notice then
given in writing to the Seller and the Servicer (and to the Indenture Trustee if
given by the Series 2001-A Noteholders) may declare that a "Series Pay Out
Event" with respect to Series 2001-A (a "Series 2001-A Pay Out Event") has
---------------------------
occurred as of the date of such notice, and, in the case of any event described
in subsection (c), (e), (f) or (g), a Series 2001-A Pay Out Event shall occur
-------------- --- --- ---
without any notice or other action on the part of the Indenture Trustee or the
Series 2001-A Noteholders immediately upon the occurrence of such event.
ARTICLE VII
Redemption of Series 2001-A Notes; Final Distributions; Series Termination
--------------------------------------------------------------------------
Section 7.1 Optional Redemption of Series 2001-A Notes; Final
-------------------------------------------------
Distributions.
-------------
(a) On any day occurring on or after the date on which the outstanding
principal balance of the Series 2001-A Notes is reduced to 10% or less of the
initial outstanding principal balance of Series 2001-A Notes, the Servicer shall
have the option to redeem the Series 2001-A Notes, at a purchase price equal to
(i) if such day is a Distribution Date, the Reassignment Amount for such
Distribution Date or (ii) if such
38
day is not a Distribution Date, the Reassignment Amount for the Distribution
Date following such day.
(b) The Issuer shall give the Servicer and the Indenture Trustee at least
thirty (30) days prior written notice of the date on which the Issuer intends to
exercise such optional redemption. Not later than 12:00 noon, New York City
time, on such day the Issuer shall deposit into the Collection Account in
immediately available funds the excess of the Reassignment Amount over the
amount, if any, on deposit in the Principal Accumulation Account. Such
redemption option is subject to payment in full of the Reassignment Amount.
Following such deposit into the Collection Account in accordance with the
foregoing, the Collateral Amount for Series 2001-A shall be reduced to zero and
the Series 2001-A Noteholders shall have no further security interest in the
Receivables. The Reassignment Amount shall be distributed as set forth in
subsection 7.1(d).
-----------------
(c) (i) The amount to be paid by the Seller with respect to Series 2001-A
in connection with a reassignment of Receivables to the Seller pursuant to
Section 2.4(e) of the Transfer and Servicing Agreement shall equal the
--------------
Reassignment Amount for the first Distribution Date following the Monthly Period
in which the reassignment obligation arises under the Transfer and Servicing
Agreement.
(ii) The amount to be paid by the Seller with respect to Series 2001-A
in connection with a repurchase of the Notes pursuant to Section 7.1 of the
-----------
Transfer and Servicing Agreement shall equal the Reassignment Amount for the
Distribution Date of such repurchase.
(d) With respect to (a) the Reassignment Amount deposited into the
Collection Account pursuant to Section 7.1 or (b) the proceeds of any sale of
-----------
Receivables pursuant to Section 5.5(a)(iii) of the Indenture with respect to
-------------------
Series 2001-A, the Indenture Trustee shall, in accordance with the written
direction of the Servicer, not later than 12:00 noon, New York City time, on the
related Distribution Date, make deposits or distributions of the following
amounts (in the priority set forth below and, in each case, after giving effect
to any deposits and distributions otherwise to be made on such date) in
immediately available funds: (i) (x) the Class A Note Principal Balance on such
Distribution Date will be distributed to the Paying Agent for payment to the
Class A Noteholders and (y) an amount equal to the sum of (A) Class A Monthly
Interest for such Distribution Date, (B) any Class A Monthly Interest previously
due but not distributed to the Class A Noteholders on a prior Distribution Date
and (C) the amount of Class A Additional Interest, if any, for such Distribution
Date and any Class A Additional Interest previously due but not distributed to
the Class A Noteholders on any prior Distribution Date, will be distributed to
the Paying Agent for payment to the Class A Noteholders, (ii) (x) the Class B
Note Principal Balance on such Distribution Date will be distributed to the
Paying Agent for payment to the Class B Noteholders and (y) an amount equal to
the sum of (A) Class B Monthly Interest for
39
such Distribution Date, (B) any Class B Monthly Interest previously due but not
distributed to the Class B Noteholders on a prior Distribution Date and (C) the
amount of Class B Additional Interest, if any, for such Distribution Date and
any Class B Additional Interest previously due but not distributed to the Class
B Noteholders on any prior Distribution Date, will be distributed to the Paying
Agent for payment to the Class B Noteholders, (iii) (x) the Class C Note
Principal Balance on such Distribution Date will be distributed to the Paying
Agent for payment to the Class C Noteholders and (y) an amount equal to the sum
of (A) Class C Monthly Interest for such Distribution Date, (B) any Class C
Monthly Interest previously due but not distributed to the Class C Noteholders
on a prior Distribution Date and (C) the amount of Class C Additional Interest,
if any, for such Distribution Date and any Class C Additional Interest
previously due but not distributed to the Class C Noteholders on any prior
Distribution Date, will be distributed to the Paying Agent for payment to the
Class C Noteholders and (iv) any excess shall be released to the Issuer.
(e) Notwithstanding anything to the contrary in this Indenture Supplement,
the Indenture or the Transfer and Servicing Agreement, all amounts distributed
to the Paying Agent pursuant to subsection 7.1(d) for payment to the Series
-----------------
2001-A Noteholders shall be deemed distributed in full to the Series 2001-A
Noteholders on the date on which such funds are distributed to the Paying Agent
pursuant to this Section 7.1 and shall be deemed to be a final distribution
-----------
pursuant to Section 11.2 of the Indenture.
------------
Section 7.2 Series Termination.
------------------
On the Series 2001-A Final Maturity Date, the right of the Series 2001-A
Noteholders to receive payments from the Issuer will be limited solely to the
right to receive payments pursuant to Section 5.5 of the Indenture.
-----------
ARTICLE VIII
Miscellaneous Provisions
------------------------
Section 8.1 Ratification of Indenture; Amendments. As supplemented by
-------------------------------------
this Indenture Supplement, the Indenture is in all respects ratified and
confirmed and the Indenture as so supplemented by this Indenture Supplement
shall be read, taken and construed as one and the same instrument. This
Indenture Supplement may be amended only by a Supplemental Indenture entered in
accordance with the terms of Section 10.1 or 10.2 of the Indenture. For purposes
------------ ----
of the application of Section 10.2 to any amendment of this Indenture
------------
Supplement, only the vote of the Series 2001-A Noteholders shall be required.
Section 8.2 Form of Delivery of the Series 2001-A Notes. The Series 2001-A
-------------------------------------------
Notes shall be Book-Entry Notes and shall be delivered as Registered Notes as
provided in Section 2.1 of the Indenture.
-----------
40
Section 8.3 Counterparts. This Indenture Supplement may be executed in
------------
two or more counterparts, and by different parties on separate counterparts,
each of which shall be an original, but all of which shall constitute one and
the same instrument.
Section 8.4 GOVERNING LAW. THIS INDENTURE SUPPLEMENT SHALL BE CONSTRUED
-------------
IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS, PROVIDED,
HOWEVER, THAT THE DUTIES AND OBLIGATIONS OF THE INDENTURE TRUSTEE SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE
TO ITS CONFLICT OF LAW PROVISIONS.
Section 8.5 Limitation of Liability. Notwithstanding any other
-----------------------
provision herein or elsewhere, this Agreement has been executed and delivered by
Bankers Trust Company, not in its individual capacity, but solely in its
capacity as Owner Trustee of the Trust, in no event shall Bankers Trust Company
in its individual capacity have any liability in respect of the representations,
warranties, or obligations of the Trust hereunder or under any other document,
as to all of which recourse shall be had solely to the assets of the Trust, and
for all purposes of this Agreement and each other document, the Owner Trustee
(as such or in its individual capacity) shall be subject to, and entitled to the
benefits of, the terms and provisions of the Trust Agreement.
Section 8.6 Rights of the Indenture Trustee. The Indenture Trustee
-------------------------------
shall have herein the same rights, protections, indemnities and immunities as
specified in the Master Indenture.
[SIGNATURE PAGE FOLLOWS]
41
IN WITNESS WHEREOF, the undersigned have caused this Indenture Supplement to
be duly executed and delivered by their respective duly authorized officers on
the day and year first above written.
FIRST CONSUMERS CREDIT CARD
MASTER NOTE TRUST, as Issuer
By: ___________________________________
BANKERS TRUST COMPANY, not in its
individual capacity, but solely as Owner
Trustee
By: ___________________________________
Name:
Title:
THE BANK OF NEW YORK, as Indenture Trustee
By: ___________________________________
Name:
Title:
42
Acknowledged and Accepted:
FIRST CONSUMERS NATIONAL BANK,
as Servicer and Seller
By:___________________________
Name:_________________________
Title:________________________
43
EXHIBIT A-1
CLASS A SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS 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.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT
IT WILL NOT AT ANY TIME INSTITUTE AGAINST FIRST CONSUMERS MASTER TRUST, A COMMON
LAW TRUST ORGANIZED UNDER THE LAWS OF ILLINOIS ("FCMT"), OR THE ISSUER, OR JOIN
IN INSTITUTING AGAINST FCMT OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION,
ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER
ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW.
THE HOLDER OF THIS CLASS A NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH
HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS A NOTES AS
INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND
FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY,
INCOME.
Exhibit A-1 (Page 1)
REGISTERED $______________*
No. R- ____________________ CUSIP NO. ______________
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A
CLASS A SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
First Consumers Credit Card Master Note Trust (herein referred to as the
"Issuer" or the "Trust"), an Illinois common law trust governed by a Trust
Agreement dated as of ______________________, 2001, for value received, hereby
promises to pay to Cede & Co., or registered assigns, subject to the following
provisions, the principal sum of __________________________________ DOLLARS, or
such greater or lesser amount as determined in accordance with the Indenture, on
the Series 2001-A Final Maturity Date (which is the earlier to occur of (a) the
Distribution Date on which the Note Principal Balance is paid in full and (b)
the ___________ Distribution Date), except as otherwise provided below or in the
Indenture. The Issuer will pay interest on the unpaid principal amount of this
Note at the Class A Note Interest Rate on each Distribution Date until the
principal amount of this Note is paid in full. Interest on this Note will accrue
for each Distribution Date from and including the most recent Distribution Date
on which interest has been paid to but excluding such Distribution Date or, for
the initial Distribution Date, from and including the Closing Date to but
excluding such Distribution Date. Interest will be computed on the basis of a
[360-day] year and the [actual] number of days elapsed. Principal of this Note
shall be paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Indenture Trustee, by manual signature, this Note shall not be
entitled to any benefit under the Indenture or the Indenture Supplement referred
to on the reverse hereof, or be valid for any purpose.
_____________________
* Denominations of $1,000 and integral multiples of $1,000 in excess
thereof.
Exhibit A-1 (Page 2)
IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be duly
executed.
FIRST CONSUMERS CREDIT CARD MASTER
NOTE TRUST,
as Issuer
By: Bankers Trust Company, not in its individual
capacity but solely as Owner Trustee under
the Trust Agreement
By: _________________________________________
Name:
Title:
Dated: ________________, ____
Exhibit A-1 (Page 3)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A Notes described in the within-mentioned Indenture.
The Bank of New York
By: _______________________________
Authorized Signatory
Exhibit A-1 (Page 4)
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A
CLASS A SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
Summary of Terms and Conditions
This Class A Note is one of a duly authorized issue of Notes of the Issuer,
designated as First Consumers Credit Card Master Note Trust, Series 2001-A (the
"SERIES 2001-A NOTES"), issued under a Master Indenture dated as of
_____________, 2001 (the "MASTER INDENTURE"), between the Issuer and The Bank of
New York, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the
Indenture Supplement dated as of _____________, 2001 (the "INDENTURE
SUPPLEMENT"), and representing the right to receive certain payments from the
Issuer. The term "Indenture," unless the context otherwise requires, refers to
the Master Indenture as supplemented by the Indenture Supplement. The Notes are
subject to all of the terms of the Indenture. All terms used in this Note that
are defined in the Indenture shall have the meanings assigned to them in or
pursuant to the Indenture. In the event of any conflict or inconsistency
between the Indenture and this Note, the Indenture shall control.
The Class B Notes and the Class C Notes will also be issued under the
Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will look
solely to the property of the Issuer allocated to the payment of this Note for
payment hereunder and that neither the Owner Trustee nor the Indenture Trustee
is liable to the Noteholders for any amount payable under the Notes or the
Indenture or, except in the case of the Indenture Trustee as expressly provided
in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is made
to the Indenture for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced thereby, and the rights, duties and immunities
of the Indenture Trustee.
The Class A Note Initial Principal Balance is $______________. The Class A
Note Principal Balance on any date of determination will be an amount equal to
(a) the Class A Note Initial Principal Balance, minus (b) the aggregate amount
of principal payments made to the Class A Noteholders on or prior to such date.
The Expected Principal Distribution Date is the ____________ Distribution
Date, but principal with respect to the Class A Notes may be paid earlier or
later under certain circumstances described in the Indenture. If for one or
more months during the Controlled Accumulation Period there are not sufficient
funds to deposit into the Principal Accumulation Account the Controlled Deposit
Amount, then to the extent that excess funds are not available on subsequent
Distribution Dates with respect to the Controlled Accumulation Period to make up
for such shortfalls, the final payment of principal of the Notes will occur
later than the Expected Principal Distribution Date. Payments of principal of
the Notes shall be payable in accordance with the provisions of the Indenture.
Exhibit A-1 (Page 5)
Subject to the terms and conditions of the Indenture, First Consumers
National Bank (the "Seller") may, from time to time, direct the Owner Trustee,
on behalf of the Trust, to issue one or more new Series of Notes.
On each Distribution Date, the Paying Agent shall distribute to each Class
A Noteholder of record on the related Record Date (except for the final payment
in respect of this Class A Note) such Class A Noteholder's pro rata share of the
amounts held by the Paying Agent that are allocated and available on such
Distribution Date to pay interest and principal on the Class A Notes pursuant to
the Indenture Supplement. Except as provided in the Indenture with respect to a
final payment, payments to Series 2001-A Noteholders shall be made by (i) check
mailed to each Series 2001-A Noteholder (at such Noteholder's address as it
appears in the Note Register), except that with respect to any Series 2001-A
Notes registered in the name of the nominee of a Clearing Agency, such payment
shall be made in immediately available funds and (ii) without presentation or
surrender of any Series 2001-A Note or the making of any notation thereon.
Final payment of this Class A Note will be made only upon presentation and
surrender of this Class A Note at the office or agency specified in the notice
of final payment delivered by the Indenture Trustee to the Series 2001-A
Noteholders in accordance with the Indenture.
On any day occurring on or after the date on which the outstanding
principal balance of the Series 2001-A Notes is reduced to 10% or less of the
initial outstanding principal balance of the Series 2001-A Notes, the Servicer
shall have the option to redeem the Series 2001-A Notes, at a purchase price
equal to (i) if such day is a Distribution Date, the Reassignment Amount for
such Distribution Date or (ii) if such day is not a Distribution Date, the
Reassignment Amount for the Distribution Date following such day.
THIS CLASS A NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN,
THE ISSUER, FIRST CONSUMERS NATIONAL BANK, OR ANY OF THEIR AFFILIATES, AND IS
NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
Each Noteholder, by accepting a Note, hereby covenants and agrees that it
will not at any time institute against FCMT or the Issuer, or join in
instituting against the FCMT or the Issuer, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any United States federal or state bankruptcy or similar law.
Except as otherwise provided in the Indenture Supplement, the Class A Notes
are issuable only in minimum denominations of $1,000 and integral multiples of
$1,000. The transfer of this Class A Note shall be registered in the Note
Register upon surrender of this Class A Note for registration of transfer at any
office or agency maintained by the Transfer Agent and Registrar accompanied by a
written instrument of transfer, in a form satisfactory to the Indenture Trustee
or the Transfer Agent and Registrar, duly executed by the Class A Noteholder or
such Class A Noteholder's attorney, and duly authorized in writing with such
signature guaranteed, and thereupon
Exhibit A-1 (Page 6)
one or more new Class A Notes in any authorized denominations of like aggregate
principal amount will be issued to the designated transferee or transferees.
As provided in the Indenture and subject to certain limitations therein set
forth, Class A Notes are exchangeable for new Class A Notes in any authorized
denominations and of like aggregate principal amount, upon surrender of such
Notes to be exchanged at the office or agency of the Transfer Agent and
Registrar. No service charge may be imposed for any such exchange but the
Issuer or Transfer Agent and Registrar may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith.
The Issuer, the Seller, the Indenture Trustee and any agent of the Issuer,
the Seller or the Indenture Trustee shall treat the person in whose name this
Class A Note is registered as the owner hereof for all purposes, and neither the
Issuer, the Seller, the Indenture Trustee nor any agent of the Issuer, the
Seller or the Indenture Trustee shall be affected by notice to the contrary.
THIS CLASS A NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND
THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A-1 (Page 7)
ASSIGNMENT
Social Security or other identifying number of assignee ____________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto _________________________________ (name and address of assignee) the within
certificate and all rights thereunder, and hereby irrevocably constitutes and
appoints _____________________ attorney, to transfer said certificate on the
books kept for registration thereof, with full power of substitution in the
premises.
Dated:_____________ _________________________________**
Signature Guaranteed:
_______________________
** The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
Exhibit A-2 (Page 1)
EXHIBIT A-2
FORM OF CLASS B SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS 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.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT
IT WILL NOT AT ANY TIME INSTITUTE AGAINST FIRST CONSUMERS MASTER TRUST, A COMMON
LAW TRUST ORGANIZED UNDER THE LAWS OF ILLINOIS ("FCMT"), OR THE ISSUER, OR JOIN
IN INSTITUTING AGAINST FCMT OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION,
ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER
ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW.
THE HOLDER OF THIS CLASS B NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH
HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS B NOTES AS
INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND
FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY,
INCOME.
Exhibit A-2 (Page 2)
REGISTERED $_________________*
No. R-___________ CUSIP NO._____________
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A
CLASS B SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
First Consumers Credit Card Master Note Trust (herein referred to as the
"Issuer" or the "Trust"), an Illinois common law trust governed by a Trust
Agreement dated as of ___, 2001, for value received, hereby promises to pay to
Cede & Co., or registered assigns, subject to the following provisions, the
principal sum of ______________ DOLLARS, or such greater or lesser amount as
determined in accordance with the Indenture, on the Series 2001-A Final Maturity
Date (which is the earlier to occur of (a) the Distribution Date on which the
Note Principal Balance is paid in full and (b) the ___________ Distribution
Date), except as otherwise provided below or in the Indenture. The Issuer will
pay interest on the unpaid principal amount of this Note at the Class B Note
Interest Rate on each Distribution Date until the principal amount of this Note
is paid in full. Interest on this Note will accrue for each Distribution Date
from and including the most recent Distribution Date on which interest has been
paid to but excluding such Distribution Date or, for the initial Distribution
Date, from and including the Closing Date to but excluding such Distribution
Date. Interest will be computed on the basis of a [360-day] year and the
[actual] number of days elapsed. Principal of this Note shall be paid in the
manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Indenture Trustee, by manual signature, this Note shall not be
entitled to any benefit under the Indenture or the Indenture Supplement referred
to on the reverse hereof, or be valid for any purpose.
THIS CLASS B NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS
ON THE CLASS A NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.
___________
* Denominations of $1,000 and integral multiples of $1,000 in excess
thereof.
Exhibit A-2 (Page 3)
IN WITNESS WHEREOF, the Issuer has caused this Class B Note to be duly
executed.
FIRST CONSUMERS CREDIT CARD MASTER
NOTE TRUST,
as Issuer
By: Bankers Trust Company, not in its
individual capacity but solely as
Owner Trustee under the Trust
Agreement
By: ___________________________________
Name:
Title:
Dated: _____________, ____
Exhibit A-2 (Page 4)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Notes described in the within-mentioned Indenture.
THE BANK OF NEW YORK,
as Indenture Trustee
By:___________________________
Authorized Signatory
Exhibit A-2 (Page 5)
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-
CLASS B SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
Summary of Terms and Conditions
This Class B Note is one of a duly authorized issue of Notes of the Issuer,
designated as First Consumers Credit Card Master Note Trust, Series 2001-A (the
"SERIES 2001-A NOTES"), issued under a Master Indenture dated as of
_____________, 2001 (the "MASTER INDENTURE"), between the Issuer and The Bank of
New York, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the
Indenture Supplement dated as of _____________, 2001 (the "INDENTURE
SUPPLEMENT"), and representing the right to receive certain payments from the
Issuer. The term "Indenture," unless the context otherwise requires, refers to
the Master Indenture as supplemented by the Indenture Supplement. The Notes are
subject to all of the terms of the Indenture. All terms used in this Note that
are defined in the Indenture shall have the meanings assigned to them in or
pursuant to the Indenture. In the event of any conflict or inconsistency
between the Indenture and this Note, the Indenture shall control.
The Class A Notes and the Class C Notes will also be issued under the
Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will look
solely to the property of the Issuer allocated to the payment of this Note for
payment hereunder and that neither the Owner Trustee nor the Indenture Trustee
is liable to the Noteholders for any amount payable under the Notes or the
Indenture or, except in the case of the Indenture Trustee as expressly provided
in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is made
to the Indenture for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced thereby, and the rights, duties and immunities
of the Indenture Trustee.
The Class B Note Initial Principal Balance is $___________________.
The Class B Note Principal Balance on any date of determination will be an
amount equal to (a) the Class B Note Initial Principal Balance, minus (b) the
aggregate amount of principal payments made to the Class B Noteholders on or
prior to such date.
The Expected Principal Distribution Date is the ____________ Distribution
Date, but principal with respect to the Class B Notes May be paid earlier or
later under certain circumstances described in the Indenture. If for one or
more months during the Controlled Accumulation Period there are not sufficient
funds to deposit into the Principal Accumulation Account the Controlled Deposit
Amount, then to the extent that excess funds are not available on subsequent
Distribution Dates with respect to the Controlled Accumulation Period to make up
for such shortfalls, the final payment of principal of the Notes will occur
later than the Expected Principal Distribution Date.
Exhibit A-2 (Page 6)
Payments of principal of the Notes shall be payable in accordance with the
provisions of the Indenture.
Subject to the terms and conditions of the Indenture, First Consumers
National Bank (the "Seller") may, from time to time, direct the Owner Trustee,
on behalf of the Trust, to issue one or more new Series of Notes.
On each Distribution Date, the Paying Agent shall distribute to each Class
B Noteholder of record on the related Record Date (except for the final payment
in respect of this Class B Note) such Class B Noteholder's pro rata share of the
amounts held by the Paying Agent that are allocated and available on such
Distribution Date to pay interest and principal on the Class B Notes pursuant to
the Indenture Supplement. Except as provided in the Indenture with respect to a
final payment, payments to Series 2001-A Noteholders shall be made by (i) check
mailed to each Series 2001-A Noteholder (at such Noteholder's address as it
appears in the Note Register), except that with respect to any Series 2001-A
Notes registered in the name of the nominee of a Clearing Agency, such payment
shall be made in immediately available funds and (ii) without presentation or
surrender of any Series 2001-A Note or the making of any notation thereon.
Final payment of this Class B Note will be made only upon presentation and
surrender of this Class B Note at the office or agency specified in the notice
of final payment delivered by the Indenture Trustee to the Series 2001-A
Noteholders in accordance with the Indenture.
On any day occurring on or after the date on which the outstanding
principal balance of the Series 2001-A Notes is reduced to 10% or less of the
initial outstanding principal balance of the Series 2001-A Notes, the Servicer
shall have the option to redeem the Series 2001-A Notes, at a purchase price
equal to (i) if such day is a Distribution Date, the Reassignment Amount for
such Distribution Date or (ii) if such day is not a Distribution Date, the
Reassignment Amount for the Distribution Date following such day.
THIS CLASS B NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN,
THE ISSUER, FIRST CONSUMERS NATIONAL BANK, OR ANY OF THEIR AFFILIATES, AND IS
NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
Each Noteholder, by accepting a Note, hereby covenants and agrees that it
will not at any time institute against FCMT or the Issuer, or join in
instituting against the FCMT or the Issuer, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any United States federal or state bankruptcy or similar law.
Except as otherwise provided in the Indenture Supplement, the Class B Notes
are issuable only in minimum denominations of $1,000 and integral multiples of
$1,000. The transfer of this Class B Note shall be registered in the Note
Register upon surrender of this Class B Note for registration of transfer at any
office or agency maintained by the Transfer Agent and Registrar accompanied by a
written instrument of transfer, in a form satisfactory to the Indenture Trustee
or
Exhibit A-2 (Page 7)
the Transfer Agent and Registrar, duly executed by the Class B Noteholder or
such Class B Noteholder's attorney, and duly authorized in writing with such
signature guaranteed, and thereupon one or more new Class B Notes in any
authorized denominations of like aggregate principal amount will be issued to
the designated transferee or transferees.
As provided in the Indenture and subject to certain limitations therein set
forth, Class B Notes are exchangeable for new Class B Notes in any authorized
denominations and of like aggregate principal amount, upon surrender of such
Notes to be exchanged at the office or agency of the Transfer Agent and
Registrar. No service charge may be imposed for any such exchange but the
Issuer or Transfer Agent and Registrar may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith.
The Issuer, the Seller, the Indenture Trustee and any agent of the Issuer,
the Seller or the Indenture Trustee shall treat the person in whose name this
Class B Note is registered as the owner hereof for all purposes, and neither the
Issuer, the Seller, the Indenture Trustee nor any agent of the Issuer, the
Seller or the Indenture Trustee shall be affected by notice to the contrary.
THIS CLASS B NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Exhibit A-2 (Page 8)
ASSIGNMENT
Social Security or other identifying number of assignee_______________________.
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
[_______________________________________]
(name and address of assignee)
the within certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints __________________, attorney, to transfer said
certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated: ____________, ____ _________________________**
Signature Guaranteed:
_______________________________
** The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
Exhibit A-2 (Page 9)
EXHIBIT A-3
FORM OF CLASS C SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS 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.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT
IT WILL NOT AT ANY TIME INSTITUTE AGAINST FIRST CONSUMERS MASTER TRUST, A COMMON
LAW TRUST ORGANIZED UNDER THE LAWS OF ILLINOIS ("FCMT"), OR THE ISSUER, OR JOIN
IN INSTITUTING AGAINST FCMT OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION,
ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER
ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW.
THE HOLDER OF THIS CLASS C NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH
HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS C NOTES AS
INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND
FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY,
INCOME.
Exhibit A-3 (Page 1)
REGISTERED $_________________*
No. R-___________ CUSIP NO._____________
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A
CLASS C SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
First Consumers Credit Card Master Note Trust (herein referred to as the
"Issuer" or the "Trust"), an Illinois common law trust governed by a Trust
Agreement dated as of August __, 2001, for value received, hereby promises to
pay to Cede & Co., or registered assigns, subject to the following provisions,
the principal sum of _________________ DOLLARS, or such greater or lesser amount
as determined in accordance with the Indenture, on the Series 2001-A Final
Maturity Date (which is the earlier to occur of (a) the Distribution Date on
which the Note Principal Balance is paid in full and (b) the ___________
Distribution Date), except as otherwise provided below or in the Indenture. The
Issuer will pay interest on the unpaid principal amount of this Note at the
Class C Note Interest Rate on each Distribution Date until the principal amount
of this Note is paid in full. Interest on this Note will accrue for each
Distribution Date from and including the most recent Distribution Date on which
interest has been paid to but excluding such Distribution Date or, for the
initial Distribution Date, from and including the Closing Date to but excluding
such Distribution Date. Interest will be computed on the basis of a [360-day]
year and the [actual] number of days elapsed. Principal of this Note shall be
paid in the manner specified on the reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Indenture Trustee, by manual signature, this Note shall not be
entitled to any benefit under the Indenture or the Indenture Supplement referred
to on the reverse hereof, or be valid for any purpose.
THIS CLASS C NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS
ON THE CLASS A AND CLASS B NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE
SUPPLEMENT.
__________________
* Denominations of $1,000 and integral multiples of $1,000 in excess
thereof.
Exhibit A-3 (Page 2)
IN WITNESS WHEREOF, the Issuer has caused this Class C Note to be duly
executed.
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST,
as Issuer
By: Bankers Trust Company, not in its individual
capacity but solely as Owner Trustee under
the Trust Agreement
By: _____________________________________
Name:
Title:
Dated: ___________, ___
Exhibit A-3 (Page 3)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class C Notes described in the within-mentioned
Indenture.
THE BANK OF NEW YORK,
as Indenture Trustee
By: _____________________________
Authorized Signatory
Exhibit A-3 (Page 4)
FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A
CLASS C SERIES 2001-A [FLOATING RATE] ASSET BACKED NOTE
Summary of Terms and Conditions
This Class C Note is one of a duly authorized issue of Notes of the Issuer,
designated as First Consumers Credit Card Master Note Trust, Series 2001-A (the
"SERIES 2001-A NOTES"), issued under a Master Indenture dated as of
_____________, 2001 (the "MASTER INDENTURE"), between the Issuer and The Bank of
New York, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the
Indenture Supplement dated as of _____________, 2001 (the "INDENTURE
SUPPLEMENT"), and representing the right to receive certain payments from the
Issuer. The term "Indenture," unless the context otherwise requires, refers to
the Master Indenture as supplemented by the Indenture Supplement. The Notes are
subject to all of the terms of the Indenture. All terms used in this Note that
are defined in the Indenture shall have the meanings assigned to them in or
pursuant to the Indenture. In the event of any conflict or inconsistency
between the Indenture and this Note, the Indenture shall control.
The Class A Notes and the Class B Notes will also be issued under the
Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will look
solely to the property of the Issuer allocated to the payment of this Note for
payment hereunder and that neither the Owner Trustee nor the Indenture Trustee
is liable to the Noteholders for any amount payable under the Notes or the
Indenture or, except in the case of the Indenture Trustee as expressly provided
in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is made
to the Indenture for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced thereby, and the rights, duties and immunities
of the Indenture Trustee.
The Class C Note Initial Principal Balance is $_____________.
The Class C Note Principal Balance on any date of determination will be an
amount equal to (a) the Class C Note Initial Principal Balance, minus (b) the
aggregate amount of principal payments made to the Class C Noteholders on or
prior to such date.
The Expected Principal Distribution Date is the ____________ Distribution
Date, but principal with respect to the Class C Notes may be paid earlier or
later under certain circumstances described in the Indenture. If for one or
more months during the Controlled Accumulation Period there are not sufficient
funds to deposit into the Principal Accumulation Account the Controlled Deposit
Amount, then to the extent that excess funds are not available on subsequent
Distribution Dates with respect to the Controlled Accumulation Period to make up
for such shortfalls, the final payment of principal of the Notes will occur
later than the Expected Principal Distribution Date.
Exhibit A-3 (Page 5)
Payments of principal of the Notes shall be payable in accordance with the
provisions of the Indenture.
Subject to the terms and conditions of the Indenture, First Consumers
National Bank (the "Seller") may, from time to time, direct the Owner Trustee,
on behalf of the Trust, to issue one or more new Series of Notes.
On each Distribution Date, the Paying Agent shall distribute to each Class
C Noteholder of record on the related Record Date (except for the final payment
in respect of this Class C Note) such Class C Noteholder's pro rata share of the
amounts held by the Paying Agent that are allocated and available on such
Distribution Date to pay interest and principal on the Class C Notes pursuant to
the Indenture Supplement. Except as provided in the Indenture with respect to a
final payment, payments to Series 2001-A Noteholders shall be made by (i) check
mailed to each Series 2001-A Noteholder (at such Noteholder's address as it
appears in the Note Register), except that with respect to any Series 2001-A
Notes registered in the name of the nominee of a Clearing Agency, such payment
shall be made in immediately available funds and (ii) without presentation or
surrender of any Series 2001-A Note or the making of any notation thereon.
Final payment of this Class C Note will be made only upon presentation and
surrender of this Class C Note at the office or agency specified in the notice
of final payment delivered by the Indenture Trustee to the Series 2001-A
Noteholders in accordance with the Indenture.
On any day occurring on or after the date on which the outstanding
principal balance of the Series 2001-A Notes is reduced to 10% or less of the
initial outstanding principal balance of the Series 2001-A Notes, the Servicer
shall have the option to redeem the Series 2001-A Notes, at a purchase price
equal to (i) if such day is a Distribution Date, the Reassignment Amount for
such Distribution Date or (ii) if such day is not a Distribution Date, the
Reassignment Amount for the Distribution Date following such day.
THIS CLASS C NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN,
THE ISSUER, FIRST CONSUMERS NATIONAL BANK, OR ANY OF THEIR AFFILIATES, AND IS
NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
Each Noteholder, by accepting a Note, hereby covenants and agrees that it
will not at any time institute against FCMT or the Issuer, or join in
instituting against the FCMT or the Issuer, any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any United States federal or state bankruptcy or similar law.
Except as otherwise provided in the Indenture Supplement, the Class C Notes
are issuable only in minimum denominations of $ 1,000 and integral multiples of
$1,000. The transfer of this Class C Note shall be registered in the Note
Register upon surrender of this Class C Note for registration of transfer at any
office or agency maintained by the Transfer Agent and Registrar accompanied by a
written instrument of transfer, in a form satisfactory to the Indenture Trustee
or
Exhibit A-3 (Page 6)
the Transfer Agent and Registrar, duly executed by the Class C Noteholder or
such Class C Noteholder's attorney, and duly authorized in writing with such
signature guaranteed, and thereupon one or more new Class C Notes in any
authorized denominations of like aggregate principal amount will be issued to
the designated transferee or transferees.
As provided in the Indenture and subject to certain limitations therein set
forth, Class C Notes are exchangeable for new Class C Notes in any authorized
denominations and of like aggregate principal amount, upon surrender of such
Notes to be exchanged at the office or agency of the Transfer Agent and
Registrar. No service charge may be imposed for any such exchange but the
Issuer or Transfer Agent and Registrar may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith.
The Issuer, the Seller, the Indenture Trustee and any agent of the Issuer,
the Seller or the Indenture Trustee shall treat the person in whose name this
Class C Note is registered as the owner hereof for all purposes, and neither the
Issuer, the Seller, the Indenture Trustee nor any agent of the Issuer, the
Seller or the Indenture Trustee shall be affected by notice to the contrary.
THIS CLASS C NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN
ACCORDANCE WITH SUCH LAWS.
Exhibit A-3 (Page 7)
ASSIGNMENT
Social Security or other identifying number of assignee ______________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto
_________________________________]
(name and address of assignee)
the within certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints ____________________, attorney, to transfer said
certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated: ____________, ____ ________________________**
Signature Guaranteed:
_______________________
** The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
Exhibit A-3 (Page 8)